The Shahbad Cooperative Sugar Mills Limited, Shahbad v. Deputy Commissioner Of Income Tax, Special Range, Karnal And Another

Civil Writ Petition No.723 of 1994 (O&M) 1 IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. Civil Writ Petition No.723 of 1994 (O&M)Date of Decision: 6[th] September, 2013 The Shahbad Cooperative Sugar Mills Limited, Shahbad Versus ..Petitioner Deputy Commissioner of Income Tax, Special Range, Karnal and another ..Respondents CORAM:HON'BLE MR JUSTICE RAJIVE BHALLA HON'BLE MR. JUSTICE DR. BHARAT BHUSHAN PARSOON Present:Mr. S.K.Mukhi, Advocate, for the petitioner. Mr. Yogesh Putney, Advocate, for the respondents. RAJIVE BHALLA, J. The petitioner prays for issuance of a writ of certiorariquashing notices dated 22.5.1992 and 17.8.1993 issued underSection 143 (2) of the Income Tax Act, 1961 (hereinafter referred toas the “Act”). Counsel for the petitioner submits that as notice for re-assessment, issued under Section 143 (2) of the Act, was served onthe assessee 12 months after the end of the month in which thereturn was furnished, the impugned notice is null and void. It isfurther argued that the petitioner filed its return, for the assessmentyear 1991-92, on 31.10.1991. The return was picked up for scrutinyby serving a notice dated 17.8.1993 under section 143 (2) of the Act.Varinder KumarThe petitioner preferred objections by averring that notice was not2013.09.13 13:03I attest to the accuracy andintegrity of this documentHigh Court Chandigarh Civil Writ Petition No.723 of 1994 (O&M) 2 served within 12 months from the end of the month in which returnwas furnished. The Assessing Officer forwarded a communicationfalsely averring that an earlier notice dated 22.5.1992, issued undersection 143 (2) of the Act, had already been dispatched to thepetitioner, within the period prescribed by the proviso to Section 143(2) of the Act. The petitioner replied vide letter dated 11.11.1993 thatno such notice had ever been received as it had received a notice forassessment year 1991-92. Despite this objection, the respondentproceeded to finalise assessment. It is further argued that as noticewas served after the period of 12 months and service of any notice,dated 22.5.1992, is not borne out from the record, the writ petitionmay be allowed, the notice and the assessment order may bequashed. In support of his arguments, counsel for the petitioner,relies upon a judgment of the Hon'ble Supreme Court in AssistantCommissioner of Income Tax and another versus Hotel Blue Moon,(2010) 35 DTR (SC) 1. Counsel for the revenue submits that the writ petitionshould be dismissed as notice dated 22.5.1992, issued underSection 143 (2) of the Act, for the assessment year 1991-92, wasdispatched to the petitioner vide dispatch no. 177 dated 22.5.1992and likewise for the assessment year 1990-91, notice under Section143 (2) of the Act was issued and sent vide dispatch no.177 dated22.5.1992. Copies of the notices are appended with the reply asAnnexures R-1 and R-2. A second notice for the assessment year1991-92 was issued on 17.8.1993, vide registered post with dispatchno.487 dated 18.8.1993 was also served on the assessee. TheVarinder Kumar2013.09.13 13:03I attest to the accuracy andintegrity of this documentHigh Court Chandigarh Civil Writ Petition No.723 of 1994 (O&M) 3 contention of the assessee that this notice was served after theperiod of 12 months was considered and office letter no.877 dated21.10.1993 was forwarded to the assessee by appending a photocopy of notice issued on 22.5.1992. Thus, as notice, under section143 (2) of the Act, issued on 22.5.1992, duly evidenced by an entry inthe dispatch register, was never received back, it was presumed tohave been served upon the assessee within twelve months. Thepetitioner's contention that the assessee was not served with noticesunder section 143 (2) of the Act, for assessment years 1990-91 and1991-92, is factually incorrect. Civil Writ Petition No.723 of 1994 (O&M) 3 contention of the assessee that this notice was served after theperiod of 12 months was considered and office letter no.877 dated21.10.1993 was forwarded to the assessee by appending a photocopy of notice issued on 22.5.1992. Thus, as notice, under section143 (2) of the Act, issued on 22.5.1992, duly evidenced by an entry inthe dispatch register, was never received back, it was presumed tohave been served upon the assessee within twelve