High Court
Case Details
ITA 1/2012 BEFORE THE HON’BLE MR.JUSTICE I.A. ANSARI THE HON’BLE DR.(MRS) JUSTICE INDIRA SHAH This is an appeal under Section 260A of the Income Tax Act, 1961, (in short, the Act) impugning the order, dated 19.03.2010, passed, by the learned Income Tax A ppellate Tribunal, Guwahati Bench, in ITA No.132 (Gau)/2007, for the assessment year 2002-2003, whereby the learned Tribunal has allowed the appeal of the asses see-respondent by taking the view that the assessment, which was challenged in t he appeal before the learned Tribunal, being without service of any notice under Section 143(2) or 142(1) of the Act, was illegal and void ab initio. 2. The appeal has been admitted, on the following substantial question of l aw for hearing: (cid:28)Whether on the facts and in the circumstances of the case, the Tribunal was jus tified and correct in law in declaring the assessment order as illegal and void ab initio and in canceling the same by holding that no notice under Section 143( 2) or 142(1) of the Income Tax Act, 1961, was served on the respondent and is no t the said decision per verse? (cid:29) 3. We have heard Dr. A.K. Saraf, learned Senior counsel, for the appellant,
Legal Reasoning
Having observed what have been indicated above, the learned Tribunal has pointed out that the question, which arises for consideration, is that out of t he two notices, one, issued under Section 143(2) and 142(1), dated 02.12.2003, b earing PAN No. AGNPG 1745 K and addressed to Smt. Gita Rani Ghosh, Shankar Mad hab Housing Society, had been served on the assessee-respondent or the notice, i ssued under Sections 143(2) and 142(1), bearing PAN No. ACKPG 5721 G and address ed to Smt. Gita Rani Ghosh, Prop. M/s. Ghosh Brothers, Soni Apartment, Ulubari, Barthakur Mill Road, Guwahati, which had been served on the assessee as per th e acknowledgement slip, copy of which had been placed by the Revenue at page 10 of its Paper Book. 9. Having noted the fact that the acknowledgement slip mentions the assessm ent year 2001-2002 and not the assessment year 2002-2003, the learned Tribunal h as pointed out, and in our view, not incorrectly, that doubt arises with regard to the assessment year for which the notices were served in terms of the acknowl edgement slip; whereas the CIT(A) had treated the mentioning of assessment year 2002-2003, in the acknowledgement slip, as a mere mistake and it was according t o him, the notices, for the assessment year 2002-2003, which were served on the assesee as per the acknowledgement slip, the learned Tribunal rejected this conc lusion of the CIT(A) by pointing out that this finding could have been accepted as correct, had the Revenue been able to establish from the records that the not ices, served upon the assessee-respondent herein, under the acknowledgement slip , were for assessment year 2002-2003, but no such evidence had been brought to t he learned Tribunal’s notice or has been placed on record. In the words of the l earned Tribunal, since it is well settled law that to establish the service of a notice upon the assessee, the initial onus is on the Revenue and unless and unt il this onus is discharged, the service of a notice simply, on the basis of pres umption and assumption, cannot be accepted. The learned Tribunal has also pointe d out that the acknowledgement slip, in the case at hand, clearly mentions the a ssessment year 2001-2002 and, therefore, in the absence of any material brought to its notice by the Revenue, it was unable to accept the CIT(A)’s finding that the assessment year, mentioned in the acknowledgement slip, was a mere mistake. 10. We may pause here to point out that the finding, so recorded, as indicat ed by the learned Tribunal, was a question of fact and this finding cannot be sa id to have been reached by ignoring any material fact or without any rationale o r reasonable cause having been assigned therefor. 11. Situated thus, the finding of fact, so recorded by the learned Tribunal, cannot be described as perverse. This apart, when the assessee-respondent had d enied receipt of the notice for the assessment year 2002-2003, it was for the Re venue to prove, by brining materials on record including witnesses, if any, that the notices sent to the assessee-respondent were for the assessment year 2002-2 Coupled with the above, the learned Tribunal, we find has also gone thro 003. This was, however, not done. 12. ugh various entries mentioned in the order sheet and pointed out as follows: (cid:28)7.5. So far as the present case is concerned, it is noted that the AO has menti oned the PA No. as ACPPG 9406M but seems to have cancelled the same later on bec ause another PA No.ACKPG 5721G has been mentioned. 7.6. The first entry in the order sheet dated 3rd September, 2003, is with respe ct to furnishing of return of income on 26th March, 2003, showing total income a t Rs.1,47,000/-and processing of the same on that very date under Section 143(1) of the Act. The second entry dated 2nd December, 2003, mentions the fact of sel ection of assessee’s case for scrutiny and issuance of notices under Section 143 (2) and 142(1) fixing the date of hearing on 04.06.2004. The month has been over written and seems to have been changed from 02 to 06. The third entry is dated 17.12.2004, which shows the issuance of a letter refixing the assessee’s case fo r hearing on 19th January, 2005. 