ITO, Hyderabad V. M/s Andhra Bank Financial Services Ltd., Hyderabad

ITA 1630/HYD/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3039 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 01-07-2010
• Assessment Year: 1997-1998
• Appeal Filed On: 04-11-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIVEDITA BISWAS
• Assessee Lawyers: C P RAMASWAMY
• Keywords: Period of limitation; Bad and doubtful debts
• Section: 271(1)(c); 12; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMEBR ITA NO. 1630/HYD/2008 ASSESSMENT YEAR 1997-98 INCOME-TAX OFFICER, WARD-1(1), HYDERABAD VS. M/S. ANDHRA BANK FINANCIAL SERVICES LTD., HYDERABAD PAN: NOT AVAILABLE APPELLANT RESPONDENT C.O. NO. 30/HYD/2008 ARISING OUT OF ITA NO. 1630/HYD/2008 ASSESSMENT YEAR 1997-98 M/S. ANDHRA BANK FINANCIAL SERVICES LTD., HYDERABAD PAN: NOT AVAILABLE VS. INCOME-TAX OFFICER, WARD-1(1), HYDERABAD APPELLANT RESPONDENT REVENUE BY: SMT. NIVEDITA BISWAS ASSESSEE BY: SHRI C.P. RAMASWAMY O R D E R PER N.R.S. GANESAN, JM: THE REVENUE FILED THE PRESENT APPEAL AGAINST THE OR DER OF THE CIT(A)-II, HYDERABAD DATED 26.8.2008 AND PERTAI NS TO ASSESSMENT YEAR 1997-98. THE ASSESSEE HAS FILED TH E CROSS OBJECTION. THEREFORE, WE HEARD THE SAME TOGETHER A ND DISPOSING OF THE SAME BY THIS COMMON ORDER. 2. SMT. NIVEDITA BISWAS, THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSING OFFICER LEVIED THE PENALTY U/S. 271(1)(C) OF THE INCOME-TAX ACT, 1961 (THE ACT). THE ASSESSEE HAD WRITTEN OFF PART OF THE DEBT DUE TO M/ S. FAIR GROWTH FINANCIAL SERVICES LTD. (FGFSL). ACCORDING TO THE LEARNED DEPARTMENTAL REPRESENTATIVE, THE ASSESSEE F ILED CIVIL ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 2 SUIT AND TAKING FURTHER STEPS FOR RECOVERY OF THE A MOUNT. FOR THE PURPOSE OF CLAIMING A DEBT AS BAD TWO FUNDAMENTAL C ONDITIONS HAVE TO BE FULFILLED. ACCORDING TO THE LEARNED DEP ARTMENTAL REPRESENTATIVE, THE FIRST CONDITION IS THE DEBT SHO ULD BE BAD AND THE SECOND CONDITIONS IS IT SHOULD BE WRITTEN OFF I N THE BOOKS OF ACCOUNT. SINCE THE ASSESSEE HAS WRONGLY CLAIMED BA D DEBT AS DEDUCTION THE ASSESSING OFFICER LEVIED THE PENALTY U/S. 271(1)(C) OF THE ACT. HOWEVER, ON APPEAL BY THE ASSESSEE, TH E CIT(A) DELETED THE ADDITION ON THE GROUND THAT THERE WAS N O DELIBERATE OR CONSCIOUS CONCEALMENT ON THE PART OF THE ASSESSE E TO EVADE TAX. ACCORDING TO THE LEARNED DEPARTMENTAL REPRESE NTATIVE MENS REA IS NOT A RELEVANT FACTOR TO BE CONSIDERED FOR LEVY ING THE PENALTY. REFERRING TO THE JUDGEMENT OF THE APEX CO URT IN THE CASE OF UNION OF INDIA AND ANR. VS. DHARMENDRA TEXT ILE PROCESSORS AND ORS. (2007) 295 ITR 244, THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT