TMI Blog2015 (9) TMI 969X X X X Extracts X X X X X X X X Extracts X X X X ..... refore, shall be excluded from the income of original assessee. Meaning thereby, the third person whose liability is found by the assessing authorities while making assessment against the original assessee, such third party has to be heard before fixing his liability. If such third party is heard then only reassessment under Section 148 read with Sections 149 and 150 of the Act is permissible. However, if he is not heard, then notice for reassessment has to be issued within the period of limitation, as provided under Section 149 (1) (b) of the Act.In the present case, admittedly, assessee was not heard by ITAT, Lucknow Bench, while observing that out of total income derived from the interest on FDRs, tax liability of UPFC is only to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,15,19,945/-. It was contended before the Assessing Authorities by the UPFC that after the bifurcation of the State of Uttar Pradesh and creation of the State of Uttarakhand, UPFC was bifurcated and Uttarakhand Forest Development Corporation (hereinafter referred to as 'UFDC') came into existence and as per the directions issued by the Central Government, UFDC was held to be entitled for 54 % of the total assets of UPFC, therefore, tax liability of UPFC over the total interest income earned should not be more than 46%. ITAT, Lucknow Bench, vide judgment/order dated 6.3.2009, was pleased to hold that UPFC cannot be held liable to pay income tax on total income of the interest on the FDRs in view of the order passed by the Central Gov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for notice. [(1) No notice under section 148 shall be issued for the relevant assessment year,- [(a) if four years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b) [or clause (c)]; (b) if four years, but not more than six years, have elapsed from the end of the relevant assessment year unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to one lakh rupees or more for that year;] [(c) if four years, but not more than sixteen years, have elapsed from the end of the relevant assessment year unless the income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eding under this Act by way of appeal, reference or revision or by a Court in any proceeding under any other law. (2) The provisions of sub-section (1) shall not apply in any case where any such assessment, reassessment or recomputation as is referred to in that sub-section relates to an assessment year in respect of which an assessment, reassessment or recomputation could not have been made at the time the order which was the subject-matter of the appeal, reference or revision, as the case may be, was made by reason of any other provision limiting the time within which any action for assessment, reassessment or recomputation may be taken. * ** Explanation 3.-Where, by an order [referred to in clause (ii) of sub-section (3) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Section 148 of the Act, if reassessment seems to be required pursuant to any observations made, direction issued by any Authority, under this Act, by way of appeal, reference or revision. Bare perusal of Explanation 3 of Section 153 (3) of the Act shall demonstrate that excluded income of original assessee, can be assessed in the income of third party, if third party was heard by the Authority, making observations or issuing direction that excluded income is of third party, therefore, shall be excluded from the income of original assessee. Meaning thereby, the third person whose liability is found by the assessing authorities while making assessment against the original assessee, such third party has to be heard before fixing his ..... X X X X Extracts X X X X X X X X Extracts X X X X
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