TMI Blog2017 (8) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... indra Nath Mishra-II, JJ. For the Appellant : D.D.Chopra, Mr. Sidharth Dhaon, Alok Mathur For the Respondent : Mudit Agarwal ORDER ( Delivered by Hon'ble Sudhir Agarwal, J. ) 1. Income Tax Appeal (hereinafter referred to as the ITA ) No. 169 of 2009 under Section 260A of Income Tax Act, 1961 (hereinafter referred to as the Act, 1961 ) has been filed by Commissioner of Income Tax (Central), Kanpur (hereinafter referred to as the Revenue ) aggrieved by judgment and order dated 30.06.2009 passed by Income Tax Appellate Tribunal, Lucknow Bench 'A', Lucknow (hereinafter referred to as the Tribunal ) in ITA No. 283/Luc/2009 relating to Assessment Year 2006-07. Tribunal has dismissed appeal preferred by Assessee and confirmed judgment of Commissioner of Income Tax (Appeals) (hereinafter referred to as the CIT(A) ) holding that for Assessment Year under consideration, Assessing Officer (hereinafter referred to as the AO ) has no jurisdiction to pass an order under Section 153A of Act, 1961. In taking above view Tribunal has followed its earlier judgment dated 29.05.2009 passed in ITA No. 232/Luc/2009, relating to Assessment Year 2006-07, which is the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rn of income for Assessment Year 2006-07 was filed by Assessee showing income of ₹ 62,250/-. Questionnaire in the form of notice under Section 142(1) of Act, 1961 was issued to Assessee on 06.11.2007 and served on 22.11.2007. For compliance, date was fixed on 04.12.2007. Thereafter a show cause notice was served on Assessee on 13.12.2007. Assessment was completed on 28.12.2007 computing total income at ₹ 8,93,210/-. In assessment order, in the column for Section under which order is passed Assessing Officer wrote Sections 143(3)/153A. 6. Aggrieved by assessment order, Assessee preferred appeal before CIT(A). Appeal was allowed vide order dated 04.02.2009 on the ground that assessment order was wrongly passed under Section 153A though it should have been under Section 143(3). Thereagainst Revenue preferred appeal before Tribunal but same has been dismissed vide impugned judgment dated 29.05.2009. Findings of Tribunal while dismissing appeal, contained in paras 16, 17 and 18, are as under: 16. After careful consideration of rival submission and facts and circumstances of the case and various decisions including the decision referred to by the Ld. D.R., we are of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, as the case may be, and if it is so, then the assessment of assessment year relevant to that previous year can be made only under section 143(1) or 143(3) or 144 or 147 of the Act but cannot be made under section 153A of the Act. 18. In view of the above discussion and the reasons stated by the CIT(A), we are of the opinion that the CIT(A) was quite justified in holding that for assessment year under consideration, the AO had no jurisdiction to pass an order under section 153A of the Act. The order of the CIT(A) is, therefore, upheld. (emphasis added) 7. Learned counsel for Revenue contended that Assessment order mentions two sections, i.e., 143(3)/153A. He submitted that assessment order in fact has been passed under Section 143(3) after serving notice under Section 142(1) and mention of Section 153A is only by way of abundant precaution and also to identify that it was a case in which assessment has been made after search and to show year of search with respect to assessment. He further submitted that pursuant to notice issued under Section 142(1), return of income was filed by Assessee and this also shows that it was not in response to any notice under Section 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the premises of Shri Siraj Iqabal and Shri Suhail Ahmad. (ii) Warrant of authorization issued in the name of Shri Siraj Iqbal was signed by the Director of Income TAx (Inv.), Kanpur. (iii) Warrant of authorization issued in the name of Shri Suhel Iqbal was signed by the Addl. Director of Income Tax (Inv.). (iv) Warrant of authorization issued in the name of Sri Monis Iqbal and Smt. Nida Ambreen Beg in respect of Locker No. 69, Allahabad Bank was signed by the Addl. Director of Income Tax (Inv.) (v) Notice u/s 153C issued on 15.10.2007/ 14.11.2007. (vi) Return in response to notice u/s 153A was filed on 27.12.2007. (vii) No notice u/s 143(2) was issued and served on the assessee. (viii) Assessment order u/s 153A/143(3) passed on 28.12.2007. ITA No. 169 of 2009 (i) Date of Search-10.11.2005 (ii) Warrant of authorization issued in the name of Shri Siraj Iqbal. (iii) Warrant was issued to search premises at 118/86 Kha, Cantt. Road, Lucknow. (iv) Notice u/s 153A was issued on the appellant on 23.10.2007. (v) Return in response to notice u/s 153A was finalized on 27.12.2007. (vi) No notice u/s 143(2) was issued and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : Provided that such revival shall cease to have effect, if such order of annulment is set aside. Explanation.