PENALTY UNDER THE INCOME-TAX ACT IS A CIVIL CONSEQUENCE. THEREFORE, THE REVENUE NEED NOT PROVE THE MENS REA FOR LEVYING PENALTY. ACCORDING TO THE LEARNED DEPARTMENTAL REPRESENTATIVE, WILLFUL CO NCEALMENT IS NOT AN ESSENTIAL INGREDIENT FOR ATTRACTING CIVIL LI ABILITY WHICH MAY BE NECESSARY FOR A CRIMINAL PROSECUTION. THEREFORE, ACCORDING TO THE LEARNED DEPARTMENTAL REPRESENTATIVE, THE CIT(A) IS NOT CORRECT IN DELETING THE PENALTY LEVIED BY THE ASSES SING OFFICER. 3. REFERRING TO THE CROSS OBJECTION OF THE ASSESSEE, T HE LEARNED DEPARTMENTAL REPRESENTATIVE POINTED OUT THA T THE ASSESSEE CLAIMED THAT THE ADMINISTRATIVE COMMISSION ER RECEIVED THE ORDER OF THIS TRIBUNAL CONFIRMING THE ADDITIONS MADE IN THE QUANTUM APPEAL ON 23.4.2007. ACCORDING TO THE LEAR NED DEPARTMENTAL REPRESENTATIVE, THE COMMISSIONER OF IN COME-TAX (CENTRAL) WAS ORIGINALLY HAVING JURISDICTION. SUBS EQUENTLY JURISDICTION WAS TRANSFERRED TO COMMISSIONER OF INC OME-TAX-I. THE CIT-I HAS RECEIVED THE ORDER ONLY ON 28.9.2007. THE PENALTY ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 3 ORDER WAS PASSED ON 31.3.1998. THEREFORE, THE ORDE R WAS PASSED WITHIN A PERIOD OF SIX MONTHS. THEREFORE, I T MAY NOT BE CORRECT TO SAY THAT THE PENALTY ORDER WAS BARRED BY LIMITATION. 4. ON THE CONTRARY, SHRI C.P. RAMASWAMY, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT ADMITTEDLY THE PENALTY ORDER WAS PASSED ON 31.3.1998. REFERRING TO PAPER BOOK PAGE 40, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS IS THE LETTER WRITTEN BY THE ASST. REGISTRAR OF THIS T RIBUNAL IN RESPONSE TO THE ASSESSEE'S LETTER DATED 5.6.2008 IN FORMING THE ASSESSEE THAT THE ORDER OF THIS TRIBUNAL CONFIRMING THE ADDITION IN I.T.A. NO. 50/H/2000 AND I.T.A. NO. 399/H/2000 W AS SERVED ON THE CIT (CENTRAL) ON 23.4.2007. ONCE THE ORDER OF THE TRIBUNAL WAS RECEIVED ON 23.4.2007 BY THE COMMISSIO NER, THE ASSESSING OFFICER OUGHT TO HAVE PASSED THE PENALTY ORDER WITHIN A PERIOD OF SIX MONTHS. ACCORDING TO THE LEARNED C OUNSEL FOR THE ASSESSEE THE PERIOD OF SIX MONTHS EXPIRED ON 31.10. 2007. THEREFORE, THE PENALTY ORDER PASSED ON 31.3.2008 IS BEYOND THE PERIOD OF SIX MONTHS. HENCE, IT IS BARRED BY LIMIT ATION. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT THE ASSESSING OFFICER AFTER RECEIVING THE ORDER OF THIS TRIBUNAL HAS GIVEN EFFECT TO THE ORDER OF THIS TRIBUNAL BY AN OR DER DATED 14.8.2007. THEREFORE, THE CONTENTION OF THE DEPART MENT THAT ORDER OF THIS TRIBUNAL WAS RECEIVED ON 28.9.2007 IS BASELESS. 