ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-(1), RAIPUR, RAIPUR V. R. K. STRUCTURES PVT LTD., , RAIPUR

ITA 200/RPR/2022

AI Insights

The case involves multiple appeals and cross objections related to reassessment orders for the Assessment Year 2010-11 against three private limited companies under a group known as Goldbricks Infrastructure Pvt Ltd. The primary legal contention revolved around the validity of reassessment orders passed by the Assessing Officer, which were challenged on grounds of being time-barred and not adhering to procedural requirements as mandated by the Income Tax Act and judicial precedents. The Tribunal's decision was influenced by the interpretation of sections 147, 148, and 153 of the Income Tax Act, along with relevant High Court and Supreme Court judgments which emphasized the necessity of adhering to procedural norms and the importance of limitation periods in tax assessments.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 106755 (ITAT-RAIPUR)
• Duration Of Justice: 2 year(s) 1 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 26-11-2024
• Assessment Year: 2010-2011
• Appeal Filed On: 21-10-2022
• Other Referred Cases: VLS Finance Ltd. Vs. Commissioner of Income Tax, Commissioner Of Income-Tax vs Dhariwal Sales Enterprises, CIT vs. Chandra Bhan Bansal, Government of India Vs. The Citadel Fine Pharmaceuticals, Madras & Others, Jet Airways (I) Ltd vs. Commissioner of Income Tax, Ranbaxy Laboratories Ltd vs. Commissioner of Income Tax, Martech Peripherals (P) Ltd vs. Commissioner of Income Tax, ACIT vs. Magor Deepak Mehta, Pr. CIT vs. Lark Chemicals (P) Ltd
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.L.ANURAGI
• Assessee Lawyers: R. B. DOSHI; A SPEAKING; AO
• Keywords: Set aside; Reassessment proceedings; Unexplained cash credit; Depreciation; Onus to prove; Gift; Period of limitation; Reopening of assessment; Principle of natural justice; Accommodation entries; Reason to believe; Time period of passing order; Bogus loan; Bogus
• Section: 148; 143(3); 142(1); 195; 64; 153; 68; 131; 133(6); 139; 191; 80HH; 20

Judgement Text

"आयकर अपीलीय अिधकरण, रायपुर Ɋायपीठ, रायपुर IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR ŵी रिवश सूद, Ɋाियक सद˟ एवं ŵी अŜण खोड़िपया, लेखा सद˟ क े समƗ । BEFORE SHRI RAVISH SOOD, JM & SHRI ARUN KHODPIA, AM ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 Sr. no ITA No’s Appellant Respondent 01 200/RPR/2022 ACIT, Circle-1(1), Raipur R. K. Structure Private Limited, Plot No. 06, Industrial Area, Sondongri, Raipur PAN: AACCR4944H 02 234/RPR/2022 ACIT, Circle-1(1), Raipur Silverbricks Infrastructure Private Limited, Subhash Road, Ganjpara, Raipur PAN: AACCR4944H 03 169/RPR/2023 DCIT, Circle-1(1), Raipur Silverleaf Infrastructure Private Limited, Subhash Road, Ganjpara, Raipur PAN: AALCS0149J Cross Objection Nos. 28, 25, 31/RPR/2023 (Assessment Years: 2010-11) Arising out of ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 Sr. no CO No’s (Arising Out of ITA) Appellant Respondent 01 28/RPR/2023 (200/RPR/2022) R. K. Structure Private Limited, Plot No. 06, Industrial Area, Sondongri, Raipur PAN: AACCR4944H ACIT, Circle-1(1), Raipur 02 25/RPR/2023 (234/RPR/2022) Silverbricks Infrastructure Private Limited, Subhash Road, Ganjpara, Raipur PAN: AACCR4944H ACIT, Circle-1(1), Raipur 03 31/RPR/2023 (169/RPR/2023) Silverleaf Infrastructure Private Limited, Subhash Road, Ganjpara, Raipur PAN: AALCS0149J DCIT, Circle-1(1), Raipur 2 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. आदेश / O R D E R Per Bench: The captioned appeals are filed by the revenue and the cross objections by the assessees, namely, (i) R.K. Structure Pvt. Ltd., (ii) Silverbricks Infrastructure Pvt. Ltd. & (iii) Silverleaf Infrastructure Pvt. Ltd., against the separate orders of Commissioner of Income Tax (Appeals), NFAC, Delhi, (in short “Ld. CIT(A)”), for the Assessment Year 2010-11, dated (i) 30.08.2022, (ii) 21.09.2022 & (iii) 14.03.2023 respectively, which in turn have arises from the separate orders U/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (in short “The Act”) all dated 31.12.2018, passed by the respective Assessing Officers, as indicated above (in short “Ld. AO”). 2. All the aforesaid matter pertains to the assessees operating under a group, known as the Goldbricks infrastructure Pvt Ltd (GIPL Group). The assessees in present cases are Pvt. Ltd. companies. Since, the issues involved in these appeals िनधाŊįरती की ओर से /Assessee by : Shri R. B. Doshi, CA राजˢ की ओर से / Revenue by : Shri S. L. Anuragi, CIT-DR सुनवाई की तारीख / Date of Hearing : 26.11.2024 घोषणा की तारीख /Date of Pronouncement : 29.11.2024 3 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. are common, interconnected and inextricably interwoven, therefore, for the sake of convenience and brevity, all the aforesaid matter are heard together and are considered for adjudication under this common order. 3. ITA No. 200/RPR/2022 in the case of ACIT vs R. K. Structure Pvt. Ltd. has been taken up for adjudication first, as the lead case, our decision therein, thus shall have a direct bearing on the other appeals, carrying common issues involved therein, accordingly, the outcome of the lead case shall apply mutatis mutandis to the remaining matters. 4. Grounds of appeal and additional grounds raised by the department in ITA No. 200/RPR/2022 are extracted as under: 1. On the facts and circumstances of the case whether the Ld. CIT(A), NFAC was justified in quashing the order u/s 143(3) r.w.s. 147 dated 31-12-1018 passed by the A.O. by considering that a totally different addition of Rs. 14,98,70,000/- has been made u/s 68 of the I. T. Act. In fact, the addition of Rs. 14,98,70,000/- made by the A.O. as unexplained cash credit u/s 68 of the I. T. Act, 1961 is not arising out of any separate issue as held by the Ld. CIT(A), NFAC but on the contrary this unexplained cash credit of Rs. 14,98,70,000/- has been used by the assessee as bogus loan to other paper companies amounting to Rs. 16,87,00,926/-. 2. On the facts and circumstances of the case whether the Ld. CIT(A), NFAC was justified in quashing the order u/s 143(3) r.w.s. 147 dated 31-12-1018 passed by the A.O. independently on the ground that the reassessment proceedings were barred by limitation. On the contrary, the A.O. has duly followed the directions contained in the order of the Hon'ble High Court in W.P.(T) No. 327/2017. 3. “Any other ground that may be adduced at the time of hearing.” 4 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 5. The revenue has further requested to admit additional grounds of appeal vide their letter dated 03.08.2023, submitted on 04.08.2023, the same are admitted, thus, extracted as under: 4. On the facts and in the circumstances of the case whether the NFAC was justified in quashing the order u/s 143(3) r.w.s. 147 dated 31-12-1018 passed by the A.O. on the ground that the reassessment proceedings were barred by limitation as per interpretation of the provisions of Section 153(2), Expl 1(ii) of Sec. 153 and First proviso to Expl 1 of Sec. 153, which is actually a flawed interpretation of the provisions applicable in the facts of the case. On the contrary, the A.O. has duly followed the directions contained in the order of the Hon'ble High Court in W.P.(T) No. 327/2017. 5. On the facts and in the circumstances of the case whether the NFAC was justified in quashing the order u/s 143(3) r.w.s. 147 dated 31-12-2018, on the ground that the reassessment proceedings were barred by limitation stating that the limitation period to pass order u/s 143(3) r.w.s. 147 expired no later than 60 days from 18.09.2018 i.e. 17.11.2018 thereby ignoring the extant provisions of Section 153 Expl. 1 (ii) of the IT Act which explicitly excludes the period of stay granted by Hon'ble HC of Chhattisgarh in W.P.(T) No. 327/2017 dated 10-07-2018 [vide para 14 of Order] 6. On the facts and in the circumstances of the case whether the NFAC was justified in quashing the order u/s 143(3) r.w.s. 147 dated 31-12-1018 passed by the A.O. whereas higher court of law has dealt with the particular issue in details in their following judgments and finally held that stay granted by HC has to be excluded from the stipulated period to complete assessment. (i) VLS Finance Ltd. Vs. Commissioner of Income Tax [[2017] 81 taxmann.com 358 (SC)/Civil Appeal No. 2667/2007] (ii) Commissioner Of Income-Tax vs Dhariwal Sales Enterprises [1996 221 ITR 240 MP] (iii) CIT vs. Chandra Bhan Bansal [ITA No. 19/2010, dtd. 22.05.2014] (iv) Government of India Vs. The Citadel Fine Pharmaceuticals, Madras & Others. [AIR 1989 SC 1771] 7. Any other ground that may be adduced at the time of hearing. 5 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 6. The brief facts of the case are that the assessee is engaged in the business of Construction work and Real Estate. Return of income was filed on 14.07.2010 for AY 2010-11 declaring total income of Rs. 84,45,610/-. Afterwards, a survey u/s 133A was conducted in the premises of Goldbricks Infrastructure Pvt Ltd (GIPL) group on 28.02.2016. During the course of survey, it was discovered that the GIPL group comprises several companies wherein, Shri Rakesh Saraogi and his wife Mrs. Babita Saraogi are the directors. Some of these were Kolkata based companies, which were created by this group. Some of companies are only on paper and no business activity was found to be carried out by these paper companies. These paper Companies are merely shell companies which are acting as layers for bringing in the ‘own money’ through Kolkata based entities. 6.1 From the unveiling of the facts during the survey proceedings, Ld. AO has observed that during the FY 2009-10 (AY 2010-11), the assessee company has given a bogus accommodation entries to the extent of Rs. 16,87,00,926/-, which includes Rs. 5,70,19,000/- to Goldbricks Infra Pvt. Ltd. and Rs. 11,16,81,926/- to M/s Shri Madan Constructions. The respective funds so invested are received by the assessee company from other Kolkata based paper companies carrying the same credentials. 6 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 6.2 Based on aforesaid information, case of the assessee was reopened for scrutiny assessment u/s 147 of the I.T. Act with the prior approval from the Principal Commissioner of Income Tax-1, Raipur dated 10.03.2017. As per Ld. AO, reasons recorded for reopening was provided to the assessee, notice u/s 148 was issued and duly served. Further, notice u/s 142(1) along with questionnaire are issued on 18.07.2017 and 02.08.2017. 6.3 Whie the reopening scrutiny proceedings were under progress, the assessee carried the matter through a Writ Petition (W.P. (T) No. 360/2017) before the Hon’ble High Court of Chhattisgarh, Bilaspur, in effect, an interim relief has been granted to the assessee vide order dated 14.12.2017, by staying the further proceedings against the petitioner (assessee), so far as the impugned order is concerned, following the similar nature of relief granted to Shri Rakesh Kumar Saraogi in W.P. (T) No. 327/2017 vide order dated 22.11.2017( copy of interim order in the case of assessee and Shri Rakesh Kumar Saraogi are placed before us at page no. 237 & 238 of the APB). 