TMI Blog2022 (8) TMI 1358X X X X Extracts X X X X X X X X Extracts X X X X ..... st the order of Ld. CIT(A)-24, New Delhi dated 14.10.2019 in Appeal No.112/2016-17 for the assessment year 2014-15. Application of assessee dated 24.06.2022 for admission of additional ground and filing of revised Ground No.1 2. The Ld. Authorized representative [ AR ] of the assessee submitted that the assessee carves for leave to add two additional grounds of appeal for admission and adjudication and also wants to file revised Ground No.1 raised in Form No.36. 3. Ld.AR submitted that failure to place these additional grounds as main ground of appeal, was neither willful nor deliberate and these are grounds pure legal in nature and its adjudication does not require any fresh investigation or material into the facts apart from looking into the material already on record. Placing reliance on the judgments of Hon ble Supreme Court in the cases of National Thermal Power Co.Ltd. vs CIT 229 ITR 383 (SC) and Jute Corporate of India Ltd.v s CIT 187 ITR 688 (SC), Ld.AR submitted that additional grounds may kindly be admitted for adjudication and revised regular Ground No.1 may also be taken on record. 4. Ld.CIT DR strongly opposed the admission of additional ground. However, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med by the AO by issue of notice u/s 143(2) firstly on 29.09.2015 (PB 9) along with notice dt: 29.09.2015 u/s 142(1) of IT Act (PB 8). The above notice was issued by the AO without having return of income in its possession which fact is proved from the above notice dt: 29.09.2015 (PB 8) where the AO requires the assessee to file the return of income in appropriate form as required in rule 12. For that purpose a blank return of income was also enclosed. Subsequently, the appellant filed letter dt: 26.10.2015 with the copy of the acknowledgment of return. The assessing officer immediately on 26.10.2015 issued notice u/s 143(2) of the Act of the same date. Issue of such a notice through which jurisdiction is assumed on the date of intimation of return shows that the notice has been issued mechanically without application of mind. To support the above proposition of law, reliance is placed in the decisions of Director of Income Tax vs. Society for Worldwide Interbank Financial Telecommunications (2010) 323 ITR 249 (Del), Micron Enterprises Pvt Ltd vs ITO ITA No.901 /Del/2016 dt: 14.05.2018 (SMC Bench) and Astech Industries Pvt Ltd vs DCIT ITA No.2332/Del/2018 dt: 20.12.2018 (DB) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vt. Ltd. Vs DCIT in ITA No.2332/Del/2018 dated 20.12.2018, the AO did not assume valid jurisdiction to frame assessment u/s 143(3) of the Act therefore, impugned assessment order as well as first appellate order may kindly be quashed. 9. Replying to the above, Ld.CIT DR submitted that in the case of Director of Income Tax vs Society for Worldwide Interbank Financial Telecommunications (supra), it was noted by the Hon ble High Court that in para 9, the return was filed by the assessee on 27.03.2000 and the notice u/s 143(2) of the Act was served upon to the Ld.AR of the assessee by hand when the Ld.AR of the assessee came and filed return of income. Therefore, it was held that the notice u/s 143(2) of the Act, can only be served to the assessee after AO has examined the return of income filed by the assessee. But in the present case, the assessee had filed return of income much earlier on 22.11.2014 therefore, the judgement of Hon ble Jurisdictional High Court is not applicable in the present case in favour of the assessee. 10. Placing re-joinder to the above, Ld.AR of the assessee again drew our attention towards pages 8 to 10 of the assessee s Paper Book and submitted that a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct on 22.11.2014 and immediately after receiving this letter, the AO issued second notice u/s 143(2) of the Act on 26.10.2015 and on this point of time, AO was not having either original or copy of return of income. Therefore, we safely presumed that the AO had issued second notice u/s 143(2) of the Act 26.10.2015 without examining the return of income filed by the assessee on 22.11.2014 and without applying mind to the same. 12. ITAT, Delhi A Bench in the case of Astech Industries Pvt. Ltd. Vs DCIT (supra) after considering the various judgements and orders including the judgement of Jurisdictional High Court of Delhi in the case of Director of Income Tax vs Society for Worldwide Interbank Financial Telecommunications (supra) held as under:- 7. We have heard both the parties and perused the records, especially the impugned order and the case laws cited by the Ld. Counsel for the assessee. We note that Assessee filed its return of income for the assessment year 2009-2010 on 29.09.2009 declaring income of Rs.339,85,750/- and the same was processed u/s 143(1) of the Act on 19.02.2011. Later on, certain information as mentioned in assessment order was received from Investiga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee extensively in case of Moti Adhesives (ITA 3133/Del/2018) in order dated 25/06/2018 copy placed before us, has been consistently holding while taking support from Hon ble Apex court leading decision in Andaman Timber Industries case (Civil Appeal No. 4228 OF 2006) reported at 127 DTR 241 that violation of principle of natural justice (here withholding of back material referred in reasons which is specifically requested for repeatedly) is a serious flaw and results in nullity of the order so passed, which is squarely applicable to present case. Be that as it may, even on merits, for the companies