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TMI Blog2016 (8) TMI 1615X X X X Extracts X X X X X X X X Extracts X X X X ..... the Income Tax Officer, Ward 6(3) who made the original assessment had no jurisdiction over the case of the Assessee and therefore the assessment is null and void ab initio. 4. The Ld. Income tax Officer, Ward 6(4) who made the remanded assessment had no jurisdiction over the case of the Assessee and therefore the assessment is null and void ab initio. 5. The ld. Commissioner of Income Tax ( Appeals)-IX New Delhi [ hereafter the CIT(A)] erred in no allowing electricity expenses of Rs. 5,07,33,033( on mercantile basis of accounting) against claim/debit to profit and loss account of Rs. 4,91,77,188( on cash basis of accounting). Without prejudice and alternatively, the ld. CIT(A) erred in upholding the addition of Rs. 10,72,022 being prior period, and without prejudice the same is excessive . 6. The Ld. CIT(A) erred in upholding the addition ofRs.7,35,000 being unsecured loans., 7. The Ld.CIT(A) erred in upholding charging of interest uls234B. 234D and 244A of the Act and without prejudice the same are excessive. The Ld. CIT(A) failed to appreciate that section 234D was introduced with effect from 01.06.2003 and being prospective is applicable from A.Y. 2004-05, as has been h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal. 5. At the time of hearing, Ld. A.R. of the Assessee stated that notice u/s. 143(2) of the Income Tax Act, 1961 was not served upon the assessee within the time permitted by proviso to section 143(2) of the Act and without prejudice the same were also not addressed to the "the principal Officer" as required by section 282(2)(b) of the Act and therefore, the same and consequential assessment is null and void ab initio. In this regard, he stated that the return for AY 2001-02 was filed on 31.10.2001; the period of limitation for service of notice u/s 143(2) expired on 31.10.2002, hence, such notice had to be mandatorily served by 31.10.2002; however, admittedly, the first notice was issued on 16.09.2002; the said notice was sent by regd. post and admittedly returned back unserved on 21.9.2002 without any postal remark; according to A.O., another notice was issued and served through process server and inspector on 26.9.2002; but there is no entry in the order sheet to this effect; according to A.O., another notice was issued and served through process server and inspector on 28.10.2002; but there is no entry in the order sheet to this effect also; the next notice is dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... our attention towards the order sheet of the assessment records and established that AO has not adopted the prescribed procedure for serving the notice u/s. 143(2) through affixture. He has also cited the various case laws of the Hon'ble Supreme Court of India and the Hon'ble High Courts and especially draw the attention towards the judgment of the Hon'ble Supreme Court of India in the case of CIT vs. Ramendra Nath Ghosh 82 ITR 888 SC and CIT Vs. Naveen Chander 323 ITR 242 (P&H). In view of the above, he requested that assessment in dispute may be cancelled by accepting the appeal filed by the assessee. 6. On the contrary, Ld. DR opposed the aforesaid request of the Ld. A.R. of the Assessee. He relied upon the orders of the authorities below and requested that the same may be upheld. 7. We have heard both the parties and perused the relevant records available with us. We find that Ld. CIT(A) has adjudicated the issue as under:- "4.6 I have examined the affidavit filed by Sh. Prem Chabbra, director of the appellant company. The affidavit does not speak as to what was the address of the appellant company & how and in what manner the notices served by AO through affixture were not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there was any default in service of notice u/s 143(2)(ii) by the AO which was validly served on the assessee. 4.6.3 It is also observed that similar ground was raised by the appellant in appeal filled before my predecessor which was disposed by him vide order dated 21-10-2004 observing as under: "5.4 I have considered the submission of the Appellant and have perused the assessment record. I find the submissions of the Appellant are devoid of merits. The Income Tax Officer sent the notice by registered post, which is a permissible mode of service. The Appellant has not denied the fact of dispatch of notice by registered post; rather the Appellant has accepted this fact. The Income Tax Officer, through not required, served the notice by affixture non only once but twice. I, therefore, reject this ground of appeal. " 4.6.4 After considering the averments made by the AO in the assessment order, Submission made by the appellant, remand report of the AO & rejoinder filed by the appellant and after examining the notices served through affixture, I do not find any substance in the submissions made by the appellant, as these notices have been found duly served through affixture whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence at the time when service is sought to be effected on him at his residence and there is no likelihood of his being found at the residence within a reasonable time and there is no agent empowered to accept service of the summons on his behalf, nor any other person on whom service can be made, the serving officer shall affix a copy of the summons on the outer door or some other conspicuous part of the house in which the defendant ordinarily resides or carries on business or personally works for gain, and shall then return the original to the court from which it was issued, with a report endorsed thereon or annexed thereto stating that he has so affixed the copy, the circumstances under which he did so, and the name and address of the person (if any) by whom the house was identified and 'whose presence the copy was affixed. 7.3 We further reproduce herebelow the Order V Rule 20 of the CPC: 20. Substituted service.- (1) Where the court is satisfied that there is reason to believe that the defendant is keeping out of the way for the purpose of avoiding service, or that for any other reason the summons cannot be served in the ordinary way, the court shall order the summons to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the procedure as laid down under Section 282 of the Income Tax Act, 1961; under order V Rule 17 & 20 of the CPC, hence, the Service of Notice is illegal and void ab inito. Our view is fully supported by the following judgments:- a) CIT vs. Ramendra Nath Ghosh 82 ITR 888 SC - the Hon'ble Supreme Court held as under:- "The contention of the assesses was that at the relevant time they had no place of business. The report of the serving office did not mention the names and addresses of the person who identified the place of business of the assesses. That officer did not mention in his report nor in the affidavit filed by him that he personally knew the place of business of the assessee. Hence, the service of notice must be held to be not in accordance with the law. The possibility of his having gone to a wrong place could not be ruled out. Hence, it was not possible to hold that the assesses had been given a proper opportunity to put forward their case as required by section 33 B. The question whether the assessee had been served in accordance with law or not was essentially a question of fact. The Act provides for an appeal against the order under section 33B. Normally, the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ads thus: "13. So, however, in the report of the inspector/notice server, who claimed to have affixed the notice, there is no evidence of any independent local person having been associated with the identification of the place of business of the assessee. in fact such report is not witnessed by any person at all. Evidently, it is in clear violation of the mandate of rule 17 of Order V of the Civil Procedure Code, which lays down the procedure to serve notice by affixture. It mandates that the serving officer shall affix the notice on the outer door or some other conspicuous part of the house in which the person ordinarily resides or carries on business or personally works for gain and shall thereafter report that he has so affixed the copy, the circumstances under which he did so and, the name and address of the person by whom the house was identified and in whose presence the copy was affixed. The impugned report of the Inspector/notice server is bereft of any such lawful requirements enshrined in the Code of Civil Procedure. in fact it would not be out of place to observe that there is no assertion even by the inspector/notice server that they had personally checked the busine ..... X X X X Extracts X X X X X X X X Extracts X X X X
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