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01-10-2018, SURENDRA KUMAR JAIN, Section 254, 132, 153A, HIGH COURT OF DELHI
Appeal No. - W.P.(C) 4304/2018 & CM APPL.16759/2018
Asstt. Year - 2005-06
PER : S.RAVINDRA BHAT, J.
1. In all these writ petitions, the narrow question agitated by the assessees is that assessment order made on 22.12.2017 under Section 153A read with Section 254 of Income Tax Act, 1961 (hereinafter„the Act’) for Assessment Year 2005-06 and subsequent years (up-to 2012-13) covered by search assessment, were barred and therefore, needs to be quashed.
2. The brief facts necessary to decide these writ petitions are that pursuant to search and seizure proceedings under Section 132 of the Act, the assessment was completed for the block period on 28.03.2013 by the concerned Assessing Officer (AO). The Commissioner of Income Tax (A) partly allowed the assessee’s appeal on 14.08.2014.
The matter was carried further to the Income Tax Appellate Tribunal (ITAT) which remitted the matter back to the AO to complete the assessment de novo. The assessee contends that in fact the concerned AO sought tax effect by re-computing the income under Section 153A of the Act, in effect, following the ITAT’s order of 18.02.2016. Relying upon that order, the assessment proceedings were taken up after remand by the AO who completed them on 22.12.2017. Relying upon the Full Bench decision of this Court in Odeon Builders Pvt. Ltd. vs. Pr. Commissioner of Income Tax-4, (2017) 393 ITR 27, it is urged on behalf of the assessees that the impugned order is per se illegal and void. It was contended that apart from the AO’s order – made after the ITAT’s decision (on 18.02.2016), there is other evidence as well, in the form of reply to the assessee’s ITR queries dated 12.03.2018 where the revenue clearly admitted that the order was served by hand to the Commissioner of Income Tax (Departmental Representative) on 30.03.2016. Taking strength from the then existing proviso to Section 153(2A), it is urged that time available then to the AO in this case was only up-to 31.12.2016, for working out of the remand and completing the assessment.
3. The revenue resisted the proceedings and urged that the impugned order was made within the time prescribed. Firstly, it is urged that petitioners cannot be heard to complain as they did not attend to the queries and co-operate in an assessment proceeding which got delayed. Learned counsel emphasized that as a result the petitioners could not be given any discretionary relief given that the petitioner was an entry provider/facilitator and that the search resulted in addition of `70 crores as income in his hand. Secondly, it was argued that the plain reading of Section 153A of the Act would reveal that it overrides the other provisions of the Act – because of the nonobstante clause. Elaborating further, it was submitted that period of limitation prescribed by Section 153B i.e. two years is substantial that excludes search assessment and therefore, excludes applicability of Section 153(2A) which is general and governs all demands other than those concerning search assessment.
4. The question as to what would be the starting point of limitation with respect to any proceedings which are to be initiated by the revenue or any steps to be taken by it, was the precise issue of point of determination by this Court in Odeon Builders (supra). The Court then held as follows:
28. The above decisions under Section 256 (3) are clearly distinguishable. The limitation for the purpose of Section 256 begins to run the moment the order is communicated to the parties. Another distinction to be drawn is that the word used in Section 256 of the Act “served” whereas under Section 260A it is “received”. The word “received” has to be seen in the context of the decision in CIT v. Sudhir Choudhrie (supra), which made it mandatory for pronouncement of the orders of the Income-tax Appellate Tribunal. At the time of such pronouncement, apart from the authorized representative of the assessee, theDepartmental representative is expected to remain present. Through him the Department becomes immediately aware of the said judgment of the Income-tax Appellate Tribunal. The “concerned” Commissioner of Income-tax
43. Viewed differently, the contextual interpretation of the expression “receive” would be when the parties notified of the pronouncement are represented at that time in the open court. When pronounced, both parties are said to receive it. The agency which they choose for transmission to the official or executive component to authorise an appeal is not the concern of the judicial system.
49. Consequently, where the order is common to several appeals, while for the assessee the starting point for limitation will be when the assessee aggrieved by such order first receives a copy thereof; for the Revenue, the date when the Department representative of the Commissioner of Income-tax (Judicial) first receives a copy thereof will be the starting point for limitation for all the appeals.
50. It is, therefore, not possible to accept the submission that till a particular jurisdictional Commissioner of Income-tax or Principal Commissioner of Income-tax has not received the order of the Income-tax Appellate Tribunal, the period of limitation for filing an appeal against that order does not commence.