The scrutiny notice was posted in time but the postman could not find me; it was handed to my representative instead. Can I say it was never served and the assessment is invalid?
Not on these facts. The Supreme Court set aside the Allahabad High Court's order quashing a section 143(2) notice. The notice was issued on 16 October 2006 and despatched by registered post on 18 October, the last date for service being 30 October. It could not be served twice because the assessee was not available, and was served on 19 October on his authorised representative, whom he later disowned. That was enough to draw an inference of deemed service and sufficient compliance with section 143(2). The Court expressly left open, for an appropriate case, the larger question whether the provision requires service or only issue.
Decided by the Supreme Court (Supreme Court of India — Ranjan Gogoi J and R. Banumathi J) on 2018-02-19, reported as Civil Appeal No. 2262 of 2018 arising out of SLP (C) No. 9174 of 2015 (Supreme Court of India); impugned judgment dated 5 December 2012 in Writ Petition No. 642 of 2007 (Allahabad High Court). It bears on section 143(2) of the Income Tax Act 1961, in Assessment & Scrutiny matters.
This is the answer to the assessee who accepts that a section 143(2) notice went out in time but says it never reached him. The Court will look at the conduct: repeated non-availability at the address, coupled with service on someone who received it as the assessee's representative and is disowned only later, supports an inference of deemed service. That reasoning is regularly deployed against limitation objections built on service. Its limits matter as much as its holding — the Court decided the case on its own peculiar facts and deliberately did not decide whether section 143(2) requires service of the notice or only its issue, so it is not authority on that question, and the Allahabad High Court's contrary view on it was not approved either.
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The Revenue issued a notice to the assessee under section 143(2) of the Income-tax Act 1961 on 16 October 2006 and despatched it by registered post on 18 October 2006. Under section 143(2) as then in force the notice had to be served on the assessee by 30 October 2006 at the latest. The record showed that on two occasions the notice sent by registered post could not be served because the assessee was not available, and that it was served on 19 October 2006 on his authorised representative — a person the assessee subsequently disowned. The assessee filed a writ petition in the Allahabad High Court, which by its judgment of 5 December 2012 in Writ Petition No. 642 of 2007 quashed the notice, taking the view that what section 143(2) requires the Revenue to satisfy is service of the notice and not its mere issue. The Revenue appealed to the Supreme Court.
The appeal was allowed and the order of the High Court set aside. The Court held that the non-availability of the assessee to receive the notice sent by registered post on as many as two occasions, together with service of the notice on 19 October 2006 on his authorised representative whom he now disowns, was sufficient to draw an inference of deemed service on the assessee and of sufficient compliance with the requirement of section 143(2). On that view the High Court was not right in the conclusion it reached on the facts of the case. The Court declined to decide the question whether section 143(2) requires service of the notice rather than mere issue, expressly keeping it open for decision in an appropriate case, because this case could be resolved on its own peculiar facts.
The Court identified the question the writ petition raised — whether, where a notice is posted within time but not actually served on the assessee within it, section 143(2) has been complied with — and then deliberately did not answer it. Its route was narrower. The facts themselves showed a course of conduct from which service could be inferred: the notice went out two days after issue and well within the period; the postal attempts failed twice for the assessee's own non-availability; and the notice reached a person who received it as his authorised representative, on 19 October, eleven days before the last date. That the assessee disowned that representative only afterwards did not displace the inference. Taken together these circumstances amounted to deemed service and sufficient compliance with section 143(2), which disposed of the appeal without any need to construe the provision.
in our considered view, is sufficient to draw an inference of deemed service of notice on the respondent – Assessee and sufficient compliance of the requirement of Section 143(2) of the Income Tax Act, 1961.
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Handle my notice → Ask a CA on WhatsAppNot on these facts. The Supreme Court set aside the Allahabad High Court's order quashing a section 143(2) notice. The notice was issued on 16 October 2006 and despatched by registered post on 18 October, the last date for service being 30 October. It could not be served twice because the assessee was not available, and was served on 19 October on his authorised representative, whom he later disowned. That was enough to draw an inference of deemed service and sufficient compliance with section 143(2). The Court expressly left open, for an appropriate case, the larger question whether the provision requires service or only issue. This was decided by the Supreme Court (Supreme Court of India — Ranjan Gogoi J and R. Banumathi J) and bears on section 143(2) of the Income Tax Act 1961. It is reported as Civil Appeal No. 2262 of 2018 arising out of SLP (C) No. 9174 of 2015 (Supreme Court of India); impugned judgment dated 5 December 2012 in Writ Petition No. 642 of 2007 (Allahabad High Court). This is the answer to the assessee who accepts that a section 143(2) notice went out in time but says it never reached him. The Court will look at the conduct: repeated non-availability at the address, coupled with service on someone who received it as the assessee's representative and is disowned only later, supports an inference of deemed service. That reasoning is regularly deployed against limitation objections built on service. Its limits matter as much as its holding — the Court decided the case on its own peculiar facts and deliberately did not decide whether section 143(2) requires service of the notice or only its issue, so it is not authority on that question, and the Allahabad High Court's contrary view on it was not approved either. If it applies to you, the first step is this: If you are objecting to service, be ready to explain the postal record — repeated non-availability at your own address will be held against you.
