Zeliant Corp Vs ITO (ITAT Delhi)
In this case, the assessee challenged the validity of the assessment framed u/s 144 wherein cash deposits were treated as unexplained money u/s 69A r.w.s. 115BBE. The primary contention before ITAT was that the assessment order itself was void ab initio as notices & assessment order were never validly served within limitation as per procedure prescribed u/s 282 r.w.r. Rule 127.
The AO had made addition of ₹83,50,900/- alleging unexplained deposits during demonetisation after best-judgment assessment due to alleged non-compliance. Though CIT(A) restored the matter to AO for fresh verification considering additional evidences, the assessee argued that remand was meaningless when the very assessment suffered from jurisdictional defect of non-service.
Before ITAT, Revenue admitted that a)Email delivery status was “email not sent” in ITBA portal; b) Assessment order could not be uploaded properly due to technical/system error; C) Alleged service by speed post was claimed but no tracking proof was produced
Relying on Delhi HC ruling in Suman Jeet Agarwal, ITAT held that mere uploading on portal without real-time alert or valid service does not constitute proper service. Since Department failed to prove valid service within prescribed time, assessment proceedings were held bad in law. Consequently, the assessment order & related demand were quashed, and the appeal of the assessee was allowed.
