By TIOL News Service

ALLAHABAD, MAY 23, 2016: THE issue is - Whether service of notice shall be deemed to be valid, if on account of assessee's refusal to accept the notice the same is affixed at the outer door of his business premises. YES is the verdict.

Facts of the case

The assessee is a doctor by profession. He had duly filed his return of income for the A.Y. 2008-09. A notice u/s 142(1) was received by assessee informing about initiation of proceeding u/s 148 for reassessment of income for the A.Y. 2008-09. In response to the same, assessee sought a certified copy of inspector's report and a certified copy of order sheet. However, assessee was told to comply with the notice u/s 142(1) and after that the requested documents will be provided. Assessee being aggrieved by such refusal and by initiation of reassessment proceeding had filed a writ petition. Assessee also contends that for initiation of proceedings u/s 148, service of notice is essential which in the present case has not been complied with. He further submits that since notice u/s 148 had not been served till date, thus, the entire proceedings stood vitiated in the absence of a valid notice. It is also alleged that such service was made not at his residence but at his clinic.

After hearing parties, HC held that,

++ the contention of the assessee, that the provision with regard to the procedure of service as provided under Order V Rule 17 and 18 has not been complied, is patently erroneous. Order V Rule 17 clearly indicates that when the notice cannot be served, the serving officer shall affix the copy of the summons on the outer door or at some other conspicuous part of the house in which the assessee ordinarily resides or carries on business. In the instant case, the Inspector's report clearly indicates that the assessee personally refused and thereafter the notice was affixed at the outer door of his clinic. The contention that the service was not made at his residence, but at his clinic is immaterial. The fact remains, that the service was made at his business place and that the assessee himself refused to accept the notice. The Inspector's report also indicates the time and manner of service which is in compliance with the Order V Rule 18 of the C.P.C. In the light of the aforesaid, we are of the opinion, that the service of the notice under Section 148 of the Act was validly made;

++ once we have held that a valid notice u/s 148 of the Act had been issued, it is open to the assessee to raise this objection before the assessing authority, as to whether the original assessment proceeding for the assessment year 2008-09 are pending or not and whether a valid notice u/s 142(1) of the Act has been issued. If such objections are filed, the assessing authority will consider the same while making the reassessment order u/s 148 of the Act;

++ we are of the opinion, that the ITO had committed an error in not supplying the details as asked by the assessee. It is not open to the ITO to force the assessee to comply with the notice issued u/s 142(1) of the Act as a condition precedent for supply of information that was demanded by him. We, accordingly, direct the ITO to supply the information as demanded by the assessee within five working days from the date of receipt of the certified copy of this order.

(See 2016-TIOL-988-HC-ALL-IT )