2023 (5) TMI 1052 - AT - Income Tax

Cognizance u/s 92BA(i) - effect of omission of law - validity of reference made to TPO under section 92CA - HELD THAT:- Hon’ble Supreme Court in GENERAL FINANCE CO. AND ANOTHER [2002 (9) TMI 3 - SUPREME COURT]wherein it has categorically been examined with regard to the effect of deletion of a provision in the Statute and it was held that the normal effect of repealing a statute or deleting a provision is to obliterate it from the statute book as completely as if it had never been passed, and the statute must be considered as a law that never existed.

In case there is no saving clause or provision introduced by way of an amendment while omitting the provision, therefore, the result is that the said provision had never been passed and we consider it as a law that never existed. Therefore, we have no hesitation to hold that the cognizance taken by the AO under section 92BA(i) are reference made to TPO under section 92CA is invalid and bad in law in view of the deletion of provision (i) of section 92BA from the enactment.

As it is clear that once a particular provision of section is omitted from the Statute, it shall be deemed to be omitted from its inception until and unless there is some saving clause or provision to make it clear that action taken or proceedings initiated under that provision or section would continue and would not be left on account of omission.

Since in the instant case, undisputedly, by the Finance Act, 2017, clause (i) of section 92BA has been omitted with effect from 01.04.2017, therefore, once this clause is omitted by subsequent amendment then it would be deemed that clause (i) was never there in the Statute. Therefore, we hold that the reference made to TPO under section 92CA is invalid and bad in law and hence consequential order passed by the TPO and AO is also not sustainable in the eyes of law and the addition so made/sustained by ld. CIT (A) too deserves to be deleted. Appeal of the assessee is allowed.