--For the removal of doubts, it is hereby declared that- (i) save as otherwise provided in this section, section 153B and section 153C, all other provisions of this Act shall apply to the assessment made under this section; (ii) in an assessment or reassessment made in respect of an assessment year under this section, the tax shall be chargeable at the rate or rates as applicable to such assessment year. (emphasis added) 12. The aforesaid provision, as is evident from bare reading, clearly start with a non-obstante clause having overriding effect over Sections 139, 147, 148, 149, 151 and 153 and empowers AO to assess or re-assess total income of six assessment years immediately preceding to assessment year, relevant to previous year in which such search is conducted or requisition is made. First proviso to sub-section (1) further provides that AO shall assess or re-assess total income in respect of each assessment year, falling within six assessment years. 13. Section 142 lays down procedure with regard to inquiry before assessment. Notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere the loss declared in the return by the assessee is adjusted but no tax or interest is payable by, or no refund is due to, him: Provided further that no intimation under this sub-section shall be sent after the expiry of one year from the end of the financial year in which the return is made. Explanation.--For the purposes of this sub-section,-- (a) an incorrect claim apparent from any information in the return shall mean a claim, on the basis of an entry, in the return,-- (i) of an item, which is inconsistent with another entry of the same or some other item in such return; (ii) in respect of which the information required to be furnished under this Act to substantiate such entry has not been so furnished; or (iii) in respect of a deduction, where such deduction exceeds specified statutory limit which may have been expressed as monetary amount or percentage or ratio or fraction; (b) the acknowledgement of the return shall be deemed to be the intimation in a case where no sum is payable by, or refundable to, the assessee under clause (c), and where no adjustment has been made under clause (a). (1A) For the purposes of processing of retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... afterwards as may be, after hearing such evidence and after taking into account such particulars as the assessee may produce, the Assessing Officer shall, by an order in writing, allow or reject the claim or claims specified in such notice and make an assessment determining the total income or loss accordingly, and determine the sum payable by the assessee on the basis of such assessment; (ii) issued under clause (ii) of sub-section (2), or as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by an order in writing, make an assessment of the total income or loss of the assessee, and determine the sum payable by him or refund of any amount due to him on the basis of such assessment: Provided that in the case of a-- (a) research association referred to in clause (21) of section 10; (b) news agency referred to in clause (22B) of section 10; (c) association or institution referred to in clause (23A) of section 10; (d) institution referred t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Officer. (emphasis added) 15. As we have already noticed, this fact is not disputed that no notice under Section 143(2) was ever issued. Tribunal has found that notice under Section 143(2) does not give any jurisdiction to AO to make assessment under Section 143(3) but it is gathered by AO just after furnishing the return of income by Assessee under Section 139 or on issuance and service of notice under Section 142(1) requiring Assessee to furnish return of income or on notice issued under Section 148 of Act, 1961. However, notice under Section 143(2) is a provision obligatory to comply before making assessment under Section 143(3) or Section 144, as the case may be. 16. Effect of non-issuance of notice under Section 143(2) was considered in ACIT and another vs. Hotel Blue Moon, 2010(321) ITR 362 (SC), where Court has said as under: An analysis of this sub-section indicates that, after the return is filed, this clause enables the Assessing Officer to complete the assessment by following the procedure like issue of notice under section 143(2)/142 and complete the assessment under section 143(3). This section does not provide for accepting the return as provided under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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