In draft submissions before the First Appellate Authority, challenge the issuance of a Section 148 notice sent to the wrong address, affecting the assessment proceedings.
Draft submissions before the First Appellate Authority Wherein Notice u/s 148 sent at wrong address of the assesse, not received by the assessee by speed post & in person with some judgements regarding the issue
Introduction of the assessee
The assessee is not an educated person and not at all conversant with computer work and cannot online notices. The department might have sent the notices through ITD portal but in person notices has not been received by the assessee. The assessee has never received any notice from the department in hand and by post. At the most the order u/s 144/147 sent by speed post was even received by some other person in the village and some child from the neighborhood handed over the order to the assessee and he without delay contacted his counsel Sh. XXXXX, Advocate. In the same way if he would have received the notices he would have contacted department or some CA so that he could have discharged his onus to prove the source of cash deposited with the bank.
The assesse is an individual and a farmer. During the F.Yr.2010-11 the assesse was having two sources of Income.
(a) Agriculture Income
(b) Income from sale and purchase of Vegetables and grains.
The assesse himself and his family members owns near about 20 acres of Agriculture Land in Haryana. He is having these two sources of Income over the past so many years. The entire agriculture produce is sold in the market in cash. Sale purchase of Vegetables and grains is also done in cash.
The initiation of assessment proceedings u/s 147/148 was without jurisdiction and the notice u/s 148 was never served on the assessee.
Notice u/s 148:
The notice u/s 148 was never received by the assessee in person and this is the prime requirement for reassessment proceedings u/s 147 of the Act, 1961. Notice u/s 148 of the Income Tax Act, 1961 issued to the assessee Dt. 23.03.2018 sent by speed post Dt. 23.3.2018 was never received by the assessee as it was not sent at the proper address of the assessee.
The case of the assessee was decided ex-parte u/s 144 of the Income Tax Act, 1961 in which a demand of Rs. 23,75,000.00 has been created which is quite illegal baseless and not justified.
The assesse could not appear before the Income tax officer during the course of assessment proceedings and the reason for non-appearance was that no notice was received by the assessee at his residential address which is “XXXX, HARYANA, India but notices were sent at ABCD, HARYANA which is wrong address and this address does not belong to the assesse.
In fact, no notice was received by the assessee at his correct address and this was the root of the ex-parte assessment made by the assessing officer. If he would have received the notices he would have contacted the Income tax officer, ward No. 2(1), AAAAA or appoint some CA so that he could have discharged his onus to prove the source of cash deposited with his saving bank account No. 6XXXXXX1055 with Bank of India, HARYANA. This account was opened long back Dt. 24.06.2004 and that time occupation written on the pass book is Agriculture and Allied AC. Basically he is a farmer and the main source of Income is Agriculture Income.
Notice issued at wrong address
The notice u/s 148 Dt. 23/3/2018 was sent by speed Post at the address of the assessee as ABCD, HARYANA but assessee was not living at this address and the notice returned back to the department. The address on the bank statement is XXXX, HARYANA. The address on the portal of the Income tax department is only XXXX, HARYANA. Below is the chart of notices issued at the wrong address of the assesse.
|
Section under which Notice is issued |
Date | Address on which notice is issued | sent by mail/ITBA/Speed Post/ By person |
| 148 | 23-Mar-18 | ABCD, HARYANA. This address is wrong and it does not belong to the assesse | ITBA, sent on portal but hard copy not received by the assesse. He is an agriculturist, having non- taxable income, never filed ITR, never got registered with ITD portal. Hard copy of the notice returned back to the ITO, AAAAA Dt. 2.04.2018. |
| 142(1) | 6-Jul-18 | ABCD, HARYANA | ITBA, sent on portal but hard copy not received by the assesse. |
| 142(1) | 7-Sep-18 | ABCD, HARYANA | ITBA, sent on portal but hard copy not received by the assesse. |
| 142(1) | 26-Oct-18 | ABCD, HARYANA | ITBA, sent on portal but hard copy not received by the assesse. as the same was returned back from Post office. |
| 142(1) | 16-Nov-18 | ABCD, HARYANA | ITBA, sent on portal but hard copy not received by the assesse |
| 142(1) | 5-Dec-18 | ABCD, HARYANA | ITBA, sent on portal but hard copy not received by the assesse. |
Looking at the above chart it is noticed that the notice u/s 148 has been issued at the different address other than the address on the bank statement. The notice u/s 148 is issued when definite information is there not for an enquiry. The notice has been issued on the presumption that the cash deposited with the bank is income of the assessee. This is only a presumption. The assessee could not reply and could not file the ITR in response to the notice as the notice could not be delivered at the correct address of the assessee.
