M/s. Jalan Carbons & Chemicals Limited, Kolkata V. ITO, Ward - 10 (1), Kolkata, Kolkata

ITA 1075/KOL/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54593 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 1999-2000
• Appeal Filed On: 08-08-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A K PRAMANIK D R
• Assessee Lawyers: SANDEEP MOOSADDEE
• Keywords: Rectification of order; Period of limitation; Difference of opinion; Time period of passing order; Change of opinion
• Section: 263; 154

Judgement Text

, . .. . . .. . , , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH : KOLKATA ( ) . . , ) [BEFORE SHRI S.V. MEHROTRA, ACCOUNTANT MEMBER] / I.T.A NO. 1075/KOL/2011 ! '#$ / ASSESSMENT YEAR : 1999-2000 M/S. JALAN CARBONS & CHEMICALS LIMITED, KOLKATA - VS.- INCOME TAX OFFICER, WARD-10(1), KOLKATA (PAN : AAACJ 8324 R) ( %& /APPELLANT ) ( '(%& / RESPONDENT ) FOR THE APPELLANT : SHRI SANDEEP MOOSADDEE, A.R. FOR THE RESPONDENT : SHRI A.K. PRAMANIK, D.R. ) ' * , - ) ' * , - ) ' * , - ) ' * , - /DATE OF HEARING : 05.10.2011 .# , - .# , - .# , - .# , - /DATE OF PRONOUNCEMENT : 21.10.2011 / / ORDER THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT YEAR 1999-2000 AGAINST ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-XXXVI, KOLKATA DATED 07.06.2011. 2. BRIEF FACTS OF THE CASE ARE THAT PROCESSING OF R ETURN OF INCOME WAS COMPLETED UNDER SECTION 143(1) ON 26.02.2002 AT A TOTAL INCOME OF R S. NIL. ASSESSING OFFICER PASSED THE ORDER UNDER SECTION 154/ 143(1) ON 30.03.2006 DETERMINING THE BOOK PROFIT UNDER SECTION 115JA AT RS.3,59,537/-. THE ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(APPEALS) AND, INTER ALIA, SUBMITTED THAT THE ORDER PASSED UNDER SECTION 154 WAS BARRED BY LIMITATION BECAUSE THE ORDER UNDER SECTION 143(1) WAS MADE ON 26.02.2002 AND, THEREFOR E, RECTIFICATION ORDER SERVED ON ASSESSEE ON 23.04.2007 WAS BARRED BY LIMITATION. THE ASSESSE E HAD RELIED ON THE DECISION OF THE HONBLE KERALA HIGH COURT IN THE CASE OF CIT VS.- SHREE NA RAYAN CHANDRIKA TRUST [212 ITR 456]AND ALSO CIT VS.- SWARNA TANEJA. LD. CIT(APPEALS) DISM ISSED THE ASSESSEES APPEAL, INTER ALIA, OBSERVING THAT SINCE THE ORDER WAS PASSED WITHIN FO UR YEARS IN TERMS OF SECTION 154(7), THEREFORE, THE SAME WAS VALID. ITA NO. 1075/KOL./2011 2 3. LD. COUNSEL FOR THE ASSESSEE REFERRED TO THE REM AND REPORT CONTAINED AT PAGE 3 OF PAPER BOOK AND SUBMITTED THAT ASSESSING OFFICER HAS, INTE R ALIA, OBSERVED THAT THE ORDER UNDER SECTION 154/ 143(1) DATED 30.03.2006 WAS PASSED AND SERVED ON THE ASSESSEE ON 23.04.2007. THEREFORE, HE SUBMITTED THAT THE ORDER UNDER SECTION 154 WAS B ARRED BY LIMITATION. HE RELIED ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE O F CIT VS.