Bhansilal Ramnath Agarwal Charitable Trust, V. Deputy Commissioner of Income-tax,

ITA 1145/PUN/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9122 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 30-05-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NIRUPAMA KOTRU
• Keywords: Charitable institution; Opportunity of being heard; Principle of natural justice; Period of limitation; Reassessment proceedings
• Section: 143(3); 2; 11

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE . , , BEFORE SHRI D.KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / ITA NOS.1145 & 1146/PUN/2016 / ASSESSMENT YEARS : 2005-06 & 2006-07 BANSILAL RAMNATH AGARWAL CHARITABLE TRUST, 251, BUDHWAR PETH, PUNE 411 002 PAN : AAATB4383K . /APPELLANT VS. DCIT, CENTRAL CIRCLE-1(2), PUNE . / RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK REVENUE BY : SMT. NIRUPAMA KOTRU, CIT-DR / DATE OF HEARING : 08.03.2018 / DATE OF PRONOUNCEMENT: 16.03.2018 / ORDER PER D. KARUNAKARA RAO, AM : THERE ARE TWO APPEALS FILED BY THE ASSESSEE UNDER CONSID ERATION AGAINST THE COMMON ORDER OF CIT(A)-13, PUNE, DATED 31-03 -2016 INVOLVING ASSESSMENT YEARS 2005-06 & 2006-07. THESE AS SESSMENTS WERE MADE U/S.153A R.W.S. 143(3) OF THE ACT. THERE WAS S EARCH ACTION U/S.132 OF THE ACT ON THE ASSESSEE. THE ISSUES RAISED BY THE ASSESSEE IN BOTH THE ASSESSMENT YEARS ARE IDENTICAL. APPEAL-WISE A ND GROUND-WISE ADJUDICATION IS GIVEN IN THE FOLLOWING PARAGRAPHS. ITA NO.1145/PUN/2016 A.Y. 2005-06 2. GROUNDS RAISED BY THE ASSESSEE ARE EXTRACTED AS UNDER : ON FACTS AND IN LAW, 1. THE LD. CIT(A) ERRED IN HOLDING THAT THE ASST. C OMPLETED U/S.153A(B) R.W.S 143(3) WAS NOT BARRED BY LIMITATION WITHOUT A PPRECIATING THAT THE REFERENCE FOR SPECIAL AUDIT U/S.142(2A) WAS INVALID AND HENCE, THE TIME LIMIT U/S. 153B COULD NOT BE EXTENDED BY TIME GIVEN FOR SPECIAL AUDIT U/S. 142(2A). 2 2. THE LEARNED CIT(A) ERRED IN NOT SPECIFICALLY DIR ECTING THE LEARNED A.O. TO GRANT EXEMPTION U/S.11 TO THE ASSESSEE TRUST PARTIC ULARLY SINCE HE HIMSELF HAS HELD THAT THE ASSESSEE HAS NOT VIOLATED ANY PROVISIONS OF SECTION 11 TO 13. 3. THE ASSESSEE SUBMITS THAT IT HAS COMPLIED WITH A LL THE CONDITIONS LAID DOWN IN SECTION 11 TO 13 AND HENCE, THE LD. CIT(A) SHOULD HAVE DIRECTED THE LD. A.O. TO GRANT THE EXEMPTION U/S.11 TO THE A SSESSEE TRUST. 4. THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISAL LOWANCE U/S.40(A)(IA) OF RS.8,81,600/- WITHOUT APPRECIATING THAT THE ASSESSE E TRUST WAS ENTITLED TO CLAIM EXEMPTION U/S.11 AND HENCE, NO DISALLOWANC E COULD BE MADE U/S. 40(A)(IA) WHILE COMPUTING THE INCOME OF THE AS SESSEE U/S.11. 5. THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISAL LOWANCE OF EXPENDITURE OF RS.11,29,550/- IN RESPECT OF THE PAYMENT MADE TO EMBOSS TECHNOPRENEURS PVT. LTD. (EMBOSS) ON THE GROUND THA T THE ASSESSEE HAD FAILED TO SUBMIT ANY EVIDENCE OF RECEIPT OF SERVICE S FROM THE SAID PARTY. 5.1. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT E MBOSS HAD RENDERED SOFT SKILL TRAINING TO THE STUDENTS OF THE ASSESSEE TRUST AND THE ASSESSEE HAD ALSO FURNISHED ALL THE RELEVANT EVIDENCES TO DE MONSTRATE THAT EMBOSS HAD RENDERED THE RELEVANT SERVICES AND HENCE , THE DISALLOWANCE MADE WAS REQUIRED TO BE DELETED. 5.2. THE LEARNED CIT(A) ERRED IN NOT APPRECIATING T HAT EMBOSS HAD RENDERED SERVICES TO THE ASSESSEE TRUST AND THE PAY MENTS MADE TO IT WERE NOT EXCESSIVE AND THEREFORE, THE SAID EXPENDIT URE SHOULD HAVE BEEN ALLOWED TO THE ASSESSEE WHILE COMPUTING ITS INCOME. 6. THE LEARNED CIT(A) ERRED IN CONFIRMING AN ADDITI ON OF RS.5,71,800/- ON ACCOUNT OF ANNUAL VALUE OF RENT IN RESPECT OF PROPE RTY AT KOTA. 7. THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISAL LOWANCE OF INTEREST OF RS.78,535/- ON ACCOUNT OF THE ADVANCES GIVEN TO SHR I MEMANE WITHOUT APPRECIATING THAT THE ADVANCE WAS GIVEN IN THE COUR SE OF ACTIVITIES OF THE ASSESSEE TRUST AND HENCE, NO DISALLOWANCE OF INTERE ST WAS WARRANTED. 8. THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISAL LOWANCE OF INTEREST OF RS.76,200/- ON ACCOUNT OF THE ADVANCE GIVEN FOR LAN D AT S.NO.63/2 WITHOUT APPRECIATING THAT THE ADVANCE WAS GIVEN IN THE COURSE OF ACTIVITIES OF THE ASSESSEE TRUST AND HENCE, NO DISA LLOWANCE OF INTEREST WAS WARRANTED. 9. THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWA NCE OF RS.28,44,877/- ON THE GROUND THAT THE SAID EXPENDITURE WAS CAPITAL IN NATURE WITHOUT APPRECIATING THAT THE EXPENDITURE INCURRED BY THE A SSESSEE WAS REVENUE IN NATURE. 9.1. WITHOUT PREJUDICE, THE ASSESSEE TRUST SUBMITS THAT SINCE IT IS ELIGIBLE FOR EXEMPTION U/S.11, IN CASE, THE SAID EXPENDITURE OF RS.28,44,877/- IS HELD TO BE CAPITAL IN NATURE, STILL THE SAME SHOULD BE ALLOWED AS AN APPLICATION OF INCOME OF THE ASSESSEE TRUST. 10. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL. 3 3. BEFORE US, LD. COUNSEL FOR THE ASSESSEE FILED AN ADDITION AL GROUND RELATING TO THE ISSUE OF LIMITATION OF TIME PROVIDED FOR MAKIN G ASSESSMENT IN CASES OF SPECIAL AUDIT MADE U/S.142(2A) OF THE ACT. THE SAID ADDITIONAL GROUND IS EXTRACTED AS UNDER : THE LEARNED CIT(A) ERRED IN HOLDING THAT THE ASST. COMPLETED U/S.153A(B) R.W.S. 143(3) WAS NOT BARRED BY LIMITATION WITHOUT APPRECIATING THAT THE REFERENCE FOR SPECIAL AUDIT U/S.142(2A) WAS INVALID AND HENCE, THE TIME LIMIT U/S.153B COULD NOT BE EXTENDED BY TIME GIVEN F OR SPECIAL AUDIT U/S.142(2A). 4. ON FINDING THE LEGAL NATURE OF THE SAME, THE SAME IS ADM ITTED AND ADJUDICATED AS FOLLOWS : GIVING BRIEF FACTS RELATING TO THE ADJUDICATION OF ADDITIONAL GROUND, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT ASSESSEE IS A CHARITABLE ORGANIZATION LOCATED IN PUNE RUNNING TECHNICAL EDUCATIONAL IN STITUTIONS AND AWARDING ENGINEERING DEGREES. ASSESSEE IS IN EXISTENC E SINCE 1975 ONWARDS AND THE SAME IS REGISTERED U/S.12A OF THE ACT. THERE WAS ACTION U/S.132 OF THE ACT ON THE ASSESSEE ON 20-07-20 05. THERE WAS AN ALLEGATION FROM THE REVENUE THAT THE ASSESSEE DID NOT COOPERATE IN MATTERS OF COMPLIANCE TO THE NOTICES AND THE MATTERS OF FILING OF RETURN OF INCOME IN TIME. ULTIMATELY, AO CONSIDERED THE FACT THAT T HE ACCOUNTS OF THE ASSESSEE INVOLVES COMPLEXITY AND VOLUME AND THE PR OVISIONS OF SECTION 142(2A) OF THE ACT WERE INVOKED. THE ACCOUNTS OF THE ASSESSEE WERE REFERRED TO THE SPECIAL AUDIT. REGARDING THE DUE DATES FOR MAKING ASSESSMENTS AND THE CONSIDERATION OF THE EXTENDED PERIOD IN RESPECT OF THE CA SES REFERRED TO THE SPECIAL AUDIT U/S.142(2A) OF THE ACT, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS IS THE CASE WHERE THE ASSESSMENTS WERE DUE FOR COMPLETION IN NORMAL COURSE ON 31-12-2007. CONSIDERING TH E PERIOD AND EXTENDED PERIOD ALLOWED UNDER THE STATUTE U/S.142(2A ) OF THE ACT, IF 4 THE PROCEDURES ARE VALIDLY FOLLOWED BY THE AO, THE DUE D ATE FOR COMPLETION OF THE ASSESSMENT IS AUGUST, 2008. THE ASSESS MENTS WERE ACTUALLY COMPLETED ON 12-08-2008. NORMALLY, THE ORDER P ASSED BY THE AO IS WELL IN TIME BUT THERE ARE PROCEDURAL ISSUES BECAUSE OF WHICH THE ASSESSMENT HAS TO BE QUASHED AS NULL AND VOID ON THE G ROUND OF THE PRINCIPLES OF LIMITATION. 5. REFERRING TO THE SAID PROCEDURAL ISSUED AND BRINGING O UR ATTENTION TO THE PROVISIONS OF SUB-SECTION (2A) OF SECTION 1 42 OF THE ACT RELATING TO ENQUIRY BEFORE ASSESSMENT, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE STATUTE PRESCRIBES FOR THE PROCEDUR E FOR THE MANNER OF GETTING APPROVALS, GRANTING OPPORTUNITY TO THE ASSESS EE, DIRECTING THE ASSESSEE TO GET HIS ACCOUNTS AUDITED ETC. ACCORDING TO WHICH, THE AO SHALL NOT DIRECT THE ASSESSEE TO GET THE ACCOUNTS SO AUDITED UNLESS ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BE ING HEARD. THE AO IS UNDER STATUTORY OBLIGATION TO GRANT OPPORTUNITY TO THE ASSESSEE. IST PROVISO TO SUB-SECTION (2A) OF SECTION 142 OF THE ACT IS RELEVANT IN THIS REGARD. THE SAME HAS COME INTO STATUTE RIGHT FROM FINANCE ACT, 2007 W.E.F. 01-06-2007. BEING PROCEDURAL SECTION, THE SAME SHOULD APPLY TO THE REFERENCE IF ANY MADE TO THE SPECIAL AUDIT A FTER THE SAID CUT-OFF DATE. REFERENCE TO THE SPECIAL AUDIT IN THE INSTAN T CASE WAS MADE ON 14-11-2007, FROM THE LETTER OF THE CIT CENTRAL, PUNE WHICH INFORMS THE ASSESSEE ABOUT THE PROPOSAL FOR SPECIAL AUDIT IS RELIED. FURTHER, BRINGING OUR ATTENTION TO THE SAID PROVISO TO SE CTION 142(2A) OF THE ACT, LD. COUNSEL SUBMITTED THAT THE SHOW CAUSE IF ANY HAS TO BE GIVEN BY THE AO OF THE ASSESSEE. THE CIT (ADMN.) IS ONLY TO GIVE ADMINISTRATIVE APPROVAL TO THE PROPOSAL OF THE AO FOR INVO KING THE PROVISIONS OF SECTION 142(2A) OF THE ACT IN ANY CASE. BRING ING OUR ATTENTION TO PAGE 6 OF THE PAPER BOOK, WHICH CONTAINS A LETTER SENT BY 5 THE OFFICE OF THE CIT, CENTRAL, PUNE TO THE ASSESSEE GRAN TING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, LD. COUNSEL S UBMITTED THAT THIS IS THE ONLY LETTER ISSUED BY THE INCOME-TAX AUTHORIT IES WHICH GIVES AN OPPORTUNITY TO THE ASSESSEE IN THE CONTEXT OF INVOKIN G THE PROVISIONS OF SECTION 142(2A) OF THE ACT. REFERRING TO THE LEGAL PROPOS ITION ON THIS ISSUE, LD. COUNSEL BROUGHT OUR ATTENTION TO THE ORDER OF THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF M/S.P.N. GADGIL & CO. (GOLD) & M/S .P.N. GADGIL & CO. (SILVER) ITA NOS. 1196 TO 1202/PUN/2015 & IT A NOS. 1626 TO 1632/PUN/2015 AND ITA NO.1539/PUN/2015 ORDER DATED 13-12-2017 AND SUBMITTED THAT IDENTICAL ISSUE WAS ADJUDIC ATED BY THE TRIBUNAL HOLDING THAT THE CIT, CENTRAL IS NOT EMPOWERED T O GRANT OPPORTUNITY TO THE ASSESSEE IN SUCH MATTERS AND THE A O IS PROPER INCOME-TAX AUTHORITY PRESCRIBED UNDER THE PROVISO TO SE CTION 142(2A) OF THE ACT. HE SUBMITTED THAT NOBODY CAN REPLACE THE AO IN SUCH MATTERS LEAVE-ALONE THE CIT AND THE FACT OF ALLOWING THE ADDITIONAL G ROUND IN THE SAID CASE WAS BROUGHT TO OUR NOTICE. THE SAME IS EVIDEN T FROM THE CONTENTS OF PARA NO.22 OF THE ORDER OF THE TRIBUNAL (SUPR A). HE ALSO SUBMITTED THAT IN ALLOWING THE SAME, THE TRIBUNAL FOLLOWED TH E DECISION IN THE CASE OF ITO (CENTRAL), KOLHAPUR VS. VILSONS PARTICLE BOA RD INDUSTRIES LTD. IN ITA NO.447/PN/2013, ITA NOS. 309 & 310 /PN/2015 & ITA NOS. 448 & 449/PN/2014 FOR A.YRS. 2004-05 TO 2006 -07, ORDER DATED 21-12-2016 AND MAHARASHTRA ACADEMY OF ENGINEERIN G AND EDUCATIONAL RESEARCH VS. DCIT (CENTRAL CIRCLE-1(1), PUNE IN IT A NOS. 915 TO 920/PN/2012 FOR A.YRS. 1999-2000 TO 2004-05, ORD ER DATED 10-02-2017 AND DISTINGUISHED THE DECISION IN THE CASE OF CIT VS. SHYAMAL SARKAR 84 TAXMANN.COM 146. 6. ON THE OTHER HAND, LD. CIT-DR FOR THE REVENUE BROUG HT OUR ATTENTION TO THE SAID PROVISIONS OF THE SAID PROVISO TO SE CTION 142(2A) OF 6 THE ACT AND SUBMITTED THAT THE STATUTE IS SILENT ABOUT THE COMPETENT INCOME-TAX AUTHORITY WHO IS EMPOWERED TO GRANT SUCH OP PORTUNITY OF BEING HEARD TO THE ASSESSEE IN MATTERS RELATING TO INVOK ING OF PROVISIONS OF SECTION 142(2A) OF THE ACT. OTHERWISE, SHE RELIED ON THE ORDERS OF THE AO/CIT(A). 7. WE HEARD BOTH THE PARTIES ON THE LEGAL ISSUE RAISED V IDE ADDITIONAL GROUND. THERE IS NO DISPUTE ON FACTS ON THE DATES OF CO MPLETION OF THE ASSESSMENT MENTIONED ABOVE. THE DISPUTE IS ONLY LEGAL IN NATURE AND IT REVOLVES AROUND THE INTERPRETATION OF THE PROVISO TO SUB -SECTION (2A) OF SECTION 142 OF THE ACT. IT IS AN UNDISPUTED FACT THAT T HE ONLY AUTHORITY THAT ISSUED THE NOTICE TO THE ASSESSEE INFORMING ABOUT THE PROPOSAL FOR MAKING A REFERRAL OF HIS CASE TO THE SPECIAL AUDIT U/S.142(2A ) OF THE ACT, IS THE CIT, CENTRAL, PUNE IN THIS CASE. AO HAS NEVER ISSUE D FORMAL NOTICE TO THE ASSESSEE GRANTING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BEFORE HE MAKES THE PROPOSAL AND OBTAIN T HE SAME FROM THE CIT, AURANGABAD. IN THIS CASE, AO MERELY COMMUNICAT ED VIDE HIS LETTER DATED 17-12-2007 DIRECTING THE ASSESSEE TO GET HIS ACCOUNTS AUDITED THROUGH A NOMINATED AUDITOR, I.E. M/S. R.B, MERCHANT & COMPANY, CAS, PUNE WITHIN A PERIOD OF 150 DAYS. OTHERWISE, AO NEVER GAVE REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSE SSEE BEFORE THE ASSESSEE WAS DIRECTED ULTIMATELY TO GET HIS ACCOUNTS AU DITED BY M/S. R.B, MERCHANT & COMPANY, CAS, PUNE. BEFORE US, SIMILAR ISSUE CAME UP FOR ADJUDICATION BY THIS BENCH WHEREIN WE HAVE HELD IN THE CASE OF M/S.P.N. GADGIL & CO. (GOLD) & M/S.P.N. GADGIL & CO. (SILVER) (SUPRA ) AND DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEES. FOR T HE SAKE OF COMPLETENESS, WE PROCEED TO EXTRACT THE CONTENTS OF PA RA NO.15 TO 23 OF THE ORDER OF TRIBUNAL (SUPRA) AS UNDER : 7 15. WE SHALL NOW TAKE UP THE LEGAL ISSUE FOR ADJUD ICATION CONSIDERING THE ABOVE ARGUMENTS AND CITATIONS BY BOTH THE PARTI ES. TO START WITH WE EXTRACT THE RELEVANT PROVISIONS OF SECTION 142(2A) OF THE