Even the reassessment proceedings initiated by AO are void since notice u/s 148 was never served upon the appellant. Service of such notice is condition precedent for making valid assessment u/s 147 as held by the Hon’ble jurisdictional High Court in CIT Vs. Lakshmi Narain 168 Tax man 128 (Punjab and Haryana) The AO at ward No. 2(1), AAAAA was well aware of the address of the appellant which is apparent from the bank statement, AIR information and available on the Aadhaar card. Hence the notice u/s 148 must have been issued at the correct address of the assessee but the notice was sent at the wrong address of the assessee and ultimately not received by the assessee.
Notice not served in proper way
As per section 282 of the Act, notice should be served in the following ways:
(a) Sent by person to the assessee by the ITO
No person was ever sent to the assessee.
(b) Service of notice by speed post:
Notice u/s 148 Dt. 23.03.2018 was sent by speed post which was never received by the assessee and subsequent notices were sent on ITBA. Even address on these notices is wrong. The address mentioned on the notices does not belong to the assesse. Most of the notices returned back to the department.
(c) Service of notice by mail: No notice was received on mail of the assesse. No mail id of the assesse is registered with ITD at the time of issue of notice u/s 148.
(d) Notice on the portal: Notice u/s 148 dt Dt. 23.03.2018 was issued on the portal but assesse is not aware of the ITD portal. He is a farmer. He has not appointed any CA for all these works because his income is only agriculture income and small retail trading. He never felt any requirement to appoint a CA. Moreover, the address on the notice is wrong. He maintained his accounts on his own.
The assessee had never appeared in any proceedings or co-operated in any enquiry relating to re-assessment because notices were not received by him. Assessee shall not be precluded from taking the objection before CIT (A), NFAC, New Delhi because notice u/s 148 Dt. 23/3/2018 was never served upon him. The section 292 BB of the Act is squarely not applicable in the case of the assessee.
In this case Section 148 notice was never served upon assessee as AO, instead of proceeding to comply with rule 127, i.e., examining the PAN database or AIR information, subsequent year returns or records to ascertain the correct address, address on the bank statement, merely dug out the wrong address and proceeded to complete reassessment in a mechanical manner, therefore, Assessment order passed under section 147 was invalid.
as held in
Veena Devi Karnani Vs ITO (Delhi High Court)
The entire assessment being notice sent at the wrong address of the assessee being not sent at the correct address of the assessee vitiates the entire assessment. The correct address is on the Aadhaar card of the assesse. On the bank account of the assessee. On the AIR information. He did not try to ascertain the correct address of the assessee by sending his office staff to the village for tracing the assesse who is a farmer and was living in village XXXX, HARYANA. It was the duty of the AO to dig out the correct address of the assessee so that notice u/s 148 is sent to the assesse.
The assessing officer has never tried to digout the correct address of the assessee before issue of notice u/s 148 of the Act Dt. 23.03.2018 and the correct address is XXXX, HARYANA, India. As the first and initial notice could not be served on the assessee, the entire assessment is prayed to be made null and void in the absence of proper service of notice.
A chart showing the documents containing the correct address & wrong address of the assesse is as under. You are requested to have a look at the chart.
| S. No. | Section/document | Date | Address of the Assessee Where Notice is issued | Remarks |
| 1 | 148 | 23-Mar-18 | ABCD, HARYANA | Correct Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the assessee whose house no. is ABCD, HARYANA. |
| 2 | 142(1) | 6-Jul-18 | ABCD, HARYANA | This address is wrong. Correct Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. |
| 3 | 142(1) | 7-Sep-18 | ABCD, HARYANA | This address is wrong. Correct Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. |
| 4 | 142(1) | 26-Oct-18 | ABCD, HARYANA | This address is wrong. Correct Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. |
| 5 | 142(1) | 16-Nov-18 | ABCD, HARYANA | This address is wrong. Correct Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. |
| 6 | 142(1) | 5-Dec-18 | ABCD, HARYANA | This address is wrong. Correct Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. |
| 7 | Aadhaar Card | NA | XXXX, HARYANA | Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. |
| 8 | Bank Statement | NA | VPO XXXX, HARYANA. It is not house No. ABCD, HARYANA | Address of the assessee is XXXX, HARYANA. There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. The address on the Aadhaar Card, ITR, Bank Account is correct. Bank statement has been obtained by the AO by writing a letter u/s 133(6) dt. 22.11.2018. He was not having bank statement at the time of reasons recorded. |
| 9 | ITR | 02.01.2019 | XXXX, HARYANA | Address of the assessee is XXXX, HARYANA There is no house in the vicinity of the asssessee whose house no. is ABCD, HARYANA. |
| 10 | Profile Registration | NA | XXXX, Haryana, INDIA | Address of the assessee is XXXX, Haryana, INDIA Address is Correct. |
| 11 | Reasons Recorded U/s 148(2). | 15-03-2018 | ABCD, HARYANA | Obtained by Assessee on 06.03.2023 not earlier. This address is wrong. |
| 12 | Approval U/s 151.
