Shri Sunil Kumar Basantilal Prop M/s Satyam Fibers, Barwani V. The DCIT, Khandwa

CO 8/IND/2011

• Counselvise Citation: [2011] 122 COUNSELVISE.COM (IT) 6433 (ITAT-INDORE)
• Duration Of Justice: 4 month(s) 26 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 18-08-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 17-08-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 23-03-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Keywords: Proportionate interest; Retrospective amendment; Revised return
• Section: 143(3); 80IB

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.293/IND/2010 A.Y. 2004-05 DCIT-KHANDWA APPELLANT VS SUNIL KUMAR BASANTILAL PROP. M/S. SATYAM FIBERS OZHAR DISTT. BADWANI PAN ABCPA 4537 D RESPONDENT AND, CROSS-OBJECTION NO.8/IND/2011 ( ARISING OUT OF ITA NO.293/IND/2010 ) A.Y. 2004-05 SUNIL KUMAR BASANTILAL PROP. M/S. SATYAM FIBERS OZHAR DISTT. BADWANI PAN ABCPA 4537 D ... OBJECTOR VS. DCIT-KHANDWA ... RESPONDENT 2 DEPARTMENT BY : SHRI ARUN DEWAN, SR. DR ASSESSEE BY : SHRI H.P. VERMA ALONG WITH SHRI GIRISH AGRAWAL DATE OF HEARING : 17.8.2011 DATE OF PRONOUNCEMENT : .8.2011 O R D E R PER JOGINDER SINGH THIS APPEAL & CROSS-OBJECTION ARE BY THE REVENUE & THE ASSESSEE, RESPECTIVELY, AGAINST THE ORDER OF THE LE ARNED CIT(A)- II, INDORE, DATED 4.2.2010. THE REVENUE HAS RAISED THE GROUND THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. FIRST APPELLATE AUTHORITY ERRED IN DIRECTING THE AS SESSING OFFICER TO GRANT 100% DEDUCTION ON TOTAL PROFITS OF INDUSTR IAL UNDERTAKING AT RS.24,83,387/-, WHICH INCLUDES THE I NCOME OF THE INTEREST, WHICH IS NOT ELIGIBLE INCOME FOR CLAIMING DEDUCTION U/S 80IB OF THE ACT. 2. DURING HEARING OF THE APPEAL, WE HAVE HEARD THE LD. REPRESENTATIVES FROM BOTH SIDES. THE CRUX OF ARGUME NTS ON BEHALF OF THE REVENUE IS THAT THE ASSESSEE DID NOT INCLUDE 3 MONEY LAUNDERING BUSINESS AND THE ASSESSEE PRODUCED THE SEPARATE BOOKS OF ACCOUNT FOR MONEY LAUNDERING BUSI NESS BEFORE THE ASSESSING OFFICER. OUR ATTENTION WAS INV ITED TO PAGE 3 OF THE ASSESSMENT ORDER AND PARA 4.1 OF THE IMPUG NED ORDER. ON THE OTHER HAND, THE LD. COUNSEL FOR ASSESSEE INV ITED OUR ATTENTION TO PARA 4.2.1 OF THE IMPUGNED ORDER AND S UPPORTED THE ORDER OF THE LD. CIT(A). 