TMI Blog2008 (6) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... rect Court fee and, therefore, we reject the objection raised by the Registry. 3. Now we will decide the assessee's appeal i.e. ITA No. 176/Luck/2007 on merits. Ground Nos. 1, 2, 3.1 and 3.2 read as under: "1. Because the learned CIT(A) has erred in law and on facts in upholding the assessment order under s. 144 which was passed without issuance and service of valid notice under s. 143(2) within the period of 12 months which is a mandatory requirement and as such the impugned assessment order should have been quashed as null and void. 2. Because the learned CIT(A) has failed to consider particularly the fact that: (a) only notice that has been served under s. 143(2) was dt. 3rd Nov., 2004 (served on 27th Nov., 2004) and such a notice was beyond the period of 12 months from the end of the month in which the return was filed, i.e., 8th Oct., 2003; (b) the alleged service of notice on Shri Ram Sewak Verma by IT Inspector was an unknown person and stranger to the assessee and at no point of time the said person was either the authorized agent or representative of the assessee; (c) the requirement of the law for service of notice as contained in s. 282 r/w Order V of CPC has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provide any details as required vide questionnaire dt. 27th Feb., 2006. The assessee challenged the validity of notice under s. 143(2) stating that no notice under s. 143(2) was received by him within 12 months from the end of the month in which the return was filed. Subsequently, the assessee moved a petition dt. 12th March, 2006 enclosing therewith objections as regards notice under s. 143(2) of the Act within the time stipulated under s. 143(2) of the Act. In this regard the AO observed that the notice under s. 143(2) issued on 21st Oct., 2004 fixing the date on 25th Nov., 2004, was served by IT Inspector on Shri Ram Sewak Verma on 28th Oct., 2004 on the address given by the assessee in the return of income. The AO rejected the objections raised by the assessee as regards service of notice under s. 143(2) vide note sheet entry dt. 23rd March, 2006. Vide para 7 of the assessment order, the AO has observed as under: "7. Shri P.S. Srivastava, ITI who served the notice was also examined by the undersigned. On being called, the person who came out of house at 4/1089, Vikas Nagar, Lucknow told himself to be Shri Ram Sewak Verma. The person Shri Ram Sewak Verma informed that the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p also deals with the issue. Here the notice was duly served on a person who was at the address provided by the appellant himself by a responsible official of the IT Department, his signatures are on record of the receipt and thus the notice is correctly served. It is also observed that the appellant failed to produce the books of account and vouchers leaving no option to the AO except to pass order under s. 144. These grounds are, therefore, rejected." 8. Shri Amit Shukla, advocate, learned counsel for the assessee reiterated the submissions made before the lower authorities. He further submitted that notice under s. 143(2) of the Act had to be served on the assessee on or before 31st Oct., 2004. He further submitted that it is undisputed proposition of law that the notice under s. 143(2) has to be served within a period of 12 months from the end of the month in which the return of income has been filed. After the expiry of 12 months, the AO loses his jurisdiction to the case under scrutiny and completes the assessment under s. 143(3) of the Act. He further submitted that in the instant case, the assessee was, however, served with a notice under s. 143(2) dt. 3rd Nov., 2004 rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Shingar Gutkha (P) Ltd. vs. CIT, judgment dt. 22nd May, 2008 in IT Appeal No. 1 of 2005 (All); (14) CIT vs. Suresh Chandra Jaiswal (IT Ref. No. 71 of 1995, dt. 7th May, 2008); (15) CIT vs. Hotline International (P) Ltd. (2007) 211 CTR (Del) 207 : (2008) 296 ITR 333 (Del). 9. Smt. Reema Hota Singh, learned senior Departmental Representative strongly supported the orders of the authorities below. She further submitted that notice under s. 143(2) was duly served on a person (Ram Sewak Verma) who was at the address provided by the assessee himself by a responsible officer of the IT Department, his signatures are on record of the receipt and thus the notice is correctly served. She therefore, submitted that the objections raised by the assessee that no notice under s. 143(2) of the Act was served upon the assessee on 28th Oct., 2007, may be rejected. 