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2023 (8) TMI 1191 - ITAT HYDERABADValidity of order u/s 201(1) and 201(1A) - period of limitation - HELD THAT:- Having regard to this passing of orders under section 201(1) and 201(1A) on a piece meal basis, we are of the considered opinion that the public policy demands that such orders must pass within reasonable time and cannot be extended to limitless period of time. Section 201(3) of the Act was introduced by Finance Act, 2009 w.e.f. 01/04/2010 setting time limit to pass an order under section 201(1) of the Act as four years from the end of the financial year in which the payment was made or credit was given. And later on, it was extended to seven years, by amendment by insertion of a new section by Finance Act, 2014. The order passed u/s 201(1) and 201(1A) of the Act in this case was beyond even the period of seven years. When the Revenue had an opportunity to verify the record on the occasion of the first order dated 06/07/2010, it would be quite unreasonable to accept the order passed four years later, because the order under challenge is passed clearly beyond seven years. In the case of CIT vs. Acer India Pvt. Ltd. [2022 (2) TMI 235 - KARNATAKA HIGH COURT] for the assessment year 2009-10, the Hon’ble Karnataka High Court held that at relevant point of time, limitation of two years was existing but it was subsequently substituted by Finance Act, 2014. However, a right was accrued to the assessee prior to the Finance Act, 2014 and, therefore, the subsequent amendment will be reviving the period of limitation and take away the vested right accrued to the assessee. We hold that the impugned order u/s 201(1) and 201(1A) of the Act is barred by limitation. Decided in favour of assessee.
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