TMI Blog2016 (12) TMI 1569X X X X Extracts X X X X X X X X Extracts X X X X ..... 8-12-2016 - K. S. Jhaveri And Dinesh Mehta, JJ. For the Appellant : Sanjay Jhanwar For the Respondent : Parinitoo Jain JUDGMENT K. S. Jhaveri , J. 1. By way of this appeal, the assessee has challenged the judgment and order of the tribunal whereby the tribunal has partly allowed the appeal of the assessee as well as Department. 2. The brief facts of the case are that during the course of search, the cash worth of ₹ 4,35,800/- was found after accepting the explanation of the assessee, the AO made addition of ₹ 3.85 lacs for unexplained cash found. The ld. CIT(A) allowed the relief of ₹ 3,27,027/- and sustained the addition of ₹ 58,773/-. 3. While admitting the appeal this court on 27.1.2006 had framed following substantial questions of law:- 1. Whether the notice issued u/s 158BC of the Income Tax Act, 1961 by the assessing officer in the present case he filed the return within 15 days does not violate the provision of Section 158BC which requires to issue a notice providing time of not being less than 15 days which implies clear 15 days and hence whether the assessment framed on the basis of such illegal and invali ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Hukumchand Mills Ltd. v. State of Madhya Pradesh (1964) 52 ITR 583 (SC); AIR 1964 SC 1329, the apex court has ruled that mere mistake in the opening part of the notification in reciting the wrong source of power does not affect the validity of the amendments made. In the case of State Bank of Patiala v. S.K. Sharma (1996) 3 SCC 364, the apex court ruled that in the case of a procedural provision which is not of a mandatory character, the complaint of violation has to be examined from the standpoint of substantial compliance. The order passed in violation of such provision can be set aside only where such violation has occasioned prejudice to the subject. It further went on to observe that even a mandatory requirement can be waived by the person concerned, if such mandatory provision of law is conceived in his interest and not in the public interest. The conduct of the subject must be borne in mind while examining a complaint of non-observance of procedural rules governing such enquiries. As a rule, all such procedural rules are designed to afford a full and proper opportunity to the subject to defend himself. In the case of Dove Investments P. Ltd. v. Gujarat Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifest injustice, for frequently equitable and humane considerations, and other considerations of a closely related nature, would seem to be of a sufficient calibre to execute or justify a technical violation of the law. In the case of Balchand v. ITO (1969) 72 ITR 197, the apex court ruled that merely because of a defect in service of notice, the assessment order does not become invalid. Similarly, the apex court in the case of Jai Prakash Singh (1996) 219 ITR 737 went on to hold that non-service of notice under section 143(2) of the Income tax Act, 1961 to 9 out of 10 representatives of the deceased did not invalidate the order of the Assessing Officer relating to the assessment year in question. 2. Venad Properties Private Limited v. Commissioner of Income-tax (2012) 340 ITR 463 (Delhi), particularly, paragraph Nos. 11, 12 and 18 which are reproduced as under: 11. In Sardar Amarjit Singh Kalra v. Smt. Pramod Gupta (2003) 3 SCC 272, a Constitution Bench of the Supreme Court has held: `26. Laws of procedure are meant to regulate effectively, assist and aid the object of doing substantial and real justice and not to foreclose even an adjudication on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to defend himself. 3. Commissioner of Income-tax v. Jagat Novel Exhibitors P. Ltd. (2013) 356 ITR 559 where at paragraph Nos. 41 and 45, it was observed as follows: 41. The aforesaid observations are significant. In the present case, the Tribunal has not held that the jurisdictional preconditions were missing or not satisfied. Reasons to believe have been recorded. Notice has also been issued within the limitation period. The question whether the notice was addressed to the correct person has been examined and dealt with by us above. Service of notice is not the jurisdictional precondition but a matter pertaining to making of the order of assessment. Before an assessment order is passed, the notice must be served. As noticed above, on February 21, 2002, Vijay Narain Seth, director of the respondent company appeared before the Assessing Officer. The respondent had also filed some details before the Assessing Officer who passed the assessment order. 45. We may note, the observations of the Supreme Court in Balchand v. ITO (1969) 72 ITR 197 (SC) wherein it was held that in construing a statutory notice, extraneous evidence may be looked into to find out whet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not a circumstance which could be said to vitiate the ultimate order. The said decision relates to the assessment made consequent on the search conducted in assessee s place and notice was issued thereon to eight firms and to the wife of the assessee. Referring to Section 158BD, this court held that non mentioning of the purpose for which the notice was issued or the source of the authority of the Officer issuing the notice per se would not defeat the aspect of the persons against whom the notice issued were fully aware of the purpose of issuing notice. 17. In the light of the above said decision of this court as well as in view of the Bombay High Court cited supra, we reject the contention of the assessee that the non mentioning of the block period would defeat the very assessment. Quite apart from this, the assessee participated in the inquiry conducted under section 131 of the Income tax Act and had also made a statement confirming the purchase of the land. Subsequent thereto, the assessee had participated in the enquiry and on 15.5.2002, in response to the notice under section 142(1) the assessee expressed his inability to file the return on or before 15.5.2002 on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lock assessment is to be made, the Assessing Officer is having knowledge about the statutory provision and while issuing notice he should have mentioned in it about his source of power and should have referred to time which is required to be given for the purpose of filing of return under section 158BC of the Act. The words mentioned in the notice are `within fifteen days whereas the provision mandates the time of not less than fifteen days . In view of the decisions of the Supreme Court referred more particularly New India Industries Ltd . (supra), we are of the opinion, fifteen days means, clear fifteen days which is the requirement under law. In that view of the matter, we are of the view that the notice which was issued by the authority asking the assessee to file the return within fifteen days is not in accordance with the provisions of the Income-tax Act and therefore it is invalid. In our view, the authority who is issuing the notice must be aware of the Act and must construe the provision strictly. The words `not less than fifteen days have to be interpreted correctly. In that view of the matter, since the Assessing Officer asked the assessee to file the return with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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