- NARAYAN CHANDRIKA TRUST [212 ITR 456], WHEREIN, INTER ALIA, IT HAS BEEN OBSERVED AS UNDER :- THE ORDER OF ANY AUTHORITY CANNOT BE SAID TO BE PA SSED UNLESS IT IS IN SOME WAY PRONOUNCED OR PUBLISHED OR THE PARTY AFFEC TED HAS THE MEANS OF KNOWING IT. IT IS NOT ENOUGH IF THE ORDER IS MADE, SIGNED, AND KEPT IN THE FILE, BECAUSE SUCH ORDER MAY BE LIABLE TO CHANGE AT THE HANDS OF THE AUTHORITY WHO MAY MODIFY IT, OR EVEN D ESTROY IT, BEFORE IT IS MADE KNOWN, BASED OF SUBSEQUENT INFORMATION THI NKING OR CHANGE OF OPINION. TO MAKE THE ORDER COMPLETE AND EFFECTIV E, IT SHOULD BE ISSUED, SO AS TO BE BEYOND THE CONTROL OF THE AUTHO RITY CONCERNED, FOR ANY POSSIBLE CHANGE OR MODIFICATION THEREIN. THIS S HOULD BE DONE WITHIN THE PRESCRIBED PERIOD, THOUGH THE ACTUAL SER VICE OF THE ORDER MAY BE BEYOND THAT PERIOD. 3.1. LD. COUNSEL FOR THE ASSESSEE FURTHER REFERRED TO THE DECISION DATED 11.06.2004 OF ITAT, INDORE BENCH IN THE CASE OF HARENDRA PAL SINGH BHAT IA VS.- CIT IN ITA NO. 364/IND./2001, WHEREIN IT HAS BEEN HELD AS UNDER :- THE COURT MAY PRESUME THAT THE ORDER WAS NOT MADE O N THE DATE IT IS PURPORTED TO HAVE BEEN MADE AND THAT IT COULD HAVE BEEN MADE AFTER THE EXPIRY OF THE PERIOD. IN THE CASE BEFORE US, NO EXPLANATION HAS BEEN GIVEN THAT WHY THE ORDER WAS SERVED ON 30 TH JULY, 2001. EVEN THE CONTENTS OF LETTER DATED 26 TH AUGUST, 2003, ARE NOT RELIABLE BECAUSE THERE IS NO EVIDENCE IN THE FORM OF DAK BOOK OR MEM ORANDUM OF INTERNAL MOVEMENT WHICH SHOWS THAT ORDER WAS ISSUED BY THE OFFICE OF THE CIT. IN VIEW OF THIS, THE NATURAL LEGAL PRESUMP TION AS PRONOUNCED IN THE ABOVE NOTED TWO AUTHORITIES AND OTHER CASES CITED BY LEARNED AUTHORIZED REPRESENTATIVE IS THAT ORDER MAY HAVE BE EN PASSED AFTER THE LIMITATION OF TIME. IN THESE CIRCUMSTANCES, WE ALLOW THE ADDITIONAL GROUND RAISED BY THE ASSESSEE AND QUASH THE ORDER U NDER S. 263 BEING TIME-BARRED. 4. LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVE NUE SUBMITTED THAT THE ONLY REQUIREMENT OF SECTION 154(7) IS THAT ORDER SHOULD HAVE BEEN PASSED WITHIN FOUR YEARS FROM THE END OF THE FINANCIAL YEARS IN WHICH THE ORDER SOUGH T TO BE AMENDED WAS PASSED. THEREFORE, SINCE THE PROCESSING HAD BEEN DONE ON 26.02.2002, T HE ASSESSING OFFICER COULD AMEND THE ORDER UPTO 31.03.2006. HE SUBMITTED THAT THE ORDER HAS BEEN PASSED ON 30.03.2007, BUT WAS ITA NO. 1075/KOL./2011 3 SERVED ON 23.04.2007. IT IS TRUE THAT THERE IS CONS IDERABLE DELAY IN SERVING THE ORDER, BUT THE QUESTION IS WHETHER THE SAME CAN RENDER THE ORDER B AD IN LAW. HE SUBMITTED THAT SINCE THE MANDATE OF SECTION IS ONLY FOR PASSING OF THE ORDER , THEREFORE, MERELY BECAUSE THE ORDER WAS SERVED AFTER CONSIDERABLE DELAY, WOULD NOT RENDER T HE SAME BEING AN ORDER BARRED BY LIMITATION. 5. HAVING HEARD BOTH THE SIDES, I HAVE CAREFULLY GO NE THROUGH THE ORDERS OF AUTHORITIES BELOW. BEFORE DISCUSSING THE CASE LAWS RELIED UPON BY THE LD. COUNSEL, I FURTHER OBSERVE FROM THE LD. CIT(APPEALS)S ORDER THAT NOTICE UNDER SECT ION 154(3) WAS ISSUED TO ASSESSEE ON 06.03.2003, I.E. WELL WITHIN THE LIMITATION. HOWEVE R, THE ASSESSEE DID NOT RESPOND THE SAME. SINCE THE AO HAD BROUGHT INTO MOTION THE PROCEEDIN GS WELL WITHIN LIMITATION, THE PRESUMPTION WOULD BE THAT HE COMPLETED THE PROCEEDINGS WITHIN L IMITATION ALSO. FURTHER, IN THE SUBMISSIONS MADE BEFORE LD. COMMISSIONER OF INCOME-TAX (APPEALS ), ASSESSEE ITSELF, INTER-ALIA, STATED AS UNDER: THUS, THE MERE FACT THAT THE ORDER WAS MADE ON 30 TH MARCH 2006 I.E. WITHIN THE LIMITATION PERIOD IS NOT SUFFICIENT WHEN IT WAS NOT SERVED WITHIN THE DUE TIME 5.1 IN THE CASE OF CIT VS.