TMI Blog2013 (11) TMI 1730X X X X Extracts X X X X X X X X Extracts X X X X ..... d invested an amount of ₹ 3 lakh in UTI Mutual Fund during the financial year 2004-05 relevant to the impugned assessment year and further since the assessee is not assed to income-tax, the Assessing Officer , as noted in the assessment order issued a notice u/s 142(1) on 30-8-2007 calling upon the assessee to submit his return of income for the impugned assessment year. In response to the said notice, the assessee filed his return of income on 15-11-2007 admitting nil income. During assessment proceedings, the Assessing Officer on examination of the bank accounts submitted by the assessee noted that there was cash deposit made by the assessee of ₹ 6,50,000/- on 8-9-2004. When the Assessing Officer asked the assessee to furnish the details of such deposit with source, the assessee submitted that the cash deposit of ₹ 6,50,000/-was out of earlier withdrawals over a period from Feb. 2002 to Sept. 2003. The Assessing Officer finding the explanation of the assessee to be not convincing enough, rejected the same and treated the cash deposit of ₹ 6,50,000/- as unexplained investment in terms of section 69 of the Act and added it to the income of the assessee. Bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation prescribed for completion of the assessment. According to the learned AR , this cannot be the intention of the legislature. The learned AR referring to the provision contained u/s 139, 153 and 147 of the Act submitted that all these provisions have to be construed harmoniously to find out the true intention of the legislature. It was contended that if a harmonious construction of the aforesaid provisions is made, then the logical conclusion would be the time limit for issuing a notice u/s 142(1) of the Act is one year from the end of the relevant assessment year. He therefore submitted that the notice issued u/s 142(1) of the Act having been issued after the expiry of one year from the end of the relevant assessment year, it is invalid in law and the assessment made consequent thereto is also not valid. 6. The learned Departmental Representative, on the other hand, submitted that there being no restriction imposed on section 142(1) of the Act on the Assessing Officer, as made out by the assessee, neither notice issued u/s 142(1) nor the assessment order passed pursuant thereto can be held to be invalid. 7. We have heard the submissions of the parties as well as the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are read together, the only rational conclusion would be the Assessing Officer can issue a notice u/s 142(1) any time before the time for completing the assessment as provided u/s 153(1) of the Act. It has been contended by the learned AR that if the provision of sec. 142(1) is interpreted literally it would lead to a situation where the Assessing Officer may issue the notice u/s 142(1) just one day prior to the time provided for completion of assessment u/s 153(1). It may happen in some cases, but in that case it will amount to a lack of adequate opportunity being granted to the assessee and court can set aside the assessment order by directing the Assessing Officer to do it again after affording reasonable opportunity. But certainly it will not make the notice void ab initio resulting in annulment of the assessment. However, in the present case, no such contingency arises as the Assessing Officer has issued a notice u/s 142(1) sufficiently ahead and assessment order was also passed well within the period of limitation. 8. Therefore, the provision of section 142(1) cannot be construed to mean that the Assessing Officer can issue a notice u/s 142(1) at any time after the end of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... retrospective effect from 1-4-1990. The aforesaid amendment as explained in the Notes on clauses to the Finance Bill, 2006 is reproduced below:- Clause 35 of the Bill seeks to amend section 142 of the Income-tax Act relating to inquiry before assessment. The existing provisions contained in clause (i) of sub-section (1) of said section provide that where a person has not made a return of income within the time allowed under sub-section (1) of section 139, the AO may serve a notice on him requiring him to furnish the return of income. It is proposed to amend the said clause (i) so as to provide that where a person has not made a return of income before the end of the relevant assessment year, the AO may serve a notice under this sub-section on him after the end of the relevant assessment year, requiring him to furnish return of income. This amendment will take effect from 1st April, 2006. It is further proposed to provide that the notice referred to in said sub-section for the purposes of said clause served after the end of the relevant assessment year commencing on or after 1st April, 1990 shall be deemed to be a notice served in accordance with the provisions of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The next issue raised in ground Nos. 2 and 4 is with regard to the addition of ₹ 6,50,000/- u/s 69 of the Act. 12. The learned authorised representative for the assessee submitted before us that the assessee left for Saudi Arabia in October, 1977 for employment and returned to India on 31-12-2002. It was submitted that he was visiting India once in a year or two on vacations during the above period. It was submitted that the assessee was maintaining a NRE account in SBI, Hyderabad for the purpose of making investment in real estate or to start some safe venture was withdrawing amounts from time to time from NRE account and the aggregate amount withdrawn from February 2002 to September, 2003 was at ₹ 19.77 lakhs. It was submitted that the assessee's family consists of himself, his wife and one son who was in 8th standard during relevant period. Further, the assessee was residing with his brother, after spending a reasonable amount for the maintenance of the family, the balance amount was available with the assessee. It was submitted that the cash deposit made in SB account on 8-9-2004 is out of amount withdrawn earlier and kept with him. The learned AR submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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