TMI Blog2015 (10) TMI 2721X X X X Extracts X X X X X X X X Extracts X X X X ..... l, at the instance of the revenue, is directed against the order of the Commissioner of Income-tax (Appeals)-XVI, New Delhi dated 30.10.2012 for the assessment year 2002-03. 2. The effective grounds of appeal taken by the revenue read as under:- 1. Whether on the facts in the circumstances of the case, the Ld. CIT (A) has erred in deleting disallowance u/s 80-IA/80-IB of the Act amounting to ₹ 44,95,392/- u/s 148/150(1) of the Act. 2. Whether on the facts in the circumstances of the case, the Ld. CIT (A) has erred in holding that no notice can be issued u/s 148 to the assessee relevant to A.Y. 2002-03 even though the same was issued to carry out the order of the Hon ble Delhi High Court in the case of the assessee relevant for A.Y. 2003-04. 3. Whether on the facts in the circumstances of the case, the Ld. CIT (A) has erred in holding that the provisions of section 150 (1) of the I.T. Act were not applicable in this case. 3. The above grounds are inter-connected, therefore, the same are disposed of together as under. 4. Brief facts of the case are that in the computation of taxable Income attached with the return of income for the year under considera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7,16,979/- had been reached after including receipts on account of Duty Draw back (DDB) of as much as ₹ 3,21,28,469/-. He observed that as per the decision of the Hon'ble Supreme Court in the case of CIT Vs. Sterling Foods 237 ITR 579 and several other cases, any receipt/income on account of DDB or other export incentives is not to be treated as income derived from the business of industrial undertaking and thus, not eligible for deduction u/s 80IA/IB. He further observed that in a number of cases, Hon'ble Supreme Court had held that income on account of DDB and other export incentives is income resulting from some schemes given by the Government, and these cannot be considered as derived from the eligible business of the industrial undertaking, thus, any receipt on account of Duty draw Back was liable to be excluded for the purposes of computation of deduction/s 80-I. The AO noticed that the assessee failed to exclude the receipts/income on account of Duty Draw back while computing deduction u/s 80-IB in this case. He observed that if this amount of ₹ 3,21,28,469/- was excluded, the resultant figure would be a huge loss of over ₹ 1,74,11,490/-. Thus, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 80IA/IB of the Act. Since no assessment was made in the assessment year 2002-03, therefore, the entire amount of deduction claimed by the assessee were allowed u/s 143 (1) of the IT Act. In view of the findings for A.Y. 2003-04 by the Hon'ble High Court and as per the provisions u/s 150 (1) of the IT Act, the case for the A.Y. 2002-03 has been reopened by the AO. Therefore, there is also no dispute that the proceeding u/s 147 were initiated for the A.Y. 2002-03 on the bases of order of Hon'ble High Court for AY. 2003-04. In other words, there is no order of High Court order for A.Y. 2002-03. 6.3 Before considering the issue as to whether AO is justified in taking the shelter of sec 150, it is pertinent to analyse the section 150. Provision for cases where assessment is in pursuance of an order on appeal, etc. 150. (1) Notwithstanding anything contained in section 149, the notice under section 148 may be issued at any time for the purpose of making an assessment or reassessment or recompilation in consequence of or to give effect to any finding or direction contained in an order passed by any authority in any proceeding under this Act by way of appeal, reference o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iso to sub-s. (1) providing that the provisions of sub-s (1) shall not apply where by virtue of any other provision limiting the time within which action for assessment, reassessment or recomputation may be taken, such assessment, reassessment or recomputation is barred on the date of the order which is the subjectmatter of the appeal, reference or revision in which the finding or direction is contained. It would, thus, mean that an appellate or revisional authority cannot give a direction for assessment or reassessment which goes to the extent of conferring jurisdiction upon the Assessing Officer if his jurisdiction had ceased due to the bar of limitation. If the issuing of a notice for assessment or reassessment for a particular assessment year had become timebarred at the time of the order, which was the subject-matter of the appeal, the provisions of s. 150 (1) cannot be invoked for making an assessment or reassessment. It follows, therefore, that if the original order which was the subject-matter of appeal, reference or revision could not have been passed, when it was purported to have been passed by reason of its being barred by limitation, the same could not be revived u/s 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... restrictions placed by section 150 (2) of the IT Act. The action of the AO is beyond the jurisdiction enshrined under the IT Act. 6. The revenue, being aggrieved, is in appeal before us. 7. Ld DR, relying on the order of the AO, submitted that the CIT (A) was not justified in deleting the disallowance u/s 80IA/80IB amounting to ₹ 44,95,392/- u/s 148/150 (1) of the Act. He submitted that the CIT (A) has also erred in holding that no notice can be issued u/s 148 to the assessee for AY 2002-03 even though the same was issued pursuant to the order of the Hon ble Delhi High Court in the case of the assessee for AY 2003-04. So, therefore, he wants us to reverse the order of the CIT (A) and uphold the order of the AO. 8. On the other hand, ld. AR reiterated, more or less, his submissions made before the AO and CIT (A). The substance of the submissions of the ld. AR is as under :- (i) The notice u/s 148 read with section 150 was issued to the assessee. As no appeal had been passed by any authority in the year under consideration (AY 2002-03), therefore, no notice could be issued u/s 148 beyond the time limit mentioned in section 149. As per section 149(1) (b), notice can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITO v. Murlidhar Bhagwan Das [1964 52 ITR 335 Rajinder Nath v. CIT [1979] 120 ITR 14 has also taken the same view. Same opinion was also expressed by Karnatka High court in the case of consolidated Coffee Ltd - 155 ITR 729 High Court of Calcutta in the case of Peico Electronics 210 ITR 991. So, therefore, the ld. AR wants us not to interfere with the order of the ld. CIT (A) and the same may be upheld. 9. We have heard both the sides on the issues and perused the material available on record and also gone through the orders relied upon. We find that there is no dispute in the instant appeal that no assessment u/s 143 (3) or u/s 147 was ever made in the case of the assessee for the year under consideration (AY 2002-03) and only processing u/s 143 (1) was completed before the issuance of notice u/s 148, therefore, question of any appellate order being passed in this case does not arise We also find that there is also no dispute that notice u/s 148 issued on 15.03.2011 which is clearly beyond the outer time limit of six years and is, therefore, hit by limitation. However, we find that the AO initiated the proceeding u/s 147 on the basis of the judgment of Hon'ble jurisdi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the subject-matter of appeal, revision, etc., was passed. In other words, sub-section (2) provides a rider as if in the nature of a proviso to subsection (1) providing that the provisions of sub-section (1) shall not apply where by virtue of any other provision limiting the time within which action for assessment, reassessment or recomputation may be taken, such assessment, reassessment or recomputation is barred on the date of the order which is the subject-matter of the appeal, reference or revision in which the finding or direction is contained. It would, thus, mean that an appellate or revisional authority cannot give a direction for assessment or reassessment which goes to the extent of conferring jurisdiction upon the Assessing Officer if his jurisdiction had ceased due to the bar of limitation. If the issuing of a notice for assessment or reassessment for a particular assessment year had become time-barred at the time of the order, which was the subject-matter of the appeal, the provisions of section 150 (1) cannot be invoked for making an assessment or reassessment. It follows, therefore, that if the original order which was the subject-matter of appeal, reference or revi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
