Chandanmalnagaraj, Chennai vs Acit Non Corporate Circle 4(1), Chennai on 13 March, 2019
9. The undisputed facts in this case include that the AO issued notice of demand
u/s.156 of the Act as well as issue of notice u/s.274 r.w.s. 271(1)(c) of the Act at the
stage of making draft assessment order as per the provisions of section 144C(1) of
the Act. Normally, such notices are issued at the end of the assessment proceedings
and at the time of making assessment order. The fact that demand is raised is evident
on the fact of draft assessment order which bears the entry of the demand in the
register of Demand Collection and Balance (DCR 02/45, dated 20-2-13). The notice
u/s.274 of the Act is found issued for furnishing of inaccurate particulars of income.
On law, it is settled legal proposition at the level of High Courts that the assessment
orders based on such draft assessment orders not following the mandatory provisions
of section 144C of the Act is without jurisdiction and therefore, null and void and
not enforceable in law. Further, the Hon'ble Andhra Pradesh High Court in the case
of M/s. Zuari Cements Ltd. Vs. ACIT in Writ Petition No.5557/2012, dated 21-02-
2013 held that the impugned order dated 12-12-2011 passed by the respondent was
:- 22 -: IT(TP)A No.80 /2018
contrary to the mandatory provisions of section 144C of the Act is declared as one
without jurisdiction, null and void and unenforceable. (SLP filed against the
judgment of AP High Court in the case of ACIT Vs. M/s. Zuari Cements Ltd. by the
Revenue stands dismissed on this issue).