7.7. From the aforesaid three entries though factum of issuance of notice under Section 143(2) and 142(1) of the Act on 2nd December, 2003, fixing the hearing o n 04.06.2004 is coming out but this do not support the CIT’s plea where he says that the assessment records including confidential folder shows that computer ge nerated notice u/s 143(2) of the Act with the same PAN AGPG 9406 M dated 2nd Dec ember, 2003, was generated which carried the name and address of Smt. Gita Rani Ghosh, A.K. Azad Road, Rehabari, Guwahati, and since the assessee’s PAN as well as address was not the same, manually generated notices u/s 143(2) for assessmen t year 2002-2003 was made in the name of Smt. Gita Rani Ghosh, Prop. M/s. Ghosh Brothers, Soni Apartment, Ulubari, Barthakur Mill Road, Guwahati, which was s erved upon the assessee on 1st March, 2004 has not supported because the origina l copy of the first notice which as per CIT(A) himself was not related to the as sessee as with the assesee whereas original copy of the alleged handmade notice is not available either the assessee or in the record. The availability of origi nal copy of notice dated 02.12.2013, which according to the revenue were not rel ated to the assessee being with the assessee, the scale of justice goes in asses see’s favour that notice served upon the assessee on 1st March, 2004, as per ack nowledgement copy at page 10 of the revenue’s paper book, where the notices issu ed with PAN ACKPG 5721G and address to Smt. Gita Rani Ghosh, Prop of M/s. Ghosh Brothers, Sony Apartment, Ulubari, Guwahati-7, meaning thereby that even if it a ssumed that AO had come to know of his mistake of having prepared notices under the wrong name, then also the revenue having no material to establish that it wa s the second set of notices, which was served upon the assessee cannot be accept ed. 7.8. Without prejudice to the above and without admitting that it was the sec ond set of notice which was served upon the assessee, there is another reason fo r not accepting the revenue’s case and the reason is that after AO had come to k now of having issued notices in wrong name and corrected the same by issuing sec ond set of notices, then this fact could have been mentioned in the order sheet which is not the case. Similarly, the fact of service of notice has also not bee n mentioned in the order sheet meaning thereby that in a nutshell, there is no e vidence with the revenue to establish its case that it was the second set of not ice which was served upon the assessee as per acknowledgement (copy placed at pa ge 10 of the revenue’s paper book). 7.9. In addition to above, we, even at the cost of repetition, would again li ke to refer to the settled principles of law with respect to establishment of se rvice of a notice which is on the revenue and since in the present case, revenue has not discharged its onus by any cogent material, the assessee’s objection th at it was served on 1st March, 2004, only with the first set of notice, which we re not relating to the assessee has to be accepted. 7.10. Having held as above, we are further of the opinion that the AO having n ot served any notice under Section 143(2) or 142(1) subsequently, also, no asses sment could be framed either under Section 143(3) or Section 144 of the Act on t he basis of the return furnished the assessee on 26th March, 2003. We are, there fore, of the opinion that assessment under appeal having been passed without ser ving any notice under Section 143(2) or 142(1) of the Act was illegal and void a b initio and the same is cancelled as such. Since the assessee’s appeal has been allowed on legal ground, we do not consider it necessary to go into the merits of other grounds. (cid:29) 13. We have gone through carefully and minutely the observations made and th e conclusions reached above by the learned Tribunal and we do not find that the learned Tribunal’s observations were based on no material or that the learned Tr ibunal’s findings were wholly contrary to the materials on record. The appellant could not show before us that it had produced before the learned Tribunal any s uch material, which could have proved, beyond any shadow of doubt, that notices, under Sections 142(3) and 142(1), were, indeed, issued to the assessee-responde nt herein and served upon the assessee-respondent herein as the appellant claims . 14. At any rate, we have already pointed out above, that when the respondent , as assessee, had denied receipt of notice, imperative it was, on the part of t he appellant, to produce requisite materials and, if available, such person(s), who had sent the notices as had been claimed by the Revenue. Nothing of the sort was, however, done by the appellant. 15. Because of what have been discussed and pointed out above, we are clearl y of the view that the finding, reached by the learned Tribunal, cannot be descr ibed as perverse. Consequently, this appeal must fail and the learned Tribunal’s order, impugned in this appeal, must be maintained. 16.
