TMI Blog2003 (12) TMI 285X X X X Extracts X X X X X X X X Extracts X X X X ..... er son Shri Laxmi Narain. 4.1 A search and seizure operation was conducted on the business premises of the firm on26-10-1988. After search the firm was dissolved on31-3-1989. A deed of dissolution was executed on12-4-1989. It is alleged that intimation of dissolution was also given to Assessing Officer under section 176(3) vide letter dated12-4-1989. 4.2 The Assessing Officer issued notice under section 148 against the firm. This notice was served upon one Mahesh Kumar s04 of the retired partner Shri Laxmi Narain on9-7-1991. The assessee filed return on21-10-1991. 4.3 Original assessment was completed on17-3-1994. Against this order the assessee preferred appeal before the learned CIT(A), Rohtak, who vide order dated 28~2-199 5 set aside the order and restored the matter; back to the Assessing Officer for framing the assessment after considering the grounds of the assessee which, inter alia, was that not service of notice under section 147/148 was effected upon the assessee. The Assessing Officer, in compliance to the direction of the learned CIT(A) framed the assessment order on31-1-1997for assessment year 1981-82. 4.4 The assessee again agitated the issue before the learn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm must be served in accordance with the provisions of section 282 i.e. on any partner or duly authorized person. According to him, in case of dissolved firm, in view of the provisions contained under section 283(2), the notice must be served on any of its partners before dissolution of the firm. He also submitted that notice upon son of partner cannot be treated to be a valid service of notice. In support of this argument, he placed reliance on the following decisions: Kanhaya Lal Surinder Kumar v. Assessing Officer [2001] 73 ITD 22 (Delhi); Narwana Motor Tpt. Co. v. ITO [1982] 13 TTJ (Chd.) 67; Cf. Radha Mal Mahavir Prashad v. CST [1978] 101 Taxman 512 (Cal.)(sic). 4.7 The learned counsel also submitted that unless the notice is served on the proper person in the manner prescribed under section 282, the service cannot be deemed sufficient and Assessing Officer has no jurisdiction to reassess the escaped income. In this regard the learned counsel made reference to the following decisions: Jayanthi Talkies Distributors v. CIT [1978] 120 ITR 576 (Mad.); Shri Sidh Co. v. ITAT [1992] 194 ITR 747 (All.); B.JoharForestWorks v. CIT [1973] 107 ITR 409 (J K); Thangam Text ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f a particular mode is provided for effecting service, the service has to be effected according to that mode only and not otherwise. 4.12 The issue relating to validity of the service was considered in the case of Kanhaya Lal Surinder Kumar. In that case also service was effected on son of one of the partners of erstwhile firm. The Bench accepted the argument of the assessee and quashed the assessment order by observing as under: "In the case of the assessee the notice has been served subsequent to the dissolution of the firm. There are separate provisions relating to the dissolution of firm as given in section 283. On perusing the provisions of sections 282 and 283 of the Act, it would be clear that while in the case of section 282 the party on whom notices are to be served is either any member of the firm or the manager, in case of dissolution of firm, the term used is 'partner' (not being a minor). Apparently, in case of dissolved firm, it is the partner, who alone can effectively represent against any action contemplated by the Department. Coming to the assessee's case, while properly addressing the notice, it has been mentioned that the same is to be through K and D. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... should be served in proper manner. The Hon'ble Supreme Court of India in the case of Y. Narayana Chetty v. ITO [1959] 35 ITR 388 held that the service of requisite notice on the assessee is a condition precedent to the validity of any reassessment under section 34 of the Income-tax Act and if a valid notice was not issued as required, the proceedings taken by the ITO in pursuance of an invalid notice and consequent orders of reassessment passed by him would be void and inoperative. 4.16 The Hon'ble Kerala High Court in the case of P.N. Sasikumar v. CIT [1988] 170 ITR 80 has also considered the issue relating to service of notice under section 148 and the consequential of invalid service. TheHon'ble Courthas observed as under: "It is settled law that the issue 6f a notice under section 148 of I.T. Act, 1961 is a condition precedent to the validity of any assessment order to be passed under section 147 of the Act. It is also settled law that if no such notice is issued or if the notice issued is invalid, not in accordance with law or is not served on proper person in accordance with law, the assessment would be illegal and without jurisdiction. The notice should specify the corre ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