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. BRIEF FACTS ARE THAT THE ASSES SEE STARTED A NEW INDUSTRIAL UNDERTAKING IN A REMOTE BACKWARD ARE A AND CLAIMED DEDUCTION U/S 80IB OF THE ACT AT 100%. THE ASSESSEE ALSO EARNED INCOME FROM HOUSE PROPERTY AND OTHER IN COME. AS IS EVIDENT FROM ASSESSMENT ORDER ITSELF, THE ASSESS EE SHOWED INCOME AT RS.5,31,183/- ON 31.10.2005, ALONG WITH T AX AUDIT REPORT AND SUBSEQUENTLY, FILED REVISED RETURN ON 30 .8.2005 SHOWING TOTAL INCOME AT RS.26,754/-. IN RESPONSE TO THE NOTICE, THE ASSESSEE APPEARED BEFORE THE LD. ASSESSING OFFI CER FROM TIME TO TIME AND PRODUCED BOOKS OF ACCOUNT, VOUCHER S ETC. 4 WHICH WERE EXAMINED BY THE LD. ASSESSING OFFICER. T HE OTHER DETAILS, REQUIRED BY THE ASSESSING OFFICER, WERE AL SO FILED DURING ASSESSMENT PROCEEDINGS WITH FURTHER DETAILS IN COMP LIANCE TO QUERIES RAISED BY THE DEPARTMENT. IN THE REVISED RE TURN, THE ASSESSEE CLAIMED PAYMENT OF INTEREST TO VARIOUS CRE DITORS AND PAYMENT OF INTEREST TO BANK AND DALALI PAYMENTS WHI CH WERE CLAIMED TO BE LEFT OVER BY OVERSIGHT WHILE FILING T HE ORIGINAL RETURN. THE LD. ASSESSING OFFICER RECASTED THE PROF IT & LOSS A/C OF THE ASSESSEE AS UNDER: DEBIT AMOUNT (IN RS.) CREDIT AMOUNT (IN RS.) INTEREST PAID IN INDIVIDUAL CAPACITY 14,11,012 NET PROFIT AS PER PROFIT & LOSS ACCOUNT 32,82,040 VAKIL FEES 1,000 INTEREST INCOME IN INDIVIDUAL CAPACITY 10,32,690 BANK CHARGES 4,956 DALALI PAID 20,886 DALALI PAID 26,730 BANK INTEREST 99,377 NET PROFIT 27,50,769 43,14,730 43,14,730 THE MAIN GRIEVANCE OF THE REVENUE/ASSESSING OFFICER IS THAT THE CLAIMED DEDUCTION U/S 80IB INCLUDES INTERE ST INCOME OF RS.5,71,828/- ON FDR WITH S.B. OF INDIA AND RS.51,8 25/-, 5 DEPOSIT WITH SHIVAM COTTON CORPN., CONSEQUENTLY, TH E INTEREST INCOME ARE NOT QUALIFIED TO BE TREATED AS INCOME DE RIVED FROM INDUSTRIAL UNDERTAKING. BEFORE THE LD. CIT AS MENTI ONED IN PARA 3.4, THE REVISED COMPUTATION OF INCOME WAS FILED WH EREIN THE ASSESSEE HIMSELF GAVE EFFECT TO INTEREST FROM FDR A ND SHIVAM COTTON CORPN. AND PROPORTIONATE INTEREST ON THE FUN DS DEPLOYED FROM THE BORROWERS, RESULTING INTO THE AMOUNT OF RS .24,83,387/- U/S 80IB AGAINST RS.32,82,040/-, ORIGINALLY CLAIMED . IN VIEW OF THESE FACTS, THERE IS NO JUSTIFICATION EITHER INCLU DING THE INTEREST INCOME IN THE PROFIT SIDE, AS APPEARING IN INVESTME NT SIDE OR CONSIDERING THE INTEREST INCOME PAID ON BORROWED FU NDS IN INVESTMENT SIDE IN RECASTED PROFIT & LOSS ACCOUNT. THE ASSESSEE HIMSELF EXCLUDED THE AMOUNT OF RS.1,75,000/-, BEING PROPORTIONATE INTEREST OF THE FUNDS INVESTED BY THE PROPRIETOR OUT OF THE BORROWED FUNDS, THEREFORE, THE AMOUNT OF RS. 24,83,387/- IS RIGHTLY ELIGIBLE AS INCOME FROM INDUSTRIAL UNDER TAKING, CONSEQUENTLY, WE FIND NO INFIRMITY IN THE IMPUGNED ORDER DIRECTING TO GRANT DEDUCTION @100% ON THIS AMOUNT F OR DEDUCTION U/S 80IB OF THE ACT. THE SAME IS UPHELD. 