The ACIT, Central Circle-1, Baroda V. M/s. Sun Pharmaceuticals Industries Ltd., Baroda

ITA 1688/AHD/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6029 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-04-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 11-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R I PATEL
• Keywords: Period of limitation; Time period of passing order; Reassessment proceedings
• Section: 143(3); 115JB; 147; 148; 10

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD - BENCH A BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ ITA NO.1688/AHD/2015 / ASSTT. YEAR: 2005-2006 ACIT, CIR.2(1)(1) BARODA. VS. M/S.SUN PHARMACEUTICAL INDUSTRIES LTD. SPARC, TANDALJA, BARODA 390 020. PAN : AADCS 3124 K / (APPELLANT) / (RESPONDENT) REVENUE BY : SHRI R.I. PATEL, CIT-DR ASSESSEE BY : SHRI S.N. SOPARKAR, AR ! / DATE OF HEARING : 20/04/2017 '#$ ! / DATE OF PRONOUNCEMENT: 05/05/2017 %& / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST OR DER OF THE LD.CIT(A)-2, VADODARA PASSED FOR THE ASSTT.YEAR 200 5-06. 2. GROUNDS OF APPEAL TAKEN BY THE REVENUE ARE NOT I N CONSONANCE WITH RULE 8 OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1962. THEY ARE DESCRIPTIVE AND ARGUMENTATIVE IN NATURE. IN BR IEF, THE GRIEVANCE OF THE REVENUE IS THAT THE LD.CIT(A) HAS ERRED IN LAW IN ANNULLING RE- ASSESSMENT ORDER HOLDING THAT IT WAS PASSED AFTER E XPIRY OF LIMITATION PROVIDED IN SECTION 153(3) OF THE INCOME TAX ACT, 1 961. ITA NO.1688/AHD/2015 2 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S FILED ITS RETURN OF INCOME ELECTRONICALLY ON 31.10.2005 DECLARING A LOS S OF RS. (-) 21,90,62,215/- UNDER NORMAL PROVISION AND SHOWN BOO K PROFIT UNDER SECTION 115JB OF THE ACT AT RS.74,17,26,149/-. THI S RETURN WAS REVISED ON 4.5.2006 AND ASSESSMENT ORDER UNDER SECTION 143( 3) OF THE ACT WAS PASSED ON 25.3.2008 WHEREBY TOTAL INCOME OF THE ASS ESSEE WAS DETERMINED AT RS.25,20,66,051/- AND BOOK PROFIT WAS DETERMINED AT RS.116,76,19,194/-. THE AO, THEREAFTER RECORDED RE ASONS AND REOPENED ASSESSMENT. NOTICE UNDER SECTION 148 WAS ISSUED AND SERVED UPON THE ASSESSEE ON 30.3.2012. AT THIS STAGE, WE DO NOT DEEM IT NECESSARY TO RECITE AND RECAPITULATE OTHER FACTS RE LATING TO RE- ASSESSMENT ORDER PASSED BY THE AO. IT IS SUFFICE T O SAY THAT RE- ASSESSMENT ORDER WAS PASSED ON 26.2.2014. 