from where assessee recd. share capital assessee placed before Ld AO in its reply dated 07/06/2016 all evidences like share application form, board resolution confirming investment made, confirmation of share capital raised, Share certificate, income tax particulars of share holders, bank statement of share holders and form 2 for allotment of shares along with their audited final a/c thus discharging its primary burden u/s 68 on three ingredients of identity, creditworthiness and genuineness of share holders. AO unimpressed by the same in the only show cause notice which is place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uccinctly in Delhi High Court decision in case of Silver Line reported at 383 ITR 455 wherein it has been held as under:- 12. The Court first proposes to consider the question as to whether in terms of the proviso to Section 292BB of the Act, the Assessee was precluded, at the stage of the proceedings before the ITAT, from raising a contention regarding failure of the AO to issue a notice under Section 143(2) of the Act. The legal position appears to be fairly well settled that Section 292BB of the Act talks of the drawing of a presumption of service of notice on an Assessee and is basically a rule of evidence. In Commissioner of Income Tax v. Parikalpana Estate Development (P.) Ltd. (supra) in answering a similar question, the Court referred to its earlier decision in Commissioner ITA No. 578 of 2015 connected matters Page 10 of 15 of Income Tax v. Mukesh Kumar Agrawal (2012) 345 ITR 29 (All.) and pointed out that Section 292BB of the Act was a rule of evidence which validated service of notice in certain circumstances. It introduces a deeming fiction that once the Assessee appears in any proceeding or has cooperated in any enquiry relating to assessment or reassessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ): 24. Proviso opens with the words where the State Government is of opinion that substantial modifications in the draft development plan and regulations are necessary..These words are indicative of the satisfaction being subjective one but there must exist circumstances stated in the proviso which are conditions precedent for the formation of the opinion. Opinion to be formed by the State Government cannot be on imaginary grounds, wishful thinking, however, laudable that may be. Such a course is impermissible in law. The formation of the opinion, though subjective, must be based on the material disclosing that a necessity had arisen to make substantial modifications in the draft development plan. 25. The formation of the opinion by the State Government is with reference to the necessity that may have had arisen to make substantial modifications in the draft development plan. The expression: so considered necessary is again of crucial importance. The term consider means to think over; it connotes that there should be active application of the mind. In other words the term consider postulates consideration of all the relevant aspects of the matter. A plain reading of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same day A.O. issued notice under section 143(2) i.e., on 26.11.2013, copy of which, is filed at page-12 of the paper book. He has, therefore, submitted that the A.O. has not validly assumed jurisdiction under section 147 and 143(3) of the I.T. Act to pass the assessment order against the assessee. He has submitted that the issue is covered in favour of the assessee by the judgment of the Hon ble Delhi High Court in the case of Director of Income Tax vs. Society for Worldwide Interbank Financial Telecommunications (2010) 323 ITR 249 (Del.) in which it was held as under : Both the CIT(A) and the Tribunal have returned a concurrent and clear finding of fact that the notice under s. 143(2) was issued on 23rd March, 2000 and since the return was filed on 27th March, 2000, the notice was not a valid one and, therefore, the assessment completed on the basis of the notice was also invalid and was consequently set aside. It is for the first time that the counsel for the appellant contends that the notice, in fact, was issued on 27th March, 2000 and not on 23rd March, 2000, the date which is recorded on the notice itself. No such contention was raised before the lower appellate authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ank Financial Telecommunications (supra) and Order of ITAT, Delhi Bench in the case of Shri Harsh Bhatia, New Delhi vs. ITO, Ward-50(3), New Delhi (supra). It is an admitted fact that assessee filed reply in response to the notice under section 148 of the I.T. Act on 26.11.2013 and submitted before A.O. that original return filed before him may be treated as return filed in response to the notice under section 148 of the I.T. Act. The A.O. on the same day served notice under section 143(2) upon assesseecompany whose signature tally on the said notice. Therefore, notice issued under section 143(2) is invalid and resultantly, the assessment is vitiated and is liable to be quashed. I, accordingly, set aside the orders of the authorities below and quash the reassessment proceedings in the matter. Resultantly, all additions stands deleted. In view of the above, there is no need to decide other contentions raised by Learned Counsel for the Assessee. 9. In the result, appeal of assessee is allowed. 7.6 Further we also find force in argument of Ld counsel for the assessee that language of section 143(2) of the Act in so far as it uses the phrase if considers it necessary or expedie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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