M/s. The Hooghly Mills Co. Ltd., Kolkata V. DCIT, Central Circle - VII, Kolkata, Kolkata

ITA 1621/KOL/2010

• Counselvise Citation: [2011] 119 COUNSELVISE.COM (IT) 6810 (ITAT-KOLKATA)
• Duration Of Justice: 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 19-04-2011
• Assessment Year: misc
• Appeal Filed On: 16-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K BEHERA
• Assessee Lawyers: R SALARPURIA
• Keywords: Recovery proceedings; Depreciation; Document seized; Period of limitation; Time period of passing order; Documents seized
• Section: 143(3); 142(1); 147; 148; 132; 139

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL BENCH: KOLKATA () BEFORE , /AND , . ! . '# ) [BEFORE HONBLE SRI MAHAVIR SINGH, JM & HONBLE SHR I C. D. RAO, AM] $ $ $ $ / I.T.A NO. 16 21 /KOL/201 0 %& '( %& '( %& '( %& '(/ // / ASSESSMENT YEAR: 1987 - 88 M/S. THE HOOGHLY MILLS CO. LTD. VS DEPUTY COMMI SSIONER OF INCOME-TAX (PAN-AAACT 9780 F) CENTRAL CIRCLE-VII, KOLKATA. ( *+ /APPELLANT ) (,-*+/ RESPONDENT ) FOR THE APPELLANT: SHRI R. SALARPURIA FOR THE RESPONDENT: SHRI A. K. BEHERA '. / ORDER PER MAHAVIR SINGH, JM ( , , , , ) THIS APPEAL BY ASSESSEE IS ARISING OUT OF THE ORDER OF CIT(A), CENTRAL - I, KOLKATA IN APPEAL NO.27/CC-VII/CIT(A)C-I/09-10 DATED 18.06. 2010. THE ASSESSMENT WAS FRAMED BY DCIT, CC-VII, KOLKATA U/S.143(3)/256 OF T HE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASSESSME NT YEAR 1987-88 VIDE HIS ORDER DATED 29.05.2009. 2. THE FIRST ISSUE IN THIS APPEAL OF THE ASSESSEE I S AS REGARDS TO ASSUMPTION OF JURISDICTION FOR THE ORDER PASSED BY ASSESSING OFFI CER U/S. 143(3) R.W.S. 256 OF THE ACT DATED 29.5.2009, WHICH IS BARRED BY LIMITATION. FO R THIS, THE ASSESSEE HAS RAISED THE FOLLOWING GROUND NO.1:- FOR THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) WAS WHOLLY WRONG AND UNJUSTIFIED IN HOLDING THE ASSESSM ENT ORDER PASSED BY THE A.O U/S 143(3)/256 DT. 29.05.2009 BEING BARRED BY LIMIT ATION AS VALID WITHOUT CONSIDERING THE FACTS THAT THE ASSESSMENT WAS MADE AFTER MORE THAN 7 ( SEVEN) YEARS FROM THE HONBLE CALCUTTA HIGH COURTS ORDER DT. 18.10.2001 AND THAT THE APPLICATION FOR CLAIMING REFUND IN FORM NO.30, DIRE CTED TO BE FILED AS PER HONBLE COURTS ORDER FOR THE PURPOSE OF ASSESSMENT , WHICH WAS MERELY A TECHNICAL FORMALITY WAS ALREADY FILED ON 17.05.1990 ALONG WITH THE RETURN U/S 148 OF THE ACT AND SUCH EVIDENCE LYING IN THE RECORD OF THE 1.T DEPARTMENT WAS VERY MUCH IN THE KNOWLEDGE OF THE A.O FOR PROCEEDING WIT H AND COMPLETING THE ASSESSMENT EXPEDITIOUSLY WITHIN THE PRESCRIBED TIME . THE ASSESSMENT ORDER PASSED IS LIABLE TO BE QUASHED / CANCELLED. 2 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 3. FACTS LEADING TO ABOVE ISSUE ARE THAT A SEARCH A CTION U/S 132 OF THE ACT WAS CONDUCTED ON RESIDENTIAL AS WELL ON BUSINESS PREMIS ES OF ASSESSEE GROUP ON 27.01.1987 AND DURING THE COURSE OF SEARCH BOOKS OF ACCOUNT, F OR THE PERIOD 1985 TO 1987, WAS SEIZED AND, TILL THE COMPLETION OF ASSESSMENT IN TH IS CASE, WAS LYING WITH DEPARTMENT. FOR THE PREVIOUS 01.07.1985 TO 30.06.1986 RELEVANT TO ASSESSMENT YEAR 1987-88, ASSESSEE FILED ITS RETURN OF INCOME U/S.139(1) OF T HE ACT ON 31.10.1988 AFTER DECLARING LOSS AT RS.31,32,110/- CLAIMING REFUND OF RS.21,72, 294/-. THE ASSESSEE ALSO FILED FORM NO.6 FOR EXTENSION OF TIME FOR FURNISHING OF RETURN OF INCOME, FROM TIME TO TIME I.E. ON 6.10.1988, 7.10.1988 AND 31.10.1988, FOR THE REASON S THAT DUE TO SEARCH ALL RECORDS WERE SEIZED AND PHOTOCOPIES WERE GIVEN AFTER LONG TIME, HENCE, DELAY IN FINALIZATION OF ACCOUNTS. AO GRANTED EXTENSION UPTILL 31.10.1988. ASSESSEE FILED ITS ORIGINAL RETURN OF INCOME ON 31-10-1988, WHICH THE AO TREATED AS NON-EST DUE TO REASON THAT IT IS NOT ACCOMPANIED WITH FORM NO.30 FOR THE CLAIM OF REFUND . AS, NO FURTHER RETURN OF INCOME WAS FILED BY ASSESSEE, THE AO ISSUED NOTICE U/S.148 OF THE ACT DATED 19.3.1990 AND IN RESPONSE TO THE SAME, ASSESSEE FILED RETURN OF INCO ME ON 17.5.1990 UNDER PROTEST DISCLOSING SAME LOSS AND CLAIMING SAME REFUND, AS O RIGINALLY, ALONG WITH FORM NO.30. IN THE MEAN TIME, ASSESSEE FILED WRIT PETITION BEFO RE HONBLE CALCUTTA HIGH COURT ON 11.12.1990 CHALLENGING ACTIONS OF AO TREATING RETUR N AS NON-EST STATING DEEMED NOT TO HAVE BEEN FILED UNDER PROVISION OF SECTION 139(10) OF THE ACT AND CHALLENGING REOPENING NOTICE U/S. 148 OF THE ACT DATED 19.3.1990. HONBL E CALCUTTA HIGH COURT DECIDED WRIT PETITION NO.3298 OF 1990 VIDE JUDGMENT DATED 18-10- 2001 AS UNDER:- HAVING HEARD THE RESPECTIVE CONTENTION OF THE LEAR NED ADVOCATES IT APPEARS TO ME THAT IN THIS CASE LEGALITY AND VALIDITY OF THE I MPUGNED NOTICE IS DEPENDING UPON LEGALITY AND VALIDITY OF THE IMPUGNED DECISION OF D EPUTY COMMISSIONER OF INCOME TAX, SPECIAL RANGE-VI, CALCUTTA DECLARING RETURN FOR THE