5. REFERRING TO SECTION 275 OF THE ACT, THE LEARNED CO UNSEL FOR THE ASSESSEE SUBMITTED THAT IN EXPLANATION TO SECTI ON 275 THE LEGISLATURE HAS CLEARLY EXPLAINED THE TIME TO BE EX CLUDED WHILE COMPUTING THE PERIOD OF LIMITATION. ACCORDING TO T HIS EXPLANATION (A) THE TIME TAKEN IN GIVING AN OPPOR TUNITY TO THE ASSESSEE, AFTER REOPENING OF THE PROCEEDINGS AS PRO VIDED IN PROVISO TO SECTION 129 OF THE ACT AT THE REQUEST OF THE ASSESSEE HAS TO BE EXCLUDED. IN THIS CASE THE ASSESSEE NEVE R REQUESTED ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 4 FOR REHEARING OF ANY OF THE MATTER; (B) THE PERIOD DURING WHICH IMMUNITY WAS GRANTED U/S. 245H OF THE ACT. THIS CO NDITION ALSO IS NOT APPLICABLE TO THE FACTS OF THE CASE SINCE IM MUNITY WAS NOT GRANTED TO THE ASSESSEE AND (C) THE PERIOD DURING W HICH THE PENALTY PROCEEDINGS WERE STAYED BY AN ORDER OR INJE CTION OF ANY COURT. ACCORDING TO THE LEARNED COUNSEL FOR THE AS SESSEE NO COURT HAS PASSED ANY ORDER TO STAY THE PENALTY PROC EEDINGS. THEREFORE, THE OBSERVATION OF THE CIT(A) THAT THE L IMITATION STARTS ONLY FROM THE END OF THE MONTH IN WHICH THE ORDER W AS RECEIVED BY THE NEW COMMISSIONER AFTER CHANGE OF JURISDICTI ON, IS NOT JUSTIFIED. 6. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER REFERR ED TO SECTION 127(4) OF THE ACT AND SUBMITTED THAT THE TR ANSFER OF THE CASE FROM ONE JURISDICTION TO ANOTHER CAN BE MADE A T ANY STAGE OF THE PROCEEDINGS AND IT IS NOT NECESSARY TO REISS UE ANY NOTICE ALREADY ISSUED BY THE ASSESSING OFFICER. IN VIEW O F THIS SECTION, WHEREVER THERE WAS A CHANGE OF JURISDICTION OR TRAN SFER OF JURISDICTION, IT IS NOT NECESSARY TO EXCLUDE THE TI ME TAKEN. THE OFFICER TO WHOM THE CASE WAS TRANSFERRED CAN PROCEE D AT THE STAGE AT WHICH IT WAS TRANSFERRED. THE LEARNED COU NSEL FOR THE ASSESSEE ALSO PLACED HIS RELIANCE ON THE PROVISIONS OF SECTION 129 OF THE ACT AND SUBMITTED THAT WHENEVER AN OFFIC ER CEASES TO EXERCISE JURISDICTION AND SUCCEEDED BY ANOTHER OFFI CER, THE OFFICER WHO SUCCEEDED MAY CONTINUE THE PROCEEDINGS FROM THE STAGE AT WHICH THE PROCEEDINGS WAS LEFT BY HIS PRED ECESSOR. BY WAY OF A PROVISO THE LEGISLATURE GAVE A DISCRETION TO THE ASSESSEE TO REQUEST FOR REHEARING OF THE MATTER. IN CASE THE ASSESSEE DEMANDED FOR REOPENING OF THE MATTER FOR THE PURPOS E OF REHEARING, THE TIME TAKEN FOR SUCH REOPENING AND RE HEARING OF THE MATTER CAN BE EXCLUDED. IN THIS CASE, ACCORDIN G TO THE LEARNED COUNSEL FOR THE ASSESSEE, THERE WAS NO SUCH REQUEST OR DEMAND FROM THE ASSESSEE FOR REOPENING OR REHEARING OF THE ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 5 MATTER. REFERRING TO EXPLANATION (1) TO SECTION 15 3, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT FOR COMPLET ING THE ASSESSMENT THE TIME TAKEN FOR REOPENING AND REHEARI NG OF THE MATTER AS REQUIRED UNDER PROVISO TO SECTION 