Arguments
and Mr. R. Goenka, learned counsel, for the respondent. Before coming to the merit of the order, which stands impugned in this a 4. ppeal, the material facts, giving rise to this appeal, may, in brief, be set out as under: (i) For the assessment year 2002-2003, the assessee-respondent filed her return of income, on 26.03.2003, showing total income at Rs.1,47,000/- and the same was processed, under Section 143(1) of the Act, on 03.09.2003. As the a ssessee-respondent’s case was selected for scrutiny, notices, according to the R evenue, were issued to the assessee-respondent under Sections 143(2) and 142(1) of the Act. The said notices, according to the Assessing Officer, were served on the assessee on 01.03.2004; but, as, according to the Assessing Officer, there was no response by the assessee, further notices were issued, on 27.12.2004 and 15.02.2005, re-fixing the hearing on 19.01.2005 and 17.02.2005, respectively. According to the Assessing Officer, as the assessee did not respond to a (ii) ny of the notices aforementioned, an assessment order was made, on 31.03.2005, i n terms of the provisions of Section 144 of the Act. Aggrieved by the ex parte a ssessment, so made, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals) (in short, the CIT(A) contending, inter alia, that assessme nt had been made, under Section 144 of the Act, without giving any notice to the assessee and without affording to her an effective opportunity of hearing and t hat the order of assessment, having been made, on 31.03.2005, in respect of the assessment year 2002-2003, was barred by limitation inasmuch as the assessment, under Section 144 of the Act, was made on 31.03.2005, though the return was furn ished on 26.03.2003 and, therefore, the assessment, under Section 144, which oug ht to have been made within a period of two years, i.e., on 25.03.2005, came to be made on 31.03.2005. In support of her case that the notices, under Sections 143(2) and 142(1 (iii) ), claimed to have been issued, on 02.12.2003, by the Assessing Officer did not relate to the assessee-respondent and though the assessee had received a notice on 01.03.2004, neither the Permanent Account Number (in short, PAN Number), ment ioned in the notice nor address, mentioned therein was that of the assessee-resp ondent inasmuch as the PAN Number, mentioned on the notice, dated 02.12.2003, wa s AGNPG 1745 K and the address, mentioned in the notice, was Flat No.B-2, Shank ar Madhab Housing Society, P.O. Pandu, Pandu, Guwahati, Assam; whereas the asses se’s PAN Number is ACLPG 5721 KFG and her address is (cid:28)Proprietor, M/s. Ghosh B rothers, Barthakur Mill Road, Ulubari, Guwahati. (iv) Thus, according to the assessee-respondent, since none of the notices, i ssued by the Assessing Officer, concerned the assessee-respondent, the assessee- respondent was not bound to comply with the same and, consequently, the assessee -respondent pleaded before the CIT(A) that the ex parte assessment, made by the Assessing Officer, on 31.03.2005, without serving any notice, as warranted by Se ction 143(2) and Section 142(1) of the Act, was illegal and untenable in law. (v) The CIT(A) did not, however, agree with the assessee-respondent’s conten tion and rejected the same by observing, in brief, thus: As per the return file d by the assessee, on 26.03.2003, for the year 2002-2003, PAN No. ACPPG 9406M an d the assessment record, including confidential folder, shows that the computer generated notice, under Section 143(2), with PAN No. AGPG 9406 M, dated 02.12.20 03, was issued, which carried the name and address of Smt. Gita Rani Ghosh, A.K. Azad Road, Rehabari, Guwahati; whereas PAN Number of the assessee-respondent wa s not the same and, thus, the notice, generated by the computer, was different f rom what ought to have been given to the appellant (i.e., the appellant-responde nt herein) and, therefore, on the same day, a manually generated notice, under S ection 143(2), for the assessment year 2002-2003, was made