TMI Blog2014 (8) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... te issuance of notice u/s 148 and completion of assessment, reassessment and re-computation respectively, in consequence of or to give effect to any finding or direction contained in an order passed by any authority in any proceeding under the Act by way of appeal, reference or revision, Explanation 2 to section 153(3) contains a deeming provision which provides that where by an order referred to in clause (ii) of sub-section (3) any income is excluded from the total income of an assessee for an assessment year, then an assessment of such income for another assessment year shall for the purposes of section 150 and section 153 be deemed to be one made in consequence of or to give effect to any finding or direction contained in the said order – Decided in favour of Revenue. - Income Tax Appeal 179/2012 - - - Dated:- 31-7-2014 - Sanjiv Khanna And V. Kameswar Rao,JJ. For the Appellant : Mr. Kamal Sawhney, Sr. Standing Counsel. For the Respondents : Mr. Ved Jain and Mr. Pranjal Shrivastava JUDGMENT Sanjiv Khanna, J. (Oral) By order dated 27th September, 2012, the following substantial question of law was framed in this appeal by the Revenue which pertains to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e impugned addition of ₹ 32 lakh made by the Assessing Officer under section 68 of the Act for assessment year 2001-02 under consideration before us cannot be sustained and so the orders of the tax authorities below in this regard are set-aside and additional ground of appeal taken by the assessee is allowed. 3. In view of the aforesaid order, that the credit entries related to earlier assessment year 2000-01, the Assessing Officer initiated proceedings by issue of notice under Section 147/148 of the Act for the said year and passed an order dated 29th December, 2009, making addition of ₹ 32 lakhs. The respondent-assessee, however, succeeded before the Commissioner of Income Tax (Appeals), who held that the notice under Section 147/148 for the assessment year 2000-01 was belatedly issued on 12th February, 2009, after a lapse of 7 years and, therefore, was beyond the time limit prescribed under Section 149 of the Act. 4. Aggrieved, appellant-Revenue preferred an appeal before the Tribunal relying upon Section 153 of the Act. It is noticeable that the Commissioner of Income Tax (Appeals) did not refer to Section 150 (2) and Section 153, Explanation 2 of the Act. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (2) to Section 150 and Explanations 2 and 3 to Section 150 of the Act were referred to. Reference was also made to sub-section (3), clause (ii) of Section 153 of the Act and thereafter it was opined:- 12. When the Income Tax Act, 1961 was enacted, Section 153 did not contain the Explanations 2 and 3. Those explanations were introduced subsequently in 1964 after the Supreme Court decision in Murlidhar Bhagwan Das (supra). It is therefore, apparent that the two explanations were added so as to supersede the view taken by the Supreme Court in respect of the 1922 Act. Explanation 2 in Section 153 makes it clear that even where any income is excluded from the total income of the assessee from a particular assessment year, then an assessment of such income for another assessment year shall, for the purpose of Section 150 as also of Section 153, be deemed to be one made in consequence of or to give effect to any finding or direction contained in the said order. In other words, a finding in respect of a different year can also be used for the purposes of invoking the provisions of Section 150 of the said Act, by virtue of the deeming provision contained in Explanation 2 in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment year, then an assessment of such income for another assessment year shall be deemed to be one made in consequence of or to give effect to any finding or direction contained in the said order for the purpose of section 150 or section 153. Thus, for the purpose of resorting to the exception provided under sub-section (3)(ii), it is not necessary that there should be any specific finding or direction contained in the said order with regard to assessment of income for another assessment year in light of the deeming provision in Explanation 2 below section 153 of the Act. The very fact that income has been excluded from the total income of the assessee for an assessment year by virtue of an order referred to in clause (ii) of sub-section (3) would be sufficient for the purpose of making an assessment of such income in another year and for the purpose of section 150 and section 153, the same would be deemed to have been made in consequence of or to give effect to any finding or direction contained in the said order. 15. x x x x 16. x x x x 17. x x x x 18. Another contention raised on behalf of the petitioner is that a finding in terms of section 150 of the Act can on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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