The Revenue issued a notice to the assessee under section 143(2) of the Income-tax Act 1961 on 16 October 2006 and despatched it by registered post on 18 October 2006. Under section 143(2) as then in force the notice had to be served on the assessee by 30 October 2006 at the latest. The record showed that on two occasions the notice sent by registered post could not be served because the assessee was not available, and that it was served on 19 October 2006 on his authorised representative — a person the assessee subsequently disowned. The assessee filed a writ petition in the Allahabad High Court, which by its judgment of 5 December 2012 in Writ Petition No. 642 of 2007 quashed the notice, taking the view that what section 143(2) requires the Revenue to satisfy is service of the notice and not its mere issue. The Revenue appealed to the Supreme Court. The matter was decided on 2018-02-19 by the Supreme Court (Supreme Court of India — Ranjan Gogoi J and R. Banumathi J). On those facts the Supreme Court held as follows. The appeal was allowed and the order of the High Court set aside. The Court held that the non-availability of the assessee to receive the notice sent by registered post on as many as two occasions, together with service of the notice on 19 October 2006 on his authorised representative whom he now disowns, was sufficient to draw an inference of deemed service on the assessee and of sufficient compliance with the requirement of section 143(2). On that view the High Court was not right in the conclusion it reached on the facts of the case. The Court declined to decide the question whether section 143(2) requires service of the notice rather than mere issue, expressly keeping it open for decision in an appropriate case, because this case could be resolved on its own peculiar facts.
The Court identified the question the writ petition raised — whether, where a notice is posted within time but not actually served on the assessee within it, section 143(2) has been complied with — and then deliberately did not answer it. Its route was narrower. The facts themselves showed a course of conduct from which service could be inferred: the notice went out two days after issue and well within the period; the postal attempts failed twice for the assessee's own non-availability; and the notice reached a person who received it as his authorised representative, on 19 October, eleven days before the last date. That the assessee disowned that representative only afterwards did not displace the inference. Taken together these circumstances amounted to deemed service and sufficient compliance with section 143(2), which disposed of the appeal without any need to construe the provision. In the words reproduced by the source cited on this page: "in our considered view, is sufficient to draw an inference of deemed service of notice on the respondent – Assessee and sufficient compliance of the requirement of Section 143(2) of the Income Tax Act, 1961."
It was decided by the Supreme Court on 2018-02-19 and is reported as Civil Appeal No. 2262 of 2018 arising out of SLP (C) No. 9174 of 2015 (Supreme Court of India); impugned judgment dated 5 December 2012 in Writ Petition No. 642 of 2007 (Allahabad High Court). Binding on every court and authority in India. A Supreme Court decision binds every assessing officer, every Commissioner (Appeals), every bench of the Income Tax Appellate Tribunal and every High Court in India. An officer who declines to follow it is acting contrary to law, and that refusal is itself a ground of appeal. On section 143(2), the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the department, and it appears in this library for that reason — you need to know what the Assessing Officer will cite against you. The appeal was allowed and the order of the High Court set aside. The Court held that the non-availability of the assessee to receive the notice sent by registered post on as many as two occasions, together with service of the notice on 19 October 2006 on his authorised representative whom he now disowns, was sufficient to draw an inference of deemed service on the assessee and of sufficient compliance with the requirement of section 143(2). On that view the High Court was not right in the conclusion it reached on the facts of the case. The Court declined to decide the question whether section 143(2) requires service of the notice rather than mere issue, expressly keeping it open for decision in an appropriate case, because this case could be resolved on its own peculiar facts. It arises in Assessment & Scrutiny matters, on section 143(2) of the Income Tax Act 1961, and was decided by Supreme Court of India — Ranjan Gogoi J and R. Banumathi J. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Do not disown a person who has in fact received departmental notices on your behalf unless you can show he had no authority; the Court treated the later disowning as telling. Keep the address on record current and someone authorised available to receive notices, since deemed service can be inferred from the surrounding circumstances. Do not cite this order for the proposition that issue alone suffices under section 143(2); that question was expressly kept open.
Still good law. An order of February 2018; the source page records it cited in five later matters. The general question it left open — whether section 143(2) requires service or only issue — was not traced to any later decision here. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The source is the Supreme Court's daily-orders text with no reporter citation, so the case numbers are given instead. The order does not identify the assessment year or the subject matter of the assessment, and it does not say what became of the assessment proceedings after the notice was upheld. The batch line lists sections 148 and 292BB; neither is mentioned anywhere in the order, which turns on section 143(2) alone. The Court decided the case on its peculiar facts and expressly left the construction of section 143(2) open, so the order is of limited precedential reach. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The appeal was allowed and the order of the High Court set aside. The Court held that the non-availability of the assessee to receive the notice sent by registered post on as many as two occasions, together with service of the notice on 19 October 2006 on his authorised representative whom he now disowns, was sufficient to draw an inference of deemed service on the assessee and of sufficient compliance with the requirement of section 143(2). On that view the High Court was not right in the conclusion it reached on the facts of the case. The Court declined to decide the question whether section 143(2) requires service of the notice rather than mere issue, expressly keeping it open for decision in an appropriate case, because this case could be resolved on its own peculiar facts.
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