- SHREE NARAYAN CHANDRIK A TRUST, HONBLE KERALA HIGH COURT HAS NOTICED THE OBSERVATIONS OF HONBLE SUPREME COU RT IN THE CASE OF B.J. SHELAT VS.- STATE OF GUJARAT AIR 1978 SC 1109, WHICH HAVE BEEN RE-PRODUC ED EARLIER. IN THESE OBSERVATIONS, HONBLE SUPREME COURT HAS LAID DOWN THE PRINCIPLE T O DETERMINE WHEN THE ORDER BECOMES COMPLETE AND EFFECTIVE. IT HAS BEEN HELD THAT IT I S NOT ENOUGH THAT THE ORDER IS MADE, SIGNED AND KEPT IN THE FILE, BUT SHOULD HAVE BEEN ISSUED SO AS TO BE BEYOND THE CONTROL OF THE AUTHORITY CONCERNED, WHICH SHOULD HAVE BEEN DONE WITHIN PRESC RIBED PERIOD. HOWEVER, ACTUAL SERVICE OF THE ORDER MAY BE BEYOND THAT PERIOD. IN THE PRESEN T CASE THE REMAND REPORT OF AO BY THE LD.DCIT CONTAINED AT PAGE 3 OF THE PB READS AS UNDE R:- AS PER DIRECTION, THE RECORDS HAVE BEEN VERIFIED. THE REPORT IN THIS RESPECT IS AS UNDER:- THE NOTICE UNDER SECTION. 154 DATED 06.03.2003 APP EARS TO HAVE BEEN RECEIVED ON 06.03.2003 ITSELF BY THE ASSESSEE. A RE MINDER DATED 26.06.2003 WAS ALSO ISSUED AND SERVED ON THE ASSESS EE ON THE SAME. ORDER UNDER SECTION.154/143(1) DATED 30.03.2006 WAS PASSE D AND SERVED ON THE ASSESSEE ON 23.04.2007. SUBSEQUENTLY, AN ORDER UNDE R SECTION.154/154/143(1) DATED 14.03.2007 WAS ISSUED AND SERVED ON THE ASSESSEE ON 23.04.2007. ITA NO. 1075/KOL./2011 4 FROM THE CONTENTS OF ABOVE REMAND REPORT THE LD. CO UNSEL FOR THE ASSESSEE SUBMITTED THAT IT IS NOT CLEAR WHEN THE ORDER WAS ACTUALLY IS SUED SO AS TO BE BEYOND THE CONTROL OF THE AUTHORITY CONCERNED. THEREFORE, IN VIEW OF THE DECI SIONS OF THE HONBLE SUPREME COURT IN THE CASE OF SHREE NARAYAN CHANDRIKA TRUST (SUPRA) AND O F TRIBUNAL IN THE CASE OF HARENDRA PAL SINGH BHATIA (SUPRA) THE ASSESSEE DESERVES TO SUCCE ED. HOWEVER, IN MY OPINION THE REMAND REPORT CANNOT BE READ TO MEAN THAT THE ORDER WAS P ASSED AND SERVED SIMULTANEOUSLY ON 24-03- 2007. SINCE THE ORDER HAD BEEN PASSED ON 30-3-2006, THEREFORE, MERELY SERVICE OF ORDER ON 23- 4-07 WAS OF NO CONSEQUENCE, PARTICULARLY, WHEN AS PER SECTION 154(7) NO TIME LIMIT, FOR SERVICE OF ORDER HAS BEEN PRESCRIBED. IN VIEW OF ABOVE DISC USSION, I FIND NO REASON TO INTERFERE WITH THE FINDINGS OF THE LD.CIT(APPEALS) THAT THE ORDER WAS PASSED WITHIN FOUR YEARS AND, THEREFORE, WAS A VALID ORDER. RESULTANTLY, I DISMISS THE GROU ND OF APPEAL TAKEN BY THE ASSESSEE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21/ 10/2011. SD/- [S.V. MEHROTRA/ ( . . )] ACCOUNTANT MEMBER/ DATED : 21/ 10/ 2011 COPY OF THE ORDER FORWARDED TO: 1. M/S. JALAN CARBONS & CHEMICALS LIMITED, 16G, EVERES T HOUSE, 46C, CHOWRINGHEE ROAD, KOLKATA-700 071. 2 ITO, WARD-10(1), KOLKATA, 3, GOVT. PLACE WEST, KOLK ATA-1 3. CIT(APPEALS)- ,KOLKATA 4. CIT- , KOLKATA 5 . DR, KOLKATA BENCHES, KOLKATA (TRUE COPY) BY ORDER ASSISTANT REGISTRAR, I.T.A.T., KOLKATA LAHA, SR. P.S.