10. We have heard learned representatives of both the parties and have also perused the materials available on record. In the instant case, we are concerned with the proviso to s. 143(2)(ii) of the Act, which reads as under: "Provided that no notice under cl. (ii) shall be served on the assessee after the expiry of 12 months fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advocate, learned counsel for the assessee submitted that in the instant case, notice under s. 143(2) was issued on 21st Oct., 2004 which is claimed to have been served within the period stipulated under the proviso to s. 143(2)(ii) of the Act on one Ram Sewak Verma. Shri Amit Shukla, advocate, learned counsel for the assessee vehemently argued that Ram Sewak Verma was neither the employee nor the authorized agent of the assessee and, therefore, the service of notice on him was not in accordance with law. At this stage, we may also refer to a letter No. F. No. Miscellaneous/ITO-1(2)/Lko/2007-08, dt. 13th Feb., 2008 written by Shri V.K. Dubey, ITO-1 (2), Lucknow addressed to senior Departmental Representative, Tribunal., Lucknow which is reproduced as under: "To, The Senior Departmental Representative ITAT, Lucknow. Sir, Sub: ITA No. 176/L/2007-Asst. yr. 2003-04-In the case of Shri Nripendra Mishra, 4/1089, Vikas Nagar, Lucknow-Report The Inspector of this office, Shri Rajesh Kumar was deputed to conduct enquiries regarding service of notice under s. 143(2) of the IT Act, 1961, in the abovementioned case. upon Shri Ram Sewak Verma for proper identification etc. The In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpowered to accept service, in which case service on such agent shall be sufficient.' Order V, r. 17 of the CPC lays down the procedure when the defendant refuses to accept service, or cannot be found and it reads as under: 'Rule 17. Procedure when defendant refuses to accept service, or cannot be found.-Where the defendant or his agent or such other person as aforesaid refuses to sign the acknowledgment, or where the serving officer, after using all due and reasonable diligence, cannot find the defendant (who is absent from his residence at the time when service is sought to be effected on him at his residence and there is no likelihood of his being found at the residence within a reasonable time), and there is no agent empowered to accept service of the summons on his behalf, nor any other person on whom service can be made, the serving officer shall affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily resides or carries on business or personally works for gain, and shall then return the original to the Court from which it was issued, with a report endorsed thereon or annexed thereto stating that he has so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appearances, application or act is made the appearances, application or act is made or done, in matters connected with such trade or business only, where no other agent is expressly authorized to make and do such appearances, applications and acts.' Learned standing counsel provided the report of the process server, which reads as follows: *** Hindi Phrases*** From the perusal of the order of the Tribunal it is not clear that on which basis the Tribunal has recorded the finding that Sri G.K. Lath, possessed requisite authority. In this view of the matter, we are of the view that the matter requires reconsideration by the Tribunal. Tribunal being the fact finding authority should examine the material on record and give basis for coming to a conclusion that Sri G.K. Lath, possessed requisite authority to receive the notice. Tribunal has not considered the Order V, r. 12 of the CPC, which contemplates the service of the summons referred hereinabove." In the above decision, the issue before the Hon'ble High Court was that, as to whether the first notice issued on 21st Nov., 2001 addressed to the company served on one G.K. Lath staying in the business premises amounts to service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the provision being in negative terms". The Hon'ble Court concluded that when an assessment is framed under s. 143(3) by issuing statutory notice beyond the prescribed time-limit, the assessment would be bad in law and is to be quashed. 14. Recently, the Tribunal, Allahabad Bench (Third Member) in the case of Awadh Automobiles (P) Ltd. vs. Dy. CIT relating to asst. yr. 1997-98 vide order dt. 27th Dec., 2007 (sic) in ITA No. 864/All/2000 has held as under: "10. Coming to the merits of the additional ground, it is a settled law that Revenue has to establish the service of notice upon the assessee under s. 143(2) within the stipulated time prescribed under proviso to s. 143(2) i.e., 12 months from the end of the month in which return is furnished. The learned JM has recorded a categorical finding that the Revenue has not been able to discharge such burden as no evidence regarding the service of notice upon the assessee within the stipulated time has been produced by the Revenue. The learned AM has not given any specific finding in this regard because he denied to admit the additional ground. He also observed that the AO cannot be asked to prove that notice under s. 143(2) was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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