New User   Login      
Tax Management India .com TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2017 (5) TMI 355 - ITAT AHMEDABAD

2017 (5) TMI 355 - ITAT AHMEDABAD - TMI - Annulling reassessment order - period of limitation - whether order passed after expiry of limitation provided in section 153(3)? - whether for computing period of limitation, period during which the assessment proceedings is stayed shall be included or period consumed in communication of Honíble High Courtís order to the AO shall also to be excluded? - Held that:- A perusal of the above details would indicate that 194 days are available to the AO from 2 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

The finding of the ld.CIT(A) is based upon orders of the ITAT, wherein the Tribunal has considered scope of Explanation (1)(ii) to section 153(1) of the Income Tax Act. This Explanation has fallen for consideration before the Honíble High Allahabad Court in CIT Versus Drs. X-Ray and Pathology Institute Pvt. Ltd. [2013 (11) TMI 19 - ALLAHABAD HIGH COURT] as held as soon as the order was vacated, the limitation will restart and will exhaust itself on the period of limitation provided under the Ac .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Rule 8 of the Income Tax (Appellate Tribunal) Rules, 1962. They are descriptive and argumentative in nature. In brief, the grievance of the Revenue is that the ld.CIT(A) has erred in law in annulling reassessment order holding that it was passed after expiry of limitation provided in section 153(3) of the Income Tax Act, 1961. 3. Brief facts of the case are that the assessee has filed its return of income electronically on 31.10.2005 declaring a loss of Rs. (-) 21,90,62,215/- under normal provis .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

eem it necessary to recite and recapitulate other facts relating to reassessment order passed by the AO. It is suffice to say that reassessment order was passed on 26.2.2014. 4. It is pertinent to mention here that the assessee had challenged reopening of the assessment by way of writ petition before the Hon ble Gujarat High Court in Special Civil Application No.2965 of 2013. The Hon ble High Court took cognizance of this petition and passed interim order on 18.3.2013. The order reads as under: .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

was required to pass assessment order within 60 days from the date of the order passed by the Hon ble High Court. In other words, it was contended by the assessee that days during which the AO was restrained from passing final order is to be excluded from the limitation ultimately the AO consumed for passing the assessment order. The ld.AO was of the view that this time limitation of 60 days is available to him from the date of receipt of order of the Hon ble High Court. He accordingly passed t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on of order of the court cannot be imported. Thus, according to the ld.CIT(A) time limit to pass assessment order would run from the date of pronouncement of the order, which was passed in the presence of counsel of counsel for the Revenue. If it is to be computed in this manner, then, assessment order was time barred, and accordingly, the ld.CIT(A) has accepted the contentions of the assessee and annulled re-assessment order. The ld.CIT(A) has fortified itself with order of the ITAT passed in t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e two decisions. 6. On the other hand, the ld.counel for the assessee contended that the issue in dispute is squarely covered by the decision of the Hon ble Allahabad High Court rendered in the case of CIT Vs. Chandra Bhan Bansal, 46 taxmann.com 108 (All.). He placed on record copies of these decisions. He further contended that the Hon ble Allahabad High Court has also considered this aspect in the case of CIT Vs. Dr. X-Ray & Pathology Institute P. Ltd., 40 taxmann.com 115 (All). The ld.cou .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

) s order. He further pointed that two decisions referred by the ld.CIT-DR are concerned, facts are quite distinguishable. In those case, the Hon ble Court has propounded that period during which assessment proceeding is stayed shall be excluded. The assessee is not disputing this proposition. It has also excluded that period. The only dispute between the assessee and the AO is whether time consumed in communication of the order has also to be excluded or not. 7. We have duly considered rival co .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d submissions read as under: 4.4. The third ground of appeal is as follows: "3. Re: Assessment order passed u/s. 143 r.w.s 147 is outside the period of limitation specified u/s. 153 and needs to be quashed as void ab iniitio: 3.1 The Assessing Officer has grossly erred in passing an assessment order u/s. 143 r.w.s 147 dated 26th February, 2014, without appreciating that it is time barred and beyond the time specified in 148 was served and hence, void ab initio." 4.2. The appellant duri .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

.e. after the expiry of one year from the end of financial year in which the notice u/s. 148 was served and hence, void ab initio. Overview of Facts: 1. The time limit for the Assessing Officer to pass order u/s.147 is one year from end of Financial Year in which notice was served [S. 153(2)] and the Assessing Officer had to pass the order by 31th March, 2013 since the notice u/s.148 was issued on 30th March, 2012. 2. Explanation 1 to sec. 153(4) provides for the period to be excluded while calc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

