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TMI Blog2015 (1) TMI 915X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer found that while arriving at the tax payable u/s.115JB of the Act, the assessee-company had added provision for taxes of Rs. 1,40,98,185/- but omitted to add provision for deferred tax of Rs. 4,55,57,386/- and issued notice u/s.148 of the Act. Assessee objected before the Assessing Officer about the jurisdiction and adjustments being made, however, AO rejected the same. Assessment was completed determining the book profit u/s.115JB at Rs. 18,42,89,994/. Before the Ld.CIT(A), assessee has raised various grounds inter alia objecting to the issuance of notice u/s.143(2), which assessee's claims to be barred by limitation. In addition to that assessee also objected to the re-opening of the assessment on the reason that Assessing Officer could not have initiated proceedings for re-opening when the amendment to the Act has come up subsequently on 28th February, 2008 where as proceedings were initiated on 17th May, 2007. It was further contended that re-opening was on mere change of opinion without any factual foundation. Assessee also contended that adjustments u/s.115JB cannot be made consequent to the retrospective amendment. Ld.CIT(A) has considered all these obj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant object to the issue of notice U/s143(2). In fact, on 29.01.2009, the appellant wrote the following to the Assessing Officer: "3. Conduct of the assessee during the assessment proceedings It is reiterated that the assessee has voluntarily and in good faith, made full and true disclosure, in its return of income and books of account. Further, the assessee has voluntarily extended full co-operation to the Revenue authorities during the assessment proceedings. This is proved by the fact that the entire assessment is based on the facts provided/discussed by the assessee itself. It is not out of place to mention that the assessee co-operated with the revenue authorities in all enquiries relating to the subject assessment and provided all requisite information and documents in response to the various queries raised, so as to enable a complete understanding of the facts related to the case . We respectfully submit that there is no evidence on record of nay omission on the part of the assessee in furnishing the particulars relevant for assessment or concealment of income. In fact, the entire assessment has been framed based on the information and particulars which were furnished by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, (i) the accounting policies; (ii) the accounting standards adopted for preparing such accounts including profit and loss account; (iii) the method and rates adopted for calculating the depreciation, shall be the same as have been adopted for the purpose of preparing such accounts including profit and loss account and laid before the company at its annual general meeting in accordance with the provisions of section 210 of the Companies Act, 1956 (1 of 1956) : Provided further that where the company has adopted or adopts the financial year under the Companies Act, 1956 (1 of 1956), which is different from the previous year under this Act, (i) the accounting policies; (ii) the accounting standards adopted for preparing such accounts including profit and loss account; (iii) the method and rates adopted for calculating the depreciation, shall correspond to the accounting policies, accounting standards and the method and rates for calculating the depreciation which have been adopted for preparing such accounts including profit and loss account for such financial year or part of such financial year falling within the relevant previous year. Explanation [l]. For the purposes o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7, 2007. 1(b) Erred in confirming that the Ld.AO acted as per law in re-opening the assessment on a mere change of opinion without any factual foundation or documentary evidence on record to support a valid reason in relation to escapement of income. 2. Erred in confirming that the adjustments made to the book profits of the appellant u/s.115JB of the Act based on a retrospective amendment as correct. 3. Erred in confirming the interest levied u/s.234D of the Act, which is otherwise applicable only from Assessment Year.2004-05. 4. The appellant craves, to consider each of the above grounds of appeal without prejudice to each other and craves leave to add, alter, delete or modify all or any of the above grounds of appeal. 7. Ld.Counsel referring to the fact sheet submitted that the notice issued u/s 143(2) was barred by limitation. It was further submitted that reliance of Ld.CIT(A) on Section 292BB is not correct as assessee has objected to the jurisdiction before AO. Referring to submissions made before AO vide letter dt.28-11-2008, Ld.Counsel submits that assessee having objected to the time barred nature of the notice, the provisions of section 292BB are not applicable. Sin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed in Ground No.1 that the notice u/s.143(2) issued was barred by limitation of time, the assessee has furnished the sequence of dates as under: S. No. Date Particulars 01 29-10-2002 Original return of income 02 06-05-2003 Intimation u/s.143(1) 03 05-09-2003 Revised return of income 04 22-03-2004 Sec.154 order 05 31-03-2004 Intimation u/s.143(1) 06 15-05-2007 Notice u/s.148 07 11-06-2007 Return of income 08 17-10-2008 Notice u/s.143(2) Bar of Limitation - The proviso to Sec.143(2) stands substituted w.e.f.01-04-2008. Prior to substitution, no notice thereunder may be served after the expiry of 12 months from the end of the month in which the return was furnished (30-06-2008) W.e.f. 01-04-2008, no notice may be served after the expiry of six months from the end of the financial year when the return was filed (30-09-2008) 09 17-10-2008 Reasons for reopening sought 10 21-11-2008 Reasons for reopening supplied 11 28-11-2008 Written objection before AO on assumption of jurisdiction (Pg.39, internal pg.4) We have seen copy of the notice issued by the Assessing Officer dt.01-10-2008. As per Sec 143(2) the notice has to be issued with in twelve months from the fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of notice beyond the time period nor even a reference to notice u/s.143(2). In view of this, we are not convinced with the Ld.Counsel's argument that the word used 'Time barred' refers to the time barred nature of notice u/s.143(2). In our opinion, assessee has not raised any objection on the notice u/s.143(2) before Assessing Officer and therefore provisions of Section 292BB are clearly applicable. 9.3 Co-ordinate bench at ITAT,Hyderabad in the case of M/s.Navayuga Spatial Technology Pvt. Ltd., (supra) has considered similar issue and held as under vide para 5. "5. As for ground No.2(b), we find that the plea with regard to belated the service of notice under S.143(2), viz. more than 12 months after the month of filing of the return, was not raised before the assessing officer during the assessment proceedings, and such a plea is raised for the first time in the appellate proceedings, that too before this Tribunal. In view of the provisions of S.292BB, mistake on account of belated service of notice is a curable mistake. Since the assessee has not raised such a plea before the assessing officer, and fully participated in the assessment proceedings, the so-called mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ever, the section does not limit its applicability only to notice under section 143(2). The scope of section is that where an assessee has appeared in any proceedings or has co-operated in any inquiry relating to the assessment or reassessment, then the consequences that would ensue would be that it will be deemed that any notice under any provisions of the Act which is required to be served on an assessee has been duly served on him and it will further be deemed to have been served in time and in accordance with the provisions of the Act. The assessee is debarred from taking the defence or raise any objection in any proceeding or inquiry that the notice was - (a) not served upon him; (b) not served upon him in time; and (c) served upon him in any improper manner. [Para 23] The assessee has a right of being served with the notice in case proceedings are taken against him and in case of invalid notice the whole proceedings taken pursuant to that notice would be void ab initio (subject to provisions of section 292B) and will have no legal consequences. To overcome such situations section 292BB has been brought on the statute as explained in the memorandum explaining the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same before the Ld.CIT(A). The Ld.CIT(A) unfortunately has considered the provisions of Section 234B and not 234D vide para 8 of the order. 11.1 After considering the rival submissions, we are of the opinion that this issue requires re-examination by the Assessing Officer. As seen an intimation u/s.143(1), as noted in the assessment order, was issued on 06-05-2003 i.e., before 01-06-2003. The provisions u/s.234D were introduced effective from 01-06-2003 and it was already held by various High Courts that if the refund is issued after that date, interest under Section 234D can be levied, even for the Assessment Years prior to AY.2004-05. Therefore, the crucial issue to be examined is whether the refund was issued prior to 01-06-2003 or later. This aspect was not brought on record nor Assessing Officer gave any detailed working how it is applicable. In the interest of justice, we restore the same to the file of Assessing Officer to calculate the interest according to the provisions of the Act and law on the subject. Assessee should be given due opportunity and a detailed order should be passed, so that the veracity of the same can be examined by higher judicial authorities if re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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