TMI Blog2020 (4) TMI 847X X X X Extracts X X X X X X X X Extracts X X X X ..... course of official duty by the AO, except for the fact that notices were issued on 05.06.2009, there is not a whisper even if the said notices were served upon the assessee. Merely producing the carbon copy of notice and dispatch register entry does not prove service of notice on the assessee. Service of notice u/s 148 dated 05.06.2009 for AYs 2006- 07 2007-08 and service of notice dated 24.09.2009 u/s 142 (1) in AY 2008-09 is not proved to have been effected upon the assessee in accordance with provisions contained under section 282 (1) of the Act read with order under Rule XII and Order III Rule 6 of CPC, 1908 which is a jurisdictional pre-condition to finalize the reassessment and as such, Revenue has failed to prove the proper service of notice u/s 148 - Decided against revenue. - ITA No.5853/Del./2016, ITA No.5854/Del./2016, ITA No.5855/Del./2016, ITA No.7343/Del./2018, ITA No.7344/Del./2018, ITA No.7345/Del./2018 - - - Dated:- 24-2-2020 - Shri O.P. Kant, Accountant Member And Shri Kuldip Singh, Judicial Member For the ASSESSEE : Shri K.R. Manjani, Advocate For the REVENUE : Shri Munesh Kumar, CIT DR ORDER PER KULDIP SINGH, JUDICIAL MEMBER : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e penalty even though the assessment is void due to non service of notice u/s 148. On this account appeal against assessment is pending in Hon'ble Tribunal. Learned A.O. as well as CIT appeal are silent and not indicating or showing any proof of service of notice u/s 148 consequently very basis of imposing penalty is wrong and is without any foundation. It is prayed that penalty levied may kindly be cancelled. ITA Nos.5853, 5854 5855/Del/2016 AYs : 2006-07, 2007-08 2008-09 4. Briefly stated the identical facts necessary for adjudication in all the aforesaid appeals at hand are : Assessee did not file return of income for AYs 2006-07, 2007-08 2008-09. In AYs 2006-07 2007-08, proceedings u/s 147 were initiated vide notices dated 05.06.2009. Notices u/ss 148 142 (1) of the Act were also issued in all the aforesaid years and stated to have been served upon the assessee. Assessee is a Director in a company, M/s. Alpha Bhoj Ltd. and also running a proprietorship concern in the name of M/s. Alpha Associates. On failure of the assessee to appear, Assessing Officer (AO) proceeded to frame the assessment u/s 254/144 of the Act by making addition of &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued u/s 148 in AYs 2006-07 2007-08 and notice issued u/s 142 (1) in AY 2008-09 were never served upon. 9. At the very outset, ld. AR for the assessee sought to decide the legal issue as to the service of the notice u/s 148 raised vide ground no.3, issue which was remitted back by the Tribunal earlier to decide afresh by the AO. 10. Undisputedly, assessee has not filed return of income for AYs 2006-07, 2007-08 2008-09. It is also not in dispute that to initiate the reopening u/s 147 of the Act, service of notice u/s 148 is a mandatory provision. It is also not in dispute that assessee stated to have not appeared before the AO during initial assessment on the ground that he had not received any notice qua the assessment proceedings. 11. In the backdrop of the aforesaid facts and circumstances of the case, the first question to be decided in this case is :- as to whether notices dated 05.06.2009 stated to have been issued by the AO for AYs 2006-07, 2007-08 2008-09 were served upon the assessee? 12. In order to decide the aforesaid issue, assessment records were summoned and perused by the Bench with the assistance of the ld. AR for the assessee as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ebuttable presumption and on denial of receipt of the registered letter from DDA, appellant discharged his onus and the onus reverted back to respondent to prove such service by either examining postal authorities or obtaining a certificate from them showing that the registered article had been deliver to and had been received by the appellant and it was on a mistake understanding of provisions of section 114(f) of the Evidence Act that the Commission came to the erroneous conclusion that allegation of unfair trade practice on the part of the respondent authority had not been proved and Respondent authority was unable to prove that service of the demand notice for the fifth and final installment had been effected on appellant. The allegation of unfair trade practice on the part of the respondent authority stood established, the impugned judgment of MRTP Commission hence set aside and the appeal allowed. 16. So, in view of the law laid down by Hon ble Supreme Court, it is bounded duty of the Revenue to prove the service of notice under sections 148 and 142(1) to the assessee. 17. Ld. DR for the Revenue supported the order passed by the AO as well as ld. CIT (A) by contending ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dressing, prepaying- and posting by Registered Post, a letter containing the document, and unless the contrary is proved, to have been effected 'at the time at which the letter would be delivered in the ordinary course of post. , D) Complainant has placed on record copy of speed post booking list. It is clear from the notices Ex.PW1/4, Ex.PW1/5, Ex.PW1/6. Ex.PW1/7 and speed post booking list, that all notices were sent to accused mentioning correct address. It is not the case of the accused that notices were sent at incorrect address. It is pertinent to mention here that summons issued to accused at the same address received back duly executed. Accused also furnished bail bond mentioning same address. Thus, keeping in view the aforesaid discussions and facts and circumstance of the case, it is held that the notices were duly served upon the accused. 