129 WAS EXCLUDED. ACCORDING TO THE LEARNED COUNSEL FOR THE ASSESSEE W HENEVER THE LEGISLATURE INTENDS TO EXCLUDE THE PERIOD OF LIMITA TION THEY HAVE SPECIFICALLY STATED SO. THEREFORE, WHENEVER A JURI SDICTION WAS CHANGED/ TRANSFERRED THERE IS NO QUESTION OF EXTENS ION OF ANY PERIOD OF LIMITATION EXCEPT THE TIME TAKEN FOR REOP ENING AND REHEARING OF THE MATTER UNDER PROVISO TO SECTION 12 9 OF THE ACT. SINCE IT IS NOT THE CASE OF THE REVENUE THAT THE AS SESSEE REQUESTED/DEMANDED THE REOPENING OF THE MATTER FOR THE PURPOSE OF REHEARING, THERE IS NO QUESTION OF EXTEN SION OF THE TIME LIMIT AS PROVIDED IN SECTION 275(1) OF THE ACT . 7. REFERRING TO THE MERIT OF THE APPEAL, THE LEARNED C OUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS WR ITTEN OFF THE AMOUNT DUE FROM FGFSL AS BAD DEBT AND CLAIMED THE S AME AS BAD DEBT UNDER THE INCOME-TAX ACT. THE ASSESSING O FFICER IN THE COURSE OF THE ASSESSMENT PROCEEDINGS REJECTED T HE CLAIM OF THE ASSESSEE AND MADE THE ADDITION WHICH WAS SUBSEQ UENTLY CONFIRMED BY THIS TRIBUNAL ALSO. ACCORDING TO THE LEARNED COUNSEL FOR THE ASSESSEE, THE ASSESSEE FURNISHED TH E ENTIRE DETAILS WITH REGARD TO THE DEBT DUE FROM FGFSL. ME RELY BECAUSE THE ASSESSEES CLAIM WAS REJECTED THAT CANNOT BE A REASON TO CONCLUDE THAT THE ASSESSEE HAS FURNISHED ANY INACCU RATE PARTICULARS OR CONCEALED ANY PART OF THE INCOME. R EFERRING TO THE PAPER BOOK AT PAGE 2, THE LEARNED COUNSEL FOR T HE ASSESSEE SUBMITTED THAT THE COMPTROLLER & AUDITOR GENERAL DU RING THE COURSE OF THEIR AUDIT FOUND THAT THE ASSESSEE HAS O VERSTATED RS.4.97 CRORES DUE TO INCORRECT ADJUSTMENT OF REDUC TION IN THE MARKET VALUE OF SHARES/SECURITIES. THIS RESULTED IN UNDERSTATEMENT OF BAD DEBTS WRITTEN OFF AND OVERSTA TEMENT OF ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 6 PROFIT FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. THEREFORE, THE ASSESSEE HAS NOT WRITTEN OFF THE ENTIRE BAD DEB T EVEN AS PER THE OBSERVATION MADE BY THE CAG. THE ASSESSEE HAS UNDERSTATED THE BAD DEBT. THEREFORE, IT WOULD NOT AMOUNT TO FURNISHING ANY INACCURATE PARTICULARS OF INCOME. R EFERRING TO THE ANNUAL REPORT, THE LEARNED COUNSEL FOR THE ASSE SSEE SUBMITTED THAT A PETITION WAS FILED BEFORE THE SPEC IAL COURT FOR RECOVERY OF THE AMOUNT DUE FROM FGFSL AND THE DIREC TORS EXPRESSED THEIR INABILITY TO EXPRESS ANY OPINION ON THE RECOVERABILITY OF THE OUTSTANDING AMOUNT. REFERRIN G TO THE JUDGEMENT OF PUNJAB & HARYANA HIGH COURT IN THE CAS E OF CIT VS. HARYANA WAREHOUSING CORPORATION (2009) 314 ITR 215, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PUNJAB & HARYANA HIGH COURT AFTER REFERRING TO THE JUDGEMENT OF THE APEX COURT IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS FOUND THAT IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS (SUPRA ) THE APEX COURT WAS EXAMINING THE PROPOSITION WHETHER MENS REA WAS AN ESSENTIAL INGREDIENT U/S. 11AC OF THE CENTRAL EXCIS E ACT, 1944. THE PUNJAB & HARYANA HIGH COURT FOUND THAT THE JUDG EMENT OF THE APEX COURT IN THE CASE OF DHARMENDRA TEXTILE P ROCESSORS (SUPRA) IS UNDER A DIFFERENT LEGISLATIVE ENACTMENT. THEREFORE, IT IS TOTALLY INAPPLICABLE TO THE FACTS OF THE CASE FO R LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT. IN VIEW OF THIS JUDGEME NT OF THE PUNJAB & HARYANA HIGH COURT, ACCORDING TO THE LEARN ED COUNSEL FOR THE ASSESSEE, THE JUDGEMENT OF THE APEX COURT I N THE CASE OF DHARMENDRA TEXTILE PROCESSORS (SUPRA) MAY NOT BE OF ANY ASSISTANCE TO THE REVENUE. 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. LET US FIRST TAKE THE ISSUE OF LIMITATION RAISED BY THE ASSESSEE IN T HE CROSS OBJECTION SINCE THE SAME GOES TO THE VERY ROOT OF T HE MATTER. ADMITTEDLY, THE PENALTY ORDER WAS PASSED ON 31.3.20 08. SECTION ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 7 275(1) OF THE ACT CLEARLY SAYS THAT THE PENALTY ORD ER SHALL BE PASSED WITHIN SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE APPELLATE TRIBUNAL IS RECEIVED EIT HER BY THE CHIEF COMMISSIONER OF INCOME-TAX OR THE COMMISSIONE R OF INCOME-TAX. IN THIS CASE THE APPELLATE ORDER OF TH IS TRIBUNAL WAS RECEIVED BY THE CIT (CENTRAL) ON 23.4.2007. TH EREFORE, THE PENALTY ORDER OUGHT TO HAVE BEEN PASSED ON OR BEFOR E 31.10.2007. HOWEVER, ADMITTEDLY THE PENALTY ORDER WAS PASSED ON 31.3.2008. THE CONTENTION OF THE REVENUE IS THA T DUE TO CHANGE/TRANSFER OF JURISDICTION THE CIT-I RECEIVED THE APPELLATE ORDER OF THIS TRIBUNAL ONLY ON 28.9.2007. IT IS NO T IN DISPUTE THAT THE ORIGINAL JURISDICTION WAS WITH CIT (CENTRA L). THE CIT (CENTRAL) ADMITTEDLY RECEIVED THE APPELLATE ORDER O F THE TRIBUNAL ON 23.4.2007. THIS IS ALSO OBVIOUS FROM THE LETTER DATED 5.6.2008 WRITTEN BY THE ASSTT. REGISTRAR OF THE TRI BUNAL TO THE ASSESSEE, THE COPY OF WHICH IS AVAILABLE AT PAGE 40 OF THE PAPER BOOK. 9. LET US NOW EXAMINE, WHETHER THE CHANGE/TRANSFER OF JURISDICTION OF THE COMMISSIONER WOULD EXTEND THE P ERIOD OF LIMITATION. EXPLANATION TO SECTION 275 READS AS FO LLOWS: 'EXPLANATION IN COMPUTING THE PERIOD OF LIMITATIO N FOR THE PURPOSE OF THIS SECTION, - (I) THE TIME TAKEN IN GIVING AN OPPORTUNITY TO THE ASSESSEE TO BE REHEARD UNDER THE PROVISO TO SECTION 129; (II) ANY PERIOD DURING WHICH THE IMMUNITY GRANTED UNDER SECTION 245H REMAINED IN FORCE; AND (III) ANY PERIOD DURING WHICH A PROCEEDING UNDER THIS CHAPTER FOR THE LEVY OF PENALTY IS STAYED BY AN ORDER OR INJUNCTION OF ANY COURT. SHALL BE EXCLUDED.' 