ASSESSMENT YEAR 1987-88 NOT BEING FILED UNDER THE PROVISION OF SECTION 139(10) OF THE INCOME TAX ACT 1961. IN THE EVENT THE AFORESAID DECISION FOLLOWED BY A LETTER DATED 19 TH MARCH 1990 OF THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE (INV)5-(2), CALC UTTA IS HELD TO BE NOT CORRECT THEN IMPUGNED NOTICE UNDER SECTION 147 READ WITH SECTION 148 AUTOMATICALLY FALLS TO THE GROUND MR. SAM THOUGH CONTENDS THAT THE ORDER GRANT ING EXTENSION OF TIME TO FURNISH THE RETURNS IS INVALID AND ILLEGAL WHICH I AM NOT PREPA RED TO ACCEPT AT THIS STAGE AS THE DEPARTMENT CONCERNED DID NOT RAISE SUCH DISPUTE AT ANY POINT OF TIME. THE CONCERNED RETURN WAS SUBMITTED AND RECEIVED BY THE DEPARTMENT . MR. KHAITAN CONTENDS THAT SINCE THE RETURN WAS ACCEPTED BY THE CONCERNED RECEIVING DEPARTMENT, THE SAME SHOULD HAVE BEEN ASSESSED ASSUMING THERE IS NO IRREGULARITY NOR ANY DEFECT AS THE BOARD CIRCULAR DATED 21 ST AUGUST 1987. I AM UNABLE TO ACCEPT THIS PORTION O F SUBMISSION OF MR. KHAITAN THAT AS IT WAS ACCEPTED BY THE RECEIVING SECTION TH E SAME SHOULD HAVE BEEN ASSESSED, BY 3 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 REASON OF THE FACT THAT A CIRCULAR OF THE BOARD CAN NOT OVERWRITE AND OR OPERATE INCONSISTENTLY WITH THE PROVISION OF THE LAW FOR TH E SIMPLE REASON THAT BOARDS CIRCULAR IS ISSUED UNDER THE PROVISION OF THE INCOME-TAX ACT 19 61. I AM OF THE VIEW THAT WHENEVER SUCH RETURN IS RECEIVED IT IS FOR THE DEPARTMENT CO NCERNED TO SCRUTINIZE AND IF IT IS FOUND THE SAME IS DEFECTIVE ONE, SUCH DEFECT SHALL BE ASK ED TO BE CURED INSTEAD OF REJECTING THE SAID RETURN AS BEING IN VALID UNDER THE PROVISION O F SECTION 139 SUB-SECTIONS 5 & 9 OF THE ACT. I FIND, IN SUPPORT OF THIS PROPOSITION, A DIVI SION BENCH JUDGMENT OF THIS COURT REPORTED IN 195 ITR 825 CITED BY MR. KHAITAN, WHICH HAS BEEN HELD AMONGST OTHER THAT UNDER SECTION 139(9) THE ASSESSING OFFICER IS TO INTIMATE DEFECTS IN THE RETURN TO THE ASSESSEE GIVING HIM AN OPPORTUNITY TO RECTIFY THEM. THE ASSE SSING OFFICER HAS POWER TO ASK THE ASSESSEE TO REMOVE ALL DEFECTS IN THE RETURN OTHER THAN THE DEFECTS MAKING THE RETURN IN VALID. IN THIS CASE RETURN WAS FILED SHOWING LOSS, AND ASK ING FOR REFUND BUT NOT BEING ACCOMPANIED BY NECESSARY APPLICATION IN PRESCRIBED FORM 30. ON THIS CORE THIS RETURN CANNOT BE HELD TO BE IN VALID. AT THE HIGHEST THE P ETITIONER CANNOT GET ANY CLAIM OF REFUND. BUT THE RETURNS ALTOGETHER CANNOT BE HELD TO BE INV ALID. THEREFORE, THE CONCERNED ASSESSING OFFICER SHOULD HAVE ASKED THE PETITIONER TO SUBMIT THE NECESSARY APPLICATION FOR CLAIM OF REFUND IN PRESCRIBED FORM WITHIN THE TIME STIPULATED UNDER SECTION 139(3) OF INCOME-TAX ACT 1961. IT IS MERELY A REMOVAL DEFECT AS THE RETURN ITSELF MENTIONED FOR CLAIM OF REFUND. NOW COMING TO THE QUESTION AS TO WHETHER WITHOUT TH E AFORESAID APPLICATION IN PRESCRIBED FORM BEING ACCOMPANIED THE RETURN COULD BE HELD TO BE INVALID UNDER SECTION 139(10) (SINCE REPEALED) OR NOT. THEREFORE, I REPRODUCE THE RELEVANT PORTION OF SECTION 139(10). NOTWITHSTANDING ANYTHING CONTAINED IN ANY OTHER PR OVISION OF THIS ACT A RETURN OF INCOME WHICH SHOWS THE TOTAL INCOME BELOW THE MAXIM UM AMOUNT WHICH IS NOT CHARGEABLE TO TAX SHALL BE DEEMED NEVER TO HAVE BEE N FURNISHED. IN MY VIEW THE AFORESAID SUB-SECTION (10) OF SECTIO N 139 WOULD HAVE BEEN APPLICABLE IN A CASE WHERE THE INCOME OF ASSESSEE IS BELOW THE MAXI MUM AMOUNT. IT DOES NOT RELATE TO SHOWING LOSS OR PROFIT. AT THE RELEVANT TIME THE IN COME OF THE ASSESSEE SHOWN IN THE RETURN WAS NOT BELOW THE MAXIMUM LIMIT. THE INCOME WAS WIT HIN THE TAXABLE RANGE AND THAT IS WHY THE CLAIM FOR REFUND OF TAX WAS ASKED FOR. SO, THE AFORESAID SUB-SECTION(10) OF SECTION 139 IS NOT AT ALL APPLICABLE IN ORDER TO HO LD THE RETURN NOT BEING FILED. THEREFORE, I ACCEPT THE ARGUMENT OF MR. KHAITAN THAT THE DECISIO N OF THE TAX OFFICIALS BY THE AFORESAID IMPUGNED ORDER UNDER SECTION 139(2) WAS TAKEN ON TO TAL NON APPLICATION OF MIND AND PATENTLY INCORRECT APPLICATION OF SECTION 139(10) O F THE ACT. AS FAR AS THE LETTER DATED 14 TH MARCH 1990 BEING ANNEXURE E TO THE WRIT PETITION IS CONCERNED THE SAID DECISION WAS CORRECT IN LAW AS THE PETITIONER WAS SUPPOSED TO FU RNISH THE APPLICATION FOR REFUND IN PRESCRIBED FORM. BUT BECAUSE OF OMISSION OF FILING SUCH APPLICATION THE RETURN CANNOT BE HELD TO BE NON- EXISTENT. ON RECEIPT OF THE REPRES ENTATION OF THE WRIT PETITIONER THE REVENUE OFFICIAL SHOULD HAVE GIVEN AN OPPORTUNITY T O SUBMIT THE APPLICATION IN PRESCRIBED FORM 30. WHEN AN ASSESSEE HAS FILED A RETURN EITHER SHOWING PROFIT OR LOSS, OR ASKING FOR REFUND AND THE RETURN SHOWS AN INCOME OF TAXABLE LI MIT THE DEPARTMENT SHOULD HAVE PROCEEDED WITH FOR ASSESSMENT. I FIND IN SUPPORT MY VIEW A DIVISION BENCH JUDGMENT OF THIS COURT CITED BY