Dhanottam Vasant Lonkar Vs ITO (ITAT Pune)
Conclusion: Notice u/s.143(2) was issued at a wrong/non-existing address and this mistake having been accepted by the Revenue authorities at the later part of the assessment proceedings during which assessee had strongly raised objection about non-receipt of valid notice u/s.143(2) on the address of communication mentioned in the PAN database, therefore, no valid notice was issued and served upon assessee u/s.143(2) within the statutory time limit provided under the Act. In the absence of issuance of valid notice u/s.143(2), AO failed to assume jurisdiction for carrying out the assessment proceedings.
Held: Assessee-individual was declaring income from business, capital gain and from other sources. Return of income for A.Y. 2013-14 was filed declaring income of Rs.1,76,25,230/-. Case selected for scrutiny under CASS. Thereafter, notice u/s.143(2) was issued and in the assessment order it was mentioned that it had been served to the assessee. Thereafter, there was change in incumbent and fresh opportunity was provided and notice u/s.142(1) was issued. But this notice was returned back with the remarks that “the assessee was not in given address”. The issue of not serving the valid notice u/s.143(2) had been strongly raised by assessee before AO with various details as well as the correct address which was there in the PAN database but still AO did not accept the contentions and proceeded to complete the assessment making addition of Rs.2,20,09,000/- under the head capital gain on conversion of land. AO assessed the income at Rs.3,96,34,320/-. Assessee thereafter challenged the validity of notice issued u/s.143(2) as well as the validity of the assessment proceedings. It was held that issuing of valid notice u/s.143(2) was mandatory and without complying to the said provision and not issuing a valid notice u/s.143(2), AO could not assume jurisdiction for proceeding ahead with carrying out of the assessment proceedings. Therefore, since in the instant case, notice u/s.143(2) was issued at a wrong/non-existing address and this mistake having been accepted by the Revenue authorities at the later part of the assessment proceedings during which assessee had strongly raised objection about non-receipt of valid notice u/s.143(2) on the address of communication mentioned in the PAN database, therefore, no valid notice was issued and served upon the assessee u/s.143(2) within the statutory time limit provided under the Act. In the absence of issuance of valid notice u/s.143(2), AO failed to assume jurisdiction for carrying out the assessment proceedings. Hence, the assessment order was quashed in the case of assessee for A.Y. 2013-14 being bad, illegal and void ab-initio and the impugned additions stood deleted. Finding of CIT(A) was set aside and legal ground raised by assessee challenging the validity of assessment proceedings in absence of valid notice u/s.143(2) not served upon assessee within the statutory time limit was hereby allowed.