10. THEREFORE, THE LEGISLATURE SPECIFICALLY EXCLUDED TH E TIME TAKEN ON THREE OCCASIONS (A) THE TIME TAKEN FOR R EOPENING AND ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 8 REHEARING OF THE MATTER ON THE DEMAND OF THE ASSESS EE AFTER CHANGE OF JURISDICTION, (B) THE PERIOD DURING WHICH IMMUNITY WAS GRANTED U/S. 245H OF THE ACT AND (C) DURING THE PERIOD THE PENALTY PROCEEDINGS WAS STAYED BY AN ORDER OF THE C OURT. IN THE CASE BEFORE US IT IS NOBODYS CASE THAT THE ASSESSE E DEMANDED FOR REOPENING AND REHEARING OF THE MATTER AFTER CHA NGE OF JURISDICTION. IT IS NOBODYS CASE THAT IMMUNITY WA S GRANTED TO THE ASSESSEE OR THE PROCEEDINGS WAS STAYED BY THE C OURT AT ANY POINT OF TIME. THEREFORE, THERE IS NO QUESTION OF ANY EXTENSION OR EXCLUSION OF THE PERIOD OF LIMITATION OF SIX MON THS AS PROVIDED IN SECTION 275(1) OF THE ACT. IN OTHER WORDS, THE CHANGE/ TRANSFER OF JURISDICTION WOULD NOT EXTEND OR EXCLUD E ANY PERIOD WHILE COMPUTING THE PERIOD OF LIMITATION U/S. 275(1 ) OF THE ACT. 11. NOW LET US EXAMINE WHETHER IN THE ABSENCE OF SPECIF IC PROVISION IN SECTION 275(1) OF THE ACT CAN WE EXTEN D THE PERIOD OF LIMITATION MERELY BECAUSE THERE WAS A CHANGE/TRA NSFER OF JURISDICTION? INCOME-TAX ACT IS A SPECIAL ENACTMENT FOR THE PURPOSE COMPUTATION OF TOTAL INCOME, ASSESSMENT AND LEVY OF TAX. THEREFORE, THE LEGISLATIVE INTENT HAS TO BE T AKEN INTO CONSIDERATION WHILE INTERPRETING THE PROVISIONS OF THE ACT. AS RIGHTLY POINTED OUT BY THE LEARNED COUNSEL FOR THE ASSESSEE WHENEVER THERE WAS A TRANSFER OF JURISDICTION, THE LEGISLATURE HAS NOT INTENDED TO EXTEND THE PERIOD OF LIMITATION . THIS IS OBVIOUS FROM SECTION 127(4) AND 129 OF THE ACT. TH E ASSESSING OFFICER HAS NO DISCRETION EXCEPT TO PROCEED FROM TH E STAGE AT WHICH IT WAS LEFT BY THE PREDECESSOR IN OFFICE. IN OTHER WORDS, WHENEVER THERE WAS TRANSFER/CHANGE OF JURISDICTION, THE SUCCEEDING OFFICER HAS TO CONTINUE THE PROCEEDINGS AT THE STAGE AT WHICH IT WAS LEFT BY HIS PREDECESSOR IN OFFICE. THEREFORE, THE LEGISLATURE HAS MADE IT VERY CLEAR THAT TRANSFER/CH ANGE OF JURISDICTION CANNOT EXTEND THE PERIOD OF LIMITATION PROVIDED IN SECTION 275(1) OF THE ACT. IN THE CASE BEFORE US I T IS NOT IN ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 9 DISPUTE THAT THE CIT (CENTRAL) WHO HAS ORIGINAL JUR ISDICTION OF THE MATTER RECEIVED THE APPELLATE ORDER OF THIS TRI BUNAL ON 23.4.2007. THEREFORE, IF AT ALL THERE WAS A TRANSF ER/CHANGE OF JURISDICTION THE ORDER OF THE TRIBUNAL OUGHT TO HAV E BEEN PLACED BEFORE THE OFFICER WHO HAS JURISDICTION ON THE MATT ER IMMEDIATELY WITHOUT ANY DELAY. IN OTHER