6 4. NOW, WE SHALL TAKE UP CROSS-OBJECTION OF THE ASSESSEE WHEREIN THE ONLY GROUND RAISED IS THAT THE ASSESSMENT ORDER PASSED U/S 143(3) AND THE IMPUGNED ORDER DATED 4.2.2010 ARE WITHOUT JURISDICTION AND THEREFO RE BAD IN LAW. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE TRO, FRAMING THE ASSESSMENT, WAS NOT AUTHORISED TO MAKE ASSESSMENT AS THE TRO CANNOT ASSUME THE JURISDICTIO N OF THE ASSESSING OFFICER. THE LD. COUNSEL FOR ASSESSEE REL IED UPON THE DECISION IN BINDAL APPARELS LTD. (104 TTJ 950) (DEL). IT WAS SPECIFICALLY POINTED OUT THAT TRO IS NOT INCLUDED I N THE DEFINITION OF ASSESSING OFFICER, MEANING THEREBY, ANY NOTIFICA TION CANNOT BE NOTIFIED AGAINST THE LAW AS I.T. ACT IS A SELF C ONTAINED COURT. THE LD. COUNSEL FOR ASSESSEE RELIED UPON THE DECISI ONS IN CIT VS. CHENNIAPPA MUDALIAR (74 ITR 41) (SC), CIT VS. S UMENDRA KR. NIYOGI (131 ITR 592) (CAL), CIT VS. HARDWARE EX CHANGE (190 ITR 61) (GAU) AND EINAROO LTD. VS. CIT (204 IT R 312) (KAR). IT WAS ALSO CONTENDED THAT RULE CANNOT PREVA IL OVER THE SCHEDULE OF THE ACT FOR WHICH RELIANCE WAS PLACED U PON THE CWT VS. SUSHILA (176 ITR 232) (KAR). 7 ON THE OTHER HAND, THE LD. SR. DR CONTENDED THAT TH E JCIT IS EMPOWERED TO AUTHORISE ANY PERSON TO WORK AS ASS ESSING OFFICER AND THE TRO WAS ASSIGNED TO WORK ACCORDINGL Y BY THE JCIT-KHANDWA BY ORDER DATED 27.2.2006 (ORDER NO.2/2 005-06) TO WHICH THE LD. COUNSEL FOR ASSESSEE CONTENDED THA T THE JCIT HIMSELF CAN ACT AS ASSESSING OFFICER BUT CANNOT DEL EGATE SUCH POWERS TO THE OFFICER WHO IS NOT INCLUDED IN THE LI ST OF ASSESSING OFFICER. THE LD. SR. DR INVITED OUR ATTENTION TO SE C. 2(7A) AND SEC. 117 OF THE ACT. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON FILE. ADMITTEDLY, THE ASSESSMENT ORDER DATED 23.11.2006 WAS FRAMED BY THE TRO- KHANDWA. NOW, QUESTION ARISES WHETHER THE JCIT CAN DELEGATE THE POWERS OF THE ASSESSING OFFICER TO THE TRO. BEF ORE COMING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUNDER SEC . 2 (7A) OF THE ACT WHEREIN THE ASSESSING OFFICER HAS BEEN DEFI NED. [( 7A ) ASSESSING OFFICER MEANS THE ASSISTANT COMMISSIO NER 27 [OR DEPUTY COMMISSIONER] 28 [OR ASSISTANT DIRECTOR] 27 [OR DEPUTY DIRECTOR] OR THE INCOME-TAX OFFICER WHO IS VESTED W ITH THE RELEVANT JURISDICTION BY VIRTUE OF DIRECTIONS OR OR DERS ISSUED UNDER SUB-SECTION (1) OR SUB-SECTION (2) OF SECTION 120 OR ANY OTHER 8 PROVISION OF THIS ACT, AND THE 29 [ADDITIONAL COMMISSIONER OR] 30 [ADDITIONAL DIRECTOR OR] 31 [JOINT COMMISSIONER OR JOINT DIRECTOR] WHO IS DIRECTED UNDER CLAUSE ( B ) OF SUB-SECTION (4) OF THAT SECTION TO EXERCISE OR PERFORM ALL OR ANY OF THE POWERS AND FUNCTIONS CONFERRED ON, OR ASSIGNED TO, AN ASSESSING OFFICER UNDER THIS ACT ;] WE ARE ALSO REPRODUCING HEREUNDER SEC. 120 OF THE A CT WHICH DEFINES JURISDICTION OF INCOME TAX AUTHORITIE S. 38 [ JURISDICTION OF INCOME-TAX AUTHORITIES. 