The case number ITA 1721/DEL/2020 was filed by Javed Ahmad Wangnoo, Srinagar against the ITO Ward-54(1), New Delhi. This appeal pertains to the assessment year 2011-12 and was filed on October 19, 2020. The final order was pronounced on June 10, 2022, by the Income Tax Appellate Tribunal (ITAT) Delhi Bench ‘SMC’. The tribunal’s decision underscores the issues related to the proper service of notice under section 148 of the Income Tax Act.
Appellant: Javed Ahmad Wangnoo, represented by Bharat Durani & Associates, CA, 207, FF, Yatri Bhawan-II, Durga Nag, Dalgate, Srinagar, Jammu and Kashmir – 190001 (PAN: AAIPW2111Q).
Respondent: ITO Ward-54(1), New Delhi.
The case was heard by Sh. Chandra Mohan Garg, Judicial Member.
The appeal filed by Javed Ahmad Wangnoo was against the order dated August 7, 2020, passed by CIT(A)-23, New Delhi for the assessment year 2011-12. The primary contention of the appellant was that the reassessment order passed by the AO under section 147 of the Income Tax Act was without jurisdiction due to the improper service of notice under section 148.
The representative for the appellant, Shri Upinder Bhatt, C.A., argued that the reassessment order was passed without satisfying the statutory pre-conditions provided by the Act. Specifically, the appellant claimed that the notice under section 148 was not served within the prescribed time limit, rendering the reassessment proceedings and the subsequent order invalid.
The appellant’s counsel emphasized that the AO had passed the reassessment order without ensuring the proper service of the notice under section 148. The notice was returned undelivered, although subsequent notices to the same address were properly served. The appellant argued that this failure to serve the notice within the statutory period should result in the reassessment proceedings being quashed.
The respondent, represented by Shri Om Prakash, Sr. D.R., argued that the notice had been sent within the prescribed period to the address available in the department’s records. He contended that the appellant had a duty to inform the department of any change of address and that the reassessment proceedings were valid based on the notice being sent within the time limit.
Upon reviewing the submissions, the tribunal noted that the AO himself recorded that the notice under section 148 was returned undelivered. The tribunal considered the appellant’s argument that the subsequent notices were properly served on the same address, indicating that the initial notice was not served correctly.
The tribunal referenced the decision of the Hon’ble Delhi High Court in the case of CIT vs. Chetan Gupta, which held that the issue and service of notice under section 148 are jurisdictional requirements that must be mandatorily complied with. Failure to serve the notice properly renders the reassessment proceedings invalid.
In light of the above facts and legal precedents, the tribunal concluded that the AO did not comply with the mandatory requirement of serving the notice under section 148 on the appellant. Consequently, the reassessment proceedings and the reassessment order were quashed.
The tribunal allowed the appellant’s primary ground, thereby quashing the reassessment order and all consequent proceedings. Other grounds on merit were not adjudicated.
As a result, the appeal filed by Javed Ahmad Wangnoo (ITA No. 1721/DEL/2020) for the assessment year 2011-12 was allowed.
The order was pronounced in the open court on June 10, 2022, by the tribunal member, Sh. Chandra Mohan Garg, Judicial Member.
Conclusion: This case highlights the critical importance of following procedural requirements, such as the proper service of notice under section 148, to ensure that reassessment proceedings are valid and just. The tribunal’s decision to quash the reassessment order underscores the necessity for the Income Tax Department to adhere strictly to statutory mandates.
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