Excel for
Chartered Accountants

INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH: KOLKATA

I.T.A Nos.593 & 594/Kol/2013 Assessment Years: 1998-99 & 1999-2000
Shri Nirmalendu Dutta (Appellant) vs. Deputy Commissioner of Income-tax (Respondent)
Date of Order: 17-02-2016

ORDER

Both these appeals by assessee are arising out of common order of CIT(A)-XIV, Kolkata vide Appeal Nos. 377 & 378/CIT(A)-XIV/Kol/08-09 dated 23.11.2012. Assessment was framed by DCIT, Circle-28, Kolkata u/s. 143(3)/148/251 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for Assessment Years 1998-99 and 1999-2000 vide his separate orders dated 12.12.2008.

2. At the outset, it is noticed that both the appeals by assessee are delayed by 105 days and assessee has filed condonation petitions supported by affidavits stating that the assessee is suffering from heart ailment and was implanted pacemaker few weeks before the month of November, 2012 and appeal was filed before ITAT on 19.03.2013. The appellate order was served on assessee on 05.12.2012 and appeal was filed with a delay of 44 days only whereas registry has mentioned the delay of 105 days by taking the date of service as 5th October, 2012

but actually the service was done on 05.12.2012. On this, when a query was put to Ld. Sr. DR, he fairly conceded the position. In term of the above, as the cause is reasonable for the delay i.e.

the ailment of assessee i.e. three months but the delay is of 44 days, which I condone and both

the appeals are admitted.

3. The first legal issue raised by assessee is that notice u/s. 148 of the Act was barred by limitation and for this, the assessee has raised identically worded additional ground in both the appeals and the ground raised reads as under:

“1. For that the assessment completed u/s. 147 was bad in law since the notice u/s. 148 was served by the notice server after lapse of considerable time and there was no evidence to show that the notice was issued by the AO within the limitation period.”

4. Briefly stated facts are that for the AY 1998-99 and 1999-2000 returns of income were filed by assessee on 28.01.1999 and 03.01.2000 respectively. These returns were processed u/s. 143(1) of the Act on 10.01.2012 and 12.12.2001. Subsequently, notices u/s. 148 of the Act in both the assessment years were issued on 30.03.2005 and 30.03.2006 respectively and served on assessee on 16.05.2005 and 05.06.2006 for the AY 1998-99 and 1999-2000 respectively. The Ld. Counsel for the assessee stated that these notices were issued after 31.03.2005 and 31.03.2006 and for this, assessee has verified the records. To these facts Ld. Sr. DR agreed that

yes records show that notice for AY 1998-99 was issued after 31.03.2005 but notices are dated

30.03.2005. For AY 1999-2000 notice was dated 31.03.2006 but issued after 31.03.2006. On this Ld. Counsel for the assessee argued that notices issued after 31.03.2005 for AY 1998-99 and after 31.03.2006 for AY 1999-2000 were barred by limitation. In view of these facts he relied on the decision of Hon’ble Gujarat High court in the case of Kanubhai M. Patel (HUF) Vs. Hiren Bhatt or His Successors to Office& Ors. (2011) 334 ITR 25 (Guj), wherein it is held as under (from headnotes):

“In this regard, the record produced before the court is sufficient to come to the conclusion that the notices had been sent for booking to the speed post centre only on 7-4-2010, in absence of any evidence to the contrary being pointed out by the respondents, as well in the light of the fact that the said position as confirmed by the Postal Department has not been controverted by the revenue. The court is required to examine the contention of the petitioners that the notices in question have been issued beyond the period of limitation prescribed under section 149 of the Act. The expression to issue in the context of issuance of notices, writs and process, has been attributed the meaning, to send out; to place in the hands of the proper officer for service. The expression "shall be issued" as used in section 149 would therefore have to be read in the aforesaid context. In the present case, the impugned notices have been signed on 31-3-2010, whereas the same were sent to the speed post centre for booking only on 7-4-2010. Considering the definition of the word "issue", it is apparent that merely signing the notices on 31-3-2010, cannot be equated with issuance of notice as contemplated under section 149.The date of issue would be the date on which the same were handed over for service to the proper officer, which in the facts of the present case would be the date on which the said notices were actually handed over to the post office for the purpose of booking for the purpose of effecting service on the petitioners. Till the point of time the envelopes are properly stamped with adequate value of postal stamps, it cannot be stated that the process of issue is complete. In the facts of the present case, the impugned notices having been sent for booking to the speed post centre only on 7-4-2010, the date of issue of the said notices would be 7-4-2010 and not 31-3-2010, as contended on behalf of the revenue. In the circumstances, impugned notices under section 148 in relation to assessment year 2003-04, having been issued on 7-4-2010 which is clearly beyond the period of six years from the end of the relevant assessment year, are clearly barred by limitation and as such, cannot be sustained.”

5. I have examined the case records including assessment records and found that the notices issued u/s. 148 was dated 30.03.2005 and 31.03.2006 for AYs 1998-99 and 1999-2000 respectively but, these were issued, as admitted by Ld. Sr. DR, after 31.03.2005 and 31.03.2006. And records clearly shows that both the notices were handed over to Postal Authorities on 05.04.2005 and 07.04.2006 for AYs 1998-1999 and 1999-2000 respectively. In the given facts of the case it is apparent that notices have been dispatched/left the control of the officer only after the end of the financial year and the same was served only on 16.05.2005 for AY 1998-99 and 05.06.2006 for AY 1999-2000 respectively. It means that the same have clearly been issued beyond the prescribed period of limitation. Ld. Sr. DR referred to the decision of Hon’ble Supreme Court in the case of R. K. Upadhyay Vs. Sanabhai P. Patel (1987) 166 ITR 163 (SC), but the same was considered by Hon’ble Gujarat High Court. In view of these facts, we are of the view that the issue is covered in favour of assessee by the decision of Hon’ble Gujarat high Court in the case of Kanubhai M. Patel (HUF), supra. Respectfully following the same, I allow the appeal of assessee on jurisdictional issue.

6. As I have decided the appeal of assessee on jurisdictional issue, we need not to go into the merits of the case.

7. In the result, appeal of assessee is allowed.

Order pronounced in the open court on 17.02.2016.

(Mahavir Singh)
Judicial Member

Assessment 147 bad as notices u/s 148 were back dated and handed over to postal authorities beyond the prescribed period of limitation | 20-02-2016 |