TMI Blog2005 (11) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... er s. 263 dt. 18th Feb., 2005 was issued to the assessee to show cause as to why the second processing order under s. 143(1), dt. 30th June, 2004 be not treated as ab initio illegal and void. 2.2 In reply, it was submitted by the assessee that: Even after issuance of intimation under s. 143(1), revised return can be validly filed and intimation under s. 143(1) can again be issued of processing of revised return even after the omission of sub-s. (1B) of s. 143 w.e.f. 1st June, 1999 as there is no change in s. 139(5) of the IT Act which provides for filing of the revised return before expiry of one year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier. It was further submitted by the assessee that processing of the return under s. 143(1) cannot be equated to the assessment and for this proposition, the reliance was placed on the following decisions: (i) Elegant Chemicals Enterprises (P) Ltd. vs. Asstt. CIT (2004) 85 TTJ (Hyd) 441 : (2004) 271 ITR 56 (Hyd)(AT); (ii) Mahanagar Telephone Nigam Ltd. vs. Chairman, CBDT (2000) 162 CTR (Del) 554 : (2000) 246 ITR 173 (Del); (iii) Asstt. CIT vs. Gujarat Bitumen Ltd. (2002) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 63 only first processing dt. 31st March, 2003 shall be treated as legal and valid in the eye of law. Other processing orders under s. 143(1) passed by the AO shall stand cancelled." 3. Being aggrieved by the order of the learned CIT, the assessee is in appeal before us. 4. The grounds taken by the assessee areas under: "1. In the facts and circumstances of the case, learned CIT erred in passing order under s. 263 of the IT Act, 1961, cancelling intimation under s. 143(1)(a) dt. 30th June, 2004. 2. In the facts and circumstances of the case, learned CIT failed to appreciate that second revised return was validly filed and so second intimation under s. 143(1) processing the second revised return, being one of the prescribed courses for dealing with IT returns, was validly issued which cannot be subjected to cancellation by CIT in absence of any erroneous elements therein. 3. In the facts and circumstances of the case, the order under s. 263 passed by CIT is bad in law and without jurisdiction as view taken by learned AO in processing valid second revised return under s. 143(1) was one of the prescribed courses open to him, there being no statutory or other requirement to pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r hand, the learned Departmental Representative strongly opposed the admission of the additional grounds taken by the assessee. 9. We have carefully considered the rival submissions of the parties and perused the material available on record. We find that the additional grounds of appeal taken by the assessee are legal grounds and the relevant facts are already on record, therefore, following the ratio of the decision of Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. vs. CIT, the additional grounds taken by the assessee are admitted. 10. The learned counsel for the assessee while arguing all the grounds of appeal as common ground strongly relied on the written submission filed before the learned CIT. He further submits that after filing of the original return on 28th Oct., 2002 the assessee did not receive any intimation under s. 143(1) dt. 31st March, 2003 as mentioned by the learned CIT in the notice under s. 263 and in the order passed under s. 263. He further submits that there is no error in the action of the AO in processing the revised return filed by the assessee under s. 139(5) of the IT Act, therefore, the order passed by the learned CIT be cance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3(1) of the Act. It is the stand of the respondents, as averred in the affidavit-in-reply, that the return of income was processed on 28th March, 2002 and refund order had been issued which was encashed by the petitioner/assessee through his bank account. The revised return of income carne to be filed on 24th Sept., 2002 claiming exemption of Rs. 51akhs from the compensation under s. 10(10C). The AO framed an order under s. 154 of the Act rectifying the mistake apparent on the record and granting credit for the prepaid taxes to the tune of Rs. 3,18,195. The AO also directed grant of interest under s. 244A of the Act. The order was made on 27th March, 2003. Subsequently, the learned CIT took action under s. 263 to revise the order made under s. 154 of the Act. It was held by the learned CIT that the order dt. 27th March, 2003 made under s. 154 of the Act was erroneous and prejudicial to the interest of the Revenue and as such cancelled the same. As a result, the order under s. 143(1) of the Act accepting the returned income at Rs. 9,98,182 was held to prevail on the basis of the original return of income dt. 31st July, 2001. In the meantime, the assessee preferred an application und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king a decision. There cannot be any liability to pay or refund unless there is a direction or order to that effect. Therefore, though not an assessment order, an intimation is nevertheless an order. Since it was not an order of assessment, therefore, the assessee is entitled to file a revised return under s. 139(5) even after issue of intimation as was held in Kalyanpur Cement Ltd. vs. Jt. CIT (2005) 195 CTR (Cal) 39 : (2005) 276 ITR 49 (Cal). But this proposition cannot be reconciled with the Explanation to s. 143, which allows the assessee to prefer an appeal under s. 246 and seek a revision under s. 264 confining the characteristics of the intimation as a deemed order only for the limited purpose for which the fiction was created through the enactment of the Explanation. Even if an intimation could be treated to be an order, even then the question remains as to whether it would be an order revisable under s. 263. 15. In Kalyanpur Cement Ltd. vs. Jt. CIT (2005) 195 CTR (Cal) 39 : (2005) 276 ITR 49 (Cal) it has been held at p. 54 as under: "Whether second revised return is valid: Sec. 139(5) permits furnishing of revised return within the relevant assessment year or before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r for the purpose of exercising power under s. 263. Therefore, the initiation of the proceeding under s. 263 is wholly without jurisdiction and a nullity and void and cannot be sustained." 18. In the case of S.R. Koshti it has also been held at p. 171 as under: "On a plain reading of the said Explanation, which was omitted by the Finance Act, 1999, w.e.f. 1st June, 1999, it becomes clear that even for the limited period when the legislature wanted the intimation to be deemed to be an order, it was for a limited purpose, namely, for the purposes of appeal under s. 246 of the Act and revision at the instance of an assessee under s. 264 of the Act. Thus, even when the said Explanation was on the statute book, the power to invoke the provision of s. 263 of the Act could not be exercised in the circumstances. For the year under consideration, admittedly, the said Explanation is not on the statute book. The respondent, therefore, could not have, in the circumstances, treated the intimation as an order for the purposes of non-suiting the petitioner by treating intimation dt. 28th March, 2002, as being an order of assessment and thus, denying the petitioner a statutory right to file a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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