in the name of the ap pellant (i.e., the assessee-respondent) and that the later notice was served on the appellant (i.e., the assessee-respondent herein) on 01.03.2004. The acknowle dgement, in respect of the notice issued under Section 143(2) and 142(1), dated 02.12.2003, bore the signature of the assessee, but the only error in the acknow ledgement slip was that the acknowledgement slip mentioned the assessment year a s 2001-2002; whereas the notices, dated 02.12.2003, were meant for the assessmen t year 2002-2003. According to the CIT(A), since the appellant (i.e., the assess ee-respondent herein) did not respond to the notice, so issued, the Assessing Of ficer issued two letters fixing the dates of hearing, but there was no response from the assessee and, therefore, the assessment was completed, under Section 14 4, on 31.03.2003 and, hence, the assessment, so made, was legal and valid and ca nnot be interfered with. On the basis of the conclusions, so reached, the assess ee-respondent’s appeal was dismissed by the CIT(A). 5. It is in the background of the facts, as noticed above, that the present appeal needs to be considered and while considering the present appeal, what ne eds to be borne in mind is that the question as to whether notices, which were c laimed by the Revenue to have been served on the assessee-respondent, had, in fa ct, been served on the assessee-respondent or not was a question of fact and the finding, given on this disputed question of fact by the learned Tribunal, canno t be interfered with, in appeal, under Section 260A of the Act, by this Court un less the learned Tribunal’s finding can be shown, or is found, to be perverse in the sense that the finding that the assess-respondent had not received requisit e notice, under Sections 143(2) and 142(1), was without any material on record o r wholly contrary to the weight of the materials on record. If the view, which h as been taken by the learned Tribunal, is one of the possible views, then, this Court, in exercise of its appellate jurisdiction, would not interfere with such a finding of fact. 6. Coupled with the above, what also needs to be noted is that the assessee -respondent’s case was that the assessee-respondent had filed her return, for th e assessment year 2002-2003, on 26.03.2003 and, hence, the assessment had to be made within a period of two years from the date of filing of the return. Looking from this angle, the assessment order, made under Section 144, on 31.03.2005, w as, according to the assessee-respondent, barred by limitation inasmuch as the a ssessment order, if any, under Section 144, ought to have been made on or before 25.03.2005. 7. In the backdrop of what have been pointed out above, let us, now, come t o the learned Tribunal’s order, which stands impugned in this appeal. In this re gard, it is of immense importance to note that the learned Tribunal has clearly observed, setting out the case of the assessee-respondent, that so far as assess ee was concerned, it had claimed to have received notices under Section 143(2) a nd 142(1) of the Act, both dated 02.12.2003, bearing PAN No. AGNPG 1745K and the said notices were addressed to Smt. Gita Rani Ghosh, Flat No.B-2, Shankar Madha b Housing Society, PO. Pandu, Pandu, Guwahati, Assam; whereas the Revenue had s ought to support the findings of the CIT(A) on the basis of copies of notices, u nder Sections 143(2) and 142(1), both issued, on 02.12.2003, bearing PAN/GIR No. ACKPG 5721 G and addressed to Smt. Gita Rani Ghosh, Prop. M/s. Ghosh Brothers, Soni Apartment, Ulubari, Barthakur Mill Road, Guwahati, as well as acknowledge ment receipt bearing signature of the assessee-respondent on having received the notices under Section 143(2) and 142(1), dated 02.12.2003 relating to assessmen t year 2001-2002 and not for assessment year 2002-2003. 8.
Decision
In the result and for the reasons discussed above, this appeal fails and the same shall accordingly stand dismissed. 17. Parties shall bear their own costs.