5. In a large number of cases Hon'ble Courts of Record have held that if the notice is not received back within the period of 30 days of its issuance, it is to be held that the notice has been duly served upon the assessee. The order of Hon'ble Jurisdictional High Court of Delhi in CIT vs Yamu Industries Limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 25.12.09 None attended sd/- AO 23.9.10 Notice u/s 142(1) issued for 29.9.10 sd/- AO 29.9.10 None attended sd/- AO 27.12.10 Order u/s 144 passed sd/- AO Notice u/s 148 issued on 05.06.2009 for filing the return of income for the AY 2007-08 29.9.09 Notice u/s 142(1) issued for 15.10.09 sd/- AO 15.10.09 None attended sd/- AO 17.10.09 Notice u/s 142(1) issued for 25.12.09 sd/- AO 25.12.09 None attended sd/- AO 23.9.10 Notice u/s 142(1) issued for 29.9.10 sd/- AO 29.9.10 None attended sd/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 142 (1) upon the assessee for AY 2008-09 was concerned, again AO recorded in para 1 of the assessment order that, notice u/s 142 (1) issued and served upon the assessee on various dates , however no such dates have been brought on record on which the service of notice was effected upon the assessee. 25. With the assistance of the ld. DR for the Revenue, we have perused the assessment record in the presence of ld. AR for the assessee which does not contain any order sheet regarding this fact, if any such notice u/s 142 (1) was issued to the assessee. There is one notice dated 24.09.2009, with overwriting and copy of dispatch register showing dispatch of order on 25.09.2009 in the assessment record but the same is not sufficient to treat the service of assessee effected for the reasons recorded and discussed in the preceding paras for returning findings qua AYs 2006-07 2007-08. 26. So far as question of overwriting is concerned which is quite visible but does not go root of the case as many a times wrong date is written and then to avoid preparing of fresh notice, date is corrected by overwriting. Again as discussed in the preceding paras, there is no acknowledgement or an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice on the assessee as deemed service . Because there is not an iota of evidence on file if notice served upon the assessee was not received back within a period of 30 days of its issuance as neither record of postal authorities nor statement of any serving official of the postal department has come on record to prove that notice was served upon the assessee. Entire assessment proceedings ex-facie go to prove that AO at no stage tried and ensured if notice has been served upon the assessee. So, the judgment relied upon by the ld. DR for the Revenue is not applicable to the facts and circumstances of the case. 30. In view of what has been discussed above, we are of the view that service of notice u/s 148 dated 05.06.2009 for AYs 2006- 07 2007-08 and service of notice dated 24.09.2009 u/s 142 (1) in AY 2008-09 is not proved to have been effected upon the assessee in accordance with provisions contained under section 282 (1) of the Act read with order under Rule XII and Order III Rule 6 of CPC, 1908 which is a jurisdictional pre-condition to finalize the reassessment and as such, Revenue has failed to prove the proper service of notice u/s 148 of the Act on the assessee, as th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee under section 148 of the Act. Reassessment proceedings finalised by an Assessing Officer without effecting proper service of notice on the assessee under section 148(1) of the Act are invalid and liable to be quashed. Held accordingly, that no attempt had been made by the Department to serve the assessee at the address provided by him. All the notices were addressed to him at another address C/o. Kiran Cinema. Therefore, this was not a case where an attempt was made by the Department to serve the assessee at his known address, and upon not finding him there the Department learnt of the address where he would be found. Merely because other notices sent to the assessee group were received by the employees of Kiran Cinema it did not automatically lead to the inference that the assessee's place of business was also Kiran Cinema. In any event, there could not be an inference that V was duly empowered by the assessee to receive notices on his behalf. In the very first notice dated March 28, 2008 the endorsement made by V showed him describing himself as accountant, Kiran Cinema and nothing more. The assessee made a specific request to the Assistan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble, hence ordered to be quashed. Consequently, appeals filed by the assessee bearing ITA Nos.5853, 5854 5855/Del/2016 for AYs : 2006-07, 2007-08 2008-09 respectively are ordered to be allowed. ITA NOS.7343, 7344 7345/Del./2018 AYs : 2006-07, 2007-08 2008-09 38. On the basis of assessments framed u/s 254/144 of the Act making various additions in AYs 2006-07, 2007-08 2008-09, AO initiated the penalty proceedings u/s 271(1)(c) of the Act and reached the conclusion that assessee has concealed his income and furnished inaccurate particulars of income and thereby levied the penalty of ₹ 11,73,88,798/-, ₹ 4,02,71,624/- ₹ 54,51,082/- @ 100% for AYs 2006-07, 2007-08 2008-09. 39. In view of our findings on the quantum appeals filed by the assessee in the preceding paras vide which very assessments framed u/s 254/144 of the Act has been held to be void ab initio and ordered to be quashed, the penalty levied by the AO and sustained by the ld. CIT (A) is not sustainable as has been held by Hon ble Supreme Court in the case of KC Builders Anr. vs. ACIT 265 ITR 562 (SC) . Consequently, penalty levied by the AO and confirmed by the ld. CIT (A) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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