39 120. (1) INCOME-TAX AUTHORITIES SHALL EXERCISE ALL OR AN Y OF THE POWERS AND PERFORM ALL OR ANY OF THE FUNCTIONS CONF ERRED ON, OR, AS THE CASE MAY BE, ASSIGNED TO SUCH AUTHORITIES BY OR UNDER THIS ACT IN ACCORDANCE WITH SUCH DIRECTIONS AS THE BOARD MAY IS SUE FOR THE EXERCISE OF THE POWERS AND PERFORMANCE OF THE FUNCT IONS BY ALL OR ANY OF THOSE AUTHORITIES. 40 [ EXPLANATION. FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED TH AT ANY INCOME-TAX AUTHORITY, BEING AN AUTHORITY HIGHER IN RANK, MAY, IF SO DIRECTED BY THE BOARD, EXERCISE THE POWERS AND PERF ORM THE FUNCTIONS OF THE INCOME-TAX AUTHORITY LOWER IN RANK AND ANY S UCH DIRECTION ISSUED BY THE BOARD SHALL BE DEEMED TO BE A DIRECTI ON ISSUED UNDER SUB-SECTION (1).] (2) THE DIRECTIONS OF THE BOARD UNDER SUB-SECTION ( 1) MAY AUTHORISE ANY OTHER INCOME-TAX AUTHORITY TO ISSUE ORDERS IN W RITING FOR THE EXERCISE OF THE POWERS AND PERFORMANCE OF THE FUNCT IONS BY ALL OR ANY OF THE OTHER INCOME-TAX AUTHORITIES WHO ARE SUBORDI NATE TO IT. (3) IN ISSUING THE DIRECTIONS OR ORDERS REFERRED TO IN SUB-SECTIONS (1) AND (2), THE BOARD OR OTHER INCOME-TAX AUTHORITY AU THORISED BY IT MAY HAVE REGARD TO ANY ONE OR MORE OF THE FOLLOWING CRI TERIA, NAMELY : ( A ) TERRITORIAL AREA; ( B ) PERSONS OR CLASSES OF PERSONS; ( C ) INCOMES OR CLASSES OF INCOME; AND ( D ) CASES OR CLASSES OF CASES. (4) WITHOUT PREJUDICE TO THE PROVISIONS OF SUB-SECT IONS (1) AND (2), THE BOARD MAY, BY GENERAL OR SPECIAL ORDER, AND SUBJECT TO SUCH CONDITIONS, RESTRICTIONS OR LIMITATIONS AS MAY BE S PECIFIED THEREIN, ( A ) AUTHORISE ANY DIRECTOR GENERAL OR DIRECTOR TO PER FORM SUCH FUNCTIONS OF ANY OTHER INCOME-TAX AUTHORITY AS MAY BE ASSIGNED TO HIM BY THE BOARD; 9 ( B ) EMPOWER THE DIRECTOR GENERAL OR CHIEF COMMISSIONE R OR COMMISSIONER TO ISSUE ORDERS IN WRITING THAT THE POWERS AND FUNCTIONS CONFERRED ON, OR AS THE CASE MAY BE, ASSI GNED TO, THE ASSESSING OFFICER BY OR UNDER THIS ACT IN RESPECT O F ANY SPECIFIED AREA OR PERSONS OR CLASSES OF PERSONS OR INCOMES OR CLAS SES OF INCOME OR CASES OR CLASSES OF CASES, SHALL BE EXERCISED OR PE RFORMED BY 41 [AN ADDITIONAL COMMISSIONER OR] 42 [AN ADDITIONAL DIRECTOR OR] A 43 [JOINT] COMMISSIONER 44 [OR A 43 [JOINT] DIRECTOR], AND, WHERE ANY ORDER IS MADE UNDER THIS CLAUSE, REFERENCES IN ANY OTHER PROVISIO N OF THIS ACT, OR IN ANY RULE MADE THEREUNDER TO THE ASSESSING OFFICER S HALL BE DEEMED TO BE REFERENCES TO SUCH 41 [ADDITIONAL COMMISSIONER OR] 42 [ADDITIONAL