Naveen Tyagi Vs ITO (ITAT Delhi)
HC held that if notice u/s 148 was not served on the assessee in accordance with law the reassessment made consequent thereto was without jurisdiction and liable to be quashed.
In the case on hand as the Revenue could not prove the service of notice u/s 148 on the assessee in accordance with law the re-assessment made u/s 147 read with section 144 pursuant to such notice is void ab initio and bad in law. Hence, the reassessment order made u/s 144 read with section 147 is quashed.
FULL TEXT OF THE ORDER OF ITAT DELHI
This appeal is filed by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-2, Noida dated 18.01.2018 for the AY 2009-10.
2. The assessee has raised several grounds on merits and also on jurisdiction of the Assessing Officer in reopening of the assessment. The assessee also raised additional grounds challenging the validity of 148 proceedings and the consequential assessment order pursuant to reopening stating that the mandatory requirement of service of notice u/s 148 is not followed thereby vitiating the entire reassessment proceedings. The additional grounds raised by the assessee are as under:
1. “That having regard to the facts and circumstances of the case, the Ld. CIT(A) has erred in law and on facts in not quashing the impugned reassessment order passed by Ld.AO that too without assuming jurisdiction as per law and without complying with mandatory conditions u/s 147 to 151 as envisaged under the Income Tax Act, 1961.
2. That in any case and in any view, the Ld.CIT(A) has erred in law and on facts in confirming the action of Ld.AO in framing the impugned reassessment order u/s 144/147 and that too without serving mandatory notices in this regard and without giving adequate opportunity of hearing as prescribed under th law.
3. That having regard to the facts and circumstances of the case, the Ld.CIT(A) has erred in law and on facts in not quashing the impugned reassessment order on the ground that mandatory notice u/s 148 was not served upon the assessee much less when the same was issued on incorrect address and thus, impugned proceeding is nullity in the eyes of law more so without following the principles laid down in the case of GKN Driveshafts (India) Ltd. Vs. ITO (2003) 259 ITR 19, Supreme Court of India”
3. The ld. Counsel submits that the additional grounds are purely legal grounds which are going to the root of the matter and do not require fresh facts to be investigated. Therefore, the same may be admitted. Reliance was placed on the decision of the Hon’ble Delhi High Court, Full Bench in the case of CIT Vs. Sardari Lal & Compnay (251 ITR 864).
4. On hearing both the contentions, the additional grounds are admitted as they are purely legal grounds. In the additional grounds raised by the assessee it was contended that the AO failed to serve notice u/s 148 of the Act. The Ld. Counsel for the assessee referring to page 25 of the Paper Book submits that notice u/s 148 was sent to assessee mentioning the address as Shri Naveen Tyagi, Village Ghookna, Ghaziabad without mentioning the complete address. Referring to page 23 of the Paper Book, which is the Form for recording reasons for initiating the proceedings u/s 147 and for obtaining the approval of the Pr. CIT the Ld. Counsel submits that even in this Form the AO stated the address as resident of Ghookna, Ghaziabad. Further the column against permanent account number was shown as not available. Referring to page 1 to 22 of the paper book the Ld. Counsel submits that the assessee has filed return for the AY 2015-16 on 29.03.2016 which clearly mentioned the address of the assessee as 506-A, Tyagi Market, Meerut Road, Village Ghookna, Ghaziabad, Uttar Pradesh-201011. The Ld. Counsel for the assessee submits that the return for the assessment year under consideration i.e., AY 2009-10 was filed on 04.03.2010 clearly mentioning the address of the assessee as 506-A, Tyagi Market, Meerut Road, Village Ghookna, Ghaziabad, Uttar Pradesh-201011. Therefore, the Ld. Counsel submits that the Department has in its knowledge the complete address, PAN details, copies of returns of the assessee with it but, however, notice u/s 148 was issued simply mentioning the address of the assessee as Village Ghookna, Ghaziabad. Therefore, it is the submission of the Ld. Counsel for the assessee that the notice u/s 148 was not served on the assessee.
5. The Ld. Counsel further submits that even in the order sheet noting the AO stated that notice u/s 148 was issued with prior approval of the Pr. CIT, Ghaziabad and nowhere it is stated that the said notice was served on the assessee. The Ld. Counsel submits that since the address in the notice is incomplete the said notice could not have been served on the assessee. Therefore, the Ld. Counsel submits that in the absence of mandatory service of notice the assessment made pursuant to such notice is bad in law. Reliance was placed on the decision of the Hon’ble Supreme Court in the case of RK Upadhyaya Vs. Shanabhai P. Patel (166 ITR 163).
6. The Ld. Counsel further placed reliance on the following decisions:
