9911796707
TMI Blog2017 (5) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... 5th October 2016, the following question of law was framed for consideration: "Did the ITAT fell into error in holding that the assessment order for AY 2003-04 was time barred given the pre-condition Clause (iii) of Explanation (i) to Section 153 (1) of the Income Tax Act which led to the amendment to that provision by Finance Act No. 2 Act of 1996?" 3. The Assessee is dealing primarily in Bullion (gold and silver) having operation in various states. The Assessee is a subsidiary of M/s. Jindal Export and Import Private Limited. For the AY in question, the Assessee filed its return on 2nd December 2003 showing total income at Rs. 2,04,84,373 from 'business and profession' and 'income from house property'. The return was picked up for scru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment made on 14th September 2006 was clearly barred by limitation in terms of Section 153 (1) of the Act. The assessment was held to be invalid and annulled. 6. Aggrieved by the above order, the Revenue went in appeal before the ITAT. The Assessee filed cross-objections. The Assessee was aggrieved by the CIT (A) not deleting some of the additions made by the AO. 7. The ITAT has, in the impugned order, dismissed the Revenue's appeal. After analysing Section 153 (1) of the Act in light of the facts of the case, the ITAT concluded that CIT (A) was justified in holding that the assessment was barred by limitation. The ITAT placed reliance on the decision of this Court in CIT v. Bishan Saroop Ram Kishan Agro (P) Limited (2011) 203 Taxm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor of the choice of the Assessee. The auditor is nominated by the Revenue and his work is not controlled by the Assessee. Where the special audit report is unable to be furnished within the time stipulated by the AO, extension of time can be granted by the AO on an application made by the Assessee. The extension has to be for good and sufficient reasons. 11. From 1st April 2008 a proviso to Section 142 (2C) of the Act was inserted to provide that the AO may 'suo motu' extend the period provided that the aggregate period originally fixed and extended period would not exceed 180 days from the date on which a direction was first issued to the Assessee for submission of report of the Special Auditor. It is an admitted position that in the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in VLS Finance Limited v. Commissioner of Income Tax (2016) 68 Taxman.com 368 (SC). It is pointed out that under Section 153 (1) of the Act, the period of limitation for making an order of assessment to be extended during which the said proceeding stands excluded for the purpose of computing the period of limitation for making an assessment order. 15. The Court is unable to accept any of the above submissions. The Explanation-1 to clause (iii) of Section 153 (1) as it stood at the relevant point in time, reads as under: "(iii) the period of commencing from the date on which the Assessing Officer directs the Assessee to get his accounts audited under subsection (2A) of Section 142 and (a) ending with the last date on which the Assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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