TMI Blog2023 (5) TMI 1179X X X X Extracts X X X X X X X X Extracts X X X X ..... nterbank Financial, Telecommunications[ 2010 (4) TMI 43 - DELHI HIGH COURT] held that the provisions of section 143(2) make it clear that the notice can only be served after the AO has examined the return filed by the assessee. Thus, first notice issued under section 143(2) is not a valid notice as per the provisions of the Act. Also since the return of income was filed by the assessee on 31/03/2011, therefore, the time limit for issuance of notice under section 143(2) of the Act, as per proviso to clause (ii), was available only till 30/09/2011. Second notice under section 143(2) of the Act was issued on 17/10/2011, i.e. beyond the time limit prescribed under the provisions of section 143(2) of the Act. Therefore, the second notice is also invalid as per the provisions of section 143(2) of the Act. In any case, it cannot be disputed that the AO in the present case has accepted the return of income filed by the assessee and has concluded the assessment under section 143(3) read with section 147 of the Act. Further, the mandatory requirement of issuance of notice under section 143(2) of the Act is quite clear from the decision of the Hon ble Supreme Court in ACIT vs Hotel Blu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct first and if necessary thereafter, to deal with the other issues raised in the present cross-appeal. 5. The brief facts of the case pertaining to this issue are: The assessee is a company engaged in the business of sale and purchase of plot rights in respect of agricultural lands acquired by the Government of Maharashtra. A survey action under section 133A of the Act was conducted on 19/11/2010 at the business premises of the assessee and M/s US Realty Private Limited. Consequently, proceedings under section 147 of the Act were initiated and notice under section 148 of the Act was issued to the assessee on 24/11/2010. In response to the aforesaid notice, the assessee filed its return of income on 31/03/2011 declaring a total income of Rs.67,33,525. The Assessing Officer ( AO ) issued statutory notices under section 143(2) as well as section 142(1) of the Act and concluded the assessment vide order dated 24/08/2012 passed under section 143(3) read with section 147 of the Act computing the total income of the assessee at Rs.742,40,18,900 under normal provisions of the Act after making various additions. The learned CIT(A) vide impugned order granted partial relief to the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reads as under:- (2) Where a return has been furnished under section 139, or in response to a notice under sub-section (1) of section 142, the Assessing Officer shall, (i) where he has reason to believe that any claim of loss, exemption, deduction, allowance or relief made in the return is inadmissible, serve on the assessee a notice specifying particulars of such claim of loss, exemption, deduction, allowance or relief and require him, on a date to be specified therein to produce, or cause to be produced, any evidence or particulars specified therein or on which the assessee may rely, in support of such claim: Provided that no notice under this clause shall be served on the assessee on or after the 1st day of June, 2003; (ii) notwithstanding anything contained in clause (i), if he considers it necessary or expedient to ensure that the assessee has not understated the income or has not computed excessive loss or has not under-paid the tax in any manner, serve on the assessee a notice requiring him, on a date to be specified therein, either to attend his office or to produce, or cause to be produced, any evidence on which the assessee may rely in support of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 143(2) of the Act was issued on 17/10/2011, i.e. beyond the time limit prescribed under the provisions of section 143(2) of the Act. Therefore, the second notice is also invalid as per the provisions of section 143(2) of the Act. 12. As per the learned DR, since the return has been filed by the assessee beyond the time prescribed under the notice issued under section 148 of the Act, therefore, the said return is not a valid return and there is no requirement to issue notice under section 143(2) of the Act. In support of his submission, the learned DR placed reliance upon the following observations of the coordinate bench of the Tribunal in Sanjaykumar Ramkishan Mantri (HUF) (supra):- 20. We find no merit in the plea of the assessee in this regard. The issue is to be looked into from the perspective of the provisions of the Act and whether the assessee had followed the same in true spirit. The requirements of various provisions of the Act have to be complied with and in case the assessee fails to comply with the provisions, the whole machinery of assessment fails and the assessee cannot be allowed to do so. On the one hand, the assessee furnishes all the informa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f his income or the income of any other person in respect of which he is assessable under this Act during the previous year corresponding to the relevant assessment year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed; and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139 : 14. Thus, section 148 of the Act mandates that before making the assessment/reassessment under section 147, the AO has to serve notice on the assessee requiring him to furnish, within such period as may be specified in the notice, inter-alia, a return of his income. It is pertinent to note that section 148 of the Act further provides that such return should be in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed. Further, the provisions of the Act shall apply as if such return is a return required to be furnished under section 139 of the Act. Therefore, for all intent and purpose, the return filed pursuant to the notice issued under section 148 of the Act is treated as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income, required to be furnished by an assessee under this section and furnished beyond the period allowed shall not be deemed to be a return under section 139 of the Act. However, during the year under consideration, such a provision was not in the Act. Therefore, in view of the above, we find no merits in the aforesaid submission made by the learned DR. 17. In any case, it cannot be disputed that the AO in the present case has accepted the return of income filed by the assessee and has concluded the assessment under section 143(3) read with section 147 of the Act. Further, the mandatory requirement of issuance of notice under section 143(2) of the Act is quite clear from the decision of the Hon ble Supreme Court in ACIT vs Hotel Blue Moon [2010] 321 ITR 362 (SC). 18. Since in the present case, no valid notice under section 143(2) of the Act was issued by the AO and the assessment was completed without following the mandatory requirement of the Act, therefore, the entire assessment proceedings concluded under section 143(3) read with section 147 of the Act is rendered null and void, and is accordingly quashed. As we have quashed the assessment proceedings for this short reas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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