ACT. [(2A) IF, AT ANY STAGE OF THE PROCEEDINGS BEFORE H IM, THE [ASSESSING] OFFICER, HAVING REGARD TO [THE NATURE A ND COMPLEXITY OF THE ACCOUNTS, VOLUME OF THE ACCOUNTS, DOUBTS ABOUT THE CORRECTNESS OF THE ACCOUNTS, MULTIPLICITY OF TRANSACTIONS IN TH E ACCOUNTS OR SPECIALIZED NATURE OF BUSINESS ACTIVITY OF THE ASSE SSEE, AND ] THE INTERESTS OF THE REVENUE, IS OF THE OPINION THAT IT IS NECESSARY SO TO DO, HE MAY, WITH THE PREVIOUS APPROVAL OF THE [PRIN CIPAL CHIEF COMMISSIONER OR ] CHIEF COMMISSIONER OR [PRINCIPAL C OMMISSIONER OR] COMMISSIONER], DIRECT THE ASSESSEE TO GET THE ACCOUNTS AUDITED BY AN ACCOUNTANT, AS DEFINED IN THE EXPLANATION BEL OW SUB-SECTION (2) OF SECTION 288, NOMINATED BY THE [PRINCIPAL CHI EF COMMISSIONER OR] CHIEF COMMISSIONER OR [PRINCIPAL COMMISSIONER O R] COMMISSIONER] IN THIS BEHALF AND TO FURNISH A REPORT OF SUCH AUDIT IN THE PRESCRIBED FORM DULY SIGNED AND VERIFIED BY SUCH ACCOUNTANT AND SETTING FORTH SUCH PARTICULARS AS MAY BE PRESCR IBED AND SUCH OTHER PARTICULARS AS THE [ASSESSING] OFFICER MAY RE QUIRE: [PROVIDED THAT THE ASSESSING OFFICER SHALL NOT DIRECT THE ASSESSEE TO GET THE ACCOUNTS SO AUDITED UNLESS THE ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BEING HEARD .] THE ABOVE PROVISO IS CATEGORICAL IN EXPRESSLY PROVI DING FOR THE LEGAL REQUIREMENT OF GRANTING OPPORTUNITY BY THE AO BEFOR E DIRECTING THE ASSESSEE TO GET THE ACCOUNTS AUDITED. 16. WE SHALL NOW PROCEED TO EXAMINE THE FACTS RELAT ING TO GRANTING OF SUCH OPPORTUNITY BY THE AO. IN THIS REGARD, WE PER USED THE CONTENTS OF PARA NO.5.5, 5.5.1, 5.5.4 ETC., OF THE CIT(A)S ORD ER FOR WANT OF FACTS RELATING TO GRANTING OF OPPORTUNITY AND THE STAND O F THE CIT(A) ON THIS ISSUE. IN PARA NO.5.5, THE CIT(A) NARRATED THE SEQ UENCE OF EVENTS AS WELL AS LD. ARS CONTENTION BEFORE HIM ABOUT THE REQUIRE MENT OF GRANTING OPPORTUNITY AND FAILURE OF THE AO IN GRANTING SUCH OPPORTUNITY TO THE ASSESSEE. RELEVANT LINES ARE EXTRACTED HERE AS UND ER : 5.5THE PROVISO TO SECTION 142(2A) STATES THA T THE A.O. SHALL NOT DIRECT THE ASSESSEE TO GET THE ACCOUNTS AUDITED UNLESS ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BEING HEARD. NARRATING THE SEQUENCE OF EVENTS IN THE CASE, THE L D. A.R. CLAIMED THAT NO SUCH OPPORTUNITY OF HEARING WAS GRANTED TO THE APPELLANT BY THE ASSESSING OFFICER AS REQUIRED U/S. 142(2A), THEREBY VITIATING ONE OF THE PRIMARY CONDITIONS PRECEDENT B EFORE EXERCISING THE POWER UNDER THE SAID PROVISION. THE LD. A.R. FU RTHER CONTENDED THAT AS THE PROVISO REQUIRES THAT THE OPPORTUNITY S HOULD BE GIVEN BY THE A.O., THE SAME HAS TO BE GIVEN BY THE ASSES SING OFFICER ALONE AND JUST BECAUSE THE LEARNED CIT HAD GIVEN A N OPPORTUNITY OF HEARING TO THE ASSESSEE DOES NOT MEAN THAT THE S TATUTORY CONDITION HAS BEEN COMPLIED WITH. HE, THUS, ARGUED THAT THE ASSESSING OFFICER HAVING CONTRAVENED THIS STATUTORY CONDITION, THE REFERENCE MADE BY THE ASSESSING OFFICER U/S.142(2A) FOR SPECIAL AUDIT IS TOTALLY ILLEGAL. THE LD. A.R. STRESSED THA T WHEN LAW GIVES AUTHORITY TO THE A.O. TO DECIDE WHETHER TO REFER TH E MATTER TO THE AUDITOR OR NOT, THERE IS NO REASON FOR SOME OTHER O FFICER, EVEN IF SENIOR TO THE A.O. TO GIVE AN OPPORTUNITY TO THE AS SESSEE, WHILE POINTING OUT THAT SECTION 2(7A) DEFINES THE TERM A. O. WHICH DOES NOT INCLUDE CIT AND THEREFORE, EVEN IF OPPORTUNITY IS GRANTED BY THE 8 CIT, THE SAME DOES NOT AMOUNT TO COMPLIANCE OF THE REQUIREMENT LAID DOWN IN THE PROVISIONS.. THE ABOVE EXTRACTS PROVE THAT THERE WAS ARGUMENTS A ND DETAILED DISCUSSION ON THE ISSUE RAISED IN THE ADDITIONAL GR OUND (SUPRA). 17. WE ALSO EXAMINED THE FINDING OF THE CIT(A) DISM ISSING THE OBJECTIONS RAISED BY THE ASSESSEE AGAINST GRANTING SUCH OPPORTUNITY BY THE AO ALONE. CONTENTS OF PARA NO.5.5.4 ARE RELEVA NT AND RELEVANT LINES ARE EXTRACTED AS UNDER : 5.5.4 IN THE PRESENT CASE, THE APPELLANT HAS NOT ESSENTIALLY QUESTIONED THE SUFFICIENCY OF EXISTENCE OF THE CIRC UMSTANCES UNDER WHICH THE ASSESSING OFFICER MADE THE REFERENCE FOR SPECIAL AUDIT U/S.142(2A), BUT THE GRIEVANCE OF THE APPELLANT IS THAT IT WAS NOT AFFORDED AN OPPORTUNITY OF BEING HEARD BY THE ASSES SING OFFICER. ACCORDING TO THE LD. A.R., SUCH AN OPPORTUNITY OF B EING HEARD HAS TO BE GIVEN BY THE ASSESSING OFFICER ALONE WHICH HA S NOT BEEN DONE AND THEREFORE, THE DIRECTIONS BY THE ASSESSING OFFICER UNDER THE SAID PROVISIONS ARE ILLEGAL. THIS ARGUMENT OF T HE APPELLANT IS DEVOID OF MERIT AND CONTRARY TO THE PROVISIONS OF S EC.142(2A). WHAT THE PROVISO TO SEC.142(2A) SAYS IS THAT THE ASSESS ING OFFICER SHALL NOT DIRECT THE ASSESSEE TO GET THE ACCOUNTS SO AUDI TED UNLESS THE ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNITY OF BEING HEARD. NOWHERE HAS IT SAID THAT SUCH AN OPPORTUNIT Y HAS TO BE GIVEN BY THE ASSESSING OFFICER ALONE.. 