6.4 The writ petition of the assessee along with other writ petitions are finally disposed of by the Hon’ble Jurisdictional High Court on 10.07.2018 (copy enclosed at page no. 239-243 of APB), wherein the grievance of the assessee that reasons 7 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. to believe as recorded u/s 147 of the IT Act, were not supplied straight away to the petitioners (assessees) despite request made. Hon’ble High Court referring to the judgment of Hon’ble Apex Court in the case of GKN Driveshaft (India) Ltd., have observed that the assessing officer is bound to furnish the reasons within a reasonable time and on receipt of reasons, the noticee / assessee is entitled to file objections to the issuance of the notice and the objections have to be disposed of by a speaking order. It is further noted that the application filed seeking reasons to believe has been treated as objections to the reasons to believe, though no reasons to believe were supplied to the petitioners (assessee) and rebuttal order came to be passed without supplying reasons to believe, which runs contrary to the decision rendered by Hon’ble Apex Court, which is followed by Hon’ble Delhi High Court and Hon’ble Bombay High Court. To the facts of present case, Hon’ble High Court have held as under: “In the considered opinion of this Court, the course adopted by the Learned Assessing Officer rejecting the application for furnishing reasons to believe without supplying the reasons to believe, as contrary to the above stated judgment of the Supreme Court”. 6.5 Consequently, the rebuttal order passed by the Ld. AO dated 02.08.2017 is quashed and the Assessing Officer is directed to furnish reasons to believe within 8 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. a period of 6 weeks, in response the petitioner is allowed to file objection within 4 weeks and thereafter the Assessing Officer to consider and dispose of the objection of the assessee by a speaking order within reasonable time, in accordance with law. 6.6 In terms of aforesaid order by the Hon’ble Jurisdictional High Court, the reasons were provided to the assessee on 03.08.2018 (i.e., within 6 weeks), to which objections are filed on 24.08.2018 (i.e., within 4 weeks). The objections of the assessee against the reasons are rejected by the Ld. AO through a rebuttal order dated 19.12.2018, and the final order was passed on 31.12.2018. 6.7 During the assessment proceedings, it is observed by the Ld. AO that the assessee keeps on challenging the validity of reopening assessment, but has failed to obtain a favourable order from the Hon’ble High Court, this shows that the assessee has actually no explanation to offer qua the merits of the issue for reopening. There was no submission by the assessee before the Ld. AO regarding the details of the share holders and the Audit Report for the FY 2009-10. From the return of the assessee, it is revealed by the Ld. AO that the assessee has brought fresh share application money of Rs. 14,98,70,000/- during the FY 2009-10 from Kolkata based companies. 9 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 6.8 To examine the identity, creditworthiness of the shareholders and genuineness of the transactions, notices u/s 133(6) and summons u/s 131 are issued but the same left unanswered or return back. A commission was issued to DDIT, Unit 1, Delhi to examine the alleged investor companies. In response, the DDIT conducted inquiries and have furnished the report that the creditworthiness could not be ascertained for the reason that, at the registered office of the investor company, the premises were closed, and on further enquiry, it is gathered that the premises are closed from more than past 2 years and no business activities are being carried out, no board of the name of company was found. It is further revealed that the premise belongs to one Smt. Neetu Soni, her statement are also recorded. A report from DDIT (Inv.), Unit-1(2), Kolkata dated 13.12.2017 along with Inspectors report regarding various alleged paper / shell companies are reproduced in the assessment order. It is further narrated by the Ld. AO that the assessee only submitted PAN, copy of return of income, its bank accounts and audit report of the share subscribers. From these documents as per Ld. AO, the identity of the share subscribers could not be proved, the share subscribers have no fixed assets, no office and have no physical activities. 7. Ld. AO further discussed about the creditworthiness of the shareholders, genuineness of the transactions, assessee’s onus to prove the identity, 10 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. creditworthiness of the shareholders and genuineness of the transaction’s u/s 68. Ld. AO further discussed various judgments in support of his contentions, have issued a show cause dated 22.12.2018, as to why the amount advanced to Goldbricks Infrastructure Pvt. Ltd. and Shri Madan Construction should not be added to the total income of assessee. In compliance assessee furnished a reply which was not found satisfactory by the Ld. AO, therefore, an addition amounting to Rs. 14,98,70,000/- was made to the income of assessee on account of unexplained cash credit u/s 68 of the Act. 8. Aggrieved with the aforesaid addition, the assessee carried the matter before the Ld. CIT(A), wherein the appeal of the assessee is allowed by the Ld. CIT(A) on the issue (i) that no addition was made on the issue for which the jurisdiction was assumed by Ld. AO to reopen the assessment proceedings u/s 147 of the Act and (ii) the reassessment order u/s 147 of the Act was passed beyond the time barring date, thus, bad in law/ invalid. The observations of Ld. CIT(A) while deciding both the aforesaid issues are culled out for the sake of clarity: (i) that no addition was made on the issue for which the jurisdiction was assumed by Ld. AO to reopen the assessment proceedings u/s 147 of the Act 11 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 11.1 The contentions of the appellant as well as the AO have been carefully examined. It is an undisputed fact that reassessment proceedings were initiated and notice UIs. 148 of the Act was issued by the AO with the following observations: - From the above facts and material on record, it has been observed that the assessee company has given bogus accommodation entries to the extent of Rs. 16,87,00,926/- (Rs. 5,70,19,000/- to Goldbricks Infra Pvt Ltd & Rs. 11,16,81,926/- to M/s Shree Madan Constructions) during FY 2009-10 related to A. Y. 2010-11, the respective funds received from other Kolkata Based paper companies also carry the same credentials. (as per para 3.1 above) \"Keeping-in-view the above facts and materials available on record I have formed an honest belief that the income of Rs. 16,87,00,926/- should have been chargeable to tax under the head \"Income from other sources\" for the relevant A. Y. 2010-11 in the hands of R.K. Structures Pvt. Ltd. It is therefore, requested to accord necessary approval to reopen the case for A. Y. 2010-11. Proposal for 148 is enclosed herewith for A. Y. 2010- 11.\" (as per para 3.2 above) However, No Addition has finally been made on this issue. The ONLY addition which has finally been made is of Rs. 14,98,70,000/-, which is on account of non-genuine share application money, an issue which does not form part of the reasons recorded u/s 148 of the Act while assuming jurisdiction to reopen the assessment proceedings u/s 147 of the Act. 11.2 In this regard, it would be worthwhile to reproduce the final show cause notice issued u/s 142(1) of the Act dated 22.12.2018 by the AO requiring the appellant to furnish the final reply reassessment order was passed on 31.12.2018.) 12 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. “Subject: - Assessment Proceedings for A. Y 2010-11-regarding 1. In connection with the ongoing assessment proceeding, you are requested to show cause as to why the amounts claimed to have been given an unsecured loan to the group companies should not be treated as bogus accommodation entries for the following reasons: F.Y. Name of the party from whom loan was taken Amount of loan (Rs.) Reason 2009- 10 Goldbricks Infrastructure Pvt. Ltd. 5,70,19,000/- Post survey compliance by the assessee and our enquiry proved that share application money and security premium taken by the silverleaf Infrastructure Pvt ltd (one of the group companies) and other group companies namely Silverbricks Infra, Raipur resort and properties were received from Sargam Vincom Pvt ltd, is nothing but accommodation entry taken by the assessee to cover up the whole transactions. Later on the assessee introduced this capital into projects. 2009- 10 M/s Shree Madan Construction 11,16,81,926/- Total 16,87,00,926/- Reply in respect of show cause may be furnished by attending this office either personally or through an authorized representative at 02:00 P.M. on 26/12/2018. You are also requested to produce the directors of the above named company on 26/12/2018 at 02:00 PM The Directors may please be informed to appear with all 13 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. necessary documents which may reliable to support their contention for any reply. \" 11.3 This show cause notice u/s. 142(1) of the Act also clearly proves that right from the time the reasons were recorded, till up to the time when the final show cause notice was issued, the only issue being considered by the AO was addition u/s. 68 of the Act of Rs. 16,87,00,926/- on account of unsecured loans given to group companies (Rs. 5,70,19,000/- given to M/S Goldbrick Infrastructure Pvt. Ltd. and Rs. 111681826/- given to Shree Madan Constructions) which the AO was treating as Bogus accommodation entries. 11.4 It is extremely strange that the AO, after issuing this final show cause notice u/s. 142(1) of the Act on 22.12.2018, fixing compliance on 26.12.2018, passes the reassessment order in a matter of few days on 31.12.2018, finally making absolutely NO addition on this issue of Rs. 16,87,00,926/-. However, the AO goes on to make the one and only addition of Rs. 14,98,70,000/- on a totally different issue of unaccounted share application money, an issue which was never raised in the \"reasons to believe\" while reopening the assessment u/s. 148 of the Act. A careful perusal of the assessment order makes it clear that the AO had also never even confronted the appellant on this issue. The AO had never asked the appellant to prove the identity/credit worthiness/genuineness of the transactions related to the issue of share application money. In fact, the AO has not even mentioned the names of the persons and the amounts invested by such persons as the alleged unaccounted share application money anywhere in the assessment order. All these facts lend credence to the appellants contentions. 12. In the case of Jet Airways (l) Ltd (2011) (Bom), 195 taxman 117 it has been held as under: 14 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 20. The second line of precedent is reflected in Shri Ram Singh (2008) (Raj). The Raj HC construed the words used by Parliament in sec 147 particularly the words that the AO may assessee or reassess such income and also any other income to which has escaped assessment and which comes to his notice, subsequently in the course of the proceedings u/s 147 The Raj HC held as follows: \"It is only when, in proceedings u/s 147 the AO, assesses or reassesses any income chargeable to tax, which has escaped assessment for any A Y, with respect to which he had 'reason to believe' to be so, then only, in addition, he can also put to tax, the other income, chargeable to tax, which has escaped assessment, and which has come to his notice subsequently, in the course of proceedings u/s 147. To clarify it further, or to put it in other words, in our opinion, if in the course of proceedings u/s 147, the AO were to come to the conclusion, that any income chargeable to tax, which, according to his 'reason to believe', had escaped assessment for any A Y, did not escape assessment, then, the mere fact that the AO entertained a reason to believe, albeit even a genuine reason to believe, would not continue to vest him with the jurisdiction, to subject to tax, any other income, chargeable to tax which the AO may find to have escaped assessment, and which may come to his notice subsequently, in the course of proceedings u/s 147.