TMI Blog2017 (5) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... h 2009 of the Central Board of Direct Taxes (CBDT) regarding prospective application for amendment to the proviso to Section 142 (2C) of the Act which gave the AO ‘suo motu’ power to extend time for furnishing the audit report. For all the aforementioned reasons, the Court finds no error having been committed by the CIT (A) or the ITAT in holding that the assessment order in the present is barred by limitation. - Decided in favour of assessee. - ITA 668/2016 - - - Dated:- 5-5-2017 - S. MURALIDHAR CHANDER SHEKHAR JJ. Appellant Through: Mr. Rahul Chaudhary, Senior Standing counsel. Respondent Through: Mr. Salil Aggarwal with Mr. Madhur Aggarwal, Advocates. O R D E R Dr. S. Muralidhar, J.: 1. The Revenue has fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 2006) and further 7 days (by direction dated 28th June 2006). As a result of these extensions, the special audit report was required to be furnished to the AO by order dated 7th July 2006. As it transpired, the special audit report was unable to be submitted by 7th July 2006. The report of the Special Auditor dated 7th July 2006 was sent under covering letter dated 12th July 2006 to the Commissioner of Income Tax-II and received by the AO on 13th July 2006. On 14th September 2006 the AO framed the assessment order for AY 200304. The AO did not accept all the recommendations in the report of the Special Auditor. Nevertheless certain additions were made to the taxable income. 5. Aggrieved by the assessment order, the Assessee filed an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... become infructuous. 8. This Court has heard the submissions of Mr. Rahul Chaudhary, learned Senior standing counsel for the Revenue and Mr. Salil Aggarwal, learned counsel for the Respondent-Assessee. 9. Mr. Chaudhary, urged that given the purpose and object behind the insertion of sub-sections 2A, 2B and 2C of Section 142 of the Act, the period between 7th July 2006 and 17th July 2006 the date when the audit report was actually made available should be excluded for the purpose of computation of limitation. Mr. Chaudhary submitted that when there was failure by the Assessee to submit the audit report within the stipulated time, the Assessee should not be allowed to take advantage of its own lapse and claim that the assessment order w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich the auditor s report was actually received i.e. 17th July 2006. 13. It was explained by this Court in Commissioner of Income Tax v. Bishan Saroop Ram Kishan Agro (P) Limited (supra) that insertion of the expression suo motu in the proviso to Section 142 (2C) of the Act was only with effect 1st April 2008. Therefore, in the present case, when the AO on his own extended the period of submission of audit report to 17th July 2006, he had no power to do so under Section 142 (2C) of the Act. Consequently, the Court finds no error in the orders of both the CIT (A) as well as the ITAT holding that the submission of audit report on 17th July 2006 was barred by limitation. 14. It was contended by Mr. Chaudhary that the time taken in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terms of Section 153 (1) of the Act. The time for passing the assessment order expired on 6th September 2006 whereas it was passed only on 14th September 2006. 17. The decision in Dhariwal Sales Enterprises (supra) concerns the execution of time spent for obtaining a copy of the report . Here there was no such occasion for granting of extension of time by the AO. In fact, the AO had no such power to do so. There was no question of excluding the time taken for obtaining a report. On the other hand the decision of this Court in CIT v. Bishan Saroop Ram Kishan Agro (P) Limited (supra) squarely covers the issue and is in favour of the Assessee. In the said decision, the Court took note of the Circular dated 27th March 2009 of the Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X
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