Foundation of the assessment is erroneous and void ab initio as notice under section 143(2) issued by another AO to whom jurisdiction was transferred much later: ITAT

 

The Hon’ble Tribunal dismissed the appeal of the department on the following grounds:

(i) Notice dated 18.09.2013 under section 143(2) was issued by another AO to whom jurisdiction was transferred much later

The case was centralised vide order dated 26.11.2013 from ITO, Ward 9(3), Kolkata to DCIT, Central Circle-14, New Delhi. This order was passed on 26.11.2013 and the endorsement was forwarded to the concerned authorities for giving effect to the order signed on 03.12.2013. A direction is issued to ITO, Ward 9(3), Kolkata, requesting to intimate the concerned assessee and send a compliance report to the CIT(A), Kolkata-III, after the physical transfer of records is completed. The Hon’ble Tribunal held that this even makes it questionable as to how even without the communication of the letter dated 26.11.2013, the ITO, Ward 9(3), Kolkata may have forwarded the record with the Central Circle-14, New Delhi for issuance of statutory notice u/s 143(2) on 18.09.2013.

(ii) Invalid mode and manner of service of notice dated 19.08.2013 under section 143(2)
The affixation report is silent about the fact that the notice was actually
‘affixed’; the exact places where the notice was allegedly affixed; there were no independent witnesses; there is no order sheet supporting the conclusion of the AO of any denial on the part of the assessee to receive the notices or that the assessee was in any way avoiding the personal service to order for service by affixation. In fact, without specific direction to the serving inspector to serve by way of affixation there was no right for the serving inspector to serve by affixation, without endorsing in the report as what compelled him to serve by substituted service instead of personal service.

(iii) Notice dated 03.09.2014 and 29.10.2014 under section 143(2) on basis of a non-existent return
Entries in the order sheet show that the notice under section 143(2) issued on 03.09.2014 and 29.10.2014, was on the basis of a non-existent return. Thus, the basic foundation of the assessment is erroneous and void ab initio.

Hence, no notice under section 143(2) issued by JAO within time

The copy of the order is as under:

1734591934-Ftra8R-1-TO