\" 21. Parliament, when, it enacted Expl. 3 to sec 147 by the FA(No.2), 2009 clearly had before it both the lines of precedent on the subject. The precedent dealt with 2 separate ques. When it effected the amendment by bringing in Expl.3 to sec 147, Parliament stepped in to correct what it regarded as an interpretational error in the view which was taken by certain Coutts that the AO has to restrict the assessment or reassessment proceedings only to the issues in respect of which reasons were 15 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. recorded for reopening the assessment. The corrective exercise embarked upon by Parliament in the form of Expl. 3 consequently provides that the AO may assess or reassess the income in respect of any issue which comes to his notice subsequently the course of the proceedings though the reasons for such issue were t included in the notice 148(2). The decisions of the Ker HC and of the P& H HC in Vipan Khanna would, therefore, no longer hold the field. Howerver, in so far as the second line of authority is concerned, which is reflected in Shri Ram Singh (Raj) Expl. 3 as inserted by Parliament would not take away the basis of that decision. The view which was taken by Shri Ram Singh (Raj), the Raj HC was also taken Atlas Cycle Industries (1989) (P&H) held that the AO did not have jurisdiction to proceed with the reassessment, once he found that the 2 grounds mentioned in the notice u/s 148 were incorrect or non-existent. Atlas Cycle Industries and Shri Ram Singh would not be affected by the amendment brought in by the insertion of Expl. 3 to sec 147. 22. Expl .3 lifts the embargo, which was inserted by judicial interpretation, on the making of an assessment of reassessment on grounds other than those on the basis of which a notice was issued u/s 148 Setting out the reasons, for the belief that income had escaped assessment. Those judicial decisions had held that when the assessment was sought to be reopened on the ground that income had escaped assessment on a certain issue, the AO could not make an assessment or reassessment on another issue which came to his notice during the proceedings. This interpretation will no longer hold the field after the insertion of Expl.3 by the FA(No.2) of 2009. 16 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. However, Expl.3 does not and cannot override the necessity of fulfilling the conditions set out in the substantive part of sec 147. An Expl. to a statutory provision is intended to explain its contents and cannot be construed to override it or render the substance and core nugatory. Sec 147 has this effect that the AO has to assess or reassess the income (\"such income\") which escaped assessment and which was the basis of the formation of belief and if he does so, he can also assess or reassess any other income which has escaped assessment and which comes to his notice during the course of the proceedings. However, if after issuing a notice u/s148, he accepted the contention of the assessee and holds that the income which he has initially formed a reason to believe had escaped assessment, has as a matter of fact not escaped assessment, it is not open to him independently to assess some other income. If he intends to do so, a fresh notice u/s148 would be necessary, the legality of which would be tested in the event of a challenge by the assessee. 23. We have approached the issue of interpretation that has arisen for decision in these appeals, both as a matter of first principle, based on the language used in section 147 and on the basis of the precedent on the subject. We agree with the submission which has been urged on behalf of the that assessee that sec 147 as it stands postulates that upon the formation of a has escaped assessment for any A Y, the AO may assess or reassesss such income \"and also\" any other income chargeable to tax which comes to his notice subsequently during the proceedings as having escaped assessment. The words “and also” are used in a cumulative and conjunctive sense. To read these words as being in the alternative would be to rewrite the language used by Parliament. Our view has been supported by the background which led to amen mu e regarded as being aware of the interpretation that was placed on the words \"and also\" in Shri Ram Singh (2008) (Raj). Parliament has not taken away the basis of that decision. While it is open to Parliament, having regard to the 17 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. plenitude of its legislative powers to do so, the sec 147 as they stood after the amendment of 14-89, continue to hold the field. 24. In that view of the matter and for the reasons that we have indicated, we do not regard the decision of the Tribunal in the present case as being in error. The que of law shall accordingly stand answered against the Revenue and in favour of the assessee. The appeal is accordingly dismissed. 13. In the case of Ranbaxy Laboratories Ltd (2011)(Del HC, 242 CTR 117) the Delhi High Court has held as under: \"18. We are in complete agreement with the reasoning of Jet Airways (l) Ltd (2011) (Bom HC). We may also note that the heading of sec147 is \"income escaping assessment\" and that of sec 148 \"issue of notice where income escaped assessment\". Secs 148 is supplementary and complimentary to sec 147. Sub-sec (2) of sec 148 mandates reasons for issuance of notice by the AO and sub-s. (1) thereof mandates service of notice to the assessee before the AO proceeds to assess, reassess or recompute the escaped income. Sec. 147 mandates recording of reasons to believe by the AO that the income chargeable to tax has escaped assessment. All these conditions are required to be fulfilled to assess or reassess the escaped income chargeable to tax. As per Expln. 3 if during the course of these proceedings the AO comes to conclusion that some items have escaped assessment, then notwithstanding that those items were not included in the reasons to believe as recorded for initiation of the proceedings and the notice, he would be competent to make assessment of those items. However, the Legislature could not be presumed to have intended to give blanket powers to the AO that on assuming jurisdiction u/s/47 regarding assessment or reassessment of the escaped income, he would keep on making roving inquiry and thereby including different items of income not connected or related with the reasons to believe, on the basis of which 18 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. he assumed jurisdiction For every new issue coming before the AO during the course of proceedings of assessment or reassessment of escaped income, and which he intends to take into account, he would be required to issue a fresh notice. 19. In the present case, as is noted above, the AO was satisfied with the justifications given by the assessee regarding the itemds, viz, club fees, gifts and presents and provisions for leave encashment, but, however, during the assessment proceedings, he found the the deduction u/s 80HH and 80-1 as claimed by the assessee to be not admissible. He consequently while not making additions on those items of club fees, gifts and presents, etc., proceeded to make deductions u/s 80HH and 80-1 and accordingly reduced the claim on these accounts. 20. The very basis of initiation of proceedings for which reasons to believe were recorded were income escaping assessment in respect of items of club fees, gifts and presents, etc., but the same having not been done, the AO proceeded to reduce the claim of deduction u/s 80HH and 80-1 which, as per our discussion, was not permissible. Had the AO proceeded to make disallowance in respect of the items of club fees, gifts and presents, etc., then in view of our discussion as above, he would have been justified as per Eepl.3 to reduce the claim of deduction u/s80HH and 801 as well. 21. In view of our above discussions, the Tribunal was right in holding that the AO had the jurisdiction to reassess issues other than the issues in respect of which proceedings are initiated but he was not so justified when the reasons for the initiation of those proceedings ceased to survive.. 14. The above views of the Bombay and Delhi High Courts have been reiterated by the Madras High Court in the case of Martech Peripherals (P) Ltd. (295 CTR 528), by the Patna High Court in the case of Takshila Education Society (378 ITR 520), by the Gujrat High Court in the case of CIT vs Mohmed Juned Dadani (2013, 30 taxmann.com 1/214 Taxman 19 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 38) etc. Further, it is pertinent to note that the Jurisdictional Chhattisgarh High Court has also favoured this view in the case of ACIT v. Magor Deepak Mehta (2012, 24 taxmann.com 147/344 ITR 40). Moreover, the Bombay High Court in the Case of Pr. CIT v. Lark Chemica (P) Ltd 2018), 99 taxmann.com 311 reiterated its views as expressed in the case of Jet Airways Ltd (supra). The Supreme Court has dismissed the SLP filed by the Revenue- Pr. CIT v. Lark Chemicals (P) Ltd. (2018), 99 taxmann.co 65 SC). 15. In view of the-above legal position, the contentions of the appellant raised in Revised Grounds of appeal No 1 & 2 are upheld and the Revised Grounds of Appeal No. 1 & No. 2 are allowed. Accordingly, the reassessment order passed u/s. 143(3) r.w.s. 147 is held to be bad in law/invalid, and is accordingly quashed. (ii) the reassessment order u/s 147 of the Act was passed beyond the time barring date, thus, bad in law/ invalid 16. Additional Ground of Appeal No. 5: The appellant's contentions on the additional Ground of Appeal No. 5 are as follows: \"5. On the facts and circumstances of the case and in law, the reassessment order passed u/s 143(3) r.w.s. 147 dt. 31-12-18 for AY 10-11 is invalid, bad in law as it is time barred by limitation provided u/s 153 as stay order on reassessment proceedings has been vacated on 10-7-18 by the Hon foie Chhattisgarh HC and the impugned reassessment order u/s 147 has been passed on 31-12-18 which is much after 60 days time provided u/s 153, is beyond the limitation & thus, time barred, and thus, it is invalid & is liable to be quashed. \" 1.1 That re-assessment proceedings were commenced in respect of AY 2010- 20 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 11 and the appellant preferred a Writ petition bearing no 360 of 2017 before Honorable High Court of Chhattisgarh challenging the rebuttal order passed by Assistant Commissioner of Income Tax Raipur against objection raised against reopening of assessment. That Honorable High Coutt of Chhattisgarh passed final order dated 10/07/2018 directing AO to dispose of the objection within reasonable time. 1.2 That the assessment proceedings were stayed by Honourable High Court of Chhattisgarh in November 2017 and less than 60 days were left for completion for assessment and thereafter stay on re-assessment proceedings were vacated by order of honourable High court of Chhattisgarh on 10/07/2018. Therefore, the assessment Order was required to be passed as per provisions of section 153 of the Income tax act 1961 on or before 10/09/2018. (2) No order of assessment, reassessment or re-computation shall be made under section 147 after the expiry of nine months from, the end of the financial year in which the notice under section 148 was served: Explanation 1.