TMI Blog2018 (9) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... passing an order is less than sixty days. Clause (iv) to Explanation 1 and the first proviso would certainly apply in the present case as special audit was directed by the Assessing Officer before the expiry of prescribed period and only six days were left to complete the assessment. Statutory time period is fixed by the Act. The same enactment can also provide for exclusion of period, and extension of time. We must abide by the legislative enactment. Substantial question of law is answered in favour of the appellant-revenue and against the respondent-assessee. The draft assessment order was passed within the prescribed time and was not barred by limitation. - ITA 292/2018 - - - Dated:- 20-8-2018 - MR. SANJIV KHANNA AND MR. CHANDER S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... declared taxable income of ₹ 36,35,27,736/-. The return was taken for scrutiny/regular assessment. Accordingly, the regular/draft assessment order was required to be passed by the assessing Officer on or before 31.12.2011. During the course of the assessment proceedings, the Assessing Officer vide order dated 26.12.2011 had directed the respondent-assessee to get his accounts audited under Section 142(2A) of the Act. Report of the special audit was received by the Assessing Officer on 22.06.2012. Thereafter, the draft assessment order was passed by the Assessing Officer on 09.08.2012. Objections raised by the respondent assessee to the draft assessment order were considered and decided by the Dispute Resolution Panel vide order dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 142- Inquiry before assessment and not time limit for completion of assessment under section 153 (1) of the Act. The Tribunal further held that: With regard to the protection of the interest of the Revenue where the report or information called under the explanation is received beyond time and the time limit for completion of assessment has expired, the court held that the AO should complete the assessment keeping in mind the limitation as per the provisions of the Act. 8. The relevant portion of the Explanation 1 to Section 153 and the first proviso to the said Explanation is reproduced below- Explanation 1.- In computing the period of limitation for the purposes of this section- *** (iv) the period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proviso to Explanation 1 is equally clear and categoric. Where ever after exclusion of the time or period, the period of limitation for passing of an assessment order is less than sixty day, the limitation period for passing of the assessment order shall be extended to sixty days. Accordingly, as the period for passing of the draft assessment order on report of special audit was six days, by virtue of the first proviso it was extended to sixty days. In view of the statutory exclusion under clause (iv) to the Explanation 1 and statutory extension vide first proviso the Assessing Officer was entitled to pass the assessment order by 21.08.2012. The draft assessment order passed on 09.08.2012 was within limitation and not void or invalid. 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ducting special audit has to be excluded. The proviso to Explanation stipulates that the Assessing Officer can pass the assessment order within 60 days, if after excluding the time mentioned in the Explanation, the time for completing the assessment is less than 60 days. In terms of the said proviso, the Assessing Officer had the extended period to complete the assessment proceedings. The Assessing Officer had to complete the assessment within 60 days from the date on which the special audit report was to be submitted to him. 12. Explanation 1 (iv) and first proviso to Section 153 being identical and pari materia to the Explanation to Section 153 B, the ratio in Ulike Promoters P. Ltd. (supra) would equally apply to the present appeal. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted staying the making of a special report, the assessing officer would not proceed with the assessment in the absence of the audit as he thought, in his wisdom, that special audit report is needed. That would be the normal and natural approach of the assessing officer at that time. It is stated at the cost of repetition that in the estimation of the assessing officer special audit was essential for passing proper assessment order. If the court, while undertaking judicial review of such an order of the assessing officer directing special audit ultimately holds that such an order is wrong (for whatever reason) that event happens at a later date and would not mean that the benefit of exclusion of the period during which there was a stay order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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