TMI Blog2018 (6) TMI 366X X X X Extracts X X X X X X X X Extracts X X X X ..... his case is also barred by limitation. - Decided in favour of assessee. - I.T.A.No.69/Viz/2018, I.T.A.No.70/Viz/2018, I.T.A.No.71/Viz/2018, I.T.A.No.72/Viz/2018, I.T.A.No.73/Viz/2018 And I.T.A.No.74/Viz/2018 - - - Dated:- 6-6-2018 - SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER For The Appellant : Shri, I Kama Sastry, AR For The Respondent by : Shri, T.Satyanandham, DR ORDER Per Bench: 1. These appeals are filed by the Dr.P.Venugopal, representative assessee (Rep.Assessee) of the appellants against the order of the Commissioner of Income Tax (Appeals) [CIT(A)]-10, Hyderabad vide ITA No.0017-0022/CIT(A)-10/ 2015-16, dated 01.01.2018 for the assessment year 2007-08. Since the issues involved in these appeals are identical, all the appeals are clubbed, heard together and disposed off in a common order for the sake of convenience as under. For the sake of convenience the facts are extracted from appeal No.ITA No.69/Viz/2018 of V.Pratima Rao. 2. The assessee has raised the following common grounds in all the appeals : 1. The Ld. AO is not correct and the Ld. CIT (Appeals) is not correct in holding that the not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hem. Hence, order u/s. 163(1)(c) was passed by the Assessing officer (AO) on 10.02.2014 treating the assessee as an Agent of the aforementioned non-residents for the A.Y.2007-08 after affording opportunity to the assessee. 3.1. As per the sale deed, the consideration was stated to be ₹ 35,00,000/, whereas the market value of the said property was at ₹ 78,39,000/-. Therefore, as per the provisions of Sec.50C, the Long Term Capital Gains in respect each case of the above non-resident is worked out as under: Sl. No Name of the non-resident Share in the property Share in sale consideration (Rs.) 1. Smt. Laliitha D.V. Rao 1/3 26,13,000 2. Smt V. Ujwala Rao 1/9 8,71,000 3 . Smt, V Gautam Rao 1/9 8,71,000 4 . Smt V. Pratima Rao 1/9 8,71000 5 . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by Finance Act, 2012 is applicable to the assessment year beginning on or before 01 April 2012, thus, there is no scope for any confusion or for interpretation giving rise to another view, therefore, held that the notice issued u/s 148 are valid. For the sake of convenience and clarity, we extract relevant part of Ld.CIT(A) order which reads as under : 6.1. I am in agreement with the stand taken by the Assessing Officer in view of the meaning clearly conveyed by the language of the explanation to Section 149(3), which is reproduced, as below. Explanation - For the removal of doubts, it is hereby clarified that the provisions of sub-sections (1) and (3), as amended by the Finance Act, 2012, shall also be applicable for any assessment year beginning onor before the 1st day of April, 2012. 6.2. In view of the above, the Intention of the legislature is clear and the time of 6 years was available to issue notice u/s 148 in the present set of facts. Important changes have been made by the Finance Act, 2012. Apart from changing the existing provisions of Section 149(1), the period of two years is substituted by six years in Sec 149(3). It may be noted that the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 7. We have heard both the parties and perused the material placed on record. In this case, the Rep.Assessee has purchased the property from Lalitha D.V.Rao and 7 others and Out of the 8 vendors, the following are non residents : 1. Smt. Lalitha Devulapalli Venkata Rao, 2. Smt. V.Ujwala Rao 3. Sri V.Gautam Rao 4. Smt.V.Pratima Rao 5. Sri R.Mani Kumar 6. Smt.R.Smitha Sarma All six of them are non residents and payment made to non residents attracts the tax deduction at source u/s 195 of I.T.Act. The Rep.Assessee failed to deduct the tax at source as required u/s 195 of I.T.Act, hence, the AO has passed the order u/s 163 (1)(c) treating the assessee as an agent of non residents for the assessment year 2007-08 and issued notice u/s 148 on 24.03.2014. According to the assessee as per section 149(3), the time limit for issue of notice u/s 148 got expired on 31.03.2010 which was two years during the assessment year under consideration. For ready reference, we extract relevant section 149(3) of I.T.Act which reads as under : (3) If the person on whom a notice under section 148 is to be served is a person treated as the agent of a non-resident under section 163 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... For sake of clarity and convenience we extract relevant part of the order of ITAT Hyderabad Bench in the case of Madhucon Sino Hydro JV Vs. DCIT (supra). 13 . We also notice from the material on record, one more fundamental flaw in the reassessment proceedings of this case, which is not even pointed out by the Appellant, is barred by limitation prescribed under provisions of sub-section (3) of Sec. 149 of the Act. The provisions of subsection (3) of Section 149 of the Act as they stood at the relevant point of time read as follows:- (3) if the person on whom a notice under section 148 is to be served is a person treated as the agent of a non-resident under section 163 and the assessment, reassessment or re-computation to be made in pursuance of the notice is to be made on him as the agent of such nonresident, the notice shall not be issued after the expiry of a period of *[six] years from the end of the relevant assessment year. [Explanation-For the removal of doubts, it is hereby clarified that the provisions of sub-section (1) and (3), as amended by the Finance Act, 2012, shall also be applicable for any assessment year beginning on or before the J day of April, 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1956, authority was conferred upon the ITO to assess a person as an agent of a foreign party under s. 43 within two years from the end of the year of assessment. But authority of the ITO under the Act before it was amended by the Finance Act of 1956, having already come to an end, the amending provision will not assist him to commence a proceeding even though at the date when he issued the notice it is within the period provided by that amending Act, This will be so, notwithstanding the fact that there has been no determinable point of time between the expiry of the time provided under the old Act and the commencement of the amending Act. The legislature has given to s. 18 of the Finance Act, 1956, only a limited retrospective operation, .e,, up to 1st April, 1956, only. That provision must be read subject to the rule that in the absence of an express provision or clear implication, the legislature does not intend to attribute to the amending provision greater retrospectivity than is expressly mentioned, nor to authorise the ITO to commence proceedings which before the new Act came into force had by the expiry of the period provided become barred. 7.2. Hon ble AP High Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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