—For the purposes of this section, in computing the period of limitation-.- ………………… (ii) the period during which the assessment proceeding is stayed by an order or injunction of any court...shall be excluded. .………………. Provided that where immediately after the exclusion of the aforesaid period, the period of limitation referred to in sub-sections (1), (2), (3) and sub-section (8) available to the Assessing Officer for making an order of assessment, reassessment or re-computation, as the case may be, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid period of limitation shall be deemed to be extended accordingly: 21 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. As per Explanation 1 to Section 153, in computing the period of limitation \"the period during which the assessment proceedings stayed by an order or injunction by the Court\" shall be excluded. In terms of first proviso to Explanation 1, where, after the vacation of stay, the period available to the AO to complete the re-assessment proceedings is less than 60 days, then \"such remaining period shall be extended to 60 days and the aforesaid period of limitation shall be deemed to be extended accordingly. \" 1.4 It is submitted that as per provision of section 153 period of limitation viz 60 days has to be computed from 10/07/2018 and the assessing officer should have passed assessment order by 10/09/2018. The AO passed assessment order on 31/12/2018 and the AO did not pass assessment order within the time frame as per provisions of law. Therefore the assessment order dated 31/12/2018 is bad in law an deserves to be quashed;\" 17.1 It is an undisputed fact that when the reassessment proceedings were stayed by the Chattisgarh High Court in November, 2017, less than 60 days were left for the completion of reassessment proceedings. This sta order was vacated by the High Court vide its order dated 10.07.2018. As per the directions of High Court, the AO furnished the reasons for reopening the assessment to the assessee. The assessee filed objections to these reasons on 24.08.2018. The AO rejected these reasons by a rebuttal order dated 19.12.2018. Show cause notice was issued on 22.12.2018 u/s. 142(1) of the Act and the reassessment order u/s. 147 of the Act was finally passed on 31.12.2018 (refer the 1st para of page 3 of the assessment order). 17.2 From a combined reading of Section 153(1), Explanation 1 (ii) and the Provisio to Explanation 1 of Section it is clear that the time barring date for completion of reassessment proceedings would be 60 days from 10.07.2018, which is the date of Chhattisgarh High Court order lifting the stay. Thus, the time barring date would be 10.09.2018. Even if the period of 60 days is counted from the day the assessee filed its objections i.e. from 24.08.2018, then also the time barring date would be 24.10.2018. 22 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 17.3 In view of the above facts, the contention of the appellant, that the reassessment order u/s. 147 of the Act was passed beyond the time barring date, is upheld and the additional ground of appeal No. 5 is allowed. Accordingly, the reassessment order passed u/s. 143(3) r.w.s. 147 is held to be bad in law/invalid on this ground also and is liable to be quashed independently on this ground alone. 9. At the outset, we find it appropriate to first advert to the issue raised by the revenue through its regular ground No. 2 & additional grounds No. 4-6, challenging the justification in the decision of Ld. CIT(A), NFAC, in quashing the assessment order treating the same barred by limitation. 10. On this issue, Shri S. L. Anuragi, Ld. CIT-DR, have submitted that Ld. CIT(A) had erred in deciding the issue. That, as per directions of the Hon’ble Jurisdictional High Court, the Ld. AO was directed to dispose of the objections of the assessee by a speaking order within reasonable time, in accordance with law. On this issue, a report is submitted by Ld. AO, elaborating with the dates of events and facts of the case along with analogy drawn by various Hon’ble Courts, in context to the issue wherein the proceedings are stayed by the Hon’ble High Court and the period during which such order or injunction was operative, the same should be excluded for the purpose of computing the period of limitation for making the 23 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. assessment order. The report of Ld. AO submitted before us is extracted hereunder for the sake of better appreciation of the facts and interpretations on the issue: 24 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 25 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 26 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 27 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 28 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 29 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 30 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 31 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 32 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 33 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 34 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 11. Based on aforesaid report by the Ld. AO, it was the submission by Ld. CIT- DR that the assessment order u/s 143(3) dated 31.12.2018 was passed by the Ld. AO after disposing of the objections of the assessee on 19.12.2018, within reasonable time permissible under the law. It was, therefore, the prayer that the assessment proceedings are completed as per directions of the Hon’ble Jurisdictional High Court of Chhattisgarh, the same cannot be treated as barred by limitation to struck down, therefore, the order of Ld. CIT(A) on this issue was unjustified, bad in law, unsustainable and liable to be set aside. 12. In rebuttal, to the aforesaid submissions by the department, Shri R. B. Doshi, CA, Authorized Representative of the assessee (in short “AR”) submitted that the issue was rightly adjudicated by the Ld. CIT(A), considering the provisions of Act prescribing limitation for making the assessment or reassessment in sub- section (2) of section 153 of the Act. It was the submission that the assessment in present case, was to be completed within 9 months from the end of Financial Year in which the notice u/s 148 was served, in present case the notice was issued on 28.03.2017, therefore, the time barring date for assessment would be 31.12.2017 (9 months from 31.03.2017, the end of Financial Year 2016-17). Ld. AR further submitted that the stay order / interim relief order directing stay on the further proceedings against the assessee was passed on 14.12.2017 and the final order was passed on 10.07.2018, thereby lifting the stay with the direction to complete 35 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. the proceedings in accordance with law. Hon’ble High Court further directed the revenue to provide reasons to believe to the assessee within a period of 6 weeks, thereafter the assessee will file objection within 4 weeks, the Assessing Officer than have to consider and dispose of the objection of the assessee by a speaking order within reasonable time. In compliance, the copy of reasons is provided to the assessee on 03.08.2018, against which objections were filed by the assessee on 24.08.2018 and the objections were disposed of by the Ld. AO after approx. 3 month on 19.12.2018. Asserting about the period of limitation, Ld. AR placed his reliance on the order of Ld. CIT(A), wherein the provisions of section 153 along with explanation-1 to the said section, explaining the situation when the assessment proceedings are stayed by an order or injunction by the court shall be excluded, have explained that as per first proviso to explanation-1, after the vacation of stay, if the period available to the Ld. AO to complete the assessment proceedings is less than 60 days, then such remaining period shall be extended to 60 days. In present case, the original time barring date for passing the assessment was 31.12.2017, however, stay order was passed by the Hon’ble Jurisdictional High Court on 14.12.2017, therefore, the Ld. AO was unable to complete the assessment on 31.12.2017, the remaining days to pass the order which were not available to the Ld.AO and have left from 15.12.2017 to 31.12.2017 were 17 days. The stay thereafter was lifted when the final order was 36 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. passed by the Hon’ble High Court on 10.07.2018, in which the Ld. AO was directed to provide reasons to believe to the assessee within 6 weeks and the assessee was to file its objections within 4 weeks thereafter, it is submitted that the 6 weeks and 4 weeks’ time was upper limit to follow the directions of Hon’ble High Court. In present case, as the reasons were provided to the assessee on 03.08.2018 and objections were lodged by the assessee on 24.08.2018, therefore, the limitation in terms of section 153(2) r.w. explanation 1(ii) r.w. 1st proviso to Explanation under the said section i.e., the date before which the assessment should have been completed was 24.10.2018 (i.e., 60 days from the date on which objections are filed by the assessee). The order disposing of the objections of the assessee is always part of assessment proceedings, therefore, the period or time taken in disposing of the objections cannot be excluded, while computing the period of limitation to complete the assessment. Under such facts and circumstances, Ld. CIT(A) have rightly decided the issue in favour of the assessee observing that the reassessment order u/s 147 of the Act, passed on 31.12.2018 was beyond the time barring date, therefore, the same is liable to be quashed. 13. We have considered the rival submissions, perused the material available on record and the judicial pronouncements relied upon by the parties. In present case, to decide the issue that “whether the assessment order passed u/s 143(3) r.w.s.147 dated 31.12.2018 for the AY 2010-11 is invalid, bad in law being barred 37 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. by limitation in terms of provisions of section 153(2) r.w. explanation 1(ii) r.w. 1st proviso to explanations to section 153”. To interpret the provisions of law qua the facts of present case, the relevant provisions are extracted hereunder: Section 153 (2) No order of assessment, reassessment or recomputation shall be made under section 147 after the expiry of nine months from the end of the financial year in which the notice under section 148 was served: Explanation 1.—For the purposes of this section, in computing the period of limitation— (ii) the period during which the assessment proceeding is stayed by an order or injunction of any court; or First Proviso... Provided that where immediately after the exclusion of the aforesaid period, the period of limitation referred to in sub-sections (1), (2), (3) and sub-section (8) available to the Assessing Officer for making an order of assessment, reassessment or re- computation, as the case may be, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid period of limitation shall be deemed to be extended accordingly. 