4. IT IS PERTINENT TO MENTION HERE THAT THE ASSESSE E HAD CHALLENGED REOPENING OF THE ASSESSMENT BY WAY OF WRIT PETITION BEFORE THE HONBLE GUJARAT HIGH COURT IN SPECIAL CIVIL APPLICATION NO. 2965 OF 2013. THE HONBLE HIGH COURT TOOK COGNIZANCE OF THIS PETITION AND PASSED INTERIM ORDER ON 18.3.2013. THE ORDER READS AS UNDER: NOTICE RETURNABLE ON 1.4.2013. RESPONDENTS MAY CO NTINUE WITH ASSESSMENT, FINAL ORDER PURSUANT TO THE IMPUGNED NO TICE SHALL NOT BE PASSED WITHOUT LEAVE OF THE COURT. THE HONBLE COURT ULTIMATELY DISPOSED OF THIS WRIT PETITION ON 29.7.2013. THE ASSESSEE TOOK OBJECTION BEFORE THE AO AND CONTENDED THAT THE HONBLE HIGH COURT TOOK COGNIZANCE OF THE ASSESSEES SCA. THERE WERE 13 DAYS AVAILABLE TO THE AO FOR PASSING ASSESSMENT ORDER. AS PER EXPLANATION (II) APPENDED TO SECTION 153(1) AND 153(4), THE AO WAS REQUIRED TO PASS ASSESSMENT ORDER WITHIN 60 DAY S FROM THE DATE OF THE ORDER PASSED BY THE HONBLE HIGH COURT. IN OTH ER WORDS, IT WAS CONTENDED BY THE ASSESSEE THAT DAYS DURING WHICH TH E AO WAS RESTRAINED FROM PASSING FINAL ORDER IS TO BE EXCLUD ED FROM THE LIMITATION ITA NO.1688/AHD/2015 3 ULTIMATELY THE AO CONSUMED FOR PASSING THE ASSESSME NT ORDER. THE LD.AO WAS OF THE VIEW THAT THIS TIME LIMITATION OF 60 DAYS IS AVAILABLE TO HIM FROM THE DATE OF RECEIPT OF ORDER OF THE HONBL E HIGH COURT. HE ACCORDINGLY PASSED THE ORDER WITHIN 60 DAYS FROM TH E DATE OF RECEIPT OF THE ORDER OF THE HONBLE HIGH COURT. 5. DISSATISFIED WITH THE ACTION OF THE AO, THE ASSE SSEE HAS REITERATED ITS CONTENTIONS BEFORE THE LD.CIT(A). THE LD.CIT(A ) HAS ACCEPTED THE CONTENTIONS OF THE ASSESSEE AND OBSERVED THAT THE EXPLANATION 1(1) APPENDED TO SECTION 153(1) POSTULATES FOR COMPUTING PERIOD OF LIMITATION, THE PERIOD DURING WHICH ASSESSMENT PROC EEDINGS IS STAYED, SHALL BE EXCLUDED. IN EXCLUDING THE ABOVE PERIOD, CONCEPT OF COMMUNICATION OF ORDER OF THE COURT CANNOT BE IMPOR TED. THUS, ACCORDING TO THE LD.CIT(A) TIME LIMIT TO PASS ASSES SMENT ORDER WOULD RUN FROM THE DATE OF PRONOUNCEMENT OF THE ORDER, WH ICH WAS PASSED IN THE PRESENCE OF COUNSEL OF COUNSEL FOR THE REVENUE. IF IT IS TO BE COMPUTED IN THIS MANNER, THEN, ASSESSMENT ORDER WAS TIME BARRED, AND ACCORDINGLY, THE LD.CIT(A) HAS ACCEPTED THE CONTENT IONS OF THE ASSESSEE AND ANNULLED RE-ASSESSMENT ORDER. THE LD.CIT(A) HA S FORTIFIED ITSELF WITH ORDER OF THE ITAT PASSED IN THE CASES OF DILIP DAHANUKAR VS. ACIT, 90 ITD 525 (MUM) AND ALSO UNREPORTED ORDER OF THE I TAT PASSED IN THE CASE OF BHARAT V. PATEL VS. ACIT, ITA NO.4514/AHD/2 007. BEFORE US, THE LD.DR FILED A LETTER DATED 24.3.2017. HE CONTE NDED THAT HE HAS INVITED COMMENTS OF THE AO IN THE LIGHT OF TWO DECI SIONS OF THE HONBLE SUPREME COURT RENDERED IN THE CASE OF AUTO & METAL ENGINEERS VS. UOI, 229 ITR 399 (SC) AND VLS FINANCE LTD. VS. CIT, (201 6) 68 TAXMANN.COM 368 (SC). HE PLACED ON RECORD COPIES O F THESE TWO DECISIONS. 