18. FROM THE ABOVE EXTRACTS, IT IS EVIDENT THAT THE AO NEVER GRANTED OPPORTUNITY AS REQUIRED UNDER THE PROVISIONS OF SE CTION 142(2A) OF THE ACT. IT IS THE CIT WHO HAS ACTUALLY GRANTED THE OP PORTUNITY. CIT(A) (CENTRAL) JUSTIFIED THE ABOVE STAND OF THE AO. IN THE LIGHT OF THE ABOVE FACTUAL MATRIX, WE NEED TO DECIDE IF THE ABOVE UNDE RSTANDING OF THE OFFICERS ON THE PROVISIONS OF LAW IS IN PROPER PERS PECTIVE OR NOT. 19. WE ALSO EXAMINED THE JUDGMENT OF HONBLE CALCUT TA HIGH COURT IN THE CASE OF SHYAMAL SARKAR (SUPRA) RELIED ON BY THE LD. CIT-DR FOR THE REVENUE. WE FIND THE SAID JUDGMENT WAS DELIVERED O N THE FACTUAL MATRIX OF ISSUING A PROPER ORDER OF REFERRAL FOR SPECIAL A UDIT. IT WAS NOT ON THE ISSUE RELATING TO GRANTING OF OPPORTUNITY OF BEING HEARD TO THE ASSESSEE BY THE AO BEFORE ORDER FOR SPECIAL AUDIT IS ISSUED. T HUS, THIS CASE IS DISTINGUISHABLE ON FACTS AND UNCONNECTED TO THE ISS UE RAISED IN THE ADDITIONAL GROUND EXTRACTED ABOVE. 20. NEXT WE SHALL TAKE UP THE PRECEDENTS CITED BY T HE LD. COUNSEL FOR THE ASSESSEE. TO START WITH, THE DECISION OF PUNE BENCH OF THE TRIBUNAL IN THE CASE OF VILSONS PARTICLE BOARD INDUSTRIES LTD. (SUPRA) IS ANALYSED. AS SUGGESTED, WE PERUSED THE CONTENTS OF PARA NO.40 AN D 41 OF THE SAID ORDER OF THE TRIBUNAL. THIS IS ALSO A CASE WHERE T HE AO NEVER GRANTED REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE BEFORE DIRECTING THE ASSESSEE TO GET THE ACCOUNTS AUDITED. IT IS TH E CIT WHO ACTUALLY ISSUED A SHOW CAUSE NOTICE ON THIS ASPECT. THE TRI BUNAL EXPLAINED THE SAID PROVISIONS OF SECTION 142(2A) OF THE ACT AND R ELIED HEAVILY ON THE HONBLE APEX COURT JUDGMENT IN THE CASE OF SAHARA I NDIA (FIRM) VS. CIT AND ANOTHER (2008) 300 ITR 403 (SC) AND HELD THAT T HE ASSESSMENT ORDER PASSED IN THE SAID CASE IS BEYOND THE PERIOD OF LIMI TATION. WE EXTRACT THE RELEVANT PARAGRAPHS OF THE SAID ORDER OF THE TRIBUN AL HEREUNDER : 40. THE QUESTION WHICH ARISES FOR ADJUDICATION BEF ORE US IS THAT IN THE PRESENT SET OF FACTS, WHERE THE ASSESSING OFFIC ER BEFORE SENDING A PROPOSAL FOR CONDUCTING SPECIAL AUDIT UND ER SECTION 9 142(2A) OF THE ACT HAS NOT GIVEN AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND IN VIEW OF THE PROVISO TO SECTION 142(2A) OF THE ACT, IS THE SAID PROPOSAL MADE WITHOUT AFFORDING PR E-DECISIONAL HEARING TO THE ASSESSEE VALID AND CAN THE PROCEEDIN GS CONDUCTED THEREAFTER BE HELD TO BE VITIATED IN LAW. THE HON'B LE SUPREME COURT IN THREE JUDGE DECISION IN SAHARA INDIA (FIRM) VS. CIT AND ANOTHER (SUPRA) HAD DECIDED THE ISSUE OF SHOW CAUSE NOTICE TO BE GIVEN ON PRE-DECISIONAL STAGE AND POST-DECISIONAL S TAGE OF STARTING THE PROCEEDINGS UNDER SECTION 142(2A) OF THE ACT AN D HAD ALSO REFERRED TO THE EARLIER DECISION OF APEX COURT IN R AJESH KUMAR AND OTHERS VS. DCIT (SUPRA). THE PRINCIPLES LAID DOWN B Y THE HON'BLE SUPREME COURT ARE THAT THE PRINCIPLE OF AUDI ALTERA M PARTEM CANNOT BE IGNORED EVEN AT THE STAGE OF PRE-DECISION AL HEARING. IN OTHER WORDS, IN CASE THE ASSESSING OFFICER IS OF TH E VIEW THAT HAVING REGARD TO THE NATURE AND COMPLEXITY OF THE A CCOUNTS AND INTERESTS OF REVENUE, IT IS NECESSARY TO GET THE AC COUNTS AUDITED BY AN ACCOUNTANT, WITH PREVIOUS APPROVAL OF PRINCIPAL CHIEF COMMISSIONER, THEN HE CAN DO SO. HOWEVER, THE PROVIS O INSERTED BY THE FINANCE ACT, 2007 W.E.F. 01.06.2007 HAS VERY CATEGORICALLY PROVIDED THAT THE ASSESSING OFFICER SHALL NOT DIREC T THE ASSESSEE TO GET THE ACCOUNTS SO AUDITED UNLESS THE ASSESSEE HAS BEEN GIVEN AN OPPORTUNITY OF BEING HEARD. IN OTHER WORDS, THE PRINCIPLES OF NATURAL JUSTICE THAT A PERSON COULD NOT BE CONDEMNE D UNHEARD, HAVE BEEN INCORPORATED IN SECTION ITSELF W.E.F. 01. 