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2016 (5) TMI 324 - AT - Income TaxValidity of assessment u/s 153 - Time limit for completion of assessments and reassessments - whether the assessment is barred by limitation of time in terms of section 153(2A) and is a nullity? - Held that:- We find from the findings given by the tribunal in its order dated 28.9.2007 it had not given any direction or finding to the Learned AO to give effect to its order , but instead had set aside the entire assessment to make it afresh by following due process of law for the purpose of examination of some witnesses in line with the principles of natural justice. The Tribunal may indicate certain lines of enquiry or other exercises for conforming to natural justice or conducting the assessment on the right procedure. That does not mean that the Tribunal’s order is not for a fresh assessment. It had effectively asked the Learned AO to make fresh exercise of assessment determining the total income. The tribunal’s order indicated as a guideline for the proper manner in which the assessment in the case ought to have been made. There was no finding or direction given thereon. The tribunal remitted the assessment for determining afresh the issues raised by the Learned AO in the assessment appealed against. Since there were no other additions or issues in dispute except the two additions ( i.e addition on account of gross profit and bogus purchases) made in the earlier assessment, the order asking for deciding the issues afresh and recomputing the total income repeating the procedure of assessment correctly amounts to a fresh assessment. We hold that the assessment means in the context of the scheme of the Act the determination of the total income to be brought to the charge of tax. The total income is the sole object of the whole exercise commencing from assessee’s filing of return and ending with the completion of assessment. Now looking at the impugned issue from this perspective, when the tribunal asked the Learned AO to determine the total income by re-deciding the issues involved in the additions made therein, it implies indisputably a mandate for fresh determination of the total income. When the order of the Tribunal nullifies the total income assessed or determined in the original order of an assessment, it definitely means the setting aside of the original order and a fresh assessment determining the total income. In effect, the tribunal’s order annihilates the earlier assessment as the total income determined by it no more subsists. The fresh assessment framed by the Learned AO on 25.3.2009 is barred by limitation in terms of section 153(2A) of the Act. We hold that the fresh assessment dated 25.3.2009 is declared as a nullity. Accordingly , the cross objection of the assessee is allowed
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