MR. KHAITAN REPORTED IN 112 ITR 47(CAL) (MAHINDRA MOHAN SIRKAR VS. INCOME TAX OFFICER, PROJECT CIRCLE, NORTH BENGAL AN D ANR.). IN THIS JUDGMENT IT HAS BEEN HELD BY THEIR LORDSHIP AMONGST OTHER AS FOLLOWS:- THERE IS A DISTINCTION BETWEEN THE CASE OF NON FIL ING OF RETURN AND THE CASE OF FILING AN INCORRECT AND INCOMPLETE RETURN. AN INCOM PLETE RETURN, THAT, A RETURN WHICH DOES NOT COMPLY WITH THE PROVISIONS OF SECTIO N 139, MAY BE SAID TO BE AN 4 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 INVALID RETURN. BUT THE ACT DOES NOT CONTAIN ANY P ROVISION FOR THE REJECTION OF AN INVALID RETURN; ON THE CONTRARY, UNDER SECTION 143( 3), A DUTY IS CAST ON THE INCOME-TAX OFFICER TO ASSESS THE TOTAL INCOME OR LO SS OF THE ASSESSEE AFTER SERVICING ON HIM A NOTICE UNDER SECTION 143(2) AND AFTER HEARING SUCH EVIDENCE AS THE ASSESSEE MAY PRODUCE OR THE INCOME-TAX OFFI CER MAY GATHER. THEREFORE, I AM OF THE VIEW THAT THIS IMPUGNED DECI SION OF THE REVENUE OFFICIAL DOES NOT STAND TO SCRUTINY AND THE SAME IS BOUND TO BE QUASH ED AND SET ASIDE. ACCORDINGLY, BOTH THE DECISIONS ARE SET ASIDE. THE REVENUE OFFICIAL SHALL PROCEED TO ASSESS THE RETURN FILED BY THE PETITIONER ON SUBMISSION OF AN APPLICATION IN PRESC RIBED FORM 30. SO, THE PETITIONER IS DIRECTED TO SUBMIT NECESSARY APPLICATION IN PRESCRI BED FORM 30 FOR CLAIM OF REFUND WITHIN FORTNIGHT FROM THE DATE OF COMMUNICATION OF THIS OR DER. APPARENTLY THOUGH IT IS A TIME BARRED, THIS BAR SHALL NOT BE APPLIED IN THIS CASE SINCE ALL THESE YEARS THE MATTER WAS BINDING BEFORE THIS COURT. THUS, THIS APPLICATION IS ALLOWED TO THE EXTENT AS ABOVE. THERE WILL NO ORDER AS TO CASTS. STAY OF OPERATION OF THE JUDGMENT AS PRAYED FOR IS CONSIDERED AND REJECTED. 4. SUBSEQUENT TO THIS JUDGMENT OF HONBLE CALCUTTA HIGH COURT, FOR ALMOST 7-8 YEARS NO ACTION WAS TAKEN BY REVENUE, BUT FINALLY O N 02.04.2009, AO ISSUED LETTER REQUIRING THE ASSESSEE TO APPEAR ON 06.O4.2009 AND ALSO COMMUNICATE, WHETHER IT HAS FILED FORM 30 OR NOT. THE RELEVANT TEXT OF LETTER O F AO DATED 02.04.2009 READS AS UNDER:- IT IS SEEN FROM THE ORDER OF HONBLE MR. JUSITICE SENGUPTA VIDE HIS JUDGMENT DTD. 18.10.2001 THAT YOU WERE DIRECTED TO SUBMIT NE CESSARY APPLICATION IN PRESCRIBED FORM-30 FOR CLAIM OF REFUND. YOU ARE REQUESTED TO INTIMATE THE UNDERSIGNED IF YO U HAVE FILED THE SAME. IN CASE YOU HAVE ALREADY FILED IT PLEASE FURNISH THE DATE O F FILING OF THE SAME. IN THIS CONNECTION, YOU ARE REQUESTED TO APPEAR BEFORE THE UNDERSIGNED ON 06.04.2009 POSITIVELY. THE ASSESSEE REPLIED VIDE LETTER DATED 6-4-2009 AS UNDER:- IN CONNECTION WITH THE ABOVE, THIS IS TO SUBMIT TH AT AS YOU ARE AWARE AGAINST PROCEEDINGS U/S. 148, WE HAD FILED WRIT BEFORE HON BLE KOLKATA HIGH COURT. THE HONBLE KOLKATA HIGH COURT BY THEIR ORDER DATED 18. 10.2001 IN WP NO.3298 OF 1990 HELD THAT THE DECISION OF THE DEPARTMENT IN ISSUIN G NOTICE U/S.148 AS WELL AS HOLDING THE RETURN AS INVALID U/S.139(10) WITHOUT GIVING A N OPPORTUNITY TO RECTIFY THE MISTAKE DID NOT STAND TO TEST OF LAW AND BOTH THE DECISIONS OF THE DEPARTMENT WERE QUASHED AND SET ASIDE. HOWEVER WHILE DECIDING THE ISSUED THE HONBLE COUR T DIRECTED US TO FILE FORM NO.30 WITHIN A FORTNIGHT FROM THE DATE OF SUCH ORDE R. IN THIS CONNECTION THIS IS TO SUBMIT THAT IN RESPO NSE TO YOUR NOTICE U/S.148 DATED 19.03.1990 WE HAD ALREADY FILED AN INCOME-TAX RETUR N ON 17.05.1990 AND THE SAID RETURN FILED IN RESPONSE TO NOTICE U/S. 148 WAS ALR EADY ACCOMPANIED WITH PRESCRIBED FORM NO.30 AS DIRECTED BY THE COURT AND THIS COULD BE EASILY VERIFIED FROM YOUR RECORDS. SINCE FORM NO.30 AS DIRECTED BY THE COURT ALREADY STAND FILED ON 17.05.1990 THERE WAS FULL COMPLIANCE TO THE ORDER OF THE HONB LE KOLKATA HIGH COURT CONTAINED IN THEIR ORDER REFERRED ABOVE. 5 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 NOW THE ASSESSMENT MAY KINDLY BE DISPOSED OFF AT Y OUR END IN ACCORDANCE WITH LAW. 5. ON 06.04.2009, AO ISSUED NOTICES U/S 143(2) & 14 3(1) OF THE ACT REQUIRING THE ASSESSEE TO PRESENT AND FILE DETAILS IN SUPPORT OF ITS CLAIM. THE ASSESSEE WAS FURTHER REQUIRED TO CLARIFY IN RESPECT TO DEPRECIATION ON G RATUITY LIABILITY. ASSESSEE FILED REPLY AND THE AO FRAMED ASSESSMENT U/S.143(3) R.W.S 256 O F THE ACT VIDE ASSESSMENT ORDER DATED 29.05.2009. THE ASSESSEE BEFORE CIT(A) CHALLE NGED THE ASSESSMENT AND RAISED THE ISSUE THAT ASSESSMENT ORDER DATED 29-05-2009 IS BAR RED BY LIMITATION. CIT(A), AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE AND REMA ND REPORT OF THE AO DATED 06-04- 2010, UPHELD THE VALIDITY OF THE ASSESSMENT BY GIV ING FOLLOWING FINDINGS :- 3.2 THE REPLY OF THE A.O WAS FORWARDED TO THE APPEL LANT AND THE LD A.R VIDE LETTER DATED 29.04.2010 MADE HIS COUNTER SUBMISSION . I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE LD AR, REPORT OF