Allahabad H.C : The Tribunal have erred in law in not taking into consideration the provisions of section 292BB of the Act while allowing the assessee to raise the additional ground of appeal and in deciding the same in the assessee’s favour by completely ignoring the fact that the assessee had participated in the assessment proceedings

High Court Of Allahabad

CIT vs. Bihari Lal Agrawal

Section : 158BC

R. K. Agrawal And B. Amit Sthalekar, JJ.

IT Appeal No. 288 Of 2011

March 2, 2012

JUDGMENT

1. The present appeal under section 260A of the Income-tax Act, 1961 (hereinafter referred to as “the Act”), has been filed against the order dated May 12, 2011, passed by the Income-tax Appellate Tribunal, Lucknow Bench. The Revenue has proposed the following questions said to be substantial questions of law which arise out of the order of the Tribunal and require adjudication by this court :

“1. Whether, on the facts and in the circumstances of the case, the Commissioner of Income-tax (Appeals) and the Tribunal have erred in law in not taking into consideration the provisions of section 292BB of the Act while allowing the assessee to raise the additional ground of appeal and in deciding the same in the assessee’s favour by completely ignoring the fact that the assessee had participated in the assessment proceedings ?

2. Whether the judgement of the hon’ble Supreme Court in the case of Asst. CIT v. Hotel Blue Moon reported in [2010] 321 ITR 362 (SC) relied upon by the Commissioner of Income-tax (Appeals) and the Tribunal in deciding the issue of non-issuance/service of notice under section 143(2) of the Act in favour of the assessee, is not at all applicable to the facts of the present case as the judgment of the apex court has not taken into consideration the provisions of section 292BB of the Act and is silent in respect of the same despite the fact that the said section had been brought on the statute book by the Finance Act, 2008, with effect from April 1, 2008, and the orders of the Commissioner of Income-tax (Appeals) and the Tribunal have been passed after April 1, 2008 ?

3. Whether the assessee ever objected to/raised the issue of non-issuance/service of notice under section 143(2) of the Act before the Assessing Officer during the assessment proceedings and fully participated in the same as such the Commissioner of Income-tax (Appeals) has erred in law in allowing the assessee to raise this issue for the first time before him without appreciating the fact that the assessee had participated in the assessment proceedings and the order of the Commissioner of Income-tax (Appeals) has been confirmed by the Tribunal ?”

2. Briefly stated the facts giving rise to the present appeal are as follows :

The appeal relates to the block period ending August 23, 1998. The respondent is an individual. A search and seizure operation under section 132(1) of the Act was conducted at the residential premises of the respondent-assessee. The proceeding for the block period assessment was initiated and notice under section 158BC of the Act was issued on July 10, 2000. The return was filed. However, without issuing any notice under section 143(2) of the Act, assessment was completed on a total income of Rs. 21,38,533.

3. Feeling aggrieved, the assessee preferred an appeal before the Commissioner of Income-tax (Appeals), who, vide order dated August 12, 2010, had been pleased to allow the appeal on the short ground that no notice whatsoever under section 143(2) of the Act was served upon the assessee before proceeding to make assessment. While holding so, the Commissioner of Income-tax (Appeals) has relied upon a decision of the hon’ble Supreme Court in the case of Asstt. CIT v. Hotel Blue Moon [2010] 321 ITR 362/188 Taxman 113.

4. The Revenue preferred an appeal before the Tribunal. The Tribunal by the impugned order dated May 12, 2011, had rejected the appeal.

5. Heard Sri D. Awasthi, learned senior standing counsel for the Revenue and Sri Sidharth Pathak, learned counsel appearing for the respondent-assessee.

6. We find that a categorical finding has been recorded by the Commissioner of Income-tax (Appeals) and the Tribunal that no notice under section 143(2) of the Act had been served upon the assessee and the block assessment has been made. They participated in the said proceedings. Matter is squarely covered by the law laid down by the hon’ble Supreme Court in the case of Hotel Blue Moon (supra).

7. We also may mention here that the question of section 292BB of the Act pressed into service by the Revenue herein came up for consideration before this court in Income Tax Appeal No. 286 of 2011, decided on November 23, 2011 (CIT v. Mukesh Kumar Agrawal [2012] 345 ITR 29/25 taxmann.com 112 (All)) and this court has held that the proviso to section 292BB is not applicable in a case where the authority did not have jurisdiction to proceed further and make assessment.

8. Respectfully following the above decision, we are of the considered opinion that the order of the Tribunal does not suffer from any legal infirmity. The appeal does not raise any question of law much less any substantial question of law.

9. The appeal fails and is dismissed in limine.

[Citation : 346 ITR 67]

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