TMI Blog2022 (8) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 of the Act, a final assessment order u/s.143(3) of the Act, in the absence of provisions of section 144C of the Act being held as prospective in term of decision of Hon ble Madras High Court in the case of Vedanta Limited, supra, the assessment should have been framed on or before 31.12.2010 but actually this was framed only on 22.02.2011, which is barred by limitation. Appeal of assessee allowed. - ITA No.:1022/DEL/2016 - - - Dated:- 6-7-2022 - Shri Mahavir Singh, Vice President And Shri Manoj Kumar Aggarwal, Accountant Member For the Appellant : Shri Vikram Vijayaraghavan, Advocate For the Respondent : Shri D. Hema Bhupal, JCIT ORDER PER MAHAVIR SINGH, VP: This appeal by the assessee is arising out of order of the Commissioner of Income-tax (Appeals), New Delhi in Appeal No.48/2012-13/CIT(A)-44, order dated 13.10.2015. The draft assessment order u/s.144C(1) of the Income Tax Act, 1961 (hereinafter the Act ) dated 24.12.2010 was prepared for assessment year 2007-08 and in consequence to the same, final assessment order u/s.143(3) r.w.s. 144C of the act was made by the ITO, Ward 10(4), New Delhi vide order dated 22.02.2011. 2. It was brought to o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fter almost six years which is barred by limitation and need not be admitted. He also argued that the provision of section 144C of the Act is procedural provision and the same applies to pending proceedings as in the present case. 6. After hearing rival contentions and going through the facts of the case, we noted that additional grounds raised by the assessee seeks to challenge the validity and the legality of the assessment order passed by AO u/s.143(3) r.w.s. 144C of the Act, dated 22.02.2011 for the assessment year 2007-08, on the ground that provisions of section 144C of the Act as introduced by the Finance (No.2) Act, 2009, with retrospective effect from 01.04.2009 has no application for the assessment year under consideration. We noted that the issue is purely legal and the facts relating to this legal issue are available on the assessment records and appellate records of the assessee and that of the Department. No new additional fact is required to be brought on record for adjudication of this issue. Hence, we admit the above grounds and adjudicate the same. 7. Brief facts are that the assessee company Dorling Kindersley India Pvt. Ltd., (now known as Pearson India Ed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicability of provisions of section 144C and the same was replaced by the following para 45.5:- 45.5. Applicability: Section 144C has been inserted with effect from 1st April, 2009. Accordingly, the Assessing Officer is required to forward a draft assessment order to the eligible assessee, if he proposes to make, on or after the 1st day of October, 2009, any variation in the income or loss returned which is prejudicial to the interest of such assessee. In other words section 144C is applicable to any order which proposes to make variation in income or loss returned by an eligible assessee, on or after 1st October, 2009 irrespective of the assessment year to which it pertains. Amendments to other sections of the Income-tax Act referred to in para 45.3 of the circular 5/2010 dated 3rd June, 2010 shall also apply from 1st October, 2009 8.2 This was issued vide Circular No.9 of 2013, dated 19-11-2013 as reported in (2013) 359 ITR (St.) 7-8. The ld.counsel further stated that this issue was considered by Hon ble Madras High Court in the case of Vedanta Ltd., supra and both the Circulars were considered and finally held that the provisions of section 144C of the Act do not merel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee and the final assessment order dated 22.02.2011 is barred by limitation. 9. On the other hand, the ld. Senior DR stated that these are procedural provisions and a procedure is adopted by the legislature for framing of assessment u/s.144C of the Act. The statutory provisions of section 144C of the Act itself state that the AO shall forward a draft order of assessment if he proposes to make any variation in the income or loss return by the assessee on or after October 01, 2009. He laid emphasis on the words on or after October 01, 2009 in the provision, he says, means any procedure that are pending as on 01.10.2009, the new procedure adopted u/s.144C of the Act, will apply to all the assessee across i.e. those comes under transfer pricing provisions. No doubt, to the clause under which the assessee comes. For this, he relied on the decision of Hon ble Supreme Court in the case of CCE v. Ratan Melting and Wire Industries [2008] 231 ELT 22. 10. We have heard rival contentions and gone through facts and circumstances of the case. We have gone through the provisions of the Act i.e., 144C of the Act as introduced by the Finance (No.2) Act, 2009 with retrospective effect fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing regard to the facts and controversy projected before the Court as is evident from the following extract from the decision of the Hon ble Supreme Court in the case of Sun Engineering Works (P) Ltd. 198 ITR 297 at page 320: . . It is neither desirable nor permissible to pick out a word or a sentence from the judgment of this Court, divorced from the context of the question under consideration and treat it to be the complete law declared by this Court. The judgment must be read as a whole and the observations from the judgment have to be considered in the light of the questions which were before this Court. A decision of this Court takes its colour from the questions involved in the case in which it is rendered and while applying the decision to a later case, the courts must I.T.A.No.4405/Del/2011/A.Y.2003-04 12 carefully try to ascertain the true principle laid down by the decision of this Court and not to pick out words or sentences from the judgment, divorced from the context of the questions under consideration by this Court, to support their reasoning . .. 15. The decision of the Hon ble Madras High Court in the case of Vijay Television Pvt. Ltd. 369 ITR 130 reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut, change of forum is considered as a form of procedure so amendment in law relating to forum typically amounts to procedural in nature. But, we noted that a stand has been taken by the judiciary that change in forum in pending proceeding would not remain procedural in nature but it would create a substantive right. Therefore, any law or amendment bringing any change in forum does not affect pending actions or proceedings in court of law unless the new law or amendment as a provision in it providing a clear indication that the pending actions or proceeding are to be affected. This principle was reiterated by the Hon ble Supreme Court in the case of CIT vs. Dhadi Sahu, (1992) SCR 3 168, wherein the Hon ble Supreme Court observed that it was true that no litigant had any vested right in the matter of procedural law, but where the question is of the change of 'forum', it ceases to be a question of procedure only, with reference to pending matter . The 'forum' of appeal or proceedings, it was held, was a vested right as opposed to pure procedure to be followed before a particular 'forum'. It was therefore concluded, that a right becomes vested when the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis of the principle against retrospectivity is the principle of 'fairness , which must be the basis of every legal rule as was observed in the decision reported in L Office Cherifien des Phosphates v. Yamashita- Shinnihon Steamship Co. Ltd. Thus, legislations which modified accrued rights or which impose obligations or impose new duties or attach a new disability have to be treated as prospective unless the legislative intent is clearly to give the enactment a retrospective effect; unless the legislation is for purpose of supplying an obvious omission in a former legislation or to explain a former legislation. We need not note the cornucopia of case law available on the subject because aforesaid legal position clearly emerges from the various decisions and this legal position was conceded by the counsel for the parties. In any case, we shall refer to few judgments containing this dicta, a little later. 10.7 Before us, in the present case, the assessment year involved is assessment year 2007-08 and draft assessment order u/s.144C(1) of the Act was framed on 24.12.2010 and served on the assessee on 31.12.2010. The assessee has accepted the draft assessment order and assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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