THE ASSESSING OF FICER AND SUBSEQUENT SUBMISSIONS MADE BY THE LD. A.R. IN THE CASE UNDER CONSIDERATIO N THE ORIGINAL RETURN WAS FILED UNDER SECTION 139(1) OF THE ACT ON 31.10.1988, SHOWING LO SS OF RS. 31,32,110/- AND CLAIMING OF REFUND OF RS.21,72,294/- WITHOUT ENCLOSING FORM NO 30. THE RETURN IN QUESTION WAS TREATED AS DEEMED NOT HAVE BEEN FILED VIDE ORDER UN DER SECTION 139(10) DATED 12.09.1989. SUBSEQUENTLY THE CASE WAS REOPENED BY I SSUING NOTICE DATED 19.03.1990 UNDER SECTION 148 OF THE ACT. IN RESPONSE TO THE SA ID NOTICE, THE ASSESSEE FILED RETURN ON 17.05.1990 UNDER PROTEST SHOWING LOSS OF RS.31,32,1 10/ ALONG WITH FORM NO 30, CLAIMING OF REFUND OF RS.21,72,294/. HOWEVER SUBSE QUENTLY, THE ASSESSEE CHALLENGED THE ABOVE NOTICE ISSUED UNDER SECTION 148 READ WITH SEC TION 147 OF THE INCOME TAX ACT AND THE ORDER PASSED BY THE A.O UNDER SECTION L39(10) B Y FILING WRIT PETITION ( W.P NO. 3298 OF 1990) BEFORE THE HONBLE HIGH COURT OF CALCUTTA. 3.3 . THE HONBLE HIGH COURT DISPOSED OFF THE WRIT PETITION ON 18.10.2001 BY QUASHING AND SETTING ASIDE THE ACTION OF THE A.O BOTH IN RES PECT OF PROCEEDINGS U/S. 139(10) AND U/S. 147/148. IN THE SAID ORDER HONBLE COURT DIREC TED THE A.O TO PROCEED TO ASSESS THE RETURN FILED BY ASSESSEE ON SUBMISSION OF FORM 30. ACCORDINGLY THE APPELLANT WAS DIRECTED TO SUBMIT NECESSARY APPLICATION IN PRESCRI BED FORM NO. 30 FOR CLAIM OF REFUND WITHIN A FORTNIGHT FROM THE DATE OF COMMUNICATION O F THE ORDER. IT WAS FURTHER HELD THAT APPARENTLY THOUGH IT IS A TIME BARRED, THIS BAR SH ALL NOT BE APPLIED SINCE ALL THESE YEARS THE MATTER WAS PENDING BEFORE THIS COURT. 3.4. THE DIRECTION OF THE COURT REGARDING SUBMISSIO N OF FORM WAS COMPLIED BY THE ASSESSEE ONLY ON 6.4.2009 BY REQUESTING THE A.O THA T THE FORM NO 30 WHICH WAS FILED ALONG WITH THE RETURN UNDER SECTION 148 MAY BE TREA TED AS FORM NO 30 FILED IN RESPONSE TO THE HONBLE COURT ORDER. ON THE SAME DATE THE A. O INITIATED THE ASSESSMENT PROCEEDING BY ISSUING NOTICE UNDER SECTION 143(2) A ND 142(1) AND ACCORDINGLY PROCEEDED TO COMPLETE THE ASSESSMENT PROCEEDING AS PER COURT DIRECTION AND THE NECESSARY ASSESSMENT ORDER WAS FINALLY PASSED ON 29 .05.2009. 3.5. CONSIDERING ABOVE FACTS, IT IS APPARENT, THAT THIS IS NOT A NORMAL ASSESSMENT AND THE TIME BARRING PROVISIONS APPLICABLE FOR OTHER ASSESS MENTS PROCEEDINGS WILL NOT BE APPLICABLE. IN THIS CASE THE HONBLE COURT DIRECTED HAS DIRECTED THE A.O TO PROCEED TO ASSESS THE RETURN FILED BY ASSESSEE ON SUBMISSION O F FORM 30. HENCE UNLESS AND UNTIL THE ASSESSEE SUBMITS THE REQUIRED FORM THE A.O WAS NOT COMPETENT TO PROCEED TO ASSESS THE RETURN FILED BY THE ASSESSEE ON 31.10.1988. FURTHER ONCE THE NECESSARY DIRECTION OF THE 6 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 HONBLE HIGH COURT WAS COMPLIED BY THE ASSESSEE ON 6.04.2009, THE ASSESSMENT WAS DULY COMPLETED BY THE ASSESSING OFFICER ON 29.05.20 09 HENCE TAKING ALL THE FACTORS UNDER CONSIDERATION, IT IS HELD THAT THE GROUND TAK EN BY THE APPELLANT HAS NO MERIT. ACCORDINGLY GROUND NO 1 TAKEN BY THE APPELLANT IS D ISMISSED. AGGRIEVED, ASSESSEE CAME IN SECOND APPEAL BEFORE TR IBUNAL. 6. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. UNDISPUTED FACTS ARE THAT SEARCH U/S 132 OF THE ACT WAS CONDUCTED ON RESIDENTIAL AS WELL BUSINESS PREMISES OF ASSESSEE GROUP ON 27.0 1.1987. DURING SEARCH BOOKS OF ACCOUNT FOR THE PERIOD 1985 TO 1987 WAS SEIZED AND WAS LYING WITH DEPARTMENT. FOR THE RELEVANT ASSESSMENT YEAR 1987-88 ASSESSEE FILED RET URN OF INCOME U/S.139(1) OF THE ACT ON 31.10.1988 AFTER DECLARING LOSS AT RS.31,32,110/ - CLAIMING REFUND OF RS.21,72,294/-. THE ASSESSEE ALSO FILED FORM NO.6 FOR EXTENSION OF TIME FOR FURNISHING OF RETURN OF INCOME FROM TIME TO TIME FOR THE REASON THAT DUE TO SEARCH ALL RECORDS WERE SEIZED AND PHOTOCOPIES WERE GIVEN AFTER LONG TIME, HENCE, DELA Y IN FINALIZATION OF ACCOUNTS. THE AO GRANTED EXTENSION UPTILL 31.10.1988 AND ASSESSEE FILED ITS ORIGINAL RETURN OF INCOME ON 31.10.1988, WHICH THE AO TREATED AS NON-EST DUE TO THE REASON THAT IT IS NOT ACCOMPANIED WITH FORM NO.30 FOR CLAIM OF REFUND. AS , NO FURTHER RETURN OF INCOME WAS FILED BY ASSESSEE, THE AO ISSUED NOTICE U/S.148 OF THE ACT DATED 19.3.1990. ASSESSEE FILED RETURN OF INCOME ON 17.05.1990 UNDER PROTEST DISCLOSING SAME LOSS AND CLAIMING SAME REFUND AS ORIGINALLY ALONG WITH FORM NO.30 CLA IMING REFUND. IN THE MEAN TIME, ASSESSEE FILED WRIT PETITION BEFORE HONBLE CALCUTT A HIGH COURT ON 11.12.1990, CHALLENGING ACTIONS OF AO TREATING RETURN AS NON-EST BY STATING DEEMED NOT TO HAVE BEEN FILED UNDER THE PROVISIONS OF SECTION 139(10) OF THE ACT AND ALSO CHALLENGING THE VALIDITY OF REOPENING U/S. 148 OF THE ACT DATED 19 .03.1990. HONBLE JURISDICTIONAL HIGH COURT VIDE JUDGMENT DATED 18.10.2001 SET ASIDE THE DECISIONS OF REVENUE TREATING ORIGINAL RETURN FILED BY ASSESSEE ON 31.10.1988 AS NON-EST AND ALSO SET ASIDE NOTICE ISSUED U/S.148 R.W.S 147 OF THE ACT. WE FIND THAT N EITHER ASSESSEE FILED FORM NO.30 AS DIRECTED BY HONBLE HIGH COURT NOR AO PROCEEDED TO ASSESS. REVENUE AFTER ALMOST SEVEN YEARS I.E. ON 02.04.2009 WROTE LETTER TO ASSE SSEE ENQUIRING, WHETHER FORM NO.30 HAS BEEN FILED OR NOT. ALSO ISSUED NOTICES U/S. 143 (2)/142(1) OF THE ACT DATED 06.04.2009 AND FRAMED ASSESSMENT. 