6. ON THE OTHER HAND, THE LD.COUNEL FOR THE ASSESSE E CONTENDED THAT THE ISSUE IN DISPUTE IS SQUARELY COVERED BY THE DEC ISION OF THE HONBLE ALLAHABAD HIGH COURT RENDERED IN THE CASE OF CIT VS . CHANDRA BHAN ITA NO.1688/AHD/2015 4 BANSAL, 46 TAXMANN.COM 108 (ALL.). HE PLACED ON RE CORD COPIES OF THESE DECISIONS. HE FURTHER CONTENDED THAT THE HON BLE ALLAHABAD HIGH COURT HAS ALSO CONSIDERED THIS ASPECT IN THE CASE O F CIT VS. DR. X-RAY & PATHOLOGY INSTITUTE P. LTD., 40 TAXMANN.COM 115 (AL L). THE LD.COUNSEL FOR THE ASSESSEE FURTHER POINTED THAT ALL RELEVANT DETAILS HAVE BEEN REPRODUCED BY THE LD.CIT(A). NO COMMENTS ARE REQUI RED FROM THE AO. THE ASSESSEE HAS SUBMITTED DETAILS IN TABULAR FORM EXHIBITING DATE OF ISSUE OF NOTICE UNDER SECTION 148, DATE OF INTERIM ORDER PASSED BY THE HONBLE HIGH COURT AND DATE OF FINAL ORDER PASSED B Y THE HONBLE COURT. IN THIS CONNECTION, HE TOOK US THROUGH WRITTEN SUBM ISSIONS OF THE ASSESSEE AND MADE REFERENCE TO THE RELEVANT PART AT PAGE NOS.5 TO 7 OF THE CIT(A)S ORDER. HE FURTHER POINTED THAT TWO DE CISIONS REFERRED BY THE LD.CIT-DR ARE CONCERNED, FACTS ARE QUITE DISTIN GUISHABLE. IN THOSE CASE, THE HONBLE COURT HAS PROPOUNDED THAT PERIOD DURING WHICH ASSESSMENT PROCEEDING IS STAYED SHALL BE EXCLUDED. THE ASSESSEE IS NOT DISPUTING THIS PROPOSITION. IT HAS ALSO EXCLUD ED THAT PERIOD. THE ONLY DISPUTE BETWEEN THE ASSESSEE AND THE AO IS WHE THER TIME CONSUMED IN COMMUNICATION OF THE ORDER HAS ALSO TO BE EXCLUDED OR NOT. 7. WE HAVE DULY CONSIDERED RIVAL CONTENTIONS AND GO NE THROUGH THE RECORD CAREFULLY. A SHORT CONTROVERSY BETWEEN THE AO AND THE ASSESSEE IS WHETHER FOR COMPUTING PERIOD OF LIMITATION, PERI OD DURING WHICH THE ASSESSMENT PROCEEDINGS IS STAYED SHALL BE INCLUDED OR PERIOD CONSUMED IN COMMUNICATION OF HONBLE HIGH COURTS ORDER TO T HE AO SHALL ALSO TO BE EXCLUDED. FOR RESOLVING THIS CONTROVERSY, WE WO ULD LIKE TO MAKE REFERENCE TO WRITTEN SUBMISSIONS FILED BY THE ASSES SEE BEFORE THE LD.CIT(A) EXHIBITING EVENTS AND DATES TAKEN PLACE. SAID SUBMISSIONS READ AS UNDER: 4.4. THE THIRD GROUND OF APPEAL IS AS FOLLOWS: '3. RE: ASSESSMENT ORDER PASSED U/S. 143 R.W.S 147 IS OUTSIDE THE PERIOD OF LIMITATION SPECIFIED U/S. 153 AND NEEDS TO BE QUASHED AS VOID AB INIITIO: ITA NO.1688/AHD/2015 5 3.1 THE ASSESSING OFFICER HAS GROSSLY ERRED IN PASS ING AN ASSESSMENT ORDER U/S. 143 R.W.S 147 DATED 26TH FEBR UARY, 2014, WITHOUT APPRECIATING THAT IT IS TIME BARRED A ND BEYOND THE TIME SPECIFIED IN 148 WAS SERVED AND HENCE, VOI D AB INITIO.' 