06.2007. THE APEX COURT IN RAJESH KUMAR AND OTHERS VS. DCIT (SUP RA) HAD DELIBERATED ON THE PROVISIONS OF THE ACT BEFORE INS ERTION OF SAID PROVISO BUT HAD LAID DOWN THE PROPOSITION THAT NOBO DY COULD BE UNHEARD EVEN AT THE STAGE OF FORMING AN OPINION THA T IN VIEW OF THE NATURE AND COMPLEXITY OF ACCOUNTS AND INTEREST OF R EVENUE, SPECIAL AUDIT IS TO BE CONDUCTED UNDER SECTION 142(2A) OF T HE ACT. THE APEX COURT IN SAHARA INDIA (FIRM) VS. CIT AND ANOTHER (S UPRA) HAVE UPHELD THE SAID PROPOSITION LAID DOWN BY THE HON'BL E SUPREME COURT AND HAS ALSO TAKEN NOTE OF THE AMENDMENT W.E. F. 01.06.2007 AND HAVE HELD THAT THE PRINCIPLES OF NAT URAL JUSTICE HAVE TO BE FULFILLED EVEN AT THE PRE-DECISIONAL STA GE. IN CONCLUSION, THE APEX COURT DIRECTED THAT THE SAID PROPOSITION W OULD BE APPLICABLE PROSPECTIVELY. THE CASE OF THE ASSESSEE BEFORE US RELATES TO THE PERIOD WHICH IS PROSPECTIVE TO THE D ECISION OF THE APEX COURT AND IS ALSO AFTER INSERTION BY THE FINAN CE ACT, 2007 W.E.F. 01.06.2007. REASONABLE OPPORTUNITY OF BEING HEARD ON PRE- DECISIONAL STAGE TO BE ALLOWED BY THE ASSESSING OFF ICER TO THE ASSESSEE WAS ON STATUTE WHEN THE PROCEEDINGS WERE T AKEN UP AGAINST THE ASSESSEE. HOWEVER, AS THE FACTS REVEAL BEFORE SUBMITTING THE PROPOSAL DATED 11.09.2008 FOR CONDUC TING SPECIAL AUDIT UNDER SECTION 142(2A)OF THE ACT TO THE CIT(C) , NO OPPORTUNITY OF HEARING WAS GIVEN TO THE ASSESSEE. THE REQUIREME NT OF THE ACT IS THAT THE ASSESSING OFFICER HAS TO GIVE FINDING THAT THERE IS COMPLEXITY OF ACCOUNTS AND THE INTERESTS OF REVENUE WOULD BE AFFECTED, AND IN SUCH CIRCUMSTANCES, SHOW CAUSE NOT ICE NEEDS TO BE GIVEN TO THE ASSESSEE TO EXPLAIN ITS CASE. WHERE THE ASSESSEE WAS ABLE TO EXPLAIN THE NATURE OF ENTRIES AND ALSO JUSTIFY THAT THE SAME ARE NOT COMPLEX, THEN THERE IS NO NEED TO PUT THE ASSESSEE TO SUCH HARDSHIP OF CONDUCTING SPECIAL AUDIT. THE ASSE SSING OFFICER HAVING FAILED TO GIVE ANY OPPORTUNITY OF HEARING TO THE ASSESSEE BEFORE MAKING THE PROPOSAL FOR CONDUCTING SPECIAL A UDIT UNDER SECTION 142(2A) OF THE ACT AT THE PRE-DECISIO NAL STAGE, THEN SUCH PROPOSAL MADE BY THE ASSESSING OFFICER TO THE CIT(C), PUNE IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE AND SUFFE RS FROM INFIRMITY. THE CASE OF REVENUE BEFORE US IS THAT THE CIT(C), P UNE BEFORE PASSING HIS ORDER OF GIVING PERMISSION TO THE ASSES SING OFFICER TO ASK THE ASSESSEE TO GET THE SPECIAL AUDIT CONDUCTED HAD GIVEN FAIR OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ROLE OF CIT(C) IS THE ROLE 10 OF APPROVING AUTHORITY. THE ROLE IS NOT THAT OF ADJ UDICATING AUTHORITY WHICH HAD TO BE CARRIED OUT BY THE ASSESS ING OFFICER. THE ADJUDICATING AUTHORITY IN THE PRESENT SET OF FACTS HAS FAILED TO GIVE ANY OPPORTUNITY TO THE ASSESSEE BEFORE MAKING PROPO SAL FOR SPECIAL AUDIT AND THE OPPORTUNITY ALLOWED BY THE APPROVING AUTHORITY, WHO IN ANY CASE IS ENSHRINED WITH THE DUTIES OF CHECKIN G WHETHER THERE IS NO ARBITRARINESS IN FUNCTIONING OF ADJUDICATING AUTHORITY, HAS TO BE SATISFIED BEFORE GIVING APPROVAL. HENCE, THE OPP ORTUNITY ALLOWED BY THE CIT(C), PUNE AFTER PROPOSAL WAS MADE BY THE ADJUDICATING AUTHORITY DOES NOT ABSOLVE THE NON-ALLOWANCE OF REA SONABLE OPPORTUNITY OF HEARING BY THE ASSESSING OFFICER. 41. APPLYING THE PRINCIPLES LAID DOWN BY THE APEX C OURT IN SAHARA INDIA (FIRM) VS. CIT AND ANOTHER (SUPRA), WE HOLD T HAT WHERE NO SHOW CAUSE NOTICE WAS GIVEN TO THE ASSESSEE BEFORE MAKING THE ORDER PROPOSING CONDUCT OF SPECIAL AUDIT UNDER SECT ION 142(2A) OF THE ACT, IN THE PRESENT CASE AND THE CIT HAVING APP ROVED THE SAID PROPOSAL THOUGH AFTER GIVING OPPORTUNITY OF HEARING TO THE ASSESSEE IS VITIATED BECAUSE OF NON-COMPLIANCE WITH THE PRIN CIPLES OF NATURAL JUSTICE. ACCORDINGLY, THE ASSESSMENT ORDER PASSED I N THE FACTS OF PRESENT CASE IS BEYOND THE PERIOD OF LIMITATION AND HENCE, THE SAME IS INVALID AND BAD IN LAW. 21. FURTHER, THE ABOVE ORDER OF THE TRIBUNAL WAS FO LLOWED BY SUBSEQUENT ORDER OF THIS BENCH IN THE CASE OF MAHAR ASHTRA ACADEMY OF ENGINEERING AND EDUCATIONAL RESEARCH (SUPRA). WE P ROCEED TO EXTRACT THE RELEVANT PARAGRAPHS OF THE ORDER OF THE TRIBUNAL ON THIS LEGAL ISSUE. CONTENTS OF PARA NOS. 115 