2023 (2) TMI 693 - AT - Income Tax

Assessement u/s 144C - notice of demand issued at the stage of draft order - HELD THAT:- Since the A.O in the present case had issued notice of demand at the stage of draft order which actually ought to have been done at the stage of passing a final order, thereby assigning finality to the assessment at the stage of draft order itself.

We hold that the resultant final assessment order actually got vitiated in the eyes of law and hence cannot stand. The A.O wanted the assessee to treat the order as the draft assessment order. Then he should not have issued demand notice and penalty notice to the assessee and even when he had issued he should have withdrawn them i.e. the said demand notice and penalty notice which in fact he had not done. Demand notice and the penalty notice are issued only after the final assessment is completed.

Therefore, the A.O violated the provisions of section 144C - Accordingly, we set aside the assessment order declaring it null and void. The legal ground raised by the assessee is answered in favour of the assessee and against the revenue.