DIRECTOR OR] 43 [JOINT] COMMISSIONER 44 [OR 43 [JOINT] DIRECTOR] BY WHOM THE POWERS AND FUNCTIONS ARE TO BE EXERCISED OR PER FORMED UNDER SUCH ORDER, AND ANY PROVISION OF THIS ACT REQUIRING APPROVAL OR SANCTION OF THE 45 [JOINT] COMMISSIONER SHALL NOT APPLY. (5) THE DIRECTIONS AND ORDERS REFERRED TO IN SUB-SE CTIONS (1) AND (2) MAY, WHEREVER CONSIDERED NECESSARY OR APPROPRIATE F OR THE PROPER MANAGEMENT OF THE WORK, REQUIRE TWO OR MORE ASSESSI NG OFFICERS (WHETHER OR NOT OF THE SAME CLASS) TO EXERCISE AND PERFORM, CONCURRENTLY, THE POWERS AND FUNCTIONS IN RESPECT O F ANY AREA OR PERSONS OR CLASSES OF PERSONS OR INCOMES OR CLASSES OF INCOME OR CASES OR CLASSES OF CASES; AND, WHERE SUCH POWERS AND FUN CTIONS ARE EXERCISED AND PERFORMED CONCURRENTLY BY THE ASSESSI NG OFFICERS OF DIFFERENT CLASSES, ANY AUTHORITY LOWER IN RANK AMON GST THEM SHALL EXERCISE THE POWERS AND PERFORM THE FUNCTIONS AS AN Y HIGHER AUTHORITY AMONGST THEM MAY DIRECT, AND, FURTHER, RE FERENCES IN ANY OTHER PROVISION OF THIS ACT OR IN ANY RULE MADE THE REUNDER TO THE ASSESSING OFFICER SHALL BE DEEMED TO BE REFERENCES TO SUCH HIGHER AUTHORITY AND ANY PROVISION OF THIS ACT REQUIRING A PPROVAL OR SANCTION OF ANY SUCH AUTHORITY SHALL NOT APPLY. (6) NOTWITHSTANDING ANYTHING CONTAINED IN ANY DIREC TION OR ORDER ISSUED UNDER THIS SECTION, OR IN SECTION 124 , THE BOARD MAY, BY NOTIFICATION IN THE OFFICIAL GAZETTE, DIRECT THAT F OR THE PURPOSE OF FURNISHING OF THE RETURN OF INCOME OR THE DOING OF ANY OTHER ACT OR THING UNDER THIS ACT OR ANY RULE MADE THEREUNDER BY ANY PERSON OR CLASS OF PERSONS, THE INCOME-TAX AUTHORITY EXERCISI NG AND PERFORMING THE POWERS AND FUNCTIONS IN RELATION TO THE SAID PE RSON OR CLASS OF PERSONS SHALL BE SUCH AUTHORITY AS MAY BE SPECIFIED IN THE NOTIFICATION.] IF THE AFORESAID SECTIONS ARE KEPT IN JUXTAPOSITION AND ANALYSED WITH THE FACTS OF THE PRESENT APPEAL, ADMI TTEDLY, THE 10 JCIT VIDE ORDER DATED 27.2.2006 AND PURSUANT TO PRO VISIONS OF SUB-SEC. (5) OF SEC. 120 OF THE ACT, IN ORDER TO IN SURE PROPER MANAGEMENT OF WORK, SPECIFICALLY AUTHORISED TO MAKE ASSESSMENT/REASSESSMENT U/S 143(3)/144/263/144, AS THE CASE MAY BE, TO FRAME THE ASSESSMENT AND TO WORK AS ASSE SSING OFFICER. ADMITTEDLY, THE ITOS AND THE TROS ARE OF T HE SAME RANK AND WHEN A PARTICULAR OFFICER IS ASSIGNED THE WORK OF WARD, HE OR SHE IS CALLED ASSESSING OFFICER AND WHEN POST ED IN RECOVERY SECTION, THE NOMENCLATURE CHANGES TO TROS. IN BOTH CASES, THEY ARE GAZETTED OFFICERS OF THE DEPARTMENT . EVEN THE ADDL. COMMISSIONER CAN PERFORM ALL OR OF ANY POWERS AND FUNCTIONS OF ANY ASSESSING OFFICER TO MAKE AN ASSES SMENT OF INCOME EVEN THOUGH HE IS NOT MENTIONED IN THE DEFIN ITION OF ASSESSING OFFICER IN SEC. 2 (7A). OUR VIEW IS FOR TIFIED BY THE DECISION IN THE CASE OF CIT VS. NEERU GAMBHIR (2008 ) 166 TAXMAN 272 (DEL). 