7 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 7. WHETHER ASSESSMENT FRAMED VIDE ASSESSMENT ORDER U/S.143(3) R.W.S 256 OF THE ACT DATED 29.05.2009 IS BARRED BY LIMITATION OR NOT , IN GIVEN FACTS AND CIRCUMSTANCES OF THE CASE? TO DECIDE THIS ISSUE, NOW, WE HAVE TO GO TO DIRECTIONS OF HONBLE HIGH COURT GIVEN IN THEIR JUDGMENT DATED 18.10.2001 AND THE RE LEVANT PORTION OF THE JUDGMENT IS BEING AGAIN REPRODUCED, EVEN THOUGH AT THE COST OF REPETITION, AS UNDER:- THEREFORE, I AM OF THE VIEW THAT THIS IMPUGNED DECI SION OF THE REVENUE OFFICIAL DOES NOT STAND TO SCRUTINY AND THE SAME IS BOUND TO BE QUASHED AND SET ASIDE. ACCORDINGLY, BOTH THE DECISIONS ARE SET ASIDE. THE REVENUE OFFIC IAL SHALL PROCEED TO ASSESS THE RETURN FILED BY THE PETITIONER ON SUBMISSION OF AN APPLICA TION IN PRESCRIBED FORM 30. SO, THE PETITIONER IS DIRECTED TO SUBMIT NECESSARY APPLICAT ION IN PRESCRIBED FORM 30 FOR CLAIM OF REFUND WITHIN FORTNIGHT FROM THE DATE OF COMMUNICAT ION OF THIS ORDER. APPARENTLY THOUGH IT IS A TIME BARRED, THIS BAR SHALL NOT BE APPLIED IN THIS CASE SINCE ALL THESE YEARS THE MATTER WAS BINDING BEFORE THIS COURT. THE ABOVE DIRECTIONS OF HONBLE HIGH COURT ARE VER Y CLEAR THAT NOTICE U/S.148 R.WS. 147 OF THE ACT IS SET ASIDE AND EVEN ACTION O F AO TREATING THE ORIGINAL RETURN FILED U/S. 139(1) OF THE ACT BY ASSESSEE AS NON-EST WAS ALSO SET ASIDE. HONBLE HIGH COURT HAS CLEARLY SET ASIDE BOTH DECISIONS OF REVENUE. FU RTHER, DIRECTIONS OF HONBLE HIGH COURT ARE VERY CLEAR THAT THE ASSESSEE HAS TO SUBM IT APPLICATION IN PRESCRIBED FORM NO.30 FOR CLAIM OF REFUND WITHIN A FORTNIGHT FORM T HE DATE OF COMMUNICATION OF THE JUDGMENT OF HONBLE HIGH COURT. FURTHERMORE, HONB LE HIGH COURT OBSERVED THAT ASSESSMENT WILL NOT GET TIME BARRED SINCE ALL THESE YEARS THE MATTER WAS PENDING BEFORE HONBLE HIGH COURT. THE ARGUMENT OF REVENUE IN THI S RESPECT IS THAT ASSESSEE FILED WRIT PETITION BEFORE HONBLE HIGH COURT CHALLENGING ORDE R U/S.139(10) OF THE ACT AS WELL NOTICE U/S.148 OF THE ACT AND ACCORDING TO REVENUE, HONBLE HIGH COURT DISPOSED OFF THIS WRIT PETITION ON 18.10.2001 BY QUASHING BOTH A CTIONS OF REVENUE OFFICIALS. REVENUE INTERPRETED THE JUDGMENT OF HONBLE HIGH COURT THAT DIRECTIONS TO ASSESSEE ARE FOR SUBMISSION OF APPLICATION IN FORM NO.30 FOR CLAIMIN G REFUND WITHIN A FORTNIGHT FROM THE DATE OF COMMUNICATION OF JUDGMENT AND HONBLE HIGH COURT DIRECTED THAT TIME BAR IS NOT APPLICABLE BECAUSE PROCEEDINGS WERE PENDING BEF ORE HIGH COURT. REVENUE CONTENDED THAT ASSESSEE DID NOT SUBMIT NECESSARY AP PLICATION IN FORM NO.30 AND FAILED TO DO SO AND ALSO MISGUIDED AO BY STATING THAT IT W AS FILING APPEAL BEFORE DIVISION BENCH VIDE LETTER DATED 07.01.2002. ACCORDING TO RE VENUE, WHEN ASSESSEE FILED APPLICATION FOR RELEASE OF SEIZED DOCUMENTS AO REQU IRED ASSESSEE TO INFORM, WHETHER IT 8 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 HAS FILED FORM NO.30 IN PURSUANCE TO DIRECTIONS OF HONBLE HIGH COURT AND IN TURN ASSESSEE REQUESTED THAT FORM NO.30 SUBMITTED ALONG WITH RETURN FILED IN RESPONSE TO NOTICE U/S.148 MAY BE TREATED AS FULL COMPLIANCE TO DIRECTIONS OF HONBLE HIGH COURT. THE CRUX OF REVENUES CONTENTION IS AS UNDER:- I) THE AO HAS ACTED AS PER ORDER OF THE HIGH COURT . II) THE ASSESSEE, ALTHOUGH LATE, ALSO ACTED AS PER ORDER OF HIGH COURT. III) THE ASSESSMENT WAS MADE AS SOON AS THE A.O. PR OCEEDED AND WITHIN A VERY REASONABLE TIME. IV) THERE WAS SPECIFIC ORDER OF HIGH COURT THAT TIM E BAR SHALL NOT BE APPLICABLE. V) ALL THE DELAYS ARE ATTRIBUTABLE TO THE ASSESSEE AND CAUSED BY IT. IN VIEW OF THESE ARGUMENTS, REVENUE CONTENDED THAT ASSESSMENT HAS BEEN MADE FOLLOWING SPECIFIC JUDGMENT OF HONBLE HIGH COURT & IS VALID IN LAW & NOT TIME BARRED AS IS BEING CONTENDED BY THE ASSESSEE AND FURTHER A SSESSEE ACCEPTED THE JUDGMENT ITSELF AND DID NOT CONTEST IT, PARTICULARLY REGARDING TIME BARRING MATTER, BUT NOW CONTENDING THE ISSUE, WHICH IS NOT PERMISSIBLE AND THIS GROUND OF THE ASSESSEE IS WITHOUT ANY MERIT AND DESERVE TO BE DISMISSED. 