14. Adverting to the facts of present case, the relevant dates furnished by the assessee, which are not in disputed as the same are identically affirm by 38 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. the revenue in their submission dated 28.06.2024 (extracted supra), are reproduced here to compute the period of limitation to complete the assessment: SN Particulars Remarks 1. Date of issue of notice u/s 148 28.03.2017 (page 2, first para of assmt. Order) 2. Limitation u/s 153(2) expiring on 31.12.2017 (nine months from end of FY in which notice u/s 148 served) 3. Stay order passed by Hon’ble High Court on 14.12.2017 (PN 222 & 223 of PB, Vol. I) 4. Number of days left as per original limitation 17 days 5. Final order passed by Hon’ble High Court on 10.07.2018 (PN 224 TO 233 of PB, Vol. I) 6. Directions of Honb’ble High Court Page no. 233 of PB, Vol. I, Para 14. 1. AO to provide reasons within 6 weeks. 2. Assessee to file objection within 4 weeks. 3. AO to consider & dispose off objections within a reasonable time, in accordance with law. 7. Period of stay granted by High Court, to be excluded for limitation From 14.12.2017 to 10.07.2018 8. Extended limitation as per Expl. 1(ii), 1st proviso to sec. 153 08.09.2018 (Sixty days from 10.07.2018) 9. Reassessment order passed on 31.12.2018 10. Reasons provided to assessee by AO on 03.08.2018, PN 236 of PB, Vol. I. 11. Objection filed by assessee on 24.08.2018 (page 12, last para, 2nd line of assmt. Order) 12. As per directions of Hon’ble High Court, date by which objections was to be disposed off Within a reasonable time after 24.08.2018, in accordance with law. 13. Objections actually disposed off on 19.12.2018 (page 2, last para, 2nd line of assmt. Order) 39 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 15. The interim order passed by the Hon’ble High Court dated 14.12.2017 in the case of present assessee along with the order in the case of Shri Rakesh Kumar Saraogi dated 22.11.2017 are extracted hereunder for the sake of clarity: 40 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 41 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 16. The findings of the Hon’ble Jurisdictional High Court, while granting the final order dated 10.07.2018 are as under: 6. I have heard learned counsel for the parties and considered their rival submissions made herein-above and also went through the record with utmost circumspection. 7. In order to adjudicate the dispute brought before this Court, it would be appropriate to consider the provisions contained in Sections 147 and 148 of the IT Act. Section 147 of the IT Act provides for income escaping assessment. Section 147 states as under: - “147. If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, or recompute the loss or the depreciation allowance or any other allowance, as the case may be, for the assessment year concerned (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year) : Provided that where an assessment under subsection (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub-section (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year: xxx xxx xxx xxx xxx xxx xxx xxx xxx 42 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 8. Thus, Section 147 of the IT Act requires recording of reasons to believe. Notice under Section 148(1) of the IT Act has to be issued where income has escaped assessment under Section 147 of the IT Act. Section 148(1) of the IT Act reads as follows: - “148. (1) Before making the assessment, reassessment or recomputation under section 147, the Assessing Officer shall serve on the assessee a notice requiring him to furnish within such period, as may be specified in the notice, a return of his income or the income of any other person in respect of which he is assessable under this Act during the previous year corresponding to the relevant assessment year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed; and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139 : xxx xxx xxx xxx xxx xxx xxx xxx xxx” 9. The Supreme Court in GKN Driveshafts (India) Ltd. (supra) while considering the provisions contained in Section 148 of the IT Act has held that where the notice is received by the assessee under Section 148(1) of the IT Act, proper course of action for the assessee / aggrieved party by issuance of notice is to file return and if he so desires, to seek reasons for issuing notices, and in that event the assessing officer is bound to furnish reasons within a reasonable time. Their Lordships observed as under: - 43 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. “5. We see no justifiable reason to interfere with the and other connected matters Page 7 of 10 order under challenge. However, we clarify that when a notice under Section 148 of the Income tax Act is issued, the proper course of action for the noticee is to file return and if he so desires, to seek reasons for issuing notices.The assessing officer is bound to furnish reasons within a reasonable time. On receipt of reasons, the noticee is entitled to file objections to issuance of notice and the assessing officer is bound to dispose of the same by passing a speaking order. In the instant case, as the reasons have been disclosed in these proceedings, the assessing officer has to dispose of the objections, if filed, by passing a speaking order, before proceeding with the assessment in respect of the abovesaid five assessment years.” 10. The decision of the Supreme Court in GKN Driveshafts (India)Ltd. (supra) was considered by the Delhi High Court in the matter of Haryana Acrylic Manufacturing Company v. The Commissioner of Income Tax IV and another and Their Lordships of the Delhi High Court held that it is mandatory for the Assessing Officer to supply reasons for reopening the assessment and this has to be done within a reasonable time. It was observed as under: - “... a notice under Section 148 without the communication of the reasons therefore is meaningless inasmuch as the Assessing Officer is bound to furnish the reasons within a reasonable time. In a case, where the notice has been issued within the said period of six years, but the reasons have not furnished within that period, in our view, any proceedings pursuant thereto would be hit by the bar of limitation inasmuch as the issuance of the notice and the communication and furnishing of reasons go hand-in- hand. The expression within a reasonable period of time as used by the Supreme Court in GKN Driveshaft (India) Limited (supra) cannot be stretched to such an extent that it extends even beyond the six years stipulated in Section 149.” 44 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 11. Similarly, the Bombay High Court in the matters of Commissioner of Income Tax v. Trend Electronics and Commissioner of Income Tax v. Videsh Sanchar Limited held as under: - “It is axiomatic that power to reopen a completed assessment under the Act is an exceptional power and whenever revenue seeks to exercise such power, they must strictly comply with the prerequisite conditions viz., reopening of reasons to indicate that the Assessing Officer had reason to believe that income chargeable to tax has escaped assessment which would warrant the reopening of an assessment. These recorded reasons as laid down by the Apex Court must be furnished to the Assessee when sought for so as to enable the Assessee to object the same before the Assessing Officer. Thus, in the absence of reasons being furnished, when sought for would make an order passed on reassessment bad in law. The recording of reasons (which has been done in this case) and furnishing of the same has to be strictly complied with as it is a jurisdictional issue. This requirement is very salutary as it not only ensures reopening notices are not lightly issued. Besides in case the same have been issued on some misunderstanding/ misconception, the Assessee is given an opportunity to point out that the reasons to believe as recorded in the reasons do not warrant reopening before the reassessment proceedings are commenced. The Assessing Officer disposes of these objections and if satisfied with the objections, then the impugned reopening notice under Section 148 of the Act is dropped/withdrawn otherwise it is proceeded with further. In issues such as this, i.e., where jurisdictional issue is involved the same must be strictly complied with by the authority concerned and no question of knowledge being attributed on the basis of implication can arise. We also do not appreciate the stand of the revenue, that the Respondent-Assessee had asked for reasons recorded only once 45 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. and therefore seeking to justify nonfurnishing of reasons. We expect the State to act more responsibly.” 12. From the principle of law laid down in aforesaid judgments, it is quite vivid that if the assessee makes a request for supply of reasons recorded under Section 147 of the IT Act after receipt of notice under Section 148 of the IT Act, the Assessing Officer is obliged to furnish reasons enabling the assessee to file objections and the Assessing Officer is, then also obliged to take decision on such objections within reasonable time by a reasoned and speaking order. 13. Reverting to the facts of the present case, it is the case of the petitioners that they have been served with notice for the first time on 21-7-2017 and they were never served with notice under Section 148 of the IT Act and therefore, they are entitled for reasons to believe recorded under Section 147 of the IT Act. On the other hand, reasons to believe as recorded under Section 147 of the IT Act were not supplied straightway to the petitioners despite request made by the petitioners, though rebuttal order contains reasons recorded in para 2 and thereafter, the learned assessing authority considering the application in great detail also came to the conclusion that the objections raised to the proceeding initiated holds no water. Their Lordships of the Supreme Court in GKN Driveshafts (India) Ltd. (supra) clearly recorded that the Assessing Officer is bound to furnish the reasons within a reasonable time and on receipt of reasons, the noticee/assessee is entitled to file objections to the issuance of the notice and the objections have to be disposed of by a speaking order. The course outlined by Their Lordships in GKN Driveshafts (India) Ltd. (supra) has not been followed in its letter and spirit and without supplying the reasons to believe which is mandatorily to be supplied as held by the Supreme Court, the learned Assessing Officer rejected the objections. The 46 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. application filed seeking reasons to believe has been treated as objections to the reasons to believe though no reasons to believe were supplied to the petitioners and rebuttal order came to be passed without supplying reasons to believe which runs contrary to the decision rendered by and other connected matters the Supreme Court in GKN Driveshafts (India) Ltd. (supra) and followed by the Delhi High Court and the Bombay High Court in the above-stated judgments. In the considered opinion of this Court, the course adopted by the learned Assessing Officer rejecting the application for furnishing reasons to believe without supplying the reasons to believe, is contrary to the above-stated judgment of the Supreme Court. 