- (1.) The present appeal is filed under section 260A of the Income-tax Act, 1961, against the order dated December 9, 2004, passed by the Income-tax Appellate Tribunal, Lucknow, in I.T.A. No. 189/Alld/2000; I.T.A. No. 254/Alld/2000 and CO No. 17/Luc/2003 for the assessment year 1996-97 whereby, the Tribunal vide its impugned order has admitted the following additional ground and allowed relief to the assessee accordingly : That the learned Assessing Officer is not justified in passing the order of intimation under section 143(1)(a) of the Income-tax Act subsequent to issuance of notice under section 143(2) of the Income-tax Act for regular assessment. The Tribunal in its order dated December 9, 2004, observed that : The learned counsel for the assessee has also filed before us a copy of notice under section 143(2) dated March 11, 1997, and pointed out that the intimation under section 143(1)(a) was issued on December 14, 1998, i.e., after the issuance of notice under section 143(2), which is bad in law in view of the decision of the hon'ble Supreme Court in , in the case of CIT v. Gujarat Electricity Board, 2003 260 ITR 84 wherein it has been held that it is not open to the Revenue to issue intimation under section 143(1)(a) of the Income-tax Act after the notice for regular assessment is issued under section 143(2). The additional ground raised by the assessee being purely legal in nature is admitted. In view of the decision of the hon'ble Supreme Court, the intimation issued under section 143(1)(a) being bad in law, is cancelled. In the result, the appeal filed by the assessee is allowed and the appeal filed by the Department is dismissed.
(2.) Being aggrieved, the Department has filed the present appeal raising the following substantial question of law : Whether the hon'ble Income-tax Appellate Tribunal has erred in law in holding that the intimation issued under section 143(1) (a) is bad in law without appreciating that intimation under section 143(1)(a) was issued in respect of the revised return whereas the notice under section 143(2) was issued in respect of the original return prior to the filing of the revised return by the respondent.
(3.) The brief facts of the case are that, in the instant case, the original return of income was filed on January 31, 1997, declaring the total income of Rs. 6,97,59,206. Thereafter, the assessee filed a revised return on March 30, 1998, declaring the loss of Rs. 74,97,579 in which expenses amounting to Rs. 8,14,55,626 were further claimed and in respect of the said claim, the assessee, vide letter dated March 30, 1998, clarified that the necessity of revising the return has arisen as during the course of finalization of return for the assessment year 1997-98, it transpired that the expenses totalling to Rs. 8,14,55,626 relating to and which accrued for the previous year relevant to the assessment year 1996-97, have been paid and accounted for in the subsequent year and as per the mercantile system of accounting, the same are allowable in the assessment year 1996-97 and, as such, the claim thereof has been made in the revised return. The revised return was processed under section 143(1)(a) of the Act on December 14, 1998, on a total income of Rs. 9,86,85,952 by treating the status of the assessee as an association of persons under section 185 and also making certain prima facie adjustment in the return of negative income.;