|
20-03-2018 | ABCD, HARYANA | Obtained by Assessee on 06.03.2023 not earlier. This address is wrong. |
| 13 | Notice U/s 148, Sent by Speed Post. | 23-.03-2018 | ABCD, HARYANA | Sent by speed post Dt. 28-3-2018 but not received by the assessee. This address is wrong. |
| 14 | Notice of Demand U/s 156. | 11-12-2018 | ABCD, HARYANA | Received by the assessee on 15-12-2018 by hand. Not Correct address. A child from the neighborhood handed over the order to the assesse. |
| 15. | Order U/s 144/147. | 11-12-2018 | ABCD, HARYANA | Received by the assessee on 15-12-2018 by hand. Not Correct address. A child from the neighborhood handed over the order to the assesse. |
| 16. | AIR Information | ABCD, HARYANA | Certified copy received on 06.03.2023. The address on the AIR is ALSO NOT correct but AO by hand wrote wrong address of the assesse. Assessee is unable to understand the source of address with the AO. | |
| 17. | Notice u/s 133(6) | 26.02.2018 | ABCD, HARYANA | Certified copy received on 06.03.2023. The address on the notice is not correct and moreover it was returned back to the AO. No approval from higher authorities has been obtained by the AO as mentioned in reasons recorded at point no.4. |
| 18. | Query Letter | 18.08.2017 | ABCD, HARYANA | Certified copy received on 06.03.2023. The address on the notice is not correct and moreover it was returned back to the AO. |
The initiation of assessment proceeding u/s 148 was without jurisdiction since the notice was never served on the assesse personally and returned back to the AO as the address on the notice was wrong which do not belong to the assessee.
The status of ABCD, HARYANA is that this address does not belong to the assesse.
Branch of Post office is at …..HARYANA. Post office is at ….HARYANA. The proper delivery of post is not done from the branch post office. They are somehow careless. They do not make proper delivery of the regular posts.
The present address of the assessee is where he lives:
XXXXXXX, S/O XXXXX, R/O XXXX, HARYANA.
One more address of the assessee is House No. xyz, Block 2, XXXX, HARYANA where the sons of the assessee live.
There is no house in the vicinity of assessee whose No. is House No. ABCD, HARYANA. Many years ago Health department allotted medicines to the houses. They may have allotted these Nos. to the house of the assessee. But at present there is no address of House No. 135 which belongs to the assessee. Wrong address of the assessee and lack of delivery of the post by the branch of the Post office were the reasons for the notices not received by the assessee.
At page No. 3 para no. 2 of the assessment order the AO has written that notices were returned undelivered.
The entire assessment is prayed to be made null and void for not issuing the notice at correct address of the assessee and notice was not received by the assessee within the time prescribed as mentioned in section 149(1) of the Act. The reopening is bad not following the strict provisions of law and hence the entire assessment is prayed to be made null and void.
1. When notices remained undelivered as written in the assessment order itself then it was the prime duty of the AO to find out the correct address of the assesse. AO could not have obtained the correct address and phone number of the assesse from the bank itself by writing a letter to the bank.
2. The notices and even order u/s 143(3) kept on sending at the wrong address of the assesse by the AO.
3. The assesse has relied on the judgement of Allahabad High Court in the case of Suresh Kumar Sheetlani Vs. ITO where in it was held “Notice served at the wrong address renders reassessment proceedings invalid”. Full text of the judgment is enclosed.
4. The assesse has relied on one more judgement of the Hon’ble ITAT, Agra “M/s K.P. Cold storage Vs. ITO (ITAT Agra) 145/Agra/2018”.
Wherein held “Notice u/s 148 is invalid if issued but not served properly to proper person”.
In the case of the assesse the notices were sent at the wrong address which does not exist in the XXXX, HARYANA. The notices remained undelivered and returned back to the ITO, AAAAA. Hence the assessment framed is prayed to be made invalid.
The author is available at skain1147@gmail.com
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