Income Tax Act, 1961 – s.142(1), Proviso to s.143(2) – Respondent-assessee company filed return of income for 2006-07, declaring total income of Rs.3,38,71,716/-, under E-Module Scheme – Notice u/s.143(2) issued to the assessee on 05.10.07 at the address available as per the PAN database –Another notice issued u/s.143(2) – Further notices u/s.142(1) issued to the assessee – Duly served – Notices challenged on the ground that they were not served upon the assessee as it never received them and the subsequent notices served and received were beyond the period of limitation prescribed under proviso to s.143– Assessing Officer made disallowance of Rs.8,91,17,643/- and computed total income at Rs.5,52,45,930/- – Assessment order confirmed by the CIT (Appeals), Income Tax Appellate Tribunal (ITAT) and the High Court – Held: Mere mentioning of the new address in the return of income without specifically intimating the Assessing Officer with respect to change of address and without getting the PAN database changed, is not sufficient – In absence of such specific intimation, Assessing Officer would be justified in sending the notice at the available address mentioned in the PAN database, more particularly when the return has been filed under E-Module scheme– Notices u/s.143(2) are issued on selection of case generated under automated system of the Department which picks up the address of the assessee from the database of the PAN – Therefore, change of address in the database of PAN is must, in case of change in the name of the company and/or any change in the registered office or the corporate office and the same has to be intimated to the Registrar of Companies in the prescribed format –Thereafter the assessee is required to approach the Department with the copy of the said document and make an application for change of address in the departmental database of PAN, which in the present case the assessee failed to do – Assessing Officer cannot be said to have committed any error and was justified in sending the notice at the address as per the PAN database – Thus, the notice dtd. 05.10.07 can be said to be within the period prescribed in proviso to s.143(2) – Once the notice is sent within the period prescribed in the proviso to s.143(2), in that case, actual service of the notice upon the assessee thereafter would be immaterial – Judgment of the High Court, CIT (Appeals) and the ITAT holding the assessment order bad in law, quashed – Matter remanded to the CIT (Appeals) to consider the appeal on merits, in accordance with law.
Allowing the appeal, the Court
HELD: 1.1 Notice under Section 143(2) of the Income Tax Act, 1961 was sent by the Assessing Officer to the assessee at the address as mentioned in the PAN database on 05.10.2007 and the same was within the time limit prescribed in proviso to Section 143(2) of the 1961 Act. It was the case on behalf of the assessee that vide communication dated 06.12.2005 the assessee intimated to the Assessing Officer about the new address and despite the same the Assessing Officer sent the notice at the old address. The assessee has failed to prove the alleged communication dated 06.12.2005. The only document available is Form No.18 filed with the ROC. Filing of Form-18 with the ROC cannot be said to be an intimation to the Assessing Officer with respect to intimation of change in address. No application was made by the assessee to change the address in the PAN data base and in the PAN database the old address continued. Therefore, in absence of any intimation to the Assessing Officer with respect to change in address, the Assessing Officer was justified in issuing the notice at the address available as per the PAN database. Therefore, the Assessing Officer cannot be said to have committed any error and in fact the Assessing Officer was justified in sending the notice at the address as per the PAN database. If that is so, the notice dated 05.10.2007 can be said to be within the period prescribed in proviso to Section 143(2) of the 1961 Act. Once the notice is issued within the period M/S I-VEN INTERACTIVE LTD., MUMBAI
prescribed as per the proviso to Section 143(2) of the Act, the same can be said to be sufficient compliance of Section 143(2) of the 1961 Act. Once the notice is sent within the period prescribed in the proviso to Section 143(2) of the 1961 Act, in that case, actual service of the notice upon the assessee thereafter would be immaterial. In a given case, it may happen that though the notice is sent within the period prescribed, the assessee may avoid actual service of the notice till the period prescribed expired. [Para 6.1] [516-F-H; 517-A-E]
1.2 Mere mentioning of the new address in the return of income without specifically intimating the Assessing Officer with respect to change of address and without getting the PAN database changed, is not enough and sufficient. In absence of any specific intimation to the Assessing Officer with respect to change in address and/or change in the name of the assessee, the Assessing Officer would be justified in sending the notice at the available address mentioned in the PAN database of the assessee, more particularly when the return has been filed under E-Module scheme. Notices under Section 143(2) of the 1961 Act are issued on selection of case generated under automated system of the Department which picks up the address of the assessee from the database of the PAN. Therefore, the change of address in the database of PAN is must, in case of change in the name of the company and/or any change in the registered office or the corporate office and the same has to be intimated to the Registrar of Companies in the prescribed format (Form 18) and after completing with the said requirement, the assessee is required to approach the Department with the copy of the said document and the assessee is also required to make an application for change of address in the departmental database of PAN, which in the present case the assessee has failed to do so. The impugned judgment and order passed by the High Court as well as the orders passed by the learned C.I.T (Appeals) and the I.T.A.T holding the assessment order bad in law on the aforesaid ground cannot be sustained and the same deserve to be quashed and set aside. As the learned C.I.T (Appeals) has not considered the other grounds on merits and has not considered the appeal on merits, the matter is required to be remanded to the learned C.I.T (Appeals) to consider the appeal on merits, in accordance with law. [Paras 7 & 9] [518-A-D; F-G]
Assistant Commissioner of Income Tax v. Hotel Blue Moon reported in (2010) 3 SCC 259 : [2010] 2 SCR
282 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
This page is for informational and research purposes only and does not constitute legal advice. Consult a qualified advocate for advice specific to your situation.