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2016 (6) TMI 117 - ITAT DELHI

2016 (6) TMI 117 - ITAT DELHI - TMI - Reopening of assessment - validity of service of notice u/s 148 which was never served upon the assessee - Held that:- Whenever a reassessment is sought to be made u/s 147, issuing and serving of a valid notice u/s 148 is a mandatory precondition. The onus lies on the Revenue authorities to prove that the notice was served on the assessee within the stipulated period. It is only if the said notice is served on the assessee that the assessing officer would be .....

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he Assessing Officer cannot be said to have been clothed with the jurisdiction to pass the assessment order. The mandate of section 148 is that notice should be served on the assessee, by prescribed mode of service, which has undeniably not been carried out in this case. In the absence of a valid service of notice u/s 148, the reassessment order passed by the Assessing Officer is illegal and void ab initio. See CIT vs Chetan Gupta [2015 (9) TMI 756 - DELHI HIGH COURT ] - Decided in favour of ass .....

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sessee is contained in Ground No. 2 which reads as under:- Because the Ld. CIT (A) erred in upholding the validity of service of notice u/s 148 which was never served upon the assessee, hence proceedings of reassessment are void ab initio. 2. The main controversy involved in the present appeal relates to the service of notice u/s 148 of the Income Tax Act, 1961 (hereinafter called the Act ). It is seen that the return of income was filed on 9.11.2000 and the same was processed u/s 143(1) of the .....

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he Act. An information was received from DIT (lnv.), New Delhi vide letters No, DIT (lnv.)-1/2006- 07/AE/1322 & 1536 dated 31.01.2007 and 5.2.2007 respectively that the assessee company is in receipt of accommodation entries totaling to ₹ 5,00,000/-. Accordingly, notice u/s 148 of the Act dated 28,03.2007 was issued and sent through regd. post on 29 03.2007 as well as served personally on the address mentioned in the return of income viz. 82-D, DDA Flats. Jhilmil Colony, Vivek Vihar, D .....

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pon query through AST, it was gathered that the assessee s latest address is G-11, Palika Palace, Panchkuian Road, New Delhi. Accordingly, a show cause letter dated 12.10.07 was issued and sent to the latest address, fixing the case for hearing on 24.10.07 but the same also remained uncomplied with. A final opportunity was provided to the assessee vide this office letter dated 13.11.2007 thereby fixing the case for hearing on 22.11.07 which was served through affixture at the last known address .....

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dated 28.03.2007 issued u/s 148 of the Act (placed at page 5 of the paper book) was not the correct address of the assessee. The Ld. AR submitted that the said notice has been issued at the address E-73, Jaswant Marg, Sangam Vihar, New Delhi and is alleged to have been received by one Ms. Suman Lata. He submitted that the correct address of the assessee company was G-11, Palika Palace, Panchkuian Road, New Delhi which was very much available on the record of the Department as was evident from th .....

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of the company and, therefore, the service of notice to her, as claimed by the Department, was not a valid service of notice on the assessee company. The Ld. AR relied on the decision of the Hon'ble Delhi High Court in the case of Pr.CIT-1 vs Atlanta Capital Pvt. Ltd. in I.T.A. No. 665/2015 for the proposition that reassessment proceedings without proper service of notice u/s 148 of the Act would be void ab initio and submitted that the entire re-assesssment proceedings in the assessee s ca .....

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ings u/s 148 of the Act. He also submitted that this kind of defect, if at all, cannot be used to vitiate the entire reassessment proceedings and submitted that the order of the Ld. CIT (A) does not call for any interference. 5. We have heard both the parties and have also perused the records. It is mentioned in the assessment order that notice u/s 148 was issued and served personally on the address mentioned in the Return of Income viz. 82-D, DDA Flats, Jhilmil Colony, Vivek Vihar, New Delhi an .....

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ory precondition. The onus lies on the Revenue authorities to prove that the notice was served on the assessee within the stipulated period. It is only if the said notice is served on the assessee that the assessing officer would be justified in taking up proceedings against the assessee. If no notice is issued, or if the notice issued is shown to be invalid, then the proceedings taken up by the assessing officer would be illegal and void. In this case, it is very much apparent that the notice u .....

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se. In the absence of a valid service of notice u/s 148, the reassessment order passed by the Assessing Officer is illegal and void ab initio. The Hon'ble Delhi High Court in CIT vs Chetan Gupta (I.T.A. No. 72 of 2014) has discussed the entire law and summarised the legal position in its judgement dated 15th September, 2015 as under:- (i) Under Section 148 of the Act, the issue of notice to the Assessee and service of such notice upon the Assessee are jurisdictional requirements that must be .....

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