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29-11-2019, Rohit Sawhney, Section 54EC, 4A, 45, Tribunal Delhi

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2 weeks 1 day ago #11602 by amit
Section - 54EC, 4A, 45
Order Date - 29-11-2019
Favouring - Assessee
Court - Tribunal Delhi
Appellant - Rohit Sawhney
Respondent - ACIT
Justice - H.S. SIDHU JM & O.P. KANT AM
Citation - 1119Taxpundit294
Appeal No. - ITA No.724/Del/2017
Asstt. Year - 2013-14

Order

PER : C.M.Garg,JM

The assessee has filed appeal against the order of the CIT(A), Berhampur dated 20.1.2012 for the assessment year 2005-06 and cross appeals filed by the assessee and revenue for the assessment year 2008-09 against the order dated 10.6.2014 of the CIT(A), Berhampur.

ITA No.128/CTK/2014: A.Y: 2005-06

2. At the time of hearing, ld counsel for the assessee has raised additional ground of appeal, which reads as under:

“For that the assessment as made u/s.143(3) is bad in law in view of the fact that the return of income was filed on 31.10.2005 and notice u/s.143(2) was issued and served on the appellant on 26.5.2009.”

3. The ld. Counsel for the assessee submitted that the afore-extractedadditional ground was inadvertently omitted to be taken in the memorandum of appeal but are significant for the disposal of the appeal by the Tribunal. It was, therefore, prayed that the same be admitted, which was opposed by the ld. DR.

4. Having gone through the subject matter of the additional ground taken by the assessee, it is discernible that the same is a legal ground involving adjudication on questions of law and, therefore, in view of the decision of the Hon’ble Supreme Court in National Thermal Power Company Ltd. Vs. CIT (1998) 229 ITR 383 (SC), we admit the same and proceed to decide the same as per law.

5. The facts of the case are that the assessee is a Development Authority constituted under the Odisha Development Authorities Act, 1982. The assessee filed its return of income for the assessment year 2005-06 on 31.10.2005 declaring loss of Rs.29,02,540/-. The Assessing Officer completed the assessment on 26.11.2009 u/s.144/147 of the Act, inter alia, adding Rs.83,90,492/- to the total income of the assessee which was shown by the assessee as excess of capital expenditure over capital receipt and Rs.31,18,535/- which was the receipt of the assessee from sale of shop rooms. The assessee carried the matter in appeal upto ITAT and the matter was restored to the file of the AO by the Tribunal dated 12.9.2011 in ITA No.299/CTK/2011 in the light of the fact that the CIT(A) rightly noted that the application of funds were on account of revenue for claiming application of funds of income exempt under the provisions of section 11 of the Act. The Tribunal also observed that it is imperative whether the assessee has preferred to apply for seeking registration u/s.12A or not. In pursuance to the Tribunal order (supra), the Assessing officer passed his order u/s.143(3)/254 of the Act on 6.12.2012 and determined the total income of Rs.55,50,620/- consisting of excess of revenue receipt over revenue expenses at Rs.54,88,250/- and profit on sale of commercial complex amounting to Rs.62,370/- and the appeal of the assessee was dismissed by the CIT(A).

6. Being aggrieved, the assessee is in further appeal before us raising the additional ground that the assessment u/s.143(3) /254 of the Act is bad in law in view of the fact that the return of income was filed on 31.10.2005 and notice u/s.143(2) was issued and served on the assessee on 26.5.2009.

7. At the time of hearing, ld counsel for the assessee submitted that the assessee filed return of income for assessment year 2005-06 on 31.10.2005. The contention of the asseseee is that notice u/s.143(2) of the Act could have been served on the assessee within six months from the end of the financial year in which the return is furnished by the assessee. He submitted that notice u/s.143(2) of the Act was served on the assessee on 26.5.2009, which was not within the stipulated period. The assessee also referred to the CBDT Circular No. 549 dated 31st October, 1989, which clarified the legal position that when there was a failure to issue a notice to an assessee under Section 143(2) of the Act within six months from the end of the month in which the return is furnished or during the financial year in which the return is furnished, whichever is later, then the Assessee can take it that the return filed by him has become final and no scrutiny proceedings are to be started in respect of that return.

7. Replying to above, ld DR drew our attention towards paras 1 & 2 of the reassessment order dated 26.11.2009 u/s 144/147 of the Act and submitted that originally the return for assessment year 2005-06 was filed by the assessee showing a loss of Rs.29,02,540/- on 30.10.2005 and the same was processed u/s.143(1) of the Act on 24.2.2006. Ld D.R. further submitted that from para 2 of the said reassessment order, it is clear that

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