4.2. THE APPELLANT DURING THE COURSE OF THE APPELL ATE PROCEEDING JIAS MADE FOLLOWING SUBMISSIONS IN THIS REGARD: 'GROUND NO. 3: ASSESSMENT ORDER PASSED U/S. 143 RWS 147 IS OUTSIDE/BEYOND THE PERIOD OF LIMITATION SPECIFIED U/S. 153 AND NEEDS TO BE QUASHED AS VOID AB INITIO: GROUND OF APPEAL IN BRIEF: THE ASSESSING OFFICER HAS GROSSLY ERRED IN PASSING AN ASSESSMENT ORDER U/S. 143 R.W.S. 147 DATED 26TH FEB RUARY, 2014, WITHOUT APPRECIATING THAT IT IS TIME BARRED A ND BEYOND THE TIME LIMIT SPECIFIED IN SECTION 153(2) I.E. AFT ER THE EXPIRY OF ONE YEAR FROM THE END OF FINANCIAL YEAR IN WHICH THE NOTICE U/S. 148 WAS SERVED AND HENCE, VOID AB INITI O. OVERVIEW OF FACTS: 1. THE TIME LIMIT FOR THE ASSESSING OFFICER TO PAS S ORDER U/S.147 IS ONE YEAR FROM END OF FINANCIAL YEAR IN W HICH NOTICE WAS SERVED [S. 153(2)] AND THE ASSESSING OFF ICER HAD TO PASS THE ORDER BY 31TH MARCH, 2013 SINCE THE NOT ICE U/S.148 WAS ISSUED ON 30TH MARCH, 2012. 2. EXPLANATION 1 TO SEC. 153(4) PROVIDES FOR THE PE RIOD TO BE EXCLUDED WHILE CALCULATING THE PERIOD OF LIMITATION . THUS, THE PERIOD FROM THE DATE ON WHICH INTERIM RELIEF WAS GR ANTED BY THE HIGH COURT TILL THE DATE OF VACATION OF RELIEF BY THE HIGH COURT WILL BE EXCLUDED. THUS THE PERIOD FROM 18TH M ARCH 2013 TO 29TH JULY 2013, I.E. 134 DAYS WILL BE EXCLU DED IN CALCULATING THE PERIOD OF LIMITATION [EXPLANATION 1 TO S. 153(4)]. 3. THUS, THE TIME LIMIT WITHIN WHICH REASSESSMENT ORDER U/S. 143(3) R. W. S. 147 AS PER SEC. 153(2) R.W.S. PROVISO TO SEC. 153(4) IS TO BE PASSED IS 27-09-2013. ITA NO.1688/AHD/2015 6 4- THE ASSESSING OFFICER HAS ERRED IN PASSING THE REASSESSMENT ORDER ON 26-02-2014 AND HENCE, THE SAM E IS VOID-AB-INITIO. SUBMISSIONS: 1. FIRSTLY ALL THE RELEVANT DATES OF PROCEEDINGS ARE MENTIONED AS UNDER: SR. NO. PARTICULARS DATES 1 DATE OF ISSUING NOTICE U/S 148 30/03/2012 2 DATE ON WHICH NOTICE U/S 148 WAS SERVED ON THE APPELLANT 30/03/2012 3 STAY ORDER PASSED BY THE GUJARAT HIGH COURT AGAINST WRIT PETITION FILED BY THE APPELLANT 18/03/2013 4 FINAL ORDER PASSED BY THE GUJARAT HIGH COURT AND STAY VACATED AGAINST WRIT PETITION FILED BY THE APPELLANT 29/07/2013 5. /4 ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) R.W.S. 147 26/02/2014 2. WE ENCLOSE HEREWITH THE