TMI Blog2015 (3) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... ed order dated 28/12/2012 passed by the Ld. Commissioner of Income Tax (Appeals)-XI, New Delhi on the following grounds:- 1. On the facts and circumstances of the case, the order passed by the learned Commissioner of Income Tax (Appeals) [CIT(A)] is bad both in the eye of law and on facts. 2. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the assessment under Section 147 read with Section 148 of the Act as the same has been passed without proper service of statutory notice under Section 148 of the Act. 3. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in confirming the reopening of the assessment and consequently making reassessment without complying with the statutory conditions prescribed under Section 147 read with Section 148 of the Act. 4. On the facts and circumstances of the case, the CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that the reassessment proceedings are bad in law and on facts as the reasons recorded for reopening the assessment do not meet the requirements of Section 147 of the Act. 5. On the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ays. The notice was received back unserved. Further notices u/s. 142(1) dated 21.10.2010 fixing the case for 29.10.2010. On 29.10.2010 the compliance was made and Authorised Representative of the assessee appeared and stated that return filed on 29.9.2008 may be treated as filed, subsequently to the notice u/s. 148 of the Act, assessee has also filed various documentary like PAN, Share Application Money, Affidavit, Bank Account copy of M/s Bhavani Portfolio (P) Ltd., M/s Tejasvi Investments (P) Ltd. and M/s Tauraus Iron and Steel Co. (P) Ltd., the share applicant companies, before the AO. After considering the reply filed by the assessee and the documentary evidence supporting the claim of the assessee, the AO completed the assessment and made the addition of ₹ 15.10 Crores to the income return filed by the assessee as unexplained share capital and AO completed the assessment on 31.12.2010 u/s. 143(3)/147 of the I.T. Act, 1961. 3. Aggrieved with the aforesaid order dated 31.12.2010, assessee filed the Appeal before the Ld. CIT(A), who impugned order dated 28.12.2012 dismissed the Appeal of the Assessee. 4. Against the aforesaid order dated 31.12.2010 passed by the Ld. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court of India; Hon ble Jurisdictional High Courts and the various Hon ble High Courts wherein the Hon ble Courts held that non-service of the notice u/s. 143(2) of the I.T. Act, the reassessment made in such cases is invalid. He requested that on this ground the assessment in dispute as well as the impugned order passed by the Ld. CIT(A) may be declared invalid, void abnitio. In support of his contention Ld counsel of the assessee cited following relevant judgments:- - ACIT anr. Vs. Hotel Blue Moon (2010) 321 ITR 362 (SC) - DIT vs. Society for Worldwide InterBank Financial Telecommunications in ITA No. 441 of 2010 (Delhi High Court) (2010) 323 ITR 249 - CIT vs. Pawan Gupta Ors. [2009] 318 ITR 322 (Delhi High Court). - M/s Sapthagiri Finance and Investments vs. ITO : TC(A) No. 159 of 2006 dated 17.7.2012 (Madras High Court) [2013] 90 DTR 289. - Alpine Electronics Asia Pte Ltd. vs. DGIT Ors. [2012] 341 ITR 247 (Del.) - Raj Kumar Chawla and Ors. vs. ITO (2005) 94 ITD 1 (Del), ITAT, Special Bench, New Delhi - DCIT vs. Indian Syntans Investments (P) Ltd. [2007] 107 ITD 457. - CIT vs. M/s Panorama Builders Pvt. Ltd. in Tax Appeal NO. 435 of 2011 of Hon ble ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enged the non-service of the notice u/s. 148 dated 30.3.2010 which was received back unserved. In support of his contention he has also cited various decisions. Assessee has also challenged the addition in dispute on merit also by producing various documentary evidence supporting its claim before the Revenue Authority as well as before us in the shape of Paper Book, but he argued only on the issue involved in Ground No. 5. Keeping in view of the facts and circumstances of the present case, and the arguments raised by the Ld. Counsel of the assessee, we are of the view that the issue raised in ground No. 5 regarding the non-issuance of notice u/s. 143(2) of the I.T. Act which goes to the root of the matter, can be taken up first and decide according to the facts and circumstances of the case laws cited by the Ld. Counsel of the assessee. 8.1 We have also perused the assessment order dated 31.12.2010 passed by the Assessing Officer u/s. 143(3)/147 of the I.T. Act. For the sake of convenience, we are reproducing the aforesaid assessment order as under:- Return of income in this case was filed on 29.9.2008 declaring income of ₹ 28989/-. Assessment proceedings were initiate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve details of transaction made with the assessee, sources of transaction, copy of account of assessee company in their Books and copy of returns of share applicants with complete enclosures. All the three share applicants confirmed having transaction with the assessee copany for a total sum of ₹ 2.40 crores as mentioned above. In this case an information was received from the DIT(Inv.), New Delhi that Sh. Tarun Goyal has created a number of private limited companies and firms for providing accommodation entries. The Directors of these companies were his employees who worked in his office as peons, receptionists etc. All the documents were got signed from these employees. A number of Bank accounts in various banks were opened in the names of these companies and his employees, in which huge cash deposits were made. Later cheques were issued to various beneficiaries, disguising the whole transaction as genuine. All the companies floated by Sh. Tarun Goyal are not carrying out any genuine activity and are merely being used to provide accommodation entries. Hence, all the companies of Sh. Tarun Goyal are bogus . All the companies are operating from the office of Sh. Tarun Goy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, we are of the view that the AO has not issued notice u/s. 143(2) of the I.T. Act which is mandatory. We are also of the view that in completing the assessment u/s. 148 of the Act, compliance of the procedure laid down u/s. 142 and 143(2) is mandatory. As per record, we find that there was no notice issued u/s. 143(2) of the I.T. Act which is very much essential for reassessment and it is a failure on the part of the AO for not complying with the procedure laid down in section 143(2) of the I.T. Act. If the notice is not issued to the assessee before completion of the assessment, then the reassessment is not sustainable in the eyes of law and deserve to be cancelled. In view of above facts circumstances of the present case, the issue in dispute raised in ground no. 5 relating to non service of the mandatory notice u/s. 143(2) of the Act is decided in favor of the assessee by declaring the assessment order dated 31.12.2010 passed u/s. 143(3) / 147 of the I.T. Act as invalid. Our view is supported by the various judgments of the Hon ble Supreme Court, Hon ble Jurisdictional High Court, other High Courts and Special Benches decision of the ITAT. The relevant portion of the various j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r and it has not been issued within the period of limitation fixed under the law, then such notice shall be deemed to have been issued within time. It has been further held that resort cannot be taken by the Revenue to section 292BH to give a go-bye to mandatory requirement of issuance of notice within the statutory fixed by the proviso to section I43(2) of the Act. CIT vs Rajeev Sharma 336 ITR 678, High court of Allahabad. In view of above submissions and case laws, it has been established that no notice u/s 143(2) was issued in the present case and therefore the impugned assessment is liable to be annulled. M/s Sapthagiri Finance and Investments vs. ITO: TC(A). No. 159 of 2006 dated 17.07.2012 (Mad HC) [(2013) 90 DTR (Mad) 289] Relevant para reproduced here under: 13. As far as the present case is concerned, the provisions of Section 148 also uses the expression so far as may be apply accordingly as if such return were a return required to be furnished under Section 139 . Thus, understanding this provisions in the background of the decision of the Apex Court, on the facts available, we are of the view that in completing the assessment under Section 148 of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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