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2004 (10) TMI 83 - HC - Income TaxDirections for special audit – assessment – limitation - 1. Whether, Tribunal was justified in holding that the direction issued by the Assessing Officer for special audit u/s 142(2A), was arbitrary and illegal and, therefore, the time taken in special audit cannot be excluded? 2. Whether, Tribunal was justified in cancelling the assessment on the ground that the same is barred by limitation?" - Once we hold that the direction for getting the special audit under section 142(2A) is legally sustainable and was rightly issued then the provisions of section 153, Explanation 1(iii) gets attracted. In other words, the period spent in special audit has to be excluded for making an assessment. In this case, it is not in dispute that once the directions under section 142(2A) are held to be legal/valid then the assessment comes within limitation. It is accordingly held to be within limitation.
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