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2021 (6) TMI 296 - HC - Income TaxValidity of issuance of notice under Section 153C - non recording of satisfaction by the IO - HELD THAT:- Referring to necessity for recording of satisfaction prior to transfer of files by the Investigating Officer to the AO having jurisdiction over an assessee in the present case, the recording of satisfaction prior to issuance to notice dated 30.09.2019 is apparent from the record and the argument of the petitioner to the contrary is rejected. In the light of the confirmation furnished now to the effect that the satisfaction had been issued by the IO only on 30.09.2019, notice dated 14.06.2019 was evidently bad in law. According to the petitioner, this fact vitiates all other and subsequent proceedings including the impugned notice dated 30.09.2019. The satisfaction notes now placed on record make it clear that as in June, 2019, there had been no recording of satisfaction by the IO and thus the issuance of notice under Section 153C on 14.06.2019 was erroneous since it was without satisfaction of the condition precedent. In fact, notice dated 14.06.2019 which has been placed in the typed set filed by petitioner at page 74 has caught Mr.Srinivas by surprise and it was only after this argument was specifically urged by the petitioner, that additional counter dated 11.02.2021 has come to be filed by R2 accompanied by a typed set containing the two satisfaction notes and note for transfer of files from IO to AO. Whether the issuance of notice dated 14.06.2019 without compliance of the statutory pre-condition, would vitiate all subsequent assessment proceedings including the impugned notice. R2, in his reply to the petitioner’s rejoinder, reiterates that the procedure followed by the respondents is in accordance with law. There is no reference in any of the respondents’ pleadings to notice dated 14.06.2019. The respondents thus disavow notice dated 14.06.2019 and their case rests on the position that satisfaction notes were drawn up on 30.09.2019 and it was only parallel and pursuant thereto that the impugned notice under Section 153C dated 30.09.2019 was issued. In this context, attention is drawn to Sections 282 and 282A of the Act as well as Rules 127 and 127A of the Income Tax Rules, 1962 (Rules) to justify the issuance of the impugned notice and to state that proper procedure has been followed. The issuance of the invalid notice dated 14.06.2019 does not compromise the assessment proceedings as, the invalid notice is one that does not exist in the eyes of the law and must thus be ignored. The provisions of Section 282 deal with service of notice in general terms and Section 282A with the authentication of notices for service by electronic means. In this case, it is not in dispute that notice dated 30.09.2019 is a valid notice qua the provisions of Sections 282 and 282A read with Rules 127 and 127A. The issuance of notice dated 14.06.2019 does not vitiate the impugned proceedings in any way.
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