months. Thepetitioner's contention that the assessee was not served with noticesunder section 143 (2) of the Act, for assessment years 1990-91 and1991-92, is factually incorrect. We have heard counsel for the parties, perused theimpugned notice and the impugned orders. The dispute, in the present case, revolves around theissuance and service of notices issued under Section 143(2) of theAct for assessment years 1990-91 and 1991-92. There is no disputethat notice under section 143 (2) of the Act, has to be served uponan assessee, before the expiry of 12 months from the end of themonth in which the return is furnished. The revenue relies uponnotices dated 22.5.1992, dispatched to the petitioner, vide dispatchno.177 dated 22.5.1992. etc. A relevant extract from paras 6, 7 and 8of the reply reads as follows:- “ 6 That initial notice u/s 143(2) dated 22.5.92 issuedvide dispatch No.177 dated 22.5.92 has never beenreceived back by the office and as such this tantamountsto be a valid service. Moreover the petitioner appearedbefore the A.O. in pursuance to notice dated 22.5.1992 Civil Writ Petition No.723 of 1994 (O&M) 4 for Assessment Year 1990-91 hence it does not lie in hismouth to contend that notice u/s 143(2) for theassessment year 1991-92 is not served upon particularlywhen both the notices u/s 143(2) for the assessment year1990-91 & 1991-92 were dispatched together. 7. That this notice of dated 22.5.92 also falsifies thecontention of the assessee as the same notice was alsoissued for the assessment year 1990-91 vide the samedispatch No. i.e., 177 dated 22,5,92 in a single Envelopand to this assessee has duly complied. 8. That surprisingly the assessee has nothing uttered towards the issuance of notice u/s 143(2) of the I.T.Actwhich was issued vide dispatch no.177 dated 22.5.92 forthe assessment year 1990-91. Only this score provesthat the notices issued u/s 143(2) of the Income Tax Actvide dispatch No.177 dated 22.5.1992 were validly issuedand served.” The averments in the reply, duly supported by copies ofthe notices, dispatched vide dispatch no.177 and the fact that noticeswere not received back raise a presumption of service under Section27 of the General Clauses Act, 1897. The onus to rebut thepresumption of service of notice sent by post, lies upon the petitioner.The petitioner has failed to discharge this onus. The bald denial by the petitioner that notice was never received, in our consideredopinion, is insufficient, to record a finding in favour of the petitioner. Civil Writ Petition No.723 of 1994 (O&M) 5 and submissions that notice dated 22.5.1992 was not served uponthe petitioner, within the period of 12 months prescribed by theproviso to Section 143 (2) of the Act. The averments in the reply, duly supported by copies ofthe notices, dispatched vide dispatch no.177 and the fact that noticeswere not received back raise a presumption of service under Section27 of the General Clauses Act, 1897. The onus to rebut thepresumption of service of notice sent by post, lies upon the petitioner.The petitioner has failed to discharge this onus. The bald denial by the petitioner that notice was never received, in our consideredopinion, is insufficient, to record a finding in favour of the petitioner. Civil Writ Petition No.723 of 1994 (O&M) 5 and submissions that notice dated 22.5.1992 was not served uponthe petitioner, within the period of 12 months prescribed by theproviso to Section 143 (2) of the Act. The judgment, relied by the petitioner in Hotel MoonBlue's case(supra), does not enure to the petitioner's benefit as ithas only been held that notice under Section 143 (2) of the Act,should be served within one year from the date of filing of return andomission on the part of the revenue to serve notice under section 143(2) of the Act, is not a mere procedural irregularity so as to curable.We have no quarrel with the ratio of this judgment but ascontroversy, in the present case, is not, whether the notice suffersfrom any curable defect, but whether notice was issued and servedwithin 12 months of the period prescribed by proviso to Section 143(2) of the Act, the judgment does not advance the petitioner's case. In view of what has been stated hereinabove, we find noerror of jurisdiction or of law in the impugned order or proceeding anddismiss the petition with no orders as to costs. ( RAJIVE BHALLA ) JUDGE 6[th]September, 2013VKVK ( DR. BHARAT BHUSHAN PARSOON ) JUDGE