WORDS, FOR ALL PRACTICAL PURPOSES, THE DATE OF RECEIPT OF THE ORDER OF THE T RIBUNAL BY THE COMMISSIONER (CENTRAL) SHALL BE THE STARTING POINT FOR LIMITATION. THEREFORE, IN OUR OPINION, THE DATE OF RECEIPT OF T HE APPELLATE ORDER OF THIS TRIBUNAL BY THE CIT-I TO WHOM THE JUR ISDICTION WAS SAID TO BE TRANSFERRED IS IMMATERIAL OR IRRELEVANT. THE ORIGINAL RECEIPT OF THE ORDER BY THE CIT (CENTRAL) ON 23.4.2 007 SHALL BE TAKEN INTO ACCOUNT FOR THE PURPOSE OF COMPUTING THE PERIOD OF LIMITATION. THEREFORE, WE ARE UNABLE TO UPHOLD THE OBSERVATION OF THE CIT(A) ON THE ISSUE OF LIMITATION. 12. WE ARE CONSCIOUS THAT WHEN WE HAVE DECIDED THE ISSU E OF LIMITATION IN FAVOUR OF THE ASSESSEE, IT MAY NOT BE NECESSARY FOR THIS TRIBUNAL TO GO INTO THE MERIT OF THE CASE. HO WEVER, IN VIEW OF THE ADMITTED FACT OF THE CASE AND THE JUDGEMENT OF THE APEX COURT IN CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. ( 2010) 322 ITR 158 NO DETAILED ADJUDICATION IS REQUIRED. THE ASSES SEE WRITTEN OFF THE PART OF THE DEBT DUE FROM FGFSL AND CLAIMED THE SAME AS BAD DEBT. THE ASSESSING OFFICER LEVIED PENALTY ON THE GROUND THAT THE ASSESSEE WAS WRONG IN WRITING OFF THE AMOU NT OF RS.34.13 CRORES AS BAD DEBT. IN OUR OPINION, THE A SSESSING OFFICER IS NOT CORRECT IN LEVYING THE PENALTY. WHE N THE ASSESSEE HAS FURNISHED THE ENTIRE DETAILS AND CLAIMED DEDUCT ION AS BAD DEBT UNDER THE STATUTORY PROVISIONS, WE CANNOT SAY THAT THE ASSESSEE HAS CONCEALED ANY PART OF ITS INCOME OR FU RNISHED ANY INACCURATE PARTICULARS AS HELD BY THE APEX COURT IN THE CASE OF RELIANCE PETROPRODUCTS PVT. LTD. (SUPRA). IN VIEW O F THE JUDGEMENT OF THE APEX COURT IN THE CASE OF RELIANCE ITA NO. 1630 & CO.NO. 30/H/08 M/S. ANDHRA BANK FINANCIAL SERVICES LTD. ===================== 10 PETROPRODUCTS PVT. LTD. (SUPRA), EVEN ON MERIT THE PENALTY HAS TO BE DELETED. IN OUR OPINION, THE CIT(A) HAS RIGHTLY DELETED THE PENALTY. IN VIEW OF THE ABOVE DISCUSSION, WHILE UP HOLDING THE ORDER OF THE CIT(A) ON MERIT, WE REVERSE THE FINDIN G OF THE CIT(A) IN RESPECT OF THE ISSUE OF LIMITATION. 13. ACCORDINGLY, THE APPEAL OF THE REVENUE IS DISMISSED AND THE CROSS OBJECTION OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH JULY, 2010. SD/- SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER (N.R.S. GANESAN) JUDICIAL MEMBER HYDERABAD, DATED 16 TH JULY, 2010 TPRAO COPY FORWARDED TO: 1. SHRI G. JOHNSON, INCOME-TAX OFFICER, WARD-1(1), 4TH FLOOR, AAYAKAR BHAVAN, BASHEERBAGH, HYDERABAD-500 004. 2. M/S. ANDHRA BANK FINANCIAL SERVICES LTD., 1ST FL OOR, ANDHRA BANK BUILDING, SULTAN BAZAR, KOTI, HYDERABAD . 3. THE CIT(A)-II, HYDERABAD 4 THE CIT-I, HYDERABAD 5. THE DR B BENCH, HYDERABAD