6. A CUMULATIVE READING OF SEC. 2 (7A) AND SEC. 120 OF THE ACT CLEARLY SPECIFIES THE SCHEME OF THE ACT. AS PER SUB-SEC. (1) TO SEC. 120, THE I.T. AUTHORITIES ARE AUTHORISE D TO EXERCISE ALL 11 OR ANY OF THE POWERS AND PERFORM ALL OR ANY OF THE FUNCTIONS CONFERRED ON OR AS THE CASE MAY BE, ASSIGNED TO SUC H AUTHORITIES BY OR UNDER THIS HEAD IN ACCORDANCE WIT H SUCH DIRECTIONS AS THE BOARD MAY ISSUE FOR EXERCISE OF P OWERS AND PERFORMANCE OF FUNCTION BY ALL OR ANY OF THOSE AUTH ORITIES. EXPLANATIOIN WAS INSERTED BY FINANCE ACT 2006 WITH RETROSPECTIVE EFFECT FROM 1.4.1998 THAT ANY INCOME- TAX AUTHORITY, BEING AN AUTHORITY HIGHER IN RANK, MAY, IF SO DIRECTED BY THE BOARD TO EXERCISE THE POWERS AND PERFORM THE FUNCTIONS OF THE INCOME-TAX AUTHORITY LOWER IN RANK AND SUCH DIRECTIONS SHALL BE DEEMED TO BE A DIRECTION ISSUED UNDER SUB- SEC. (1). SUB-SEC. (5) TO SEC. 120 FURTHER CLARIFIES THAT THE DIRECTIONS AND ORDERS REFERRED TO IN SUB-SEC. (1) AND (2), WHEREVE R CONSIDERED NECESSARY OR APPROPRIATE FOR THE PROPER MANAGEMENT OF THE WORK REQUIRE TWO OR MORE ASSESSING OFFICER (WHETHER OR NOT OF THE SAME CLASS) TO EXERCISE AND PERFORM, CONCURRENT LY, THE POWERS AND FUNCTIONS IN RESPECT OF ANY AREA OR PERS ONS OR CLASSES OF PERSONS OR INCOME OR CLASSES OF INCOME O R CASES OR CLASSES OF CASES AND WHERE SUCH POWERS AND FUNCTION S ARE 12 EXERCISES AND PERFORMED CONCURRENTLY BY THE ASSESSI NG OFFICER OF DIFFERENT CLASSES, ANY AUTHORITY LOWER IN RANK A MONGST THEM SHALL EXERCISE THE POWERS AND PERFORM THE FUNCTIONS AS ANY HIGHER AUTHORITY AMONGST THEM MAY DIRECT. SEC.124 F URTHER DESCRIBES THE JURISDICTION OF ASSESSING OFFICER WHE RE BY VIRTUE OF ANY DIRECTION OR ORDER ISSUED UNDER SUB-SEC (1) OR SUB-SEC. (2) OF SEC. 120, THE ASSESSING OFFICER HAS BEEN VES TED WITH JURISDICTION OR ANY AREA, WITHIN THE LIMITS OF SUCH AREA, HE SHALL HAVE JURISDICTION. SUB-SEC. (2) HAS FURTHER CLARIFI ED THE POSITION WHETHER AN ASSESSING OFFICER HAS JURISDICTION TO AS SESS ANY PERSON. SUB-SEC. (3) CLEARLY SAYS THAT NO PERSON SH ALL BE ENTITLED TO CALL ANY QUESTION THE JURISDICTION OF A N ASSESSING OFFICER. SUB-SEC. (5) FURTHER ELABORATES THE JURISD ICTION BY VIRTUE OF DIRECTIONS/ORDERS ISSUED UNDER SUB-SEC. (1) OR S UB-SEC. (2) OF SEC. 120 OF THE ACT. THE CONTENTION OF THE LD. COUN SEL FOR ASSESSEE WOULD HAVE MERIT IF THE TRO WOULD HAVE ACT ED WITHOUT THE ORDER PASSED U/S 120 (5) OF THE ACT, TH EREFORE, WE ARE OF THE VIEW THAT THE TRO, UNDER THE FACTS STATE D ABOVE, CAN ACT AS ASSESSING OFFICER. 