8. WE FIND FROM JUDGMENT THAT THERE WAS A DIRECTION OF HONBLE COURT TO FILE AN APPLICATION IN FORM NO. 30 WITHIN 15 DAYS OF THE DA TE OF COMMUNICATION OF THE JUDGMENT OF HONBLE COURT AND IT WILL BE FURTHER AP PARENT THAT ASSESSEE AS WELL AS REVENUE WERE DIRECTED TO ACT ON THE BASIS OF THE SI GNED COPY OF THE MINUTES OF THE OPERATIVE PORTION OF THE JUDGMENT. AS IS APPARENT T HAT HONBLE COURT REJECTED PRAYER FOR STAY OF OPERATION OF THE JUDGMENT AND EVEN AS DIREC TED, DECISION OF THE COURT HAD TO BE CARRIED OUT AND IMPLEMENTED IMMEDIATELY ON THE BASI S OF SIGNED MINUTES DATED 18.10.2001. WE FIND THAT ASSESSEE ALREADY FILED FOR M NO.30 ALONG WITH THE RETURN FILED IN RESPONSE TO NOTICE U/S 148 OF THE ACT ON 17.05.1 990 ITSELF, AND THIS WAS QUITE IN THE KNOWLEDGE OF INCOME-TAX DEPARTMENT ALSO AS WOULD BE APPARENT FROM SECOND PARA OF THE ASSESSMENT ORDER WHICH IS REPRODUCED FOR THE SA KE OF CONVENIENCE. AS THE RETURN WAS NOT ACCOMPANIED WITH FORM NO.30 FOR CLAIM OF REFUND, THE RETURN WAS DECLARED NON-EST AS PER PROVISIONS OF SE C. 139(10) OF THE I.T ACT, 1961. AS NO FURTHER RETURN WAS FILED BY THE APPELLA NT, A NOTICE U/S 148 WAS ISSUED ON 19.03.1990 AND WAS SERVED ON 20.03.1990. IN RESP ONSE TO SAID NOTICE, THE APPELLANT FILED RETURN ON 17.05.1990 UNDER PROTEST SHOWING LOSS OF (-) RS.31,32,110/- INCLUDING A CLAIM OF REFUND OF RS.21 ,72,294/- ALONG WITH A FORM NO. 30 CLAIMING THE REFUND. 9 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 ON THE BASIS OF SUCH FORM NO.30 FILED ON 17.05.1990 , PRESENT ASSESSMENT HAD BEEN COMPLETED AND HENCE, THE A.O HAS TAKEN DUE COGNIZAN CE OF SAID FORM NO. 30. SINCE IN THIS CASE RETURN WAS FILED U/S 139(1) OF THE ACT AS DISCUSSED ABOVE, ASSESSMENT IN THIS CASE WAS REQUIRED TO BE COMPLETED IN TERMS OF SEC.1 53(1)(A)(III) OF THE ACT WITHIN TWO YEARS FROM THE END OF ASSESSMENT YEAR 1987-88 AS EX ISTED IN THE STATUTE DURING THE RELEVANT PERIOD OR IN OTHER WORDS THE ASSESSMENT WA S REQUIRED TO BE COMPLETED BY 31.03.1990. HOWEVER, SINCE A NOTICE U/S 148 OF THE ACT WAS ISSUED ON 19.03.1990, AND IN VIEW OF PROCEEDINGS U/S 139(10) AND U/S 147/148 OF THE ACT HAVING BEEN QUASHED / SET ASIDE BY THE HONBLE HIGH COURT AS DISCUSSED ABOVE, THE PERIOD FOR COMPLETING ASSESSMENT WILL BE DEEMED TO HAVE BEEN EXTENDED BY 13 DAYS FROM 18.10.2001. IN OTHER WORDS, SUCH ASSESSMENT, AFTER JUDGMENT OF HONBLE C OURT, WAS REQUIRED TO BE COMPLETED BY 31.10.2001. IT IS A FACT THAT WRIT PETITION AGAI NST PROCEEDINGS U/S 148 OF THE ACT HAVING BEEN FILED AFTER 15.04.1990, MUCH AFTER 31.0 3.1990, A.O DOES NOT GET THE BENEFIT OF EVEN 13 DAYS TO COMPLETE ASSESSMENT AND ASSESSME NT WAS REQUIRED TO BE COMPLETED ON 18.10.2001 ITSELF WHEN THE JUDGMENT WAS PRONOUNC ED AND THE PARTIES WERE DIRECTED TO ACT UPON SIGNED MINUTES OF JUDGMENT ON 18.10.200 1 AND IN ANY CASE, THE PERIOD FOR COMPLETION OF ASSESSMENT COULD NOT BE BEYOND 11.01. 2002, WHEN THE ORDER WAS COMMUNICATED TO A.O. SINCE ASSESSMENT HAS BEEN COMP LETED ON 29.05.2009 I.E. AFTER A LAPSE OF MORE THAN 7 (SEVEN) YEARS FROM THE DATE OF JUDGMENT OF HONBLE COURT, ASSESSMENT IS CLEARLY BARRED BY LIMITATION AND HENC E IS BAD. WE FIND THAT A.O HAS TAKEN RECOURSE TO JUDGMENT OF COURT FOR COMPLETING SUCH D ELAYED ASSESSMENT BY STATING THAT IN THE SAME ORDER HONBLE COURT DIRECTED THAT TIME BAR IS NOT APPLICABLE BECAUSE PROCEEDINGS WERE PENDING IN COURT. ABOVE OBSERVATI ON OF THE HONBLE COURT HAS BEEN COMPLETELY MISUNDERSTOOD BY REVENUE. WHAT WE UNDERS TOOD BY JUDGMENT OF HONBLE COURT SIMPLY MEANT THAT PERIOD FOR WHICH THE ASSESS MENT COULD NOT BE COMPLETED BECAUSE OF MATTER PENDING BEFORE HONBLE COURT IN W RIT PETITION SHOULD BE EXCLUDED AND I.E. CLEARLY EMBODIED IN SUB-CLAUSE (II) OF EXP LANATION-I OF SEC. 153 OF THE ACT ITSELF CLEARLY STATES THAT THE PERIOD DURING WHICH ASSESSM ENT PROCEEDINGS ARE STAYED BY AN ORDER OR INJUNCTION OF ANY COURT SHALL BE EXCLUDED IN COMPUTING THE PERIOD OF LIMITATION AND HENCE, THE PERIOD OF LIMITATION COULD NOT BE EX TENDED BEYOND DATE OF JUDGMENT OF HONBLE COURT QUASHING PROCEEDINGS U/S 139(10) AND 147/148 OF THE ACT. WE WILL GO TO 10 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 CASE LAW REFERRED BY LD. COUNSEL OF ASSESSEE OF HON ,BLE APEX COURT WHEREIN PRINCIPLE ENUNCIATED IN HOPE TEXTILES LTD AND ANOTHER V. UNIO N OF INDIA AND OTHERS (1994) 205 ITR 508 (SC), IN WHICH IT IS HELD THAT IN TERMS OF SUB-CLAUSE (II) OF SEC. 153(3) OF THE ACT HIGH COURT IS NOT EMPOWERED TO GIVE DIRECTION T O AUTHORITY UNDER THE ACT TO IGNORE THE PERIOD OF LIMITATION PRESCRIBED UNDER THE ACT. SINCE SUB-CLAUSE (II) TO EXPLANATION-1 OF SEC. 153 OF THE ACT CLEARLY PRESCRIBE THE PERIOD OF LIMITATION, IN SUCH CASES OF WRIT PETITION PENDING, COURTS COULD NOT EXTEND LIMITATIO N FOR COMPLETION OF ASSESSMENT BEYOND A PERIOD EMBODIED IN SUB-CLAUSE (II) TO EXPL ANATION-1 OF SEC. 153 OF THE ACT. 9. WE FURTHER FIND THAT SINCE FORM NO.30 HAD ALREAD Y BEEN FILED ALONG WITH RETURN OF INCOME FILED U/S. 148 OF THE ACT ON 17.05.1990, A.O COULD HAVE COMPLETED ASSESSMENT AFTER THE PERIOD OF EXPIRY OF 13 