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2022 (12) TMI 405 - HC - Income TaxReopening of assessment u/s 147 - non-issue of a notice u/s 143(2) - assumption of jurisdiction by an officer commences with, and is triggered by, the issuance of a notice under Section 143(2) and failure to do so, would compromise the proceedings fatally - HELD THAT:- There is complete uniformity in the conclusion of Courts on the issue as to whether non-issue of notice under Section 143(2) would vitiate the assessment, answering the issue in the affirmative. CBDT Instruction No.3 of 2003 elucidates upon and explains the provisions relating to Transfer Pricing, as contained in Sections 92 and 92F of the Act that had come into force, with effect from assessment year 2002-03 onwards. The Circular reinforces the position that it is sine qua non for the Assessing Officer to assume jurisdiction prior to taking any steps in the matter of assessment, including reference of the matter to the TPO. The jurisdiction assumed by an officer in terms of Section 120 of the Act is activated by issuance of notice under Section 143(2), and as a consequence, failure to issue the statutory notice will lead to the inevitable result of the Officer not having assumed jurisdiction, for all practical purposes. Period when the matter was pending before the Assessing Officer for compliance of the procedure set out should stand excluded in computing the period of 6 months required to issue notice under Section 143(2) - As the statutory period of six months cannot be altered except in the situations contemplated under Explanation to Section 153. The Explanation takes note of events that might intervene in the course of assessment proceedings, and excluded the time taken for those events to run their course, in computation of limitation. These are the only situations where statutory limitation under Section 153 may be expanded. On 10.01.2020, reasons had been supplied and on 04.03.2020, the petitioner filed its objections. These objections have been disposed only on 23.07.2021, after a period of one year and four months. There was nothing that prevented the assessing officer to have called for objections, assigning a time limit to the assessee to file the same, and disposed the objections expeditiously. The procedure set out in the case of GKN Drive shafts (India) Ltd [2002 (11) TMI 7 - SUPREME COURT] nowhere envisages modification/expansion of the statutory limitations under the Act. Thus impugned notice under Section 148 and reference to TPO stand vitiated by non-issue of notice under Section 143(2) of the Act and the same are quashed. WP allowed.
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