14. As a fallout and consequence of the aforesaid discussion, the rebuttal order dated 2-8-2017 is quashed and the Assessing Officer is directed to furnish reasons to believe within a period of six weeks and thereafter, the petitioners will file objections within four weeks and thereafter, the Assessing Officer consider and dispose of the objections by a speaking order within reasonable time, in accordance with law. 17. After giving a thoughtful consideration to the relevant dates / events, orders of Hon’ble Jurisdictional High Court, orders by the Ld. AO and contentions of the parties in the present case. As per provisions of Act, the time barring date for completing the assessment in present case is deduced as under: 47 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. SN Particulars Remarks Number of days 1. Date of issue of notice u/s 148 28.03.2017 2. Limitation u/s 153(2) expiring on 31.12.2017 (nine months from end of FY in which notice u/s 148 served) 275 days (9 Months) 3. Duration of stay in terms of interim relief order by Hon’ble High Court i.e., from 14.12.2017 to 10.07.2018 191 days (6 Months, 27 days) 4. Number of days left with the Ld. AO to complete the assessment when the stay order was passed. But as per 1st proviso to explanation to section 153 the period shall be extended to 60 days, if the remaining period is less than 60 days 31.12.2017 – 14.12.2017 = 17 days 60 days (to be considered whichever is higher) 60 days 5. The period for furnishing of reasons to believe to the assessee by the Ld. AO and objections by the assessee allowed as per directions of Hon’ble High Court 6 weeks + 4 weeks (Maximum) = 70 days The reasons to believe provided to assessee on 03.08.2018 and the objections are filed by the assessee on 24.08.2018. The period between the final order of Hon’ble High Court on 10.07.2018 to objections filed by the assessee on 24.08.2018 45 days 48 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 6. The allowable period to the Ld. AO for passing the assessment order includes: (1) Original period permitted u/s 153(2) (2) the period of stay, (3) period used for furnishing the reasons and objections, (4) 60 days as per proviso to section 153 275 days + 191 days + 60 days + 45 days = 571 days 571 days from the end of FY in which notice u/s 148 was served (31.03.2017) = 24.10.2018 (1 Year, 6 Months, 24 days) 7. Actual period utilized to pass the order by the Ld. AO on 31.12.2018 from end of FY in which notice u/s 148 served (31.03.2017) From 31.03.2017 to 31.12.2018 640 days (1 Year, 9 Months) 18. From the above analysis, it is explicitly clear beyond doubt that the order passed by the Ld. AO on 31.12.2018 (i.e., after 1 Year & 9 Months from the end of FY in which notice u/s 148 was served – refer row no. 7 of the above table), whereas, as per provisions of section 153 r.w. explanation 1 (ii) r.w. 1st proviso to the explanations and also taking into consideration the directions of the Hon’ble High Court, the Ld. AO was under bounded duty to pass the assessment on or before 24.10.2018 (i.e., 1 Year, 6 Months & 24 days from the end of FY in which notice u/s 148 was served – refer row no. 6 of the above table), thus, has certainly jumped the period of limitation permitted under the mandate 49 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. of law, inter alia including (i) the period of stay as per order of Hon’ble Jurisdictional High Court , (ii) period of reasons provided to the assessee and (iii) objections filed by the assessee (though the same in ordinary course of assessment are part of the assessment proceedings) and also (iv) the period of 60 days in terms of section 153(2) read with Explanation 1(ii) of section 153 and 1st proviso to explanations therein. 19. Adverting to the judicial pronouncements referred and relied upon by the revenue in their submission, on a thorough interpretation of the same, we observe as under: 19.1 VLS Finance Ltd. v. Commissioner of Income-tax, CIVIL APPEAL NO. 2667 OF 2007, [2016] 68 taxmann.com 368 (SC)/[2016] 239 Taxman 404 (SC)/[2016] 384 ITR 1(SC)/[2016] 286 CTR 146 (SC)[28-04-2016] In the aforesaid judgment Hon’ble Apex Court has delt with a question: “the High Court was right in holding that the special audit was not only a step in the assessment proceedings, but an important and integral step, in the absence of which an assessment order could not be made.” wherein the issue has been answered in favour of revenue with the following observations: 50 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 23. We, therefore, agree with the High Court that the special audit was an integral step towards assessment proceedings. The argument of the appellants that the writ petition of the appellant was ultimately allowed, and the Court had quashed the order directing special audit would mean that no special audit was needed and, therefore, it was not open to the respondent to wait for special audit, may not be a valid argument to the issue that is being dealt with. The assessing officer had, after going through the matter, formed an opinion that there was a need for special audit and the report of special audit was necessary for carrying out the assessment. Once such an opinion was formed, naturally, the assessing officer would not proceed with the assessment till the time the special audit report is received, inasmuch as in his opinion, report of the special audit was necessary. Take a situation where the order of special audit is not challenged. The assessing officer would naturally wait for this report before proceeding further. Order of special audit followed by conducting special audit and report thereof, thus, become part of assessment proceedings. If the order directing special audit is challenged and an interim order is granted staying the making of a special report, the assessing officer would not proceed with the assessment in the absence of the audit as he thought, in his wisdom, that special audit report is needed. That would be the normal and natural approach of the assessing officer at that time. It is stated at the cost of repetition that in the estimation of the assessing officer special audit was essential for passing proper assessment order. If the court, while undertaking judicial review of such an order of the assessing officer directing special audit ultimately holds that such an order 51 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. is wrong (for whatever reason) that event happens at a later date and would not mean that the benefit of exclusion of the period during which there was a stay order is not to be given to the Revenue. Explanation 1 which permits exclusion of such a time is not dependent upon the final outcome of the proceedings in which interim stay was granted. 24. We, therefore, answer this question in favour of Revenue. 19.2 Based on aforesaid judgment, it was the contention by revenue that the Ld. CIT(A) have not considered the provisions stated in explanation 1(ii) of section 153 in the present case, i.e., the period during which the assessment proceeding is stayed by an order or injunction of any court is not excluded. On perusal of the date of events refer to supra, we find that the period of stay by the Hon’ble Jurisdictional High Court for 6 months, 27 days (refer row no. 3 of the table in para 17 of this order), as demonstrated and also the period for directions were conferred upon by Hon’ble High Court are for supply of reasons to believe and the period for filing the objections towards such reasons by the assessee, has been computed for 45 days (refer row no. 5), are duly excluded while calculating the period of limitation for completing the assessment in present case. We, therefore, unable to persuade ourselves to subscribe to the arguments of the revenue that the provisions of explanation 1(ii) of section 153 are not adhered to by the Ld. CIT(A), while calculating the period of limitation. 52 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. Considering such factual findings, the analogy drawn from the judgment in the case of VLS Finance Ltd. vs CIT (supra), relied upon cannot be of any help to the revenue, as the same has been duly followed by the First Appellate Authority. 19.3 Further, the contention of revenue qua proviso u/s 153(3) that there are separate time barring for certain class of assessments, reassessment which excludes sub-section 3 of section 153. It is the argument that there were directions by Hon’ble High Court of Chhattisgarh vide order dated 10.07.2018, according to the Ld. AO had followed the same, but the same was not properly appreciated by the Ld. CIT(A). In this context, we would like to refer to the directions granted by Hon’ble Jurisdictional High Court in para 14 of the order dated 10.07.2018, that “the assessing officer is directed to furnish reasons to believe within a period of 6 weeks and thereafter the petition will file objections within 4 weeks and thereafter the Assessing Officer consider and dispose of the objections by a speaking order within reasonable time, in accordance with law”. As we may observed the directions of Hon’ble jurisdictional High Court are qua the disposing off the objections of the assessee, within reasonable time in accordance with law, whereas the objections are disposed of on 19.12.2018 and assessment was completed on 31.12.2018, both beyond the prescribed time limit as mandated under the law following the provisions of section 153 of 53 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. the Act, which has been works out at 24.10.2018 (refer row no. 6 of the table- supra – para17). In view of such facts, we cannot concur with the argument of the revenue having no plausible substance. 19.4 Another argument of the department is that, though there is a limitation period of 60 days for certain class of assessment proceedings as provided in section 153(1), had no application in the facts of present case. Reliance was made to the case of CIT vs Chandrabhan Bansal, (2014) 46 Taxmann.com 180 (Allahabad) dated 22.05.2014, the elaborate contentions citing the said case law are extracted supra in the report d AO. On perusal of the order relied upon, the final verdict of the Hon’ble Court is “The order of the High Court passed in Writ Petition Nos.162/1992 and 278/1992 has been quoted above. In the order dated 01/8/1995, neither there is any finding nor there is any direction which can be relied on by the Assessing Officer for framing the assessment. There being neither any direction nor any finding within the meaning of Section 153 (3) (ii) of the Act, 1961, the submission of Shri Shambhu Chopra, learned counsel appearing for the Revenue that there shall be no limitation for making assessment cannot be accepted.” 19.5 Accordingly, it can be safely gathered that as per provisions of explanation 1(ii) to section 153, period of limitation for Assessment can be stayed only by an order or injunction of any Court or as soon as said order or 54 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. injunction of Court is vacated, period of limitation shall restart even though order vacating injunction is not communicated to department. 