09-2013. 4- The Assessing Officer has erred in passing the reassessment order on 26-02-2014 and hence, the same is void-ab-initio. Submissions: 1. Firstly all the relevant dates of proceedings are mentioned as under: Sr. No. Particulars Dates 1 Date of issuing notice u/s 148 30/03/2012 2 Date on which notice u/s 148 was served on the Appellant 30/03/2012 3 Stay order passed by the Gujarat High Court against Writ Petition filed by the Appellant 18/03/2013 4 Final order passed by the Gujarat High .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

filed by the Appellant • Assessment order passed by the Assessing Officer u/s 143(3) r.w.s. 147 3. Section 153 states the time limits for completion of assessments and reassessments. Sub-section 2 of 153 reads as under "No order of assessment, reassessment or recomputation shall be made under section 147 after the expiry of one year from the end of the financial year in which the notice under section 148 was served 4. Since the notice u/s 148 was served on the Appellant on 30th March .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ctives to the respondent i.e. the Assessing Officer that it may continue with the assessment but final order pursuant to the impugned notice shall not be passed without the leave of the court. Thus, the Honourable Gujarat High Court had stayed the assessment proceedings with effect from this date. Till this date, only 13 days (18th March 2013 to 31st March 2013) were remaining as per section 153 to pass the order u/s. 147 since the last date to pass the order u/s. 147 was 31st March, 2013. 6. Th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

period of limitation for the purposes of this section- (i) ..... (ii) the period during which the assessment proceeding is staved by an order or injunction of any court, or (iia)..... (iii) ...... (iv) (v) ..... (vi).... (vii).... (viii) ..... (ix)..... shall be excluded " Thus, the period from the date on which interim relief was granted by the High Court till the date of vacation of relief by the High Court will be excluded. Subsequently, the High Court with oral judgment order dated 29t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

after vacation of stay the time period remaining to pass an order is less than sixty days it will be extended to sixty days. The relevant extract is produced herein below: "Provided that where immediately after the exclusion of the aforesaid time or period, the period of limitation referred to in subsections (1), 65[(1A), (IB),] 66[(2), (2A) and (4)] available to the Assessing Officer for making an order of assessment, reassessment or recomputation, as the case may be, is less than sixty d .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

012 4 One year from the end of the Financial Year in which notice was served - Time limit given for Assessing Officer to pass order u/s. 147 (as per section 153(2)) 31/03/2013 5 Stay order passed by the Gujarat High Court against Writ Petition filed by the Appellant 18/03/2013 6 Final order passed by the Gujarat High Court and stay vacated against Writ Petition filed by the Appellant 29/07/2013 7 Number of days which will be excluded in computing the time limit (As per expl 1 to sec 153(4)) [6- .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

statute. Since the order passed is barred by limitation, the reassessment order passed u/s 143(3) rws 147 by the Assessing Officer is void ab initio and needs to be quashed. 9. On this issue, we further clarify that the limitation period for completing assessment would start from date when High Court vacated the stay order and not from date when Assessing Officer received such vacation order. Thus in the present the limitation period would start with effect from 27th July 2013. The date of recei .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ply was also filed by the Departmental Representative on 21st June 2013. This shows that the Departmental Representative was aware of the court proceedings. Hence there was no requirement for the Assessing Officer to wait for the communication of the High Court order as with the passing of the order, the stay as provided by the Hon'ble High Court came to an end. The date of communication of order would be irrelevant. 8. A perusal of the above details would indicate that 194 days are availabl .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

by the ld.CIT(A). The finding of the ld.CIT(A) is based upon orders of the ITAT, wherein the Tribunal has considered scope of Explanation (1)(ii) to section 153(1) of the Income Tax Act. This Explanation has fallen for consideration before the Hon ble High Allahabad Court and while considering this explanation, the Hon ble high Court has observed as under: The aforesaid writ petitions having been dismissed on 01/8/1995, as per proviso to Explanation 1 to Section 153, the assessment was to be co .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

) on 18/12/1995. There are two reasons due to which the said submission cannot be accepted. Firstly, the order of the High Court dated 01/8/1995, dismissing the writ petitions was passed in the presence of the learned counsel for the revenue, hence the submission that it was communicated on 18/12/1995 has no relevance, and secondly the provision of Explanation 1 (ii) of Section 153 of the Act, 1961 which is to the following effect: "Explanation 1- In computing the period of limitation for t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

been provided because of stay or injunction by any Court during which the assessment proceedings are stayed. The intention is clear that when the limitation for assessment has started it can be stayed only by an order or injunction of any Court and as soon as the order or injunction of the Court is vacated, the period of limitation shall re-start since after the vacation of the order of the Court, there is no embargo on the authorities to proceed with the assessment. The submission of Shri Shamb .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version