Commissioner of Income Tax vs Kishan Chand

Adarsh Kumar Goel, J.—At the instance of the Revenue, the following question of law has been referred by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar, for opinion of this Court, arising out of its order dated July 31, 1990, in I. T. A. No. 16(ASR)/1987 for the assessment year 1969-70:

Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal is right in law in upholding the findings of the Appellate Assistant Commissioner of Income Tax, Talandhar Range, Talandhar to the effect be said to be proper service especially when the Assessee has refused to accept the service of the said notice ?

The Assessee is individual and as a sequel to the search and seizure operation was conducted on his premises, he filed revised return. The Assessing Officer framed assessment u/s 144 of the Act on the basis of best judgment. The Commissioner of Income Tax (Appeals) accepted the appeal mainly on the ground that the Assessee had not been served. Evidence with regard to service by affixture was rejected on the ground that resort to affixture could not be straightaway taken without first taking other modes of service. The Tribunal affirmed the said finding. It was observed:

From the facts of the case, I find that the search and seizure operations had been taken at the business and residential premises of the Appellant as far back as August, 1976, and the income of the assessment year 1969-70 could be assessed by issuing a notice by March 31, 1978. Notice u/s 148 was issued on March 23, 1978, and the Income Tax Officer was naturally anxious to see that the notice gets served by March 31, 1978. Though he meticulously complied with all the formalities prescribed with regard to the service of notice through the affixture yet the hurry which he had to make is quite apparent. As pointed out, search had taken place in the year August, 1976, and when no action had been taken up to March 23, 1978, taken recourse to service by affixture can be said only a sheer formality and not the real sendee as held by their Lordships in different judgments of the different High Courts, referred to above....

Learned Counsel for the Revenue is unable to show that there was any refusal of the Assessee to accept service as has been assumed in the question referred. On the other hand, the Tribunal has categorically held that no other mode was adopted and steps for service of notice were taken about a week before the time was expiring.

In view of the finding of the Tribunal, which is not shown to be perverse, the question referred has to be answered against the Revenue and in favour of the Assessee. Ordered accordingly.

Reference is disposed of.