13 7. SO FAR AS THE RELIANCE UPON THE DECISION IN THE CASE OF BINDAL APPAREL VS. ACIT (SUPRA) IS CONCERNED, WE FIND THAT THIS ORDER WAS PASSED ON 31.3.2006. THE ISSUE BEFOR E THE BENCH WAS WHETHER THE ADDL. CIT CAN EXERCISE OR PER FORM ALL OR ANY POWERS AND FUNCTIONS OF AN ASSESSING OFFICER. H OWEVER, WE ARE MAKING IT CLEAR THAT AT THAT TIME, THE ADDL. CIT WAS NOT INCLUDED WITHIN THE MEANING OF ASSESSING OFFICER AS THE ADDL. CIT WAS INSERTED BY THE FINANCE ACT 2007 (THOUGH WI TH RETROSPECTIVE EFFECT 1.6.1994), THEREFORE, THE AFOR ESAID ORDER DATED 31.3.2006 WAS PASSED PRIOR TO INSERTION MADE BY THE FINANCE ACT 2007. EVEN OTHERWISE, BY SUB-SEC. (7A) TO SEC. 2 ITSELF, THE RELEVANT JURISDICTION CAN BE ASSUMED BY VIRTUE OF DIRECTIONS/ORDERS ISSUED UNDER SUB-SEC. (1) OR SUB- SEC. (2) OF SEC. 120 OR ANY PROVISION OF THIS ACT. IN THE PRESE NT APPEAL, SINCE THE ASSESSMENT ORDER WAS FRAMED BY THE TRO PU RSUANT TO THESE DIRECTIONS, THEREFORE, WE FIND NO MERIT IN THE CLAIM OF THE ASSESSEE. SO FAR AS THE OTHER CASES (SUPRA), RE LIED UPON BY THE LD. COUNSEL FOR ASSESSEE, ARE CONCERNED, THE AR GUMENT OF THE LD. COUNSEL FOR ASSESSEE IS THAT WHEN THE ACT I TSELF HAS 14 USED THE WORD PRESCRIBED, THEREFORE, CONCURRING P OWERS ON THE EXECUTIVE TO MAKE THE RULE IS NOT JUSTIFIED. WE ARE NOT IN AGREEMENT WITH THIS SUBMISSION BECAUSE A CLEAR-CUT EXPRESS PROVISION HAS BEEN MADE IN THE ACT ITSELF DEFINING THE WORD ASSESSING OFFICER (SEC. 2 (7A) OF THE ACT) AND DE LEGATION OF POWERS BY THE HIGHER AUTHORITIES BY VIRTUE OF POWER S CONTAINED IN SEC. 120 (5) OF THE ACT. EVEN THE DECISION OF HO NBLE BOMBAY HIGH COURT IN THE CASE OF ENAROO LTD. (SUPRA) ITSEL F SPEAKS ABOUT HARMONIOUS CONSTRUCTION SO FAR AS INTERPRETAT ION OF TAXING STATUTE IS CONCERNED. THE HONBLE COURT WHILE DELIV ERING THIS JUDGMENT DULY NOTED THE EFFECT OF MARGINAL NOTE. HO WEVER, IN THE PRESENT APPEAL, A SPECIFIC ORDER WAS PASSED BY THE LD. JCIT AUTHORISING THE TRO TO WORK AS ASSESSING OFFICER BY VIRTUE OF POWERS VESTED IN HER BY SEC. 120 (5) OF THE ACT, TH EREFORE, THESE JUDICIAL PRONOUNCEMENTS MAY NOT HELP THE ASSESSEE, CONSEQUENTLY, WE FIND NO MERIT IN THE CROSS-OBJECTI ON OF THE ASSESSEE. FINALLY, THE APPEAL OF THE REVENUE AND CROSS-OBJECT ION OF THE ASSESSEE ARE DISMISSED. 15 ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH AUGUST, 2011. (R.C.SHARMA) (JOGINDER SI NGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 18 .8.2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE !VYAS!