TMI Blog2021 (5) TMI 524X X X X Extracts X X X X X X X X Extracts X X X X ..... ursuant to reopening is absent and, therefore, the legal effect is that the order of the AO dated 25.07.2017 is null in the eyes of law. Rescue u/s 292BB - Section 292BB is only safeguarding the deficiency if any of the service/non-service of notice and it does not cure the omission of issuance of mandatory notice by the AO And since in this case, the AO has not issued the mandatory notice u/s. 143(2) of the Act as found by the Ld. Pr. CIT, the question of section 292BB coming to the rescue of the AO to pass the reassessment order does not arise. Respectfully taking note of the ratio of Laxman Das Kandelwal [ 2019 (8) TMI 660 - SUPREME COURT] , we find no merit in the contention of the Ld. DR that section 292BB of the Act would cure the defect of non-issuance of notice u/s. 143(2) of the Act and since the AO in this case had not issued notice u/s. 143(2) of the Act before framing the re-assessment u/s. 143(3)/147 of the Act as discussed supra, the order passed by the AO dated 25.07.2017 u/s. 143(3)/147 of the Act is without jurisdiction and, therefore, is non-est in the eyes of law and therefore, the Ld. Pr. CIT could not have interfered by exercising his power u/s. 263 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld. Pr. CIT in order to interfere with the reassessment order of AO by exercising his power u/s. 263 of the Act had found out that AO omitted to have issued notice u/s. 143(2) of the Act before framing the reassessment order, when the assessee has filed the return pursuant to notice u/s. 148 of the Act. Therefore, according to the Ld. AR, the assessment order framed by the AO dated 25.07.2017 u/s. 143(3)/147 of the Act without issuing mandatory notice u/s. 143(2) of the Act was without jurisdiction and, therefore, null in the eyes of law and consequently, the Ld. Pr. CIT cannot revise the order which is not existing in the eyes of law (i.e. AO's order dated 25.07.2017). Therefore, he prayed that the impugned order may be quashed. 5. Per contra, the Ld. CIT, DR Shri John Vincent D. Longstich submitted that since the assessee has already taken part in the proceedings before the AO he cannot now turnaround and challenge the non-issuance of notice u/s. 143(2) of the Act because AO's action of framing re-assessment order is saved by section 292BB of the Act and, therefore, the Ld. CIT, DR does not want us to interfere with the impugned order passed by the Ld. Pr. CIT. 6. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee is an individual carrying a business of brokerage. Search and seizure operation was conducted under Section 132 of the Act of 1961 on 11.03.2010 at his residential premises. The assessee submitted return of income on 24.08.2011, declaring total income of ₹ 9,35,130/-. The assessment was completed under Section 143(3) read with Section 153(D) of 1961 Act. ₹ 9,09,110/- was added on account of unexplained cash under Section 69 of 1961 Act. ₹ 15,09,672/- was added on account of unexplained jewellery. ₹ 45,00,000/- was added on account of unexplained hundies and ₹ 29,53,631/- was added on account of unexplained cash receipts. Aggrieved, the assessee filed an appeal before the Commissioner Income Tax (Appeal). The Commissioner of Income Tax (Appeal) deleted an amount of ₹ 7,48,463/- holding that jewellery found in locker weighing 686.4 gms stood explained in view of circular No. 1916 and further deleted the addition of ₹ 29,23,98,117/- out of ₹ 29,53,52,631/- holding that the correct approach would be to apply the peak formula to determine in such transaction which comes to ₹ 29,54,514/- as on 05.03.2010. Aggrieved, Revenue fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Tribunal held, while affirming the decision of CIT(A) that non-issue of notice under Section 143(2) is only a procedural irregularity and the same is curable. In the appeal filed by the assessee before the Gauhati High Court, the following two questions of law were raised for consideration and decision of the High Court, they were: (1) Whether on the facts and in circumstances of the case the issuance of notice under Section 143(3) of the Income Tax Act, 1961 within the prescribed time- limit for the purpose of making the assessment under Section 143(3) of the Income Tax Act, 1961 is mandatory? And (2) Whether, on the facts and in the circumstances of the case and in view of the undisputed findings arrived at by the Commissioner of Income Tax (Appeals), the additions made under Section 68 of the Income Tax Act, 1961 should be deleted or set aside? 4. The High Court, disagreeing with the Tribunal, held, that the provisions of Section 142 and sub-sections (2) and (3) of Section 143 will have mandatory application in a case where the assessing officer in repudiation of return filed in response to a notice issued under Section 158-BC(a) proceeds to make an inquiry. Acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was duly served and the assessee would be precluded from taking any objections that the notice was (a) not served upon him; or (b) not served upon him in time; or (c) served upon him in an improper manner. According to Mr. Mahabir Singh, learned Senior Advocate, since the Respondent had participated in the proceedings, the provisions of Section 292BB would be a complete answer. On the other hand, Mr. Ankit Vijaywargia, learned Advocate, appearing for the Respondent submitted that the notice under Section 143(2) of the Act was never issued which was evident from the orders passed on record as well as the stand taken by the Appellant in the memo of appeal. It was further submitted that issuance of notice under Section 143(2) of the Act being prerequisite, in the absence of such notice, the entire proceedings would be invalid. 8. The law on the point as regards applicability of the requirement of notice under Section 143(2) of the Act is quite clear from the decision in Blue Moon's case. The issue that however needs to be considered is the impact of Section 292BB of the Act. 9. According to Section 292BB of the Act, if the assessee had participated in the proceedin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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