19.6 Coming to the facts of present case, wherein the directions of Hon’ble Allahabad High Court are to dispose off the objections of the assessee within reasonable time in accordance with law, there was no specific direction for completing the assessment thus the same would be governed by the provisions of the Act i.e., in accordance with law, therefore, it was the duty of the assessing authority to complete the assessment within the limitation as contemplated in section 153 r.w. explanation 1(ii) r.w. 1st proviso to explanations under Section 153, which the Ld. AO had failed to comply with. The case law CIT vs Chandrabhan Bansal (supra), therefore, is inapposite to support the contentions of revenue in the present case, rather the same is contrary to the understanding of the revenue, thus, cannot rescue their argument. 19.7 Further arguments, referring to the judgment by Hon’ble High Court of Madras in the case of J. K.K. Natarajah & Ors Vs. Wealth Tax Officer, Central Circle-VII, Madras & Ors, 142 ITR 804, judgment of Hon’ble Apex Court in the case of Govt. of India Vs The Citedal Fine Pharmaceuticals, Madras & Ors AIR 1989 SC 1771, are made placing strong emphasis on the word “reasonable 55 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. time” by the revenue, contending that in the present case Hon’ble Jurisdictional High Court have directed to decide the issue within reasonable time, thus, the perception of Ld. CIT(A) is bad in law, as it has not taken into account the fact that limitation has been relaxed from 60 days to “reasonable time”. It is further argued that Hon’ble High Court had allowed a period of 6 weeks to Ld. AO for furnishing reasons to believe and thereafter 4 weeks to assessee for filing the objections, in view of such directions for 10 weeks or 70 days should further be added while computing the period for limitation. Though, we have considered, contemplated, interpreted and arrived at the date, being reasonable time in accordance with mandate of law after adding 45 days for providing the reasons to believe and the objections filed by the assessee, as the period of 6 weeks and 4 weeks was upper limit for complying the directions of the Hon’ble Court. Herein, one cannot oblivion of the fact that the directions of Hon’ble Court are qua the disposal of objections and not for completion of the assessment, in fact, there was no specific direction for completion of the assessment. Even if the directions granted by Hon’ble High Court are construed as direction for completing the assessment, the same are for completing the task within a reasonable time, in accordance with law, adhering to the directions of Hon’ble Court in terms of relevant provisions of the Act, described u/s 153 of the Act, the date of limitation has been ascertained to be 24th Oct, 2018 (refer row 6 of the table at para17- supra ). In present case, though it is not 56 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. required but if the contention of revenue to provide 70 days on account of directions by the Hon’ble Court are added the last date to complete the assessment would be 18th Nov, 2018, still the assessment remain time barred as the same was completed on 31st Dec, 2018. 19.8 Considering the aforesaid arguments / contentions by the revenue, placing their applicability / usefulness to the facts of present case, we are of the considered view that the case laws relied upon by the revenue, though has a direct nexus and binding guidance to follow in the present case, but the same are not supporting the contentions of the revenue, on the contrary the principle of law, the analogy and the ratio laid down in all the aforesaid judgments supports the decision of Ld. CIT(A) in construing that the assessment order completed u/s 143(3) r.w.s. 147 dated 31.12.2018 was barred by limitation and has no standing under the eyes of law. 20. In order to interpret the issue of limitation in terms of the recent judgment by the Hon’ble Apex Court in the case of Union of India vs Rajeev Bansal (2024) 167 taxmann.com 70 (SC) (03.10.2024), wherein, the expressive analogy drawn by Hon’ble Apex Court, though in context of new provisions of Section 148, but is vital and binding. In the case of UOI vs Rajeev Bansal the guiding principle laid 57 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. down by Hon’ble Apex Court for computing the period of limitation, analyzing the preconditions contemplated, to be followed by the revenue for issuance of notice u/s 148, as per the order of Hon’ble Apex Court in the case of Hon’ble Ashish Agrawal (2022) 138 taxmann.com 64 (SC) have held as under: 110. The effect of the creation of the legal fiction in Ashish Agarwal (supra) was that it stopped the clock of limitation with effect from the date of issuance of Section 148 notices under the old regime [which is also the date of issuance of the deemed notices]. As discussed in the preceding segments of this judgment, the period from the date of the issuance of the deemed notices till the supply of relevant information and material by the assessing officers to the assesses in terms of the directions issued by this Court in Ashish Agarwal (supra) has to be excluded from the computation of the period of limitation. Moreover, the period of two weeks granted to the assesses to reply to the show cause notices must also be excluded in terms of the third proviso to Section 149. 111. The clock started ticking for the Revenue only after it received the response of the assesses to the show causes notices. After the receipt of the reply, the assessing officer had to perform the following responsibilities: (i) consider the reply of the assessee under Section 149A(c); (ii) take a decision under Section 149A(d) based on the available material and the reply of the assessee; and (iii) issue a notice under Section 148 if it was a fit case for reassessment. Once the clock started ticking, the assessing officer was required to complete these procedures within the surviving time limit. The surviving time limit, as prescribed under the Income Tax Act read with TOLA, was available to the assessing officers to issue the reassessment notices under Section 148 of the new regime. 58 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 112. Let us take the instance of a notice issued on 1 May 2021 under the old regime for a relevant assessment year. Because of the legal fiction, the deemed show cause notices will also come into effect from 1 May 2021. After accounting for all the exclusions, the assessing officer will have sixty-one days [days between 1 May 2021 and 30 June 2021] to issue a notice under Section 148 of the new regime. This time starts ticking for the assessing officer after receiving the response of the assessee. In this instance, if the assessee submits the response on 18 June 2022, the assessing officer will have sixty-one days from 18 June 2022 to issue a reassessment notice under Section 148 of the new regime. Thus, in this illustration, the time limit for issuance of a notice under Section 148 of the new regime will end on 18 August 2022. 113. In Ashish Agarwal (supra), this Court allowed the assesses to avail all the defences, including the defence of expiry of the time limit specified under Section 149(1). In the instant appeals, the reassessment notices pertain to the assessment years 2013-2014, 2014- 2015, 2015-2016, 2016-2017, and 2017-2018. To assume jurisdiction to issue notices under Section 148 with respect to the relevant assessment years, an assessing officer has to: (i) issue the notices within the period prescribed under Section 149(1) of the new regime read with TOLA; and (ii) obtain the previous approval of the authority specified under Section 151. A notice issued without complying with the preconditions is invalid as it affects the jurisdiction of the assessing officer. Therefore, the reassessment notices issued under Section 148 of the new regime, which are in pursuance of the deemed notices, ought to be issued within the time limit surviving under the Income Tax Act read with TOLA. A reassessment notice issued beyond the surviving time limit will be time barred. G. Conclusions 59 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 114. In view of the above discussion, we conclude that: a. After 1 April 2021, the Income Tax Act has to be read along with the substituted provisions; b. TOLA will continue to apply to the Income Tax Act after 1 April 2021 if any action or proceeding specified under the substituted provisions of the Income Tax Act falls for completion between 20 March 2020 and 31 March 2021; c. Section 3(1) of TOLA overrides Section 149 of the Income Tax Act only to the extent of relaxing the time limit for issuance of a reassessment notice under Section 148; d. TOLA will extend the time limit for the grant of sanction by the authority specified under Section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(i) has extended time till 30 June 2021 to grant approval; e. In the case of Section 151 of the old regime, the test is: if the time limit of four years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(2) has extended time till 31 March 2021 to grant approval; f. The directions in Ashish Agarwal (supra) will extend to all the ninety thousand reassessment notices issued under the old regime during the period 1 April 2021 and 30 June 2021; 60 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. g. The time during which the show cause notices were deemed to be stayed is from the date of issuance of the deemed notice between 1 April 2021 and 30 June 2021 till the supply of relevant information and material by the assessing officers to the assesses in terms of the directions issued by this Court in Ashish Agarwal (supra), and the period of two weeks allowed to the assesses to respond to the show cause notices; and h. The assessing officers were required to issue the reassessment notice under Section 148 of the new regime within the time limit surviving under the Income Tax Act read with TOLA. All notices issued beyond the surviving period are time barred and liable to be set aside; 20.1 Taking into cognizance, the aforesaid judgment of the Hon’ble Apex Court in the case of Rajeev Bansal (supra), wherein for calculating the period of limitation, it has been held that the clock started ticking for the revenue only after it received, the response of the assessee to the show cause notice and after received of the said reply from the assessee, the Assessing Officer had to perform the responsibilities mandated u/s 148A(c), 148A(d) and to issue a notice u/s 148. The Assessing Officer is expected to complete the procedures, ones the clock started ticking within the surviving time limit. 20.2 Coming to the facts of present case, drawing support from the analogy accorded by the Hon’ble Apex Court in the case of Rajiv Bansal (supra), the time to frame the assessment including disposing of the objections of the assessee 61 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. shall start ticking, once the assessee has lodged its objections against the reasons recorded for reopening. In present case, as per the order of Hon’ble Jurisdictional High Court dated 10.07.2018, the stay granted vide order dated 14.12.2017 was lifted on 10.07.2018 and as directed the Ld. Assessing Officer was to furnish reason to believe within a period of six weeks and thereafter the assessee was to file objection within four weeks. The Assessing Officer thereafter was directed to consider and dispose of the objection by speaking order within reasonable time, in accordance with law. As the reasons to believe are provided by the Ld. AO to the assessee on 03.08.2018 and objection thereto are filed by the assessee on 24.08.2018, the process of assessment, in terms of the ratio of procedure laid down by Hon’ble Apex Court in the case of Rajiv Bansal (supra), shall start from this point i.e., from 25.08.2018 onwards. In terms of provisions of Section 153(2) r.w. explanation 1(ii) and 1st proviso to Explanations u/s 153, the Assessing Officer has to pass the assessment order within 60 days (having period available for completion of assessment for 17 days on 31.12.2017, the period between original date of limitation u/s 153(2) and 14.12.2017, date of stay order, which is extended to 60 days in terms of 1st proviso to Explanations u/s 153) from 24.08.2018, therefore, the outer limit to complete the assessment in accordance with law inter alia including the reasonable time for disposing of the objections of the assessee, happen to be accomplished on 23.10.2018, however, the assessment order in the present case 62 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. was passed on 31.12.2018, beyond the stipulated date of limitation i.e., on 23.10.2018. 