Amendment to Sec.153(1). - Income Tax - 1810/1989

INSTRUCTION NO. 1810/1989 Dated: March 10, 1989 Sub-section (1) of section 153 of the Income-tax Act has been substituted by the Direct Tax Laws (Amendment) Act, 1987 with effect from 1st April, 1989. Under the substituted sub-section, no order of assessment under section 143 or section 144 can be made after the expiry of two years from the end of the assessment year in which the income was first assessable. 2. Under sub-clause (iii) of clause (a) of sub -section (1) of section 153, as it stood prior to the amendment made by the Direct Tax Laws (Amendment) Act, 1987, the time limit for completion of assessments was two years from the end of the assessment year in which the income was first assessable. Clause (b), (c) and (d) of the said sub-section provided an extended time limit for completion of assessments in certain circumstances. Under the substituted sub section, extended time limit provided under the aforesaid clauses is not available. 3. The effect of the substituted sub-section, therefore, is that no order of assessment can be made under section 143 or section 144 of the Act in respect of the assessment year commencing on 1st April, 1986 or any earlier assessment year after 31st March, 1989. 4. The Board, therefore, desire that Assessing Officers should ignore the extended time limit for completion of assessments earlier available under clauses (b), (c) (d) of sub-section (1) of section 153, as these stood prior to the amendment of that section by the Direct Tax Laws (Amendment) Act, 1987, and complete all assessments for the assessment year 1986-87 and earlier assessment years by 31st March, 1989. 5. These instructions may be brought to the notice of all officers in your region for immediate action.