Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2005 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2005 (2) TMI 429 - ITAT AMRITSARExemption in respect of interest on FDRs in NRE account u/s 10(4) - challenged the Order passed u/s 154 - fresh evidence in the form of bank certificate - Whether there is a mistake in the intimation or deemed intimation is to be seen in the light of powers conferred u/s 143(1) - HELD THAT:- The certificate of the Bank, which indicated that money kept in the NRE account was as per guidelines of Reserve Bank of India, went to the very root of the issue. The CIT(A) has inherent powers to admit such evidence under Sub Rule 4 of Rule 46A of the Income-tax Rules. This would have helped the cause for justice. He should have appreciated that orders were passed u/s 154 and not u/s 143(3). Therefore, in my view, CIT(A) was not justified in declining to admit such evidence. It is no doubt true that powers have been conferred on the Assessing Officer to rectify intimation or deemed intimation u/s 143(1). But such power has to be seen in the light of powers conferred u/s 143(1). The returns were processed u/s 143(1) on 28-3-2000. Provisions of section 143 have been drastically amended by the Finance Act, 1999 w.e.f. 1-6-1999. Highlights of these amendments are that powers of the Assessing Officer to make adjustments u/s 143(1)(a) and consequent levy of additional tax u/s 143(1A) have been taken away. Since the action of the Assessing Officer for withdrawing exemption of interest u/s 10(4) of the Act falls outside the scope of powers conferred u/s 143(1), the Assessing Officer had no jurisdiction to pass orders u/s 154(1)(b). Even if the assessee had agreed before the Assessing Officer due to wrong appreciation of law, such agreement would have not made the illegal orders as legal because the Assessing Officer had no authority or jurisdiction to do so. Therefore, such orders are bad in law and void ab intio and deserve to be quashed on this ground itself. In the present case, returns were filed on 31-12-1998 and 15-12-2000. Therefore, the time limit for issue of notices u/s 143(2) expired before 31-12-2001. The present orders u/s 154 have been passed on 14-2-2002 i.e., after the expiry of time limit of issue of notices u/s 143(2). In any case, section 154 cannot be substituted for issue of notices u/s 143(2). Thus, I am of the considered opinion that CIT(A) was not justified in sustaining the orders of Assessing Officer passed u/s 154. Accordingly, I quash the orders of Assessing Officer passed u/s 154 and resultant orders of CIT(A) and allow the grounds of appeals of the assessee for all the assessment years. In the result, all the appeals filed by the assessee for the assessment years from 1997-98 to 2000-01 are allowed.
|