Notice served on Lawyer is Valid If Assessee was not available to receive the same on Several Occasions: SC [Read Judgment]

In the case of Income Tax Officer v. Dharam Narain, the Supreme Court recently ruled that a notice served on the authorized representative can be termed as valid if the Assessee was not available to receive the notice sent by post on several occasions.

The assessee in the present case is an individual. During the assessment year, the Revenue issued notice under section 143(2) of the Income Tax Act 1961 regarding some issues relating to the income tax return of the Assessee. The notice was issued by the Revenue on 16th October 2006 and the same was despatched on 18th October 2006 by registered post. The Revenue further indicated that on two occasions the notice sent by registered post could not be served on the Assessee because he was not available to receive the notice. Therefore, the same was served to the authorized representatives of the Assessee and started proceedings under section 143(2) of the Act.

Thereafter the Assessee approached the High Court by filing a return petition against the action of the Revenue. He compiled that he does not receive any notice by himself, and then it is not possible to start proceedings under section 143(2) of the Act in the circumstances. After perusing the available materials the Court accepted the submission of the Assessee and quashed the notice dated 16th October 2006 issued by the Revenue and accordingly allowed the writ petition filed by the Assessee.

Aggrieved by the order passed by the High Court, the Revenue approached the Supreme Court on appeal.

After analyzing the above narrated facts and circumstances, the Apex Court Justice Ranjan Gogoi and Justice R.Banumathi observed that “non-availability of the Assessee to receive the notice sent by registered post as many as on two occasions and service of notice on 19th October 2006 on the authorized representative of the Assessee whom the Assessee now disowns is sufficient to draw an inference of deemed service of notice on the Assessee and sufficient compliance of the requirement of section 143(2) of the Income Tax Act 1961”.

The Court further held that “what is required to be satisfied by the Revenue is service of notice and not mere issuance thereof and the High Court made a wrong conclusion in the present case without considering the facts of the issue”. Therefore, the Court set aside the order passed by the High Court and allowed the appeal filed by the Revenue.