PCIT (Central) v. Narayan Kumar Khaitan – [2023] (Orissa)
SM and group were the subject of a search and seizure operation in accordance with section 132, during which time several incriminating documents were discovered. The assessment in the case of the assessee was then finished in accordance with section 153C read with section 143(3).
A notice was then issued by the Principal Commissioner for service on the assessee at his last known address after the Principal Commissioner exercised revisionary jurisdiction under Section 263 against the aforementioned assessment order. In response, a member of the assessee’s staff showed up and revealed that the assessee was being held by the court. The Principal Commissioner issued the order in accordance with Section 263 after determining that the employee’s appearance met the requirements of Section 292BB.
The assessee received relief from the ITAT following an appeal. CIT, who was displeased, brought the current appeal before the Orissa High Court.
The High Court agrees that a person in judicial custody is deprived of various constitutional rights that he could otherwise exercise, as stated by the ITAT in the assailed judgement.
Any government official, including a PCIT, should be aware that once it is learned that someone who needs to receive notice is in judicial custody, the proper order should be passed requiring that person to receive notice through the Superintendent of the relevant jail. This is the bare minimum that the law requires.
Since the PCIT had not done this, the Department was not permitted to argue that the Notice/Assessee’s staff member’s appearance before the PCIT should be construed as the Notice/Assessee himself.
The impugned order issued under section 263 was therefore susceptible to being quashed since it could not be concluded that the notice served to the staff member was valid.
