CIT-II Vs. JAGDAMBA MARBLES LTD.

JUDGEMENT

(1.) THIS is an Appeal under Section 260A(1) of the Income Tax Act, 1961 ('IT Act. for short) assailing the Order of the Income Tax Appellate Tribunal (ITAT), New Delhi passed on 4.7.2008 in respect of the Block Assessment period 1.4.1990 to 30.10.2000. Section 158BE(2b) prescribes that the period of limitation for block assessments shall be two years from the end of the month in which the notice under Chapter XIV -B of the IT Act came to be served on the assessee concerned. The ITAT has found that 'admittedly' the notice under Section 158BD dated 24.1.2002 was dispatched to the assessee on 28.1.2002 as per the postal receipt. The ITAT has further returned a finding of fact that this notice was served upon the assessee on 30.1.2002. The Block Assessment Order came to be passed on 5.2.2004 and ,therefore, lacked jurisdiction inasmuch as the last date on which it could have been passed was 31.1.2004. The Assessment Order records the address of the Respondent/Addressee as C -4/127, S.D. Area, New Delhi. However, according to learned Counsel for the Respondent/Assessee the Assessee has shifted to 27, Sadhana Enclave, New Delhi around December -January, 2002. The ITAT has noticed that the aforementioned notice under Section 158BD dated 24.1.2002 was dispatched through Speed Post to the correct address, that is, 27, Sadhana Enclave, New Delhi. The envelope or any part of its enclosures enclosed along with Notice dated 24.1.2002 had not been returned to the Department raising the inference that it had been served on the Asseessee. A copy of the Notice dated 15.2.2002, along with postal receipts and the returned envelope, have been placed on record. There is sufficient reason, therefore, for the assumption that the Notice was duly served on the Assessee. We have perused the Assessment Order dated 5.2.2004 passed by Shri Sanjay Gupta, Deputy Commissioner of Income Tax, Central Circle -18, New Delhi, noting that the Notice under Section 158BD read with Section 158BC was issued on 5.2.2002 and that the Block Return had been filed by the Assessee on 22.3.2002. Beyond this, there is no discussion on the aspect that the Assessment Order was passed within the time prescribed by law.

(2.) THE CIT(A) -III, New Delhi, in the Order dated 14.1.2005, has recorded that 'as per the A.O. the notice Under Section 158BD dated 24.1.2002 was served upon the appellant on 15.2.2002. Though the appellant submitted that aforesaid notice was served on him on 30.1.2002, however, it could not bring on record any corroborative evidence to justify the same i.e. copy of speed post envelop or receipt showing date of service. Therefore, the ground raised by the appellant remained unsubstantiated and as the notice was served on 15.2.2002, the limitation for completion of block assessment proceedings comes to February, 2004'.

(3.) IT was in this factual background that learned Counsel for the Respondent has placed on record the Notice dated 24.1.2002 with the envelope thereof, as well as Notice dated 15.2.2002 with its envelope, together with Memorandum of Appeal in Form -35 filed before the CIT(Appeals), which categorically makes a mention of the Notice dated 24.1.2002. On a scrutiny of the Notice dated 24.1.2002, as well as the envelope, we are unable to arrive at any conclusion other than that it was duly dispatched and received by the Assessee on or before 30.1.2002. This is despite the fact that the Response/Return was filed only on 22.3.2002. Mr. Sahni, learned Senior Counsel for the Department, had submitted that the Notice dated 15.2.2002 was dispatched on 21.2.2002 but was returned to the Department with the endorsement that no such company existed at that address. According to him, the Notice dated 15.2.2002 was again issued on 4.3.2002. Meanwhile, the Return had been filed on 22.3.2002, which, in no way, excludes the possibility of service of the notice on the Assessee on or before 30.1.2002.