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RAKESHBHAI VITTHALBHAI PATEL Versus INCOME TAX OFFICER, WARD-4 & 1

2015 (11) TMI 1381 - GUJARAT HIGH COURT

Reopening of assessment - misconception of law - Held that:- In the present case no assessment has been framed under section 143(3) of the Act, under the circumstances, the proviso to section 147 of the Act would not be attracted. On an overall view of the matter, it appears that the petitioner has proceeded on a misconception of law and not in terms of the provisions of the Act and the principles laid down by judicial pronouncements in that regard. The petitioner should have been appropriately .....

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nt to the impugned notice. Besides, as noted earlier, except for a bare assertion, nothing has been pointed out on behalf of the petitioner to show as to why the second respondent lacked jurisdiction to issue the notice under section 148 of the Act. Thus no merit in any of the submissions advanced on behalf of the petitioner so as to warrant exercise of powers under Article 226 of the Constitution of India. Decided against assessee - SPECIAL CIVIL APPLICATION NO. 17768 of 2015 - Dated:- 2-11-201 .....

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rned advocates Mr. B. J. Priyadarshi and Mr. M. R. Molavi, however, subsequently, the petitioner had informed the learned advocates that he did not desire to be represented through them and had appointed one Mr. Manubhai Hargovanbhai Patel to plead in the matter as his legal power of attorney. 3. Under rule 31(A) of the Gujarat High Court Rules, 1993, a party-in-person is required to obtain a competency certificate from the registry. In this case, the registry has submitted a note stating that t .....

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sted in deciding whether or not to allow the power of attorney holder to appear on behalf of the petitioner without the requisite certification from the registry, this court has permitted him to appear and argue on behalf of the petitioner. 5. It is the case of the petitioner that his income being below the taxable limit, he was never liable to file an income tax return under the provisions of the Act. That a notice dated 27th March, 2015 came to be issued by the Income Tax Officer, Ward No.1, M .....

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ised the following contentions:- (i) The notice is not served in accordance with law. (ii) The notice is not in a prescribed form. (iii) The Assessing Officer being the below rank of Assistant Commissioner of Income Tax, he has no jurisdiction to issue the notice under section 148 of the Act. (iv) Ask for the reasons recorded prior to issuance of the notice. (v) The notice is barred by the law of limitation. (vi) Permission of the Joint Commissioner prior to issuance of the notice to be furnishe .....

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paragraph 3.8 of the memorandum of petition. It appears that the petitioner has also addressed a letter dated 10.09.2015 to the first respondent requesting to take directions under section 144 of the Act from Range Joint Commissioner. The petitioner has also addressed a letter dated 16.09.2015 to the first respondent, wherein along with other contentions it was stated that he was present on 16.01.2015 for his matter, but he (the Income Tax Officer) did not have the time to attend to the petitio .....

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ner of Income Tax, Patan Range, Patan pursuant to the notice issued under section 148 of the Act stating that the first notice had been issued by the Income Tax Officer, Ward No.1, Mehsana, who had no jurisdiction to issue such a notice and that the subsequent notice was issued by the first respondent. Various other grounds were also raised in the said letter. 8. The petitioner has, in the aforesaid backdrop, challenged the impugned notice dated 27.03.2015 issued under section 148 of the Act on .....

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of the Act, to submit that the Income Tax Officer being below the rank of Assistant Commissioner of Income Tax, was required to obtain the permission of the Chief Commissioner or the Commissioner prior to issuance of notice under section 148 of the Act and in the absence of such sanction, the notice is vitiated. It was further submitted that the notice is required to be issued within a period of four years from the end of the relevant assessment year, whereas in the facts of the present case, th .....

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nce with the provisions of section 127 of the Act, the impugned notice is without jurisdiction. 10. One of the main contentions raised on behalf of the petitioner is that the notice under section 148 of the Act has not been served upon the petitioner, but has been served upon one Sitaben Viththalbhai Patel, mother of the petitioner, and hence, the notice has not been duly served upon the petitioner. Reliance was placed upon the decision of the Supreme Court in the case of Commissioner of Income .....

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t was right in holding that the notice in question was invalid and as such, the Income Tax Officer had no jurisdiction to revise the assessment of the assessee for the year 1948-49. Reliance was also placed upon the decision of the Madras High Court in the case of Jayanthi Talkies Distributors v. Commissioner of Income Tax, (1979) 120 ITR 576 (Mad.), for the proposition that the notice prescribed by section 34 of the Indian Income Tax Act, 1922 for the purpose of initiating reassessment proceedi .....

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of the partners of the firm had been personally served with the notice and the service of the notice was only on the manager of the firm. The manager, on whom the notice had been served, had no specific or written authority to receive the notice. The court held that when the statute provides that a notice should be served in a particular mode, it is not possible to hold that there had been a proper service of notice merely from the fact that the person to whom the notice had been addressed had r .....

