Income Tax Appellate Tribunal - Delhi
Sat Narain vs Income Tax Officer on 15 March, 2005
Equivalent citations: (2005)94TTJ(DELHI)499
ORDER
N.V. Vasudevan, J.M. These two appeals are filed by the assessee against the common Order dt. 28th Oct., 2003, of CIT{A)-XXV, New Delhi, relating to the asst. yrs. 1999-2000 and 2000-2001.
2. Before we take up the main grounds of appeal for adjudication, we have to consider a prayer for admission of additional grounds on behalf of the assessee. The assessment for both the years had been completed under Section 147 of the Act. The additional ground of the appeal raised by the assessee reads as follows :
"That the impugned assessment Order has been framed under Section 143(3) without assuming the jurisdiction to frame such assessment inasmuch as notice under Section 143(2) was not issued and served within the statutorily allowable period of 12 months from the end of the month in which return under Section 148 was filed."
In the additional ground, the assessee has prayed for declaring the assessment framed under Section 147 r/w Section 143(3) as without jurisdiction on the ground that no notice under Section 143(2) of the Act was served within the statutory period of 12 months from the end of the month in which return under Section 148 was filed. The learned counsel for the assessee submitted that the additional ground sought to be raised is purely a legal question and can be decided on the facts already available on record. He also submitted that in view of the decision of Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. v. CIT (1998) 229 ITR 383 (SC), the additional ground may be admitted for adjudication. The learned Departmental Representative, however, opposed the prayer for admission of additional ground. He submitted that these grounds were not raised before the lower authorities and, therefore, do not arise out of the Order of the CIT(A). He submitted that the assessee should not be permitted to raise a new ground of appeal before the Tribunal for the first time.
3. We have considered the submissions of the learned Departmental Representative. In our view, the additional ground sought to, be raised by the assessee, can be adjudicated on the basis of material already available on record. Since this ground is a legal ground, it can be raised at any point of time. As the facts necessary for adjudication of this legal ground are already available on record, keeping in mind the decision of Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. (supra), we deem it proper to admit the additional ground for adjudication. The additional ground is, therefore, admitted for adjudication.
4. The facts which are relevant for the purpose of adjudication of this ground are that the assessee had filed a letter dt. 28th June, 2001, in response to notice under Section 148 of the Act, requesting the AO to treat the return originally filed for the asst. yr. 1999-2000, on 29th Nov., 1999, as a return filed in response to the notice under Section 148 of the Act, For the first time, a notice under Section 143(2) was issued and served on the assessee only on 23rd of Aug., 2002. The proviso to Section 143(2) contemplates service of notice under Section 143(2) within a period of 12 months from the end of the month in which the return is filed. In this case, the period of 12 months as laid down in the proviso to Section 143(2), expires on 30th June, 2002. Admittedly, no notice under Section 143(2) had been issued and served on the assessee on or before 30th June, 2002.
5. As far as asst. yr. 2000-01 is concerned, the assessee had filed his original return of income on 1st Oct., 2000, which was requested to be treated as a return filed in response to notice under Section 148 vide assessee's letter dt. 28th June, 2001. The first notice under Section 143(2) was issued and served on the assessee on 11th Dec., 2002. The period of 12 months as contemplated by the proviso to Section 143(2), in this assessment year, is on or before 30th Aug., 2002. Admittedly, no notice had been served on the assessee under Section 143(2) on or before 30th Aug., 2002.
6. In the light of the aforesaid factual position on which there was no dispute between the parties, we have to hold that the AO did not have jurisdiction to frame an Order of assessment under Section 147 without complying with the requirement of service of notice under the proviso to Section 143(2) within the time prescribed by the said proviso, As to whether the provisions of Section 143(2) apply to a case of proceedings under Section 147 had been considered by a Special Bench of this Tribunal in the case of Raj Kumar Chawla and Ors. v. ITO (2005) 92 TTJ (Del)(SB) 1245. The Special Bench has held that provisions of Section 143 including the proviso would be applicable to assessment/reassessment under Section 147 and that if compliance of the proviso to Section 143(2) is not made, the AO will not be entitled to make an Order of assessment. In view of the aforesaid decision of the Special Bench, we hold that the assessments framed in both the assessment years, deserve to be annulled and they are accordingly annulled.
7. Since the appeals of the assessee are being allowed on preliminary issue, no adjudication on the other grounds of appeal raised by the assessee are taken up for adjudication.
8. In the result, the appeals by the assessee are allowed.