Assessment Order Signed on a Holiday cannot be treated as Invalid: ITAT [Read Order]

The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has held that the assessment order signed on holiday could not be treated as invalid.

The assessee Priyal Kauhshal Shah was an individual engaged in the business of trading in shares, securities and derivatives transactions. As per the assessee, the notice under section 143(2) of the Act was digitally signed by the AO dated 30 September 2018 but the same was put into the process of service on 1st October 2018. According to the assessee, the AO was duty-bound to serve the notice under section 143(2) of the Act before the stipulated but the AO had failed to do so. Accordingly, the assessment framed under section 143(3) of the Act was invalid and not maintainable.

Sunil Maloo, who appeared on behalf of the assessee submitted that the income tax office was working as on 30 September 2018 despite the fact that it was the holiday being Sunday and the notice was digitally signed by the AO on 30 September 2018 and it should have been issued through the email on the same date.

He further submitted that the notice was invalid and the assessment framed on such notice was also not maintainable.

Purushottam Kumar, on behalf of the revenue submitted that the General Clause Act had provided that any or Regulation made after the commencement of this Act, any act or proceeding was directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office was closed on that day or the last day of the prescribed period, the act or proceeding would be considered as done or taken in due time if it was done or taken on the next day afterwards on which the Court or office was open Provided that nothing in this section shall apply to any act or proceeding to which the Indian Limitation Act, 1877 (15 of 1877), applies.

He, therefore, submitted that the notice served upon the assessee i.e. 1 October 2018 is the next working day could not be held as barred by time.

A Single Bench of Waseem Ahmed, (Accountant Member) allowed the appeal holding that the benefit granted under the General Clause Act as discussed above could not be deprived to the Revenue. “There was more workload on the Government Officers and therefore they had to work even on the holiday. But that does not mean that such holiday shall be presumed as a working day like any other normal day,” the Bench further observed.

To Read the full text of the Order CLICK HERE

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Priyal Kauhshal Shah vs I.T.O , 2023 TAXSCAN (ITAT) 721 , Shri Sunil Maloo , Shri Purushottam Kumar