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(All) for the proposition that the service of the notice under section 21 of the U. P. Sales Tax Act is not a mere procedural requirement, but is a condition precedent. If no notice is issued or the notice issued is shown to be invalid or no notice has been served on the dealer, the proceedings and the consequential order under section 21 will be illegal and void irrespective of the fact that the dealer gets knowledge of the proceedings under section 21. The court held that the clear intention .....

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inherent jurisdiction over the subject matter of issue, the parties cannot by their mutual consent convert it into a proper judicial process although they may constitute the Judge their Arbiter and be bound by his decisions on the merits when these are submitted to him. It was submitted that therefore, when the Income Tax Officer, Mehsana did not have the jurisdiction to issue notice, it is not even open for the parties to confer jurisdiction upon him by mutual consent. Reference was also made .....

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d in the said notice. The attention of the court was invited to Annexure P to the petition, at page 24, to submit that the petitioner falls under the jurisdiction of Ward No.4, Patan and therefore, the Income Tax Officer, Mehsana did not have the jurisdiction to issue notice to the petitioner. It was, accordingly, urged that the impugned notice stands vitiated on the ground of lack of jurisdiction, being vague, as well as on the ground that the notice has not been duly served upon the petitioner .....

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pears that there was a change in the territorial jurisdiction and hence, the case was transferred to the Income Tax Officer, Ward No.4, Patan, who was conferred jurisdiction in view of the change in territorial jurisdiction. Accordingly, the Income Tax Officer, Ward No.4, Patan issued notice under section 142(1) read with section 129 of the Act calling upon the petitioner to file return of income within 30 days of receipt of the notice as well as calling upon him to file certain details. It is i .....

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ord to show that the second respondent did not have jurisdiction over the petitioner at the time of issuance of the impugned notice. 13. Pursuant thereto, the petitioner, by a communication dated 18.08.2015 addressed to the Income Tax Officer, Ward No.4, Patan, stated that the notice was served on 03.04.2015 to Sitaben V. Patel, which was handed over to him on 06.04.2015 and hence, the notice is not served properly and that the law of limitation bars the notice. Various other grounds were taken .....

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roceedings ex-parte under section 144 of the Act. The petitioner subsequently addressed a letter dated 04.09.2015 to the Income Tax Officer, Patan stating that he has omitted his reply dated 27.08.2015 and that unless he replies to his letter, he declines to entertain any other notice/letters. He has further cautioned the Income Tax Officer that he must bear in mind that he cannot travel beyond the Income Tax Act. By a communication dated 07.09.2015 addressed to the first respondent, the petitio .....

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pplication under the Right to Information Act calling for certain information on 09.09.2015. The petitioner, through his power of attorney holder, addressed a letter dated 10.09.2015 to the first respondent asking him to take advice/instructions under section 144A of the Act from the Joint Commissioner of his range with reference to the submissions made by him. A communication dated 16.09.2015 addressed by the petitioner to the first respondent has been annexed to the petition (Annexure J ), whe .....

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mmunication dated 18.09.2015 addressed to the petitioner, the first respondent informed the petitioner that the notice under section 148 of the Act had been duly served upon him personally on 30.03.2015 and was also sent by RPAD post on 27.03.2015 and thus, it is a valid service of notice. Insofar as the request for reasons is concerned, the petitioner was informed that the reasons for reopening of assessment under section 147 shall be given only after the assessee files return in response to no .....

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A perusal of the impugned notice dated 27.03.2015 indicates that the same is in the normal format in which the notices under section 148 of the Act are generally issued. Under the circumstances, the contention that the impugned notice is vague and not in the prescribed format, does not merit acceptance. 15. Insofar as reliance placed upon the provisions of section 151 of the Act is concerned, on a plain reading of the provisions of section 151, it is evident that the same relate to a case where .....

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year under consideration, nor has any assessment has been framed under section 143(3) of the Act, under the circumstances the provisions of section 151 of the Act would not be attracted. 16. Insofar as the invalidity of the service of notice is concerned, a perusal of the cause title of the petition reveals that the address of the petitioner is shown to be 3, Vishwakarma Society, Unjha, District Mehsana . A perusal of the notice issued under section 148 of the Act clearly shows that the same is .....

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o be effected on him at his residence and there is no likelihood of his being found at the residence within a reasonable time and he has no agent empowered to accept service of the summons on his behalf, service may be made on any adult member of the family, whether male or female, who is residing with him. The Explanation thereto provides that a servant is not a member of the family within the meaning of the said rule. From the facts of the present case, as noted hereinabove, it is manifest tha .....

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a period of six years from the end of the relevant assessment year. However, in the present case no assessment has been framed under section 143(3) of the Act, under the circumstances, the proviso to section 147 of the Act would not be attracted. On an overall view of the matter, it appears that the petitioner has proceeded on a misconception of law and not in terms of the provisions of the Act and the principles laid down by judicial pronouncements in that regard. The petitioner should have be .....

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