Ashok Kumar Agarwal and Ors HUF Vs ACIT (ITAT Kolkata)
Assessee filed the return of income declaring total income at ₹22,40,160/-. Case of Assessee was selected for scrutiny through CASS. Statutory notices including other notices & questionnaires were issued & served upon Assessee. Notice u/s 143(2) was issued by ITO Ward 34(2), Kolkata. AO (ACIT Circle-34 Kolkata) after issuing notice u/s 142(1) along with questionnaire called for the information/ details from Assessee which were duly furnished & examined by AO. AO finally after considering the submissions & evidences furnished by Assessee made the addition of ₹31,44,400/- u/s 68 in respect of unexplained cash credit in the books of Assessee. CIT (A) affirmed AO’s order.
Assessee challenged the assessment framed by AO on the ground that no notice u/s 143(2) has been issued by the jurisdictional AO. Besides, Assessee challenged the assessment on the ground that the notice u/s 143(2) was not in conformity with the instruction issued by CBDT instruction No.1/2011 (F. No. 187/12/2010-IT(A-1) dt 31.01.2011.
Tribunal noted that notice u/s 143(2) specifies only computer aided scrutiny selection which neither mentioned it either to be a limited or a complete scrutiny nor compulsory manual scrutiny. Thus, the said notice has been issued in violation of the CBDT instruction. Revenue authorities have to follow the instruction issued by CBDT & violation thereto would certainly render the notice as invalid with the result all the consequential proceedings would also be invalid. Tribunal held that the notice issued u/s 143(2) is invalid notice & accordingly, the assessment framed consequentially is also invalid & quashed.