FOLLOWING DOCUMENTS TO SUBSTANTIATE E ABOVE AT PAGE 1 TO PAGE 5 OF THE PAPERBOOK: NOTICE ISSUED U/S 148 STAY ORDER PASSED BY THE GUJARAT HIGH COURT AG AINST WRIT PETITION FILED BY THE APPELLANT FINAL ORDER PASSED BY THE GUJARAT HIGH COURT A ND STAY VACATED AGAINST WRIT PETITION FILED BY THE APP ELLANT ASSESSMENT ORDER PASSED BY THE ASSESSING OFFIC ER U/S 143(3) R.W.S. 147 3. SECTION 153 STATES THE TIME LIMITS FOR COMPLETION OF ASSESSMENTS AND REASSESSMENTS. SUB-SECTION 2 OF 153 READS AS UNDER 'NO ORDER OF ASSESSMENT, REASSESSMENT OR RECOMPUTATION SHALL BE MADE UNDER SECTION 147 AFTER THE EXPIRY OF ONE YEAR FROM THE END OF THE FINANCIA L YEAR IN WHICH THE NOTICE UNDER SECTION 148 WAS SERVED ITA NO.1688/AHD/2015 7 4. SINCE THE NOTICE U/S 148 WAS SERVED ON THE APPEL LANT ON 30TH MARCH 2012, THE REASSESSMENT ORDER U/S 147 OUGHT TO BE PASSED BY THE ASSESSING OFFICER BY 31ST MARCH 2013 I.E. ONE YEAR FROM 31ST MARCH 2012 I.E. THE END OF THE FINANCIAL YEAR IN WHICH THE NOTICE IS SE RVED. 5. HOWEVER, THE APPELLANT HAD FILED A CIVIL PETITIO N APPLICATION DATED 8TH MARCH 2014 AGAINST THE VALIDI TY OF THE SAID NOTICE BEFORE THE HONOURABLE GUJARAT HIGH COURT ON 12TH MARCH 2013. SUBSEQUENTLY, THE HONOURABLE GUJARAT HIGH COURT VIDE ORAL JUDGEMENT ORDER DATED 18TH MARCH, 2013 HAD ISSUED DIRECTIVES TO THE RESPONDENT I.E. THE ASSESSING OFFICER THAT IT MAY CONTINUE WITH THE ASSESSMENT BUT FINAL ORDER PURSUANT TO THE IMPUGNED NOTICE SHALL NOT BE PASSED WITHOUT THE LEAVE OF THE COURT. THUS, THE HONOURABLE GUJARAT HIGH COURT HAD STAYED THE ASSESSMENT PROCEEDINGS WITH EFFECT FROM THIS DATE. TILL THIS DATE, ONLY 13 DAYS (18TH MARCH 2013 TO 31ST MA RCH 2013) WERE REMAINING AS PER SECTION 153 TO PASS THE ORDER U/S. 147 SINCE THE LAST DATE TO PASS THE ORDE R U/S. 147 WAS 31ST MARCH, 2013. 6. THE HONOURABLE GUJARAT HIGH COURT PASSED THE FIN AL ORDER ON 29TH JULY, 2013 (SEE ANNEXURE 1.5 OF PAPER BOOK PAGE NO. 6 TO 14). ACCORDINGLY BY VIRTUE OF TH E PROVISIONS OF EXPLANATION 1 TO S. 153(4), THE PERIO D DURING WHICH THE REASSESSMENT PROCEEDINGS WERE STAY ED BY THE ORDER OF THE HONOURABLE GUJARAT HIGH COURT I S TO BE EXCLUDED. EXPLANATION 1 TO SEC. 153(4) WHICH PRO VIDES FOR THE PERIOD TO BE EXCLUDED WHILE CALCULATING THE PERIOD OF LIMITATION READS AS UNDER: 'EXPLANATION L.IN COMPUTING THE PERIOD OF LIMITATI ON FOR THE PURPOSES OF THIS SECTION (I) ..... (II) THE PERIOD DURING WHICH THE ASSESSMENT PROCEEDING IS STAVED BY AN ORDER OR INJUNCTION OF ANY COURT, OR (IIA)..... (III) ...