DAYS AS STATED ABOVE PLUS 15 DAYS AS PER DIRECTION OF THE COURT TO FILE FORM NO 30, IF ASSES SEE HAD FAILED TO COMPLY WITH SUCH DIRECTION OF HONBLE COURT OR IN OTHER WORDS EVEN A CCORDINGLY THE ASSESSMENT SHOULD HAVE BEEN COMPLETED LATEST BY 18.11.2001. WE FIND T HAT IT WAS FOR THE FIRST TIME ON 2ND APRIL, 2009 THAT A.O CALLING TO FILE FORM NO. 30 IN PURSUANCE OF JUDGMENT OF HONBLE COURT OR IN OTHER WORDS SUCH ACTION OF THE AO WAS I TSELF TAKEN AFTER A LAPSE OF MORE THAN 7 YEARS FROM JUDGMENT OF HONBLE HIGH COURT, HENCE ALSO, THE AO CANNOT TAKE SHELTER OF FORM NO. 30 TO SAVE PERIOD OF LIMITATION THOUGH IT WAS ALREADY FILED AS STATED ABOVE ON 17.05.1990. WE ARE OF THE VIEW THAT THERE IS CLEAR PERIOD PRESCRIBED UNDER THE ACT ITSELF UNDER WHICH SUCH ASSESSMENT SHOULD HAVE BEEN COMPLE TED AND HONBLE MADRAS HIGH COURT IN THE CASE OF M. SRINIVASA RAO V. ACIT (2008 ) 219 CTR (MAD) 40 HAS EVEN GONE TO THE EXTENT THAT EVEN IN THOSE CASES WHERE NO TIM E LIMIT IS PRESCRIBED FOR COMPLETING ASSESSMENT PROCEEDINGS, SUCH PROCEEDINGS MUST BE CO MPLETED WITHIN REASONABLE TIME AND COMPLETION OF SUCH ASSESSMENT AFTER INORDINATE DELAY OF 6 YEARS WAS HELD TO BE BAD AND PROCEEDINGS IN THIS CASE WERE QUASHED BY HONBL E MADRAS HIGH COURT BY RELYING ON THE DECISION OF HONBLE APEX COURT IN THE CASE OF M OHAMAD KAVI MOHAMAD AMIN VS. FATIMABAI IBRAHIM (1997) 6 SCC 71 AS UNDER: NO DOUBT, UNDER SECTION 153(3) OF THE ACT, TIME LI MIT IS NOT PRESCRIBED, BUT THE SAME CANNOT BE PRESUMED THAT THE RESPONDENT IS EMPOWERED TO INITIATE ACTION EVEN AFTER LAPSE OF SEVERAL YEARS. ADMITTEDLY, IN THIS CASE, AFTER THE TRIBUNAL'S ORDER, THE PETITIONER HAS MADE SEVERAL REPRESENTATIONS IN RESPECT OF REFUND OF AMOUNT ON VARIOUS OCCASIONS AS MENTIONED ABOVE, BUT THE RESPONDENT HAS NOT GIVEN ANY REPLY. THE PETITIONER HAS ALSO APPROACHED THE INCOME-TAX OMBUDSMAN, CHENNAI, BY A PETITION DATED MARCH 22, 2007, 11 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 FOR REDRESSING HIS GRIEVANCE OF NON-PAYMENT OF REFU ND. AFTER THE INTERVENTION OF THE OMBUDSMAN, THE SAID REQUEST OF THE PETITIONER WAS M ET BY THE RESPONDENT. THE RESPONDENT NOT EVEN MENTIONED IN THEIR COUNTER-AFFIDAVIT ON W HAT DATE THE ORDER OF THE TRIBUNAL WAS RECEIVED BY THEM. IT IS ALLEGED BY THE RESPONDENT T HAT DUE TO RESTRUCTURING OF JURISDICTION AND FREQUENT CHANGE OF INCUMBENTS, ENQUIRY WAS NOT COMMENCED IMMEDIATELY IN THIS CASE. EXCEPT THE SAID BALD AVERMENT, HARDLY ANY EXPLANAT ION, WHICH IS WORTH OF CONSIDERATION FURNISHED BY THE RESPONDENT TO EXPLAIN THE DELAY O F SIX YEARS. NO DOUBT RECOVERY OF TAX IS ESSENTIAL TO RAISE REVENUE AND BRING ABOUT CERTAIN ECONOMIC AND SOCIAL RESULTS. BUT FOR THE SAME, THAT ALONE CANNOT BE THE REASON FOR ALLOWING THE DELAY IN INITIATING PROCEEDINGS AGAINST THE PETITIONER. HENCE, THIS COURT IS OF TH E CONSIDERED VIEW THAT THOUGH NO TIME LIMIT IS PRESCRIBED FOR EXERCISE OF POWER UNDER A STATUTE, IT SHOULD BE EXERCISED WITHIN A REASONABLE TIME AS HELD BY THE HONOURABLE SUPREME COURT IN THE BELOW MENTIONED DECISIONS : (I) MOHAMAD KAVI MOHAMAD AMIN V. FATMABAI IBRAHIM [1997 ] 6 SCC 71 WHEREIN IN PARAGRAPH 2, IT WAS HELD THUS (AT PAGE 72) : IN THIS CONNECTION, ON BEHALF OF THE APPELLANT REL IANCE WAS PLACED ON A JUDGMENT OF JUSTICE S. B. MAJMUDAR (AS HE THEN WAS IN THE HI GH COURT OF GUJARAT) IN STATE OF GUJARAT V. JETHMAL BHAGWANDAS SHAH DISPOSED OF O N MARCH 1, 1990, WHERE IN CONNECTION WITH SECTION 84C ITSELF IT WAS SAID THA T THE POWER UNDER THE AFORESAID SECTION SHOULD BE EXERCISED WITHIN A REASONABLE TI ME. THIS COURT IN CONNECTION WITH OTHER STATUTORY PROVISIONS, IN THE CASE OF ST ATE OF GUJARAT V. PATIL RAGHAV NATHA [1969] 2 SCC 187 AND IN THE CASE OF RAM CHAND V. UNION OF INDIA [1994] 1 SCC 44 HAS IMPRESSED THAT WHERE NO TIMELIMIT IS P RESCRIBED FOR EXERCISE OF A POWER UNDER A STATUTE IT DOES NOT MEAN THAT IT CAN BE EXERCISED AT ANY TIME ; SUCH POWER HAS TO BE EXER CISED WITHIN A REASONABLE TIME . WE ARE SATISFIED THAT IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, THE S UO MOTU POWER UNDER SECTION 84C OF THE ACT WAS NOT EXERCISED BY THE MAMLATDAR W ITHIN A REASONABLE TIME. ACCORDINGLY, THE APPEAL IS ALLOWED. THE IMPUGNED OR DERS ARE SET ASIDE. NO COSTS. SINCE IN THE PRESENT CASE ALSO ASSESSMENT HAD BEEN COMPLETED AFTER AN INORDINATE DELAY OF MORE THAN 7 (SEVEN) YEARS FROM THE DATE OF JUDGM ENT OF HONBLE COURT, THE ASSESSMENT IS BAD IN LAW AND IS BARRED BY LIMITATIO N. PRINCIPLES ENUNCIATED BY HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. NHK JAPAN B ROADCASTING CORPORATION(2008) 305 ITR 137(DELHI), WHEREIN PAGE 141 HELD AS UNDER: - WE ARE NOT INCLINED TO DISTURB THE TIME LIMIT OF F OUR YEARS PRESCRIBED BY THE TRIBUNAL AND ARE OF THE VIEW THAT IN TERMS OF THE D ECISION OF THE SUPREME COURT IN