By Jagdish D. Shah, Jagdish T. Punjabi, Chartered Accountants
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Part B — Unreported Decisions
(Full texts of the following Tribunal decisions are available
at the Society’s office on written request. For members desiring that the
Society mails a copy to them, Rs.30 per decision will be charged for
photocopying and postage.)
23 Kuber Tobacco Products Pvt. Ltd.
v. DCIT
ITAT Delhi Bench ‘Special’
Before Vimal Gandhi (President),
I. P. Bansal (JM) and Deepak R. Shah (AM)
IT(SS) A No. 261/Del./2001
A.Y. : 1-4-1988 to 25-1-1999. Decided on : 14-1-2009
Counsel for assessee/revenue : Raj Kumar Gupta, Saurav
Rahatgi/Durga Charan Dash
S. 143(2) read with S. 292 BB of the Income-tax Act, 1961 —
Whether the assessee who has participated in the block assessment proceedings is
precluded from taking any objection that notice u/s.143(2) was not served upon
him or was not served upon him in time in view of the provisions of S. 292BB
inserted by the Finance Act, 2008 w.e.f. 1-4-2008 and if so, since when he can
be said to be so precluded — Held that S. 292BB is applicable to the A.Y.
2008-09 and subsequent assessment years.
Per I. P. Bansal :
Facts :
The issue before the Bench was regarding the validity of the
assessment made u/s.158BC in the absence of issuance of a notice u/s.143(2) of
the Act.
According to the Revenue in view of insertion of S. 292BB,
which is inserted by the Finance Act, 2008 w.e.f. 1st April, 2008, the assessee
cannot take the plea that assessment should be held invalid merely for the
reason that no notice u/s.143(2) was issued. Further, relying on the Madras High
Court decision in the case of Areva T & D India Ltd., it was contended that the
non-issuance/service of notice cannot render the assessment/re-assessment
invalid, but at best it can be a case of irregularity which can be removed. It
was also submitted that presumption against retrospective construction has no
application to enactment, which affects only the procedure, and the practice of
the Courts as held by the Rajasthan High Court in the case of Man Bahadur Singh.
Held :
The Tribunal referred to two of the Supreme Court decisions
viz., the case of H. V. Thakur and the case of Maharaj Chintamani Saran
Nath Shahdeo to examine the present issue. According to it,
‘First and foremost rule of
construction of interpretation is that in the absence of anything in the
enactment to show that it is to have retrospective operation, the said enactment
cannot be construed to have retrospective operation and when amendment relates
to a procedural provision resulting into creating a new disability or obligation
and which imposes new duty in respect of transactions already completed, then,
the said procedural provision also cannot be applied retrospectively. Similar is
the position where a statute which not only changes the procedure, but also
creates new rights and liabilities which shall be construed to be prospective in
operation, unless otherwise provided either expressly or by necessary
implication.”
Applying the above principle, it noted that S. 292BB has been
made effective by the Legislature from 1st April 2008 and there is nothing in
the enactment to show that S. 292BB has retrospective operation. If it is so,
according to Rule of Interpretation described above, S. 292BB cannot be
construed retrospectively. Further, it noted that if the principles laid down by
the Supreme Court in the above two cases were applied, it would mean that every
litigant has a vested right in substantive law, but no litigant has such right
in procedural law. It further added that though the provisions in question
related to procedural law, since the said procedural statute created a new
disability or obligation, and imposed new duties in respect of transactions
already accomplished, the statute cannot be construed to have retrospective
effect. Therefore, it was held that S. 292BB cannot be construed to have
retrospective operation and it has to be applied prospectively.
Cases referred to :
1. H. V. Thakur v. State of Maharashtra, AIR 1994 SC
2623
2. Maharaj Chintamani Saran Nath Shahdeo v. State of
Bihar, AIR 1999 SC 3609
3. Areva T & D India Ltd. v. ACIT, 294 ITR 233
(Mad.)
