TMI Blog2017 (11) TMI 317X X X X Extracts X X X X X X X X Extracts X X X X ..... learned lower authorities grossly erred in issuing notice u/s. 148 of the Incometax Act, 1961 which is issued without any reason to believe, based on Audit Objection, based on Change of opinion and thus the entire proceedings of reassessment deserves to have be quashed. 1.1. That the proceedings u/s. 148 of the Income-tax Act, 1961 suffers from non-issuance of notice u/s. 143(2) and the ld. CIT (A) quashed the assessment order on this ground only but on the other hand he has given directions to the ld. Assessing Officer to initiate fresh reassessment proceedings by issue of notice u/s 148 of the Act and such directions of the Id. CIT (A) is illegal, bad in law, beyond his jurisdiction and competence and which will lead to second round of reassessment proceedings against the assessee appellant and thus deserves to be quashed. 2. That on the facts and in the circumstances of the case, the ld. CIT (A) grossly erred in not deciding the grounds on merits of the case and he ought to have decided the case on merits of the case as well otherwise it will lead to second round of litigation against the assessee appellant. 2.1. That the learned Assessing Officer grossly erre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, and the other did not decide the same. Against this, the assessee is in further appeal before this Tribunal. 4. Ground nos. 1 to 2 are against the decision of the Ld. CIT(A) to give liberty to the Assessing Officer to the fresh assessment proceedings by issuing a notice u/s 148 of the Income Tax Act 1961 (hereinafter referred to as the Act). 4.1 Ld. Counsel for the assessee reiterated the submissions as made before the Ld. CIT(A) and submitted that once the reassessment found to be illegal, no liberty can be given to initiate fresh reassessment. There is no provision under the law to make reassessment twice. Further, he submitted that the Ld. CIT(A) has no power to remand the matter to the Assessing Officer, for making fresh assessment. 4.2 On the contrary, Ld. D/R supported the order of the authorities below. 4.3 We have heard the rival contentions, perused the material available on record and gone through the order of the authorities below. We find that Ld. CIT(A) has decided the issue of reopening as under:- ( ii) I have duly considered the submissions of the appellant, remand report of the AO and its rejoinder by the appellant, material placed on record a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hotel Blue Moon and other cases of various high courts and held as under: 12. The narration of facts as noted above by the Court makes it clear that no notice under Section 143(2) of the Act was issued to the Assessee after 16th December 2010, the date on which the Assessee informed the AO that the return originally filed should be treated as the return filed pursuant to the notice under Section 148 of the Act. 13. In DIT v. Society for Worldwide Interbank Financial Telecommunications [2010] 323 ITR 249 (Delhi), this Court invalidated an reassessment proceedings after noting that the notice under Section 143(2) of the Act was not issued to the Assessee pursuant to the filing of the return. In other words, it was held mandatory to serve the notice under Section 143(2) of the Act only after the return filed by the Assessee is actually scrutinized by the AO. 14. The interplay of Sections 143 (2) and 148 of the Act formed the subject matter of at least two decisions of the Allahabad High Court. In CIT v. Rajeev Sharma [2011] 336 ITR 6781[2010] 192 Taxman 197 (All.) it was held that a plain reading of Section 148 of the Act reveals that within the statutory period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 (3) of the Act, it is necessary to issue a notice under Section 143 (2) of the Act and in the absence of a notice under Section 143 (2) of the Act, the assumption of jurisdiction itself would be invalid. 16. In the same decision in Salarpur Cold Storage (P.) Ltd. (supra), the Allahabad High Court noticed that the decision of the Supreme Court in Hotel Blue Moon (supra) where in relation to block assessment, the Supreme Court held that the requirement to issue notice under Section 143(2) was mandatory. It was not a procedural irregularity and the same is not curable and, therefore, the requirement of notice under Section 143(2) cannot be dispensed with. 17. The Madras High Court held likewise in Sapthagiri Finance Investments v. ITO (2012] 25 taxmann.com 341/210 Taxman 78 (Mad.) (Mag.). The facts of that case were that a notice under Section 148 of the Act was issued to the Assessee seeking to reopen the assessment for AY 2000-01. However, the Assessee did not file a return and therefore a notice was issued to it under Section 142 (1) of the Act. Pursuant thereto, the Assessee appeared before the AO and stated that the original return filed should be treated as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pursuant to a notice under Section 148 of the Act, is fatal to the order of re-assessment. 20. Consequently, there is no legal infirmity in the impugned order of the ITAT. No substantial question of law arises. The appeal is dismissed. ( vi) In the case of PCIT vs. Silver Line [2016] 65 taxmann.com 137 (Del.) it has been held by the Hon'ble High Court that a reassessment order cannot be passed without compliance with the mandatory requirement of notice being issued by the AO to the assessee u/s 143(2) of the Act, ITAT was in the present case right in concluding that the reassessment orders in question were legally unsustainable. ( vii) In the instant case under consideration, it is an admitted fact that no notice u/s 143(2) of the Act was issued by the AO to the appellant when the appellant stated vide its letter dated 26.03.2015 that the original return of income filed on 31.07.2011 may be treated as return of income in compliance to notice issued u/s 148 of the Act. The issue of notice u/s 143(2) of the Act is mandatory in nature and since in the instant case under consideration, no notice u/s 143(2) of the Act was issued, the AO has no jurisdiction to ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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