TMI Blog2019 (12) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... , AR For the Respondent : Smt. Ranu Biswas, Sr. DR ORDER Per Shri S. S. Godara : These two assessee s appeals for assessment year2005-06 arise against the Commissioner of Income Tax Burdwan s separate orders dated 21.06.2016 16.12.2015 in Case No.150/CIT(A)/W-1/Suri/2010-11 and Case No.91/CIT(A)/Asl/Ward-1/Suri/2012-13, involving proceedings u/s 147/143(3) 154/147/143(3) of the Income Tax Act, 1961 (in short the Act ). Heard both the parties. Case files perused. 2. It emerges at the outset that these two appeals suffer from 345 days delay in filing. It is pleaded in assessee s condonation petition/affidavit dated 16.10.17 that his accountant in charge dealing with tax matters had quit the job without handing over all connected documents which could be found only in the year 2017. All these solemn averments have gone unrebutted from the Revenue s side. It is fair enough in neither disputing the above factual averments nor the case law Collector, Land Acquisition vs. Mst. Katji Ors [1987] 167 ITR 0471 (SC) the cause of substantial justice prevails over all technical aspects. We thus treat this 345 days delay i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... backdrop is as to whether such a section 143(2) notice issued before filing of return could be treated as sufficient compliance of a scrutiny assessment or not. We make it clear that hon ble apex court s landmark decision in ACIT vs. Hotel Blue Moon (2010) 3 SCC 259(SC) settled the law that any assessment framed in absence of section 143(2) notice is not sustainable and deserves to be quashed. This tribunal s coordinate bench s decision in Kamla Devi Sharma vs. ITO ITA No.1026/JP/2016 dated 06.02.2018 takes note of hon ble Delhi high court s decision in PCIT-08 vs. Shri Jai Shiv Shankar traders Pvt. Ltd. 383 ITR 448 - (Delhi) to hold that section 143(2) notice has to be issued after filing of the return only as under: In this case, notice u/s 148 was issued on 30.03.2010, in response to which no return of income was filed. On 01.10.2010, Ld.AO issued notice u/s 143(2), which was duly served. Subsequently notices u/s 142(1) were also issued on certain occasions. Authorized representative of assessee, on 16.12.2010 presented and stated that return of income filed u/s 139 may be treated as furnished in response to notice u/s 148. Assessment was completed vide order dated 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act was complied with or that on placing the objection the assessee had waived the notice for further processing of the reassessment proceedings. The fact that on the notice issued under section 143(2) of the Act, the assessee had placed its objection and reiterated its earlier return filed as one filed in response to the notice issued under section 148 of the Act and the Officer had also noted that the same would be considered for completing of 11 ITA 1026/JP/2016_ Kamla Devi Sharma Vs ITO assessment, would show that the Assessing Officer has the duty of issuing the notice under section 143(3) to lead on to the passing of the assessment. In the circumstances, with no notice issued under section 143(3) and there being no waiver, there is no justifiable ground to accept the view of the Tribunal that there was a waiver of right of notice to be issued under section 143(2) of the Act. Recently Jaipur bench of ITAT in the case of Cameron (Singapore) Pte Ltd Vs. ADIT in ITA No. 2/JP/14 vide orders dt. 27/7/2017 held that where notice u/s 143(2) is not served upon the assessee within the stipulated time period, the consequent order passed cannot be sustained. In that ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is no provision in the Act, which would allow an AO to treat the return which was already subject to a processing u/s 143(1) of the IT Act, as a return filed pursuant to a notice subsequently issued u/s 148 of the Act. However, once an assessee itself declare before the AO that his earlier return could be treated as filed pursuant to notice u/s 148 of the IT Act, three results can follow. Assessing Officer can either say no, this will not be accepted, you have to file a fresh return or he can say that 30 days time period being over I will not take cognizance of your request or he has to accept the request of the assessee and treat the earlier returns as one filed pursuant to the notice u/s 148 of the IT Act. In the former two scenarios, AO has to follow the procedure set out for a best of judgment assessment and cannot make an assessment under section 143(3). On the other hand, if the AO chose to accept assessee's request, he can indeed make an assessment under section 143(3). In the case before us, assessments were completed under section 143(3) read with section 147. Or in other words AO accepted the request of the assessee. This in turn makes it obligatory to issue notice u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice under Section 148 of the Act. The High Court observed that if thereafter, the AO found that there were problems with the return which required explanation by the Assessee then the AO ought to have followed up with a notice under Section 143(2) of the Act. (Para 17) As already further noticed, the legal position regarding Section 292BB has already been made explicit in the aforementioned decisions of the Allahabad 14 ITA 1026/JP/2016_ Kamla Devi Sharma Vs ITO High Court. That provision would apply insofar as failure of service of notice was concerned and not with regard to failure to issue notice. In other words, the failure of the AO, in re-assessment proceedings, to issue notice under Section 143(2) of the Act, prior to finalising the re-assessment order, cannot be condoned by referring to Section 292BB of the Act. (Para 18) The resultant position was that as far as the present case was concerned the failure by the AO to issue a notice to the Assessee under Section 143(2) of the Act subsequent to 16th December 2010 when the Assessee made a statement before the AO to the effect 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
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