BHATINDA DISTRICT CO-OP. MILK PRODUCERS UNION LT D. [2007] 9 RC 637; 11 SCC 363 ACTION MUST BE INITIATED BY THE COMPETENT A UTHORITY UNDER THE INCOME- TAX ACT, WHERE NO LIMITATION IS PRESCRIBED AS IN SE CTION 201 OF THE ACT WITHIN THAT PERIOD OF FOUR YEARS. LEARNED COUNSEL FOR THE REVENUE SUBMITTED THAT THE DEPARTMENT CAME TO KNOW THAT THE ASSESSEE WAS AN ASSESSEE IN DEFAULT ONLY I N NOVEMBER, 1998, WHEN A SURVEY WAS CONDUCTED AND IT CAME TO BE KNOWN ONLY T HEN THAT WHEN THE ASSESSEE HAD NOT DEDUCTED TAX AT SOURCE ON THE GLOBAL SALARY . WE ARE OF THE OPINION THAT THE DATE OF KNOWLEDGE IS NOT RELEVANT FOR THE PURPO SES OF EXERCISING JURISDICTION 12 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 IS SO FAR AS THE PROVISIONS OF THE INCOME-TAX ACT A RE CONCERNED. IF IT WERE SO, THE LIMITATION PERIOD, AS FOR EXAMPLE PRESCRIBED UNDER SECTION 147/148 OF THE ACT WOULD BECOME MEANINGLESS IF THE CONCEPT OF KNOWLEDG E IS IMPORTED INTO THE SCHEME OF THE ACT. THE SECOND PART OF THE ARGUMENT OF LEARNED COUNSEL FOR THE REVENUE IN THIS REGARD WAS THAT THE QUESTION OF LIMITATION DID NOT AT ALL ARISE BECAUSE THE ASSESSEE HAD ITSELF ADMITTED ITS LIABILITY AND IT V OLUNTARILY PAID THE TAX AND INTEREST ON THAT AMOUNT. AGAIN, WE ARE NOT IN AGREE MENT WITH LEARNED COUNSEL FOR THE REVENUE IN THIS REGARD. IT APPEARS THAT THE ASSESSEE PAID THE TAX VOLUNTARI LY AS WELL AS INTEREST THEREON BUT THE ACCEPTANCE OF THE LIABILITY BY THE ASSESSEE WOULD NOT BY ITSELF EXTEND THE PERIOD OF LIMITATION NOR WOULD IT EXTEND THE REASON ABLE TIME THAT IS POSTULATED BY THE SCHEME OF THE INCOME-TAX ACT. THE ASSESSEE CANN OT BE PUT, IN A SENSE, IN A WORSE POSITION MERELY BECAUSE IT HAS ADMITTED ITS L IABILITY. IF THE ASSESSEE HAD DENIED ITS LIABILITY, THE QUESTION THAT WOULD HAVE ARISEN WOULD BE WHETHER THE REVENUE COULD HAVE INITIATED PROCEEDINGS AFTER A LA PSE OF FOUR YEARS. THE ANSWER OF THAT WOULD OF COURSE HAVE TO BE IN THE NE GATIVE IN VIEW OF THE REASON THAT WE HAVE ALREADY INDICATED ABOVE. THE FACT THAT THE ASSESSEE AGREED TO PAY THE TAX VOLUNTARILY CANNOT PUT THE ASSESSEE IN A SI TUATION WORSE THAN IF IT HAS CONTESTED ITS LIABILITY. 10. FURTHER, WE ARE OF THE VIEW THAT PROVISO TO EXP LANATION -1 OF SEC. 153 OF THE ACT WILL NOT COME TO RESCUE OF REVENUE FROM SAVING IT F ROM PERIOD LIMITATION AS 153(1A) & SEC. 153(1B) OF THE ACT HAD BEEN BROUGHT INTO STATU TE W.E.F. 1.4.2006 ONLY BY FINANCE ACT, 2005, AND IN PRESENT CASE BEFORE US, HONBLE C ALCUTTA HIGH COURT GAVE JUDGMENT ON 18.10.2001. SIMILARLY, AFORESAID PROVISO WILL NO T COME TO RESCUE OF REVENUE FROM SAVING IT FROM THE PERIOD OF LIMITATION AS SEC. 153 (2), SEC 153(2A) & SEC 153(4) OF THE ACT WERE BROUGHT BY FINANCE ACT, 2008 W.E.F. 1.6.20 03 ONLY, WHEREAS IN THIS CASE JUDGMENT OF HONBLE COURT WAS DATED 18.10.2001 AND HAVING BEEN AVAILABLE WITH THE A.O MUCH PRIOR TO 1.6.2003, THE SAID FIRST PROVISO TO EXPLANATION 1 OF SEC. 153 OF THE ACT WILL NOT EXTEND THE PERIOD FOR COMPLETING ASSES SMENT OF EVEN 60 DAYS AND HENCE, IN THIS CASE PERIOD OF LIMITATION FOR COMPLETING ASSES SMENT EXPIRED ON 19.10.2001. WE FIND THAT SINCE FORM NO.30 HAD ALREADY BEEN FILED ALONG WITH RETURN OF INCOME FILED U/S. 148 OF THE ACT ON 17.05.1990, A.O COULD HAVE COMPLETED ASSESSMENT AFTER THE PERIOD OF EXPIRY OF 13 DAYS FROM THE DATE OF JUDGMENT OF HON BLE HIGH COURT IN WRIT PETITION, AS STATED ABOVE, PLUS 15 DAYS AS PER DIRECTION OF HON BLE HIGH COURT TO FILE FORM NO 30, IF ASSESSEE HAD FAILED TO COMPLY WITH SUCH DIRECTION O F HONBLE COURT. FAILURE OF THE ASSESSEE TO FILE FORM NO. 30 INSPITE OF DIRECTIONS OF HONBLE HIGH COURT WILL BE 13 ITA 1621/K/2010 M/S. THE HOOGHLY MILLS. CO. LTD... A.Y. 87-88 DETRIMENTAL TO THE ASSESSEE TO THE FACT THAT HE WIL L NOT GET ANY CLAIM OF REFUND. WE ARE OF THE VIEW THAT IN PRESENT CASE ASSESSMENT MADE ON 29 .05.2009, AFTER A LAPSE OF MORE THAN 7 YEARS FROM THE DATE OF JUDGMENT OF HONBLE HIGH C OURT, IS CLEARLY BARRED BY LIMITATION AND IS BAD IN LAW IN VIEW OF THE FACTS AND IN THE C IRCUMSTANCES OF THE CASE AND IS QUASHED. 11. WE HAVE DECIDED THAT THE ASSESSMENT IS BARRED B Y LIMITATION, MERITS WE NEED NOT TO ADJUDICATE. 12. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. 13. ORDER PRONOUNCED IN THE OPEN COURT ON 24.6.2011 . SD/- SD/- . ! ! ! ! . '# , (C. D. RAO) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( !# !# !# !#) )) ) DATED 24TH DAY OF JUNE, 2011 /0 %12 3 JD.(SR.P.S.) '. 4 ,5 6'5'7- COPY OF THE ORDER FORWARDED TO: 1 . *+ / APPELLANT M/S. THE HOOGHLY MILLS CO. LTD., C/O M /S. SALARPURIA JAJODIA & CO. 7, C. R. AVENUE, KOLKATA-7 00 072.. 2 ,-*+ / RESPONDENT DCIT, CC-VII, KOLKATA. 3 . .% ( )/ THE CIT(A), KOLKATA 4. 5. .% / CIT KOLKATA 5 => ,% / DR, KOLKATA BENCHES, KOLKATA -5 ,/ TRUE COPY, '.%?/ BY ORDER, 2 /ASSTT. REGISTRAR .