TMI Blog2008 (1) TMI 473X X X X Extracts X X X X X X X X Extracts X X X X ..... 470. The AO observed that the audit has pointed out that against receipts for work done of Rs. 50,96,608, the assessee firm had shown receipts of only Rs. 46,84,488 and there was a short computation of income to the extent of Rs. 4,12,190. Accordingly, the case was reopened and notice under s. 148 of the Act was issued on 21st Jan., 2002 and served on assessee on 24th Jan., 2002. No return was filed by the assessee in response to notice under s. 148 of the IT Act, 1961. The AO issued notice under s. 142(1) on 27th Aug., 2002 fixing the case for compliance on 4th Sept., 2002. According to AO, this notice was duly served by notice server on 3rd Sept., 2002. Another notice under s. 143(2) was issued on 20th Dec., 2002 fixing the compliance on 3rd Jan., 2003. According to AO, this notice was received by one Shri Babloo on 27th Dec., 2002. There was no compliance to this notice also. The AO also issued a notice to the assessee through IT Inspector. The report of the Inspector reads as under: "The shop has since been closed. However from the enquiry from the other persons it is gathered by me that Mr. M.S. Bedi, one of the partners (main) of the aforesaid firm has shifted to Delhi. His ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and report to show that the recipient of the notice is an authorised person, i.e. any partner of the firm. 5. In view of the above, it was submitted by the assessee before the CIT(A) that no notice under s. 148 was received by the assessee. The assessee also prayed that there was no legal or valid service of notice under s. 148 in present case, the AO did not acquire a legal or valid jurisdiction to pass any order in the present case. 6. The learned CIT(A) accepted this contention of the assessee that neither the notice under s. 148 was served on the partners of the firm nor on the Authorised Representative of the firm, or any person authorised in this behalf by the firm. For the sake of convenience, we may reproduce the finding of CIT(A) on this issue, which reads as under: "2.8...........I have carefully considered the reply given by the appellant and perused the assessment order. A remand report was called for from the AO vide this office letter dt. 5th April, 2005 in which the assessee (sic-AO) was informed that the appellant has challenged the validity of the service of notice under s. 148. Hence a remand report may be submitted in this regard. The AO has sent remand rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatives of the appellant firm in this regard as per provision of s. 282 of the IT Act, 1961. The Hon'ble Supreme Court in its judgment in case of R.K. Upadhyaya vs. Shanabhai P. Patel (1987) 62 CTR (BC) 17 : (1987) 166 ITR 163 (BC) have held, that service under the new Act, is not a condition precedent to confirmation of jurisdiction on the ITO. It is a condition precedent and to making of the order of assessment. The Hon'ble Allahabad High Court in case of Addl. CIT vs. Prem Kumar Rastogi have held that a person who is not an authorised agent of the assessee or an agent or manager. personally carrying on the assessee's business or an adult member of the family but who has merely accepted notices in the past on his behalf cannot be deemed or treated to be an authorised agent of the assessee and service on him of the assessment order of the assessee is not valid. In the case of the appellant, the AO has neither served notice on the partner of the firm or Authorised Representative of the firm. even the notice server has not identified the person on whom the notice was served. 2.9 The Hon'ble Allahabad High Court in case of Laxmi Narain Anand Prakash vs. CST have held that the quest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssuance of notice. In this regard, Shri Anadi Verma, senior Departmental Representative submitted that office records show that the assessee has communicated neither closure of business nor change of address of business premises which was the bounden duty of the assessee. He further submitted that notice under s. 148 was sent to M/s Bedi Enterprises, 82, G.B. Marg, Lucknow which was served on 24th Jan., 2002. He further submitted that ITI, in his report, has duly stated that notice under s. 148 in this case, for asst. yr. 1996-97 was served at the residential address 48, Purana Kila, Lucknow on 24th Jan., 2002 as the assessee was not available at G.B. Marg, address. He further stated that above notice was served on a lady who was present in the house. Shri Anadi Verma, senior Departmental Representative further submitted that as a notice under s. 148 was served on the person present at the residential premises and who was the member of the family of the partner as the name of the recipient on the notice suggests, inference of CIT(A) that notice under s. 148 was neither served on the partner of the firm nor on the Authorised Representative of the firm, is not sustainable in law. Lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [ITA No. 1951/All/1996 dt. 12th Oct., 2004 (sic-31st May, 2005)] [reported at (2005) 95 TTJ (All)(TM) 489-Ed.]; 7. Chandra Agencies vs. ITO (2004) 89 ITD 1 (Del); 8. Duli Chand Luxmi Narain vs. Asstt. CIT (2004) 90 TTJ (Del) 236 : (2004) 89 ITD 426-(Del); 9. Hind Book House vs. ITO (2005) 93 TTJ (Del) 224 : (2005) 92 ITD 415 (Del). 10. We have heard learned representatives of both the parties at length and have also perused the materials available on record. The decisions cited at the time of hearing of the appeal were duly considered. Sec. 148(1) of the IT Act, 1961 reads as under: "148. (1) Before making the assessment, reassessment or recomputation under s. 147, the AO shall serve on the assessee a notice requiring him to furnish within such period, (* * *) as may be specified in the notice, a return of his income or the income of any other person in respect of which he is assessable under this Act during the previous year corresponding to the relevant assessment year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed; and the provisions of this Act shall, so far as may be, apply accordingly as if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the IT Act, 1961. It is well settled law that it is the duty of the Revenue to establish that a service of notice under s. 148 was made on the assessee himself or on somebody duly authorised by him in that behalf When the assessee took the plea that there was no proper service on him, it is for the Revenue to place the relevant material to substantiate the plea that the assessee was served with proper notice. In the case of R.K. Upadhyaya vs. Shanabhai P. Patel, the Hon'ble Supreme Court held that "the mandate of s. 148(1) is that reassessment shall not be made unless there has been service." In our considered view, valid assessment order could not be passed without proper service of notice. 11. In the case of Addl. CIT vs. Prem Kumar Rastogi, the Hon'ble Allahabad High Court held as under: "A person who is not an authorised agent of the assessee or an agent or manager personally carrying on the assessee's business or an adult member of his family but who has merely accepted notices in the past on his behalf cannot be deemed or treated to be an authorised agent of the assessee and service on him of the assessment order of the assessee is not valid." 12. It is observed that d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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