ITAT Quashes Assessment since Valid Notice u/s. 143(2) was not Served upon the Assessee [Read Order]

While allowing the appeal of assessee, Dr. SB Kalidhar, the ITAT quashed an assessment order for the reason that a valid notice under Section 143(2) of the Income Tax Act was not served upon the assessee before making such assessment.

The assessee, in the instant case, was aggrieved with the order of the CIT (A) wherein it was held that appellant cooperated during the course of re- assessment proceedings and did not challenge delay in the issue of notice u/s. 143(2) and also added that notice u/s. 143(2) was valid in the present case and it cannot be challenged after the completion of re-assessment proceedings.

The first appellate authority invoked the provisions of 292BB, wherein When an assessee has appeared in any proceeding or cooperated in any inquiry relating to an assessment or reassessment, it shall be deemed that any notice under any provision of this Act, which is required to be served upon him, has been duly served upon him in time in accordance with the provisions of this Act.

The assesee has contended that no valid notice was served upon the assessee u/s. 143(2) of the Act and on contrary DR relied upon the orders of the authorities.

While hearing both the contentions and perused the records and impugned order the bench observed that the issue is squarely covered in favour of the Assessee and against the Revenue and submitted various facts supporting cases.

The Tribunal bench pointed out that ITAT, ‘E’ Delhi Bench decision passed in the case of ITO vs. Naseman Farms Pvt. Ltd. & Orswherein the Tribunal has followed the decision of the Apex Court in the case of ACIT vs. Hotel Blue Moon and held that if the notice is not issued to the assessee before completion of the assessment, then the reassessment is not sustainable in the eyes of law and deserves to be cancelled. Accordingly, the plea of the assessee was upheld.

To Read the full text of the Order CLICK HERE