TMI Blog2018 (9) TMI 1752X X X X Extracts X X X X X X X X Extracts X X X X ..... Shyam Kumar Naidu, Visakhapatnam representative assessee is barred by limitation and accordingly, the notice issued u/s 148 is quashed and the consequent assessment made u/s 147 r.w.s. 143(3) dated 28.03.2016 is annulled. - Decided in favour of assessee. - I.T.A. No. 333/Viz/2018 - - - Dated:- 26-9-2018 - 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 : Shri K.C.Das, DR ORDER PER D.S. SUNDER SINGH, Accountant Member: This appeal is filed by the assessee against the order of the Commissioner of Income-Tax (Appeals)[CIT(A)]-10, Hyderabad vide I.T.A.No.0018/CIT(A)-10/2016-17/CIT(A),HYD-10/10031/2016-17 dated 23.04.2018 for the assessment year 2008-09. Gudivada Shyam Kumar Naidu, Visakhapatnam 2. This is a case of representative assessee. Sri Gudivada Shyam Kumar Naidu, non-resident has sold the immovable property to Smt. Bheemarasetty Sunitha comprising of 226 sq.yards of vacant site situated at Allipuram, Ward ( D.No.30-15-173), Dabagardens, Visakhapatnam during the financial year 2007-08 relevant to the assessment year 2008-09 vide document No.3187 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rep.Assessee has purchased the property from Gudivada Shyam Kumar Naidu, Visakhapatnam LalithaD.V.Rao and 7 others and Out of the 8 vendors, the following are non residents : 1. Smt. LalithaDevulapalliVenkataRao, 2. Smt. V.UjwalaRao 3. Sri V.GautamRao 4. Smt.V.PratimaRao 5. Sri R.Mani Kumar 6. Smt.R.SmithaSarma 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 and the assessment, reasses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was barred by limitation. 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 sub-section (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 non-resident, 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 beginni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, ended on 31st March, 1956. It is true that under the amending Act by 5. 18 of the Finance Act, 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 Gudivada Shyam Kumar Naidu, Visakhapatnam 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 pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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