Calcutta High Court
Commissioner Of Income Tax vs M/S. Humdoldt Wedag India Pvt Ltd on 8 April, 2014
Author: Girish Chandra Gupta
Bench: Girish Chandra Gupta
ORDER SHEET
ITAT No. 149 of 2013
G.A. No.2598 of 2013
IN THE HIGH COURT AT CALCUTTA
Special Jurisdiction (Income Tax)
ORIGINAL SIDE
COMMISSIONER OF INCOME TAX, KOLKATA-III
Versus
M/s. HUMDOLDT WEDAG INDIA PVT LTD
BEFORE:
The Hon'ble JUSTICE GIRISH CHANDRA GUPTA
The Hon'ble JUSTICE SUDIP AHLUWALIA
Date : 8th April, 2014.
Ms. A. Gutgutia, Advocate for the Appellant
Mr.J.P. Khaitan, Sr. Adv. , Mr.S.Bhowmick, Adv.
and Mr. Pritam Choudhury, Adv.for the Respondent
The Court : The subject matter of challenge in this appeal is a judgment and order dated 12th April, 2013 by which the learned Tribunal dismissed the appeal preferred by the revenue agreeing with the views expressed by the CIT (Appeal). The learned Appellate Tribunal appears to have devoted its energy in establishing the essentiality of a notice under section 143(2) of the Income Tax Act before any assessment under section 143(3) of the Income Tax Act can be made. There can be no denial of the fact that such a notice is required. The question for decision in this case is, not whether such a notice is required. Therefore, this exercise was also not required.
2
In this case, after the assessment was reopened, the assessee filed his reply to the recorded reasons. The order under section 147/143(3) of the Income Tax Act was passed on 31st December, 2010. The Assessing Officer recorded in his order that he had issued a notice under section 143(2) of the Income Tax Act. The CIT (Appeal) has opined that he had gone through the assessment records but he did not find any indication to show that a notice under section 143(2) of the Income Tax Act had, in fact, been issued. That may be true and we shall assume it to be true, but the fact remains, whether subsequent appearance of the assessee, before the assessment order was passed, can be said to have the effect of waiving such notice. The object of a notice is to make a party aware of the proceedings, which in this case was under section 143(3). When the party is already aware of the intended proceedings and appeared therein, service of a notice is an idle formality. In that case, it cannot be said that there has been any violation of any principles of natural justice. This is the wholesome principle which was statutorily recognized under section 292BB of the Act. The learned Tribunal held that the aforesaid provision has prospective operation. We are unable to agree with the learned Tribunal. This was a procedural matter and the amendment will have retrospective effect and shall apply to the pending 3 proceedings. The learned Tribunal held that "only one entry relating to seeking of reasons recorded by the Ld. Counsel for the assessee is there".
The aforesaid finding is clearly wrong. We called for the records of the Assessing Officer which go to show that on 10th March, 2010 he passed the following order"
" Sri Miroj Shah and Sri Vishan Khandelwal appeared. They are given copy of reason for issue of notice of 148 of Act".
From the aforesaid order passed by the Assessing Officer, it is difficult to infer that the learned Advocates or representatives of the assessee had appeared seeking a copy of the recorded reason. Such copy had already been given to the assessee and he had also given reply thereto. Therefore, their appearance on 10th March, 2010 could not have been for the purpose of collecting a copy of the recorded reasons.
We are, as such, of the opinion that the views expressed by the learned Tribunal are erroneous. The learned Tribunal upheld the order of the CIT (Appeal). Therefore, we need not separately deal with the reasoning of the CIT (Appeal).
Even assuming that the order under section 143(3) read with section 147 of the Income Tax Act was passed by the Assessing Officer without notice or 4 proper notice under section 143(2) of the Income Tax Act the omission could have been a reason for setting aside the order of assessment, but that could not have been a reason, in the facts and circumstances of this case, for nullifying the exercise under section 147 of the Income Tax Act.
For the aforesaid reasons, the orders passed by the learned Tribunal, Commissioner of Income Tax and the Assessing Officer are all set aside and the matter is remanded to the Assessing Officer. He shall give once again a fresh notice and shall proceed to pass an appropriate order after hearing the assessee.
Both the appeal and the application are, thus, disposed of.
(GIRISH CHANDRA GUPTA, J.) (SUDIP AHLUWALIA, J.) km AR(CR)