20.3 In view of the aforesaid facts and circumstances, even after following the ratio of law drawn from the order of Hon’ble Apex Court in the case of Rajiv Bansal (supra), the order of assessment passed u/s 143(3) r.w.s. 147 dated 31.12.2018, has to be held as invalid, bad in law, being barred by limitation, having completed beyond the time limit permitted under the law up to 23.10.2018, thus, the same is liable to be quashed on this count also. 21. In backdrop of such facts and circumstances of the present case, in absence of any plausible explanation, substantial material on record or judicial pronouncement to support the contentions of revenue, so as to dislodge the decision of Ld. CIT(A), respectfully following the ratio of law / the guiding principle laid down by Hon’ble Courts referred to supra inter alia interpretation of the provisions of section 153, we are of the strong conviction that in present case, the reassessment order passed u/s 143(3) r.w.s. 147 passed by the Ld. AO on 31.12.2018 is barred by limitation, thus, in violation of settled jurisprudence / mandate of law, consequently, cannot be sustained. We, therefore, uphold the decision of Ld. CIT(A), in terms of our aforesaid observations. Resultantly, the grounds raised by the revenue challenging the decision of Ld. CIT(A) in 63 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. quashing the assessment order passed by the Ld. AO, treating the same barred by limitation, has been decided against the revenue. 22. Since, we have approved the decision of Ld. CIT(A), wherein the assessment order passed by the Ld. AO u/s 143(3) r.w.s. 147 has been quashed, for the reason that it was barred by limitation, passed beyond the prescribed date of limitation up to which the Ld. AO has authority to pass the assessment, in such a scenario, the other contentions raised by the department assailing therein the justification in decision of the Ld. CIT(A) to quash the assessment on different grounds are not considered to be deliberated upon, thus, are left open. 23. In result, the appeal of the department in ITA No. 200/RPR/2022 stands dismissed. 24. CO No. 28/RPR/2023 As we have dismissed the appeal of the revenue in ITA No. 200/RPR/2022 by quashing the assessment being passed after the permissible time barring date, consequently, the issues raised by the assessee in its CO turn out to be academic. Consequently, the CO of the assessee is rendered as infructuous, thus, dismissed. 64 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 25. ITA No. 234/RPR/2022 – ACIT-1(1), Raipur Vs Silverbricks Infrastructure Pvt. Ltd and CO 25/RPR/2023- (Arising out of ITA No. 234/RPR/2022) The respective grounds of appeal raised by the department and the assessee are culled out as under: ITA No. 234/RPR/2022 1. On the facts and circumstances of the case whether the Id. CIT(A), National Faceless Appeal Centre is justified in deleting the addition of Rs. 5,16,00,000/- made by the A. O. on account of share application money treating the same as unexplained cash credit u/s 68 of the Income Ta Act, 1961. 2. The order of the Id. CIT(A), National Faceless Appeal Centre is erroneous both in law and on facts. 3. Any 0th r ground which may be adduced at the time of hearing. CO 25/RPR/2023 1. Ld. CIT(A) erred in upholding the reopening of case made by the AO resorting to sec. 147/148 and in holding that initiation of reassessment proceedings is as per law. The recording of reasons, initiation of reassessment proceedings and assumption of jurisdiction by the AO invoking sec. 147 is illegal, bad in law and the consequent reassessment order passed by AO is unsustainable. Conditions of sec. 147 are not fulfilled in the case of assessee. 2. Without prejudice to above ground, initiation of reassessment is illegal and invalid inasmuch as approval granted u/s 151 is not in accordance with provisions of law. There was no application of mind by the approving authority. Consequently, reassessment proceedings and the reassessment order illegal and liable to be quashed. Ld. CIT(A) erred in holding that the approval u/s 151 is in accordance with law. 65 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 3. Without prejudice to the other grounds, the reassessment order passed u/s 147 dated 31.12.2018 is invalid, bad in law and is barred by limitation. Ld. CIT(A) erred in holding that the reassessment order was passed within the limitation prescribed under the law. 4. The cross objector reserves the right to add, amend, modify or alter any of the ground/s of cross objection. 26. Adverting to the appeal of revenue in ITA No. 234/RPR/2022 and CO of the assessee in CO 25/RPR/2023, it is observed that according to the cross objection filed by the assessee, in ground no. 3, an issue has been raised challenging the validity of the reassessment order passed u/s 143(3) r.w.s. 147 dated 31.12.2018 in the case of M/s Silverbricks Infrastructure Pvt. Ltd. As the controversy raised by the assessee in it’s CO assailing the legal ground regarding passing the impugned assessment order beyond the time barring date has been delt with by us in the case of M/s R. K. Structure Pvt. Ltd. in ITA No. 200/RPR/2022, having similar facts and circumstances in the present case, wherein also the proceeding initiated for reopening assessment are stayed and finally the order with directions to provide reasons to believe, disposal of objections of the assessee was accorded by Hon’ble High Court, thus, our decision in the case of M/s R. K. Structure Pvt. Ltd. in ITA No. 200/RPR/2022 shall squarely applicable in the present case and accordingly, the appeal of revenue in ITA No. 234/RPR/2022 and CO of the assessee in CO 25/RPR/2023 are dismissed, in terms of our aforesaid observations. 66 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. 27. ITA No. 169/RPR/2023 – DCIT-1(1), Raipur Vs Silverlief Infrastructure Pvt. Ltd. and CO 31/RPR/2023- (Arising out of ITA No. 169/RPR/2023) The respective grounds of appeal raised by the department and the assessee are culled out as under: ITA No. 169/RPR/2023 1. On the facts and circumstances of the case whether the Id. CIT(A), NFAC was justified in quashing the order u/s 143(3) r.w.s 147 dated 31.12.2018 passed by the AO independently on the ground that the assessment proceedings were barred by limitation. On the contrary, the AO has duly followed the directions contained in the order of the Hon'ble High Court in W. P(T) No. 327/2017. 2. On the facts and in the circumstances of the case whether the Id. CIT(A), NFAC was justified in not deciding the main issue of addition made u/s 68 of the Income Tax Act, 1961 amounting to Rs. on merits, and only adjudicating the last ground taken of limitation, thereby violating the very basic principles of natural justice. 3. \"Any other ground that may be adduced at the time of hearing.\" CO 31/RPR/2023 1. Without prejudice to the submission of the respondent that assessment order is time barred, the recording of reasons, initiation of reassessment proceedings and assumption of jurisdiction by the AO invoking sec. 147 is illegal, bad in law and the consequent reassessment order passed by AO is unsustainable. Conditions of sec. 147 are not fulfilled in the case of assessee. Ld. CIT(A) erred in not adjudicating ground relating to the validity of reassessment holding that the ground raised by respondent is academic in nature. 2. Without prejudice to the submission of the respondent that assessment order is time barred, the initiation of reassessment is illegal and invalid inasmuch as approval granted u/s 151 is not in accordance with provisions of law. There was no application of mind by the approving authority. Consequently, reassessment 67 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. proceedings and the reassessment order illegal and liable to be quashed. Ld. CIT(A) erred in not adjudicating the ground relating to invalid approval u/s 151. 3. Without prejudice to the submission of the respondent that assessment order is time barred, the addition of Rs. 5,40,00,000/- made by AO on account of share capital/premium invoking sec. 68 is arbitrary, baseless and not justified. Ld. CIT(A) erred in not adjudicating revised ground no. 3 of appeal taken before him. Ld. CIT(A) erred in holding that the ground raised by respondent is academic in nature. 4. The cross objector reserves the right to add, amend, modify or alter any of the ground/s of cross objection. 28. Adverting to the appeal of revenue in ITA No. 169/RPR/2023 and CO of the assessee in CO 25/RPR/2023, it is observed that according to the appeal filed by the revenue, in ground no. 1, an issue has been raised challenging the justification in the order of Ld. CIT(A), NFAC, wherein the assessment order passed u/s 143(3) r.w.s. 147 dated 31.12.2018 in the case of M/s Silverlief Infrastructure Pvt. Ltd. has been quashed by the Ld. CIT(A) contemplating that the same was completed beyond the time barring date against the mandate of law, has been delt with by us in the case of M/s R. K. Structure Pvt. Ltd. in ITA No. 200/RPR/2022, having similar facts and circumstances in the present case, wherein also the proceeding initiated for reopening assessment are stayed and finally the order with directions to provide reasons to believe, disposal of objections of the assessee was accorded by Hon’ble High Court, thus, our decision in the case of M/s R. K. Structure Pvt. Ltd. in ITA No. 200/RPR/2022 shall squarely applicable in the 68 ITA Nos. 200, 234/RPR/2022 & 169/RPR/2023 CO Nos. 28, 25, 31/ RPR/2023 R. K. Structure Private Limited, Silverbricks Infrastructure Pvt. Ltd., Silverleaf Infrastructure Pvt. Ltd. present case and accordingly, the appeal of revenue in ITA No. 169/RPR/2023 and CO of the assessee in CO 31/RPR/2023 are dismissed, in terms of our aforesaid observations. 29. In combined result, all the captioned appeals of revenue and Cross Objections (CO’s) of assessee under consideration in this common order, stands dismissed in terms of our aforesaid observations. Order pronounced in the open court on 29/11/2024. Sd/- (RAVISH SOOD) Sd/- (ARUN KHODPIA) Ɋाियक सद˟ / JUDICIAL MEMBER लेखा सद˟ / ACCOUNTANT MEMBER रायपुर/Raipur; िदनांक Dated 29/11/2024 Vaibhav Shrivastav आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : आदेशानुसार/ BY ORDER, (Senior Private Secretary) आयकर अपीलीय अिधकरण, रायपुर/ITAT, Raipur 1. अपीलाथŎ / The Appellant- 2. ŮȑथŎ / The Respondent- 3. आयकर आयुƅ(अपील) / The CIT(A), 4. The Pr. CIT, Raipur (C.G.) 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, रायपुर/ DR, ITAT, Raipur 6. गाडŊ फाईल / Guard file. // स×याǒपत Ĥित True copy // "