TMI Blog2005 (8) TMI 344X X X X Extracts X X X X X X X X Extracts X X X X ..... n granted to the assessee to tile the return of income which was in conformity with the intent and purpose of the Act as contemplated under Section 292B of the Act. 4. ITA No. 2303/2005 was admitted on 05.06.2006 to consider the following three substantial questions of law: i) Whether the Appellate Authorities were correct holding that the notice issued under Section 158BC of the Act on 9.3.99 giving the assessee 15 days time to file the return of income is invalid and consequently, the assessment stand annulled despite the assessing officer granting further time of six months by issuing fresh notices and thereafter the assessee filed the return on 24.11.99. ii) Whether the notice issued under Section 158 BC(a)(i) of the Act cannot be treated as invalid since further time of six months has been granted to the assessee to tile the return of income which was in conformity with the intent and purpose of the Act as contemplated under Section 292B of the Act. iii) It is submitted alternatively without conceding whether the Tribunal after treating the notice as invalid, should have directed the Assessing Officer to pass fresh order of assessment in accordance with the law by givi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laws, the facts in ITA No. 2784/2005 is considered. The assessee is a company carrying on the business of the pharmaceuticals, On 10.09.1997, a search was conducted in the group of cases of the assessee under Section 132 of the Act. A notice under Section 158BC was issued on 15.12.1997 requesting the assessee to file a return of income within a period of 15 days for the block period 1988-89 to 1998-99. By a latter dated 02.01.1998, the assessee sought time to file his return of income. On 16.06.1999, the assessee was once again requested to file, his return of income for the block period, which was served on him on 17.06.1999 The assessee filed the return of income on 29.06.1999 declaring a sum of Rs.200 lakhs as undisclosed income for the block period 01.04.1987 to 5.11.1997. The Assessing Officer took into consideration the seized materiel and the return of income filed and arrived at a net undisclosed income for the block period at Rs. 200 lakhs 7. The assessee being aggrieved by this order preferred an appeal to the Commissioner of Income Tex (Appeals). The Appellate Commissioner held that the notice issued under Section 158BC of the Act was invalid and consequently, he ann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and did not cause any prejudice to the assessee and more importantly, the second notice was issued containing all the statutorily required information. Hence, they held that the proceedings were valid. The facts of the present case are different. By the notice issued to the assessee under Section 158 BC, a period less than 15 days has been granted to furnish the return. There is no second notice issued to the assessee rectifying the first notice Therefore, the cited judgment would not be applicable to the facts of the present case. 11. The learned counsel appearing of the assessee submits that there is no error committed by the authorities that calls for any interference. That the statutory time in terms of Section 158BC has not been compiled with and hence. the entire assessment proceedings is bad in law. That the Tribunal has rightly held that Section 240 is not applicable to the block assessment proceedings under Chapter XIV B of the Act and consequently the tax paid is liable to be refunded. 12. He placed reliance on the judgment of the Gujarat High Court in the case of P.V. Doshi, Vs. Commissioner of income Tax, Gujarat reported in (1978) 113 ITR PAGE 22 to contend that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C provides for a procedure to be adopted for block assessment. Under this procedure envisaged the Assessing Officer shall serve a notice requiring the assessee to furnish his return within such time not being less than 15 days but not more than 45 days as specified in the notice, Therefore, the time to be granted to the assessee in terms of Section 158 BC is a minimum of 15 days and a maximum of 45 days, it the said period of time is not granted, the notice is invalid rendering the entire proceedings as without jurisdiction. Admittedly in this case, the notice under Section 158BC calls upon the assessee to submit its return of income within a period of 15 days . Within a period of 15 days is less than 15 days. Therefore, the mandatory period of time as stipulated under Section 158 BC has not been complied with. The notice therefore is invalid. An invalid notice cannot confer any jurisdiction on the authority, Hence, the entire proceedings are bad in law. The notice is ab-initio void. 15. It was contended by the Revenue that a letter seeking extension of time was made and in the said latter there is no mention whatsoever questioning the validity or otherwise of the notice under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be termed as invalid. The notice should the in conformity with and in accordance with the intent and purpose of the Act. The intent and purpose as provided under Section 158 BC is to serve a notice on the assessee by providing a time of not less than 15 days and not more than 45 days. This is the purport and intent of the section. No extra time can be granted subsequently. Time to be granted is a minimum of 15 and maximum of 45 days. The same has to be specified in the notice, Hence grant of extra time is without authority of law. it cannot validate an invalid notice, Moreover, it is relevant to note that the notice issued is on a printed form wherein the details are required to be filed up. At the bottom of the notice, is a printed matter, which reads that the time to be granted shall not be less than 15 days. In spite of this, the time granted to the assessee is less than 15 days. Therefore. It is apparent that there has been a violation of law, Therefore, when the sum and substance of the notice issued to the assessee is not in conformity with the purpose of the Act, Section 292 B has no application. Hence, question No.2 is answered in favour of the assessee and against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Appeals) exceeded his jurisdiction to deny the refund. In the facts of the present case, Clause (b) of proviso to Section 240 is not applicable. The order of the Tribunal is just and proper. It is in conformity with law. Accordingly, question No.3 is answered in favour of the assessee and against the revenue. 22, Question No.4 is as to whether the Appellate Authorities have jurisdiction to adjudicate the issue with regard to refund. 23. The assessments have been annulled. The jurisdiction of the Appellate Authorities to adjudicate the issue of refund in the Appellate proceedings is consequential upon the validity of the assessment proceedings. having recorded a finding by holding that the entire assessment proceedings are invalid, the question oi the jurisdiction of the Appellate authorities therefore would not arise for determination. it has now become academic. Question No. 4 is accordingly answered. 24, Question No.5 is as to whether the Appellate Authorities should have directed the Assessing Officer to pass a fresh order of assessment in view of holding that the notice is invalid. 25. it was further contended by the revenue that if the notice was held to be invalid, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
