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2016 (2) TMI 980 - AT - Income TaxValidity of assessment order passed under section 143(3)/158BC - period of limitation - Held that:- Undisputedly, in the present case of the assessee, the search was conducted on March 19, 2002, and notice under section 158BC of the Act was issued to the assessee on May 9, 2002. Thus, both the dates falls well before June 1, 2002, when the new Explanation 1 to this section was in existence. Prior to the insertion of the new Explanation 1 with effect from June 1, 2002, Explanation 1, as inserted by the Finance (No. 2) Act, 1996, with retrospective from July 1, 1995, and amended by the Finance (No. 2) Act, 1998, with retrospective effect from July 1, 1995, in computing the period of limitation for the purposes of this section, the period during which the assessment proceedings is stayed by an order or injunction of any court was to be excluded. The order under section 158BC was to be passed within two years from the end of the month in which the last of the authorisation for search under section 132 or for requisition under section 132A, as the case may be, was executed in cases where a search is initiated or books of account or other documents or any assets are requisitioned on or after the January 1, 1997. Keeping all these material facts in totality in its mind, the learned Commissioner of Income-tax (Appeals) has rightly held that the new Explanation 1 inserted to section 158BE of the Act with effect from June 1, 2002 was not retrospective and thus the assessment order in question passed on July 14, 2011, was barred by limitation as the prescribed limitation for passing the order was up to May 30, 2011, after exclusion of the stay period. The first appellate order in this regard is thus upheld.
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