TO 119, WHICH ARE RELEVAN T ARE REPRODUCED AS UNDER : 115. GROUND OF APPEAL NO.2 WHICH IS COMMON FOR ALL THE YEARS RELATES TO VALIDITY OF THE REASSESSMENT PROCEEDINGS ON THE ISSUE OF LIMITATION IN VIEW OF THE ILLEGAL ORDER FOR SPECIAL AUDIT U/S.142(2A). HOWEVER, THE LD. COUNSEL FOR THE ASSESSEE RESTRICTE D HIS ARGUMENTS FOR A.Y. 1999-2000 AND 2000-2001 ONLY AND DID NOT PRESS THIS GROUND FOR OTHER YEARS. ACCORDINGLY, TH IS GROUND FOR OTHER YEARS ARE DISMISSED. SINCE WE HAVE ALREADY H ELD IN THE PRECEDING PARAGRAPHS THAT THE ORDER FOR A.Y. 1999-2 000 IS VOID, THEREFORE, WE CONFINE OUR DISCUSSION ON THIS ISSUE ONLY FOR A.Y. 2000-2001. 116. IT IS THE SUBMISSION OF THE LD. COUNSEL FOR TH E ASSESSEE THAT WHILE DIRECTING FOR SPECIAL AUDIT U/S.142(2A) OF THE I.T. ACT FOR A.YRS. 1999-2000, 2000-01 AND 2005-06 THE ASSESSING OFFICER HAD NOT GIVEN OPPORTUNITY OF BEING HEARD AS PER THE PROVISO TO SECTION 142(2A) AND ONLY THE LD.CIT HAS GIVEN THE O PPORTUNITY. THEREFORE, IN VIEW OF THE DECISION OF HONBLE SUPRE ME COURT IN THE CASE OF RAJESH KUMAR (SUPRA) AND THE DECISION OF HO NBLE BOMBAY HIGH COURT IN THE CASE OF NIKUNJ EXIMP ENTER PRISES PVT. LTD. (SUPRA) THE ORDER U/S.142(2A) IS ILLEGAL AND INVALID AND THEREFORE, THE LIMITATION FOR ASSESSMENT COULD NOT BE EXTENDED IN VIEW OF THE ILLEGAL ORDER U/S.142(2A). IT IS ALSO HIS SUBMISSION THAT THE ASSESSMENTS FOR A.YRS. 1999-2000, 2000-01 AND 2005-06 WERE GETTING TIME BARRED IN VIEW OF SECOND PROVISO TO SECTION 153(2) ON 31-12-2007 WHEREAS THE ASSESSMENT ORDER I S DATED 08- 08-2008. THEREFORE, SUCH ASSESSMENT ORDERS ARE TIM E BARRED AND THEREFORE ARE VOID. 11 117. WE FIND MERIT IN THE ABOVE ARGUMENT OF THE LD. COUNSEL FOR THE ASSESSEE. IT IS AN ADMITTED FACT THAT THE ASSE SSMENT ORDER FOR A.Y. 2000-01 IS DATED 08-08-2008. IT IS ALSO AN AD MITTED FACT THAT THE ASSESSING OFFICER WHILE DIRECTING FOR SPECIAL A UDIT U/S.142(2A) HAS NOT GIVEN ANY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND THE OPPORTUNITY OF BEING HEARD WAS GRANTED ONLY BY THE LD. CIT CENTRAL WHO HAS PASSED A DETAILED ORDER DATED 05-12 -2007 GRANTING APPROVAL ON THE REFERENCE BY THE ASSESSING OFFICER FOR SPECIAL AUDIT U/S.142(2A). UNDER THESE CIRCUMSTANC ES WE HAVE TO SEE WHERE THE ASSESSING OFFICER BEFORE SENDING A PR OPOSAL FOR CONDUCTING SPECIAL AUDIT U/S.142(2A) OF THE ACT HAS NOT GIVEN AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND IN V IEW OF THE PROVISO TO SECTION 142(2A) OF THE ACT, WHETHER THE SAID PROPOSAL MADE WITHOUT AFFORDING PREDECISIONAL HEARING TO THE ASSESSEE WAS VALID AND CAN THE PROCEEDINGS CONDUCTED THEREAF TER BE HELD TO BE VITIATED. 118. WE FIND AN IDENTICAL ISSUE HAD COME UP BEFORE THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. VILSON S PARTICLE BOARD INDUSTRIES LTD. AND VICE VERSA. WE FIND THE TRIBUNAL IN ITA NO.447/PN/2013, ITA NOS. 309 & 310/PN/2013 AND ITA NOS. 448 & 449/PN/2013 VIDE ORDER DATED 21-12-2016 AFTER CONSIDERING THE DECISION OF HONBLE SUPREME COURT I N THE CASE OF RAJESH KUMAR AND OTHERS (SUPRA) AND VARIOUS OTHER D ECISIONS HAS HELD THAT WHERE NO SHOW CAUSE NOTICE WAS GIVEN TO T HE ASSESSEE BEFORE MAKING THE ORDER PROPOSING CONDUCT OF SPECIA L AUDIT U/S.142(2A) OF THE ACT AND SUCH OPPORTUNITY WAS GIV EN ONLY BY THE CIT BEFORE APPROVAL FOR SUCH SPECIAL AUDIT, SUC H ASSESSMENT IS VITIATED BECAUSE OF NON-COMPLIANCE OF PRINCIPLE OF NATURAL JUSTICE. HENCE THE LIMITATION FOR CONCLUSION OF ASSESSMENT C ANNOT BE EXTENDED FOR SUCH ILLEGAL ORDER U/S.142(2A). THE R ELEVANT OBSERVATION OF THE TRIBUNAL FROM PARA 40 ONWARDS OF THE ORDER READ AS UNDER : . . . . . . . . . . . . . . 119. SINCE IN THE INSTANT CASE THE ASSESSING OFFICE R HAS NOT GIVEN ANY OPPORTUNITY OF BEING HEARD TO THE ASSESSE E BEFORE DIRECTING HIM TO GET ITS ACCOUNTS AUDITED U/S.142(2 A) AND SUCH OPPORTUNITY WAS GRANTED ONLY BY THE CIT, THEREFORE, THE LIMITATION FOR COMPLETION OF ASSESSMENT CANNOT BE EXTENDED IN VIEW OF SAID ILLEGAL ORDER PASSED U/S.142(2A). SINCE THE ASSESS MENT IN THE INSTANT CASE WAS GETTING TIME BARRED UNDER SECOND P ROVISO TO SECTION 153(2) ON 31-12-2007 AND SINCE THE ASSESSIN G OFFICER HAS PASSED THE ORDER ON 08-08-2008, THEREFORE, THE ASSE SSMENT ORDER PASSED U/S.143(3)/147 FOR THE IMPUGNED A.Y. 2000-20 01 IS BARRED BY LIMITATION AND ACCORDINGLY THE SAME IS VO ID AND ILLEGAL. GROUND OF APPEAL NO.2 FOR A.Y. 2000-2001 BY THE ASS ESSEE IS ACCORDINGLY ALLOWED. 22. FROM THE ABOVE EXTRACTS, IT IS OBVIOUS THAT THE PROVISO TO SECTION 142(2A) OF THE ACT IS EXPLAINED AND IT IS THE STATU TORY REQUIREMENT OF LAW THAT AO SHALL NOT DIRECT THE ASSESSEE TO GET THE A CCOUNTED AUDITED UNLESS THE ASSESSEE HAS BEEN GIVEN A REASONABLE OPPORTUNIT Y OF BEING HEARD. NOBODY CAN REPLACE THE AO IN SUCH MATTERS, LEAVE AL ONE THE CIT, AS IS THE CASE IN THE INSTANT CASE. ACCORDINGLY, THE ADDITIO NAL GROUND RAISED BY THE ASSESSEE IS ADMITTED AND ALLOWED AS A COVERED ISSUE . 12 23. SINCE THE ASSESSEE SUCCEEDS ON THIS TECHNICAL G ROUND, THE OTHER GROUNDS FOR A.Y. 2000-01 HAVE BECOME ACADEMIC IN NA TURE AND THEREFORE, THEY ARE DISMISSED AS ACADEMIC. THE APPEAL FILED B Y THE ASSESSEE FOR A.Y. 2000-01 IS ACCORDINGLY PARTLY ALLOWED. FROM THE ABOVE, IT IS EVIDENT THAT AFTER THE AMENDMENT IN THE FINANCE ACT, 2007, GIVING REASONABLE OPPORTUNITY OF BEING HE ARD TO THE ASSESSEE BY THE AO IS A MANDATORY REQUIREMENT. THE FAILU RE TO GRANT THE SAME BY THE AO MAKES THE REFERRAL INVALID AND UNSUST AINABLE IN LAW. CONSEQUENTLY, THE PERIOD OR EXTENDED PERIOD AVAILAB LE TO THE AO BECOMES A NULLITY FORCING THE AO TO COMPLETE THE ASSESSME NT BEFORE THE NORMAL DUE DATES, I.E. 31-12-2007 IN THE INSTANT CASE. TH EREFORE, THE ASSESSMENT MADE BY THE AO U/S.153A R.W.S. 143(3) AND FUR THER R.W.S. 142(2A) OF THE ACT ON 12-08-2008 IS INVALID AND HAS TO BE QUASHED. THUS, THE LEGAL ADDITIONAL GROUND RAISED BY THE ASSESSEE IS DECIDED IN FAVOUR OF THE ASSESSEE. CONSIDERING THE RELIEF GRANTED ON THE LEGAL ADDITIONAL GROUN D, ADJUDICATION OF THE GROUNDS RAISED BY THE ASSESSEE IN TH E APPEAL BECOMES AN ACADEMIC EXERCISE AND THEREFORE, THEY ARE DIS MISSED AS ACADEMIC. ACCORDINGLY, THE APPEAL FILED BY THE ASSESSEE FOR A.Y. 2005- 06 IS PARTLY ALLOWED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ITA NO.1146/PUN/2016 A.Y. 2006-07 9. THE ASSESSEE FILED THIS APPEAL RAISING VARIOUS GROUNDS O N MERITS OF THE ADDITIONS MADE BY THE AO IN THE ASSESSMENT MADE U/S.153A R.W.S. 143(3) OF THE ACT AND FURTHER R.W.S. 142(2A) OF THE ACT . DURING THE PROCEEDINGS BEFORE US, LD. COUNSEL FOR THE ASSESSEE FILED AN ADDITIONAL GROUND WHICH IS SIMILAR TO THE ISSUE RAISED (ADDITIONAL GROUND ) RAISED IN 13 A.Y. 2005-06. THE LEGAL ISSUE RAISED VIDE ADDITIONAL GROUND RELATES TO THE ISSUE OF LIMITATION IN MAKING THE ASSESSMENT QUA THE PE RIOD PROVIDED TO AO TO THE CASES REFERRED FOR SPECIAL AUDIT AS PER SECTION 142(2A) OF THE ACT. THIS ISSUE IS EXACTLY SIMILAR TO THE ON E RAISED BY THE ASSESSEE AND ADJUDICATED BY THE TRIBUNAL IN THE APPEAL FOR A.Y. 2005-06 ABOVE. 10. ON HEARING BOTH THE PARTIES AND PERUSING THE ORDER S OF THE REVENUE AND OTHER MATERIAL BROUGHT TO OUR NOTICE, WE AR E OF THE OPINION, THE FACTS ARE SIMILAR. IT IS THE CIT, WHO GRANTED O PPORTUNITY OF BEING HEARD TO THE ASSESSEE AND NOT THE AO. THUS, TH E LEGAL ISSUED RAISED IN THIS APPEAL IS SIMILAR IN NATURE TO THE APPEAL IN A.Y . 2005-06. THEREFORE, OUR CONCLUSIONS SHALL REMAIN SAME FOR THE A.Y. 20 06-07 TOO. ACCORDINGLY, THE ASSESSMENT MADE BY THE AO FOR THE A.Y. 2006-07 ON 12-08-2008 IS INVALID AND THEREFORE REQUIRES TO BE QUASH ED. ACCORDINGLY, THE LEGAL GROUND RAISED BY THE ASSESSEE IS ALLOWED. CONSIDERING THE FACT THAT THE LEGAL GROUND IS ALLOWED IN FAV OUR OF THE ASSESSEE ADJUDICATION OF THE GROUNDS RAISED BY THE ASSESSEE ON MERITS BECOMES AN ACADEMIC EXERCISE. THEREFORE, THE SAM E ARE DISMISSED AS ACADEMIC. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. 12. TO SUM UP, BOTH THE APPEALS OF THE ASSESSEE FOR A.YR S. 2005-06 AND 2006-07 ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 16 TH DAY OF MARCH, 2018. SD/- SD/- (VIKAS AWASTHY) (D. KARUNAKARA RAO) /JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE; DATED : 16 TH MARCH, 2018 14 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, //TRUE COPY// //TRUE COPY// SENIOR PRI VATE SECRETARY , / ITAT, PUNE 1. / THE APPELLANT 2. / THE RESPONDENT 3. THE CIT(A)-13, PUNE 4. CIT-13, PUNE 5. , , B BENCH PUNE; 6. / GUARD FILE.