High Court Of Allahabad
Mohd. Ayub vs. ITO
Assessment Years : 1994-95 To 1997-98
Section : 148
R.K. Agrawal And B. Amit Sthalekar, JJ.
IT Appeal Defective No. 108 Of 2004
March 1, 2012
JUDGMENT
1. The present appeal has been filed under section 260A of the Income-tax Act, 1961 (hereinafter referred to as “the Act”), against the order dated April 20, 2004, passed by the Income-tax Appellate Tribunal, Allahabad. The appeal has been admitted on the following substantial questions of law :
“1. Whether, upon the facts and circumstances of the case, the Tribunal was justified in holding the single notice issued under section 148 for four assessment years as valid ?
2. Whether, upon the facts and circumstances of the case, the Tribunal was justified in treating the letter dated January 24, 2001, as notice under section 143(2) of the Act ?
3. Whether, upon the facts and in the circumstance of the case, the Tribunal’s finding that assessment order can be passed under section 143(3) of the Act without issuing notice under section 142(1) or under section 143(2) of the Act subsequent to the notice issued under section 148 of the Act is based on correct legal position ?
4.Whether, upon the facts and circumstances of the case, the Tribunal was correct in not giving due consideration to the contention of the appellant that protshahan money is not taxable?”
2. Briefly stated the facts giving rise to the present appeal are as follows :
The appeal relates to the assessment year 1996-97. The appellant acts as an agent of the post office and gets commission and incentive bonus in respect of the various saving schemes implemented by the post office. For the assessment year 1995-96, he had filed his return of income declaring an income of Rs. 43,740. A combined notice under section 148 of the Act was issued for four assessment years, i.e., 1994-95 to 1997-98 calling upon the appellant to submit his return. The appellant had not filed any return in respect thereof. A notice/letter dated January 24, 2001, for all the four years was issued calling upon the appellant to appear on the date fixed and explain the reasons for not disclosing the amount of incentive bonus. The appellant appeared and contested the matter. However, the Assessing Officer had not accepted the plea and has determined the total income at Rs. 2,02,240. The appellant preferred an appeal before the Commissioner of Income-tax (Appeals) who partly allowed the appeal with certain directions for determining the income regarding incentive bonus. Still feeling aggrieved the appellant preferred an appeal before the Tribunal. Before the Tribunal, the appellant had raised the question regarding the validity of the notice issued under section 148 of the Act as also the genuineness of notice under section 143(2) of the Act on the ground that in the absence of both the notice or any one of them, the entire proceedings were vitiated and without jurisdiction. The Tribunal has repelled both the contentions.
3. We have heard Shri Shakeel Ahmad, learned counsel for the appellant and Shri Dhananjay Awasthi, learned standing counsel appearing for the Revenue.
4. Shri Shakeel Ahmad submitted that a composite notice under section 148 of the Act is not contemplated in respect of four assessment years, i.e., 1994-95 to 1997-98 as each assessment year is an independent unit by itself and in respect of each assessment year proceedings have to be taken separately by issuance of notice under section 148 of the Act. He thus submitted that the assessment made under section 147/148 of the Act is wholly without jurisdiction and liable to be set aside. He further submitted that no notice under section 143(2) of the Act had been issued to the appellant in the absence of which the proceedings are even otherwise vitiated. On the merits he submitted that the Tribunal had not decided the question regarding the taxability of the incentive bonus. Shri Dhananjay Awasthi submitted that as the assessee was the same and the issue involved, which related to the escapement of the assessment, the Assessing Officer was perfectly justified in issuing one composite notice for all the four assessment years and, therefore, the proceedings have been validly initiated. He further submitted that the notice/letter dated January 24, 2001, conformed substantively to the requirement of section 143(2) of the Act and even otherwise saved by section 292B of the Act. So far as the question of taxability of incentive bonus is concerned, he submitted that this question was not argued before the Tribunal and, therefore, the Tribunal had rightly not gone into.
5. We have given our thoughtful consideration to the various pleas raised by the learned counsel for the parties. We are of the considered opinion that the appellant is liable to be succeed on the first point, that is, regarding non-issuance of separate notice under section 148 of the Act under the scheme of the Act. Each assessment year is taken to be an independent unit of assessment and the provisions of the Act applies separately, even where there has been escapement of income, the Assessing Officer is obliged to issue separate notice for each assessment year. The Assessing Officer in the present case admittedly has not issued separate notice under section 148 of the Act and instead had issued a composite notice which does not meet the requirement of section 148 of the Act. Thus, the entire reassessment proceedings are wholly without jurisdiction.
6. In this view of the matter, we are not called to go into the other questions raised by the learned counsel for the parties.
7. The appeal succeeds on this short point alone.
[Citation : 346 ITR 30]