Commissioner Of Income-Tax, Faridabad v. Sh. K.c.tapedar

of 2006 *** IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH Income-tax Appeal No.417 of 2006Date of decision: 28.3.2011 Commissioner of Income-Tax, Faridabad ...Appellant Versus Sh. K.C.Tapedar ...Respondent CORAM: HON'BLE MR.JUSTICE ADARSH KUMAR GOEL HON'BLE MR.JUSTICE AJAY KUMAR MITTAL Present: Ms. Urvashi Dhugga, Senior Standing Counsel for the appellant. None for the respondent. **** AJAY KUMAR MITTAL, J. 1.As per office report service is complete. No one appears onbehalf of the respondent to oppose the prayer made in the appeal. 2.This appeal has been preferred by the revenue under Section260A of the Income Tax Act, 1961 (hereinafter referred to as “the Act”)against order dated 5.8.2005 passed by the Income Tax AppellateTribunal, Delhi Bench 'E', Delhi (for short, “the Tribunal”) in ITANo.3503/DEL/2001, relating to the assessment year 1998-99. 3.The appeal was admitted on 20.7.2007 for determination of thefollowing substantial questions of law by this Court:- “i)Whether on the facts and in the circumstances of thecase, the assessment can be annulled on the ground thatnotice u/s 143(2) was not served upon the assesseepersonally but upon one of his subordinates? ii)Whether the defect in effecting service of notice u/s 143(2) is not curable u/s 292-B of the Income Tax Act, 1961? *** iii)Whether on the facts and in the circumstances of thecase, the Hon'ble ITAT was right in law in confirming the orderof the CIT(A) quashing the assessment order on the basis ofservice of notice u/s 143(2) of the Act on the person availableat the office premises of the company in which the assesseewas a Managing Director?” 4.The facts as stated in the appeal necessary for adjudicationfor the present appeal may be noticed. The assessee declared an incomeof Rs.14,51,028/- in his return filed on 29.9.1998. The return wasprocessed under Section 143(1)(a) of the Act on 31.5.1999. The case ofthe assessee was selected for scrutiny and notice under Section 143(2) ofthe Act was issued on 29.9.1999. The said notice was received by Sh.Sanjay Chaudhary on behalf of the assessee. The assessing officercompleted the assessment under Section 143(3) of the Act at an income ofRs.21,27,100/- on 16.2.2001 after making certain additions. The assesseefeeling aggrieved against the additions made by the Assessing Officer hadfiled an appeal before the Commissioner of Income-Tax (Appeals) (forshort “the CIT(A)”) which was allowed on 1.6.2001 on a technical groundthat the notice under Section 143(2) of the Act was served on Shri SanjayChaudhary on behalf of the assessee who was not authorisedrepresentative of the assessee. The appeal of the Revenue against thesaid order was dismissed by the Tribunal vide order dated 5.8.2005.Hence this appeal. 5.We have heard the learned counsel for the revenue and haveperused the records. 6.Learned counsel for the Revenue submits that Shri SanjayChaudhary was duly authorised representative of the assessee and hadbeen appearing on his behalf in the proceeding relating to the earlier years as well. She drew the attention of this Court to the letter No.438 dated31.5.2001 which was addressed by the representative of the assesseewhich reads as under:- 5.We have heard the learned counsel for the revenue and haveperused the records. 6.Learned counsel for the Revenue submits that Shri SanjayChaudhary was duly authorised representative of the assessee and hadbeen appearing on his behalf in the proceeding relating to the earlier years as well. She drew the attention of this Court to the letter No.438 dated31.5.2001 which was addressed by the representative of the assesseewhich reads as under:- “Sh.K.C.Tapedar, the assessee is residing at C-4/42,Safdarganj, Delhi but filing the return of income-tax andwealth-tax at Faridabad being the director of the company M/sPorritts & Spencer (A) Ltd., Faridabad. Return of income wasfiled on 29.09.1998. Notice u/s 143(2) was served throughnotice serve which was received by Sh. Sanjay Chaudhary onbehalf of the assessee on dated 30.9.99. In response to thisnotice Mr. Sanjay Chaudhary attended the proceedings ondated 8.10.99. The records show in the earlier years alsonotices were received and proceedings were attended by theSh. Sanjay Chaudhary, duly authorised by the assessee.Therefore, notice was served within time and was valid one.The CIT(A) may kindly decide the issue.” 7. Learned counsel for the Revenue further submits that in viewof Section 292-B of the Act such technical defect, if any, could not be fatalto the proceedings. 8.We have given our thoughtful consideration to the submissionsof learned counsel for the revenue and find weight therein. 9.In the present case, admittedly the notice issued under Section143(2) of the Act in the name of the assessee was served upon Sh. SanjayChaudhary on 30.9.99. The proceedings on 8.10.99 were attended by Sh.Sanjay Chaudhary on behalf of the assessee. It has been specificallystated in letter dated 31.5.2001 addressed by the representative of theassessee that Shri Sanjay Chaudhary was served on behalf of theassessee on 30.9.99 and had appeared on 8.10.99. On earlier occasions and in earlier years, Sh. Sanjay Chaudhary had been representing theassessee before the Department. During the assessment proceedings, noobjection regarding validity of the notice under Section 143(2) of the Actwas raised. Nothing had been produced by the assessee to establish thatSh. Sanjay Chaudhary was no longer his authorised representative.Moreover, the provisions of Section 292B of the Act would protect theassessment order from being declared null and void for want of service inthe present fact situation. The CIT(A) and the Tribunal were, thus, notjustified in holding the assessment order to be vitiated. 10.In view of the above, the substantial questions of law areanswered in favour of the revenue. The orders of the CIT(A) as well as theTribunal are set aside. The matter is remanded to the CIT(A) to decide thesame on merits in accordance with law. ( Ajay Kumar Mittal) Judge March 28, 2011Pka (Adarsh Kumar Goel) Judge