- (1.) The revenue has filed the present appeal under Section 260A of the Income Tax Act, 1961 challenging order dated 18-5-2007 passed by the Tribunal, Amritsar Bench, Aniritsar in ITA No. 462/Asr/2004 reported as Rai Bahadur Kishore Chand & Sons v. Income Tax Officer,2008 113 TTJ(Asr) 586 Ed by raising the following substantial questions of law: (i) Whether in the facts and circumstances of the case, the Tribunal was right in law in concluding that the assessment order had not been passed on 26-3-2004 though the revenue had stated that the said assessment order had been dispatched to the assessee on 31-3-2004. (ii) Whether in the facts and circumstances of the case, the Tribunal has erred in law in setting aside the order of the assessment and Commissioner (Appeals), who based upon the office record had recorded a finding that the assessment order had been dispatched by registered post on 31-3-2004.
(2.) The brief facts of the case are that the assessee filed return on 31-10-2001 declaring total income of Rs. 1,92,971. The same was processed under Section 143(1) on 30-3-2002 at the returned income. However, the case was selected for scrutiny and as per the stand of the revenue, the assessing officer completed the assessment under Section 143(3) of the Income Tax Act,1961 vide his order dated 26-3-2004. The taxable income of the assessee was computed by the assessing officer as under: Rent received Rs. 13,95,116.00 Add : Arrears of rent Rs. 25,880.00 Rs. 14,20,996.00 Less : Municipal taxes shown under the account Rs. 1,71,722.00 House-tax in miscellaneous expenses Rs. 12,49,274.00 Less : Deduction under Section 24(1)(i) at the rate of 25% Rs. 3,12,318.00 Income from house property Rs. 9,36,956.00 Add : Miscellaneous income Rs. 28,682.00 Total : Rs. 9,65,638.00 Vide this order, the assessing officer also ordered for initiation of penalty proceedings under Section 271(1)(c) of the Income Tax Act against the assessee for concealing the particulars of its income. The assessee filed an appeal before the Commissioner (Appeals) against the said order on the ground that the order dated 26-3-2004 was served on the assessee by affixture on 1-4-2004 and the same is barred by limitation as the same was never properly served upon the assessee. However, the said appeal was dismissed by him vide his order dated 3-8-2004.
(3.) Aggrieved against the said order, the assessee filed an appeal before the Tribunal raising the grievance that the assessment order for the assessment year 2001-02 had not been passed within the time allowed. Although the assessment order passed by the assessing officer is dated 26-3-2004, yet it was served on the assessee by affixture only on 1-4-2004. It was also argued that no effort was made to serve the notice on the assessee through normal means before serving the notice by affixture. Thus, it was submitted that the service of the notice could be done by affixture only if service through normal means was not possible. It was also argued that in case the order was passed on 26-3-2004, why the same was not served by registered post on that date. It was also stated by the assessee that admittedly, a notice under Section 17(1) of the Wealth Tax Act, 1957 dated 29-3-2004 for the assessment year 1997-98 issued by the same assessing officer and was served on the assessee on 31-3-2004 and the service on the said notice was accepted by the assessee and if the impugned assessment order was also ready along with demand notice and challan, the same could have been accepted by the assessee on 31-3-2004 and where was the need for the assessing officer to effect service of the assessment order by affixture. Thus, it was argued that the assessment order had not been passed on 31-3-2004.;