TMI Blog2011 (1) TMI 1477X X X X Extracts X X X X X X X X Extracts X X X X ..... was not served in this case on the assessee, and which was mandatory before proceeding with the action under s. 148. 3. Briefly stated the facts of the case are that the assessee, which is a company by status, has been engaged since its inception in the business of manufacture of white crystal sugar and sale thereof. For the asst. yr. 1999-2000, the assessee filed its return disclosing net loss of ₹ 3,60,12,790 on 21st Dec., 1999. The said return was processed on returned loss under s. 143(1) of the IT Act, 1961 (In short the Act ) on 23rd March, 2000. The processing resulted in refund amounting to ₹ 1,92,539 which was allowed to the assessee company vide R.V.No. B-984602 on 28th April, 2000. Subsequently, it was noticed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Vide notice under s. 142(1) of the Act dt. 21st April, 2006, the assessee company was required to furnish details as mentioned in the said notice. The AO did not issue notice under s. 143(2) of the Act. However, the AO framed the assessment on 31st May, 2006 under s. 143(3)/148 of the Act determining net loss of ₹ 3,30,10,220. 4. Aggrieved by the order of the AO, the assessee carried the matter in appeal before the learned CIT(A). The assessee has raised a number of grounds before the learned CIT(A). However, the assessee also raised an additional ground before the learned CIT(A), which reads as under : Because in absence of mandatory notice under s. 143(2) having been served on appellant within the specified period, the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act was ever issued. It is now a trite law that to complete an assessment under s. 143(3)/147/158BC etc., the AO is duty-bound to issue notice under s. 143(2) of the Act. Reference in this regard is made to the following decisions : (i) Asstt. CIT Anr. vs. Hotel Blue Moon (2010) 35 DTR (SC) 1 If an assessment is to be completed under s. 143(3) r/w s. 158BC, notice under s. 143(2) should be issued within one year from the date of filing of block return' Omission on the part of the assessing authority to issue notice under s. 143(2) cannot be a mere procedural irregularity and the same is not curable. (ii) CIT vs. Rajeev Sharma (2010) 232 CTR (All) 303 : (2010) 40 DTR (All) 129 Reassessment 'Validity' Abs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k assessment under Chapter XIV-B' Non-issuance of notice is not a mere procedural irregularity and the same is not curable' No assessment could be made without issuing notice under s. 143(2) within the time specified' Notice having not been issued and the period of limitation having already expired, such notice cannot be issued' Tribunal not justified in remanding the case to the AO to cure the defect by issuing a fresh notice. (iv) Dy. CIT vs. Mahi Valley Hotels Resorts (2006) 201 CTR (Guj) 308 Hence when an assessment is framed under s. 143(3) of the Act by issuing statutory notice beyond the prescribed time-limit, the assessment would be bad in law and has to be quashed.' 3.4 Moreover, in s. 148 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ajeev Sharma (2010) 232 CTR (All) 303: (2010) 40 DTR (All) 129 never intended that the notice under s. 143(2) should be issued in all the cases where action under s. 148 is contemplated. But what the Hon'ble High Court intended was that the notice under s. 143(2) should be issued in those cases only where the assessee has filed a fresh return in response to notice under s. 148 of the Act and not in those cases where the return already filed is deemed to have been filed in response to notice under s. 148 of the Act. On the other hand, Shri Amit Shukla, advocate, learned counsel for the assessee submitted that before making assessment under s. 143(3) r/w s. 147 of the Act, the AO was obliged under the law to issue notice under s. 143(2) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the return filed in response to notice under s. 148 and thereafter issue notice under s. 143(2) before proceeding to decide the controversy regarding escaped assessment; non-issuance of notice under s. 143(2) after filing of return by assessee vitiated the reassessment proceedings. In the case of Hotel Blue Moon (supra), the Hon'ble Supreme Court ruled that if the AO, for any reason, repudiates the return filed by an assessee in response to notice under s. 158BC(a) of the IT Act, 1961 relating to a block assessment, the AO must necessarily issue notice under s. 143(2) of the Act within the time prescribed in the proviso to s. 143(2). In the case of Virendra Dev Dixit vs. Asstt. CIT (2010) 41 DTR (All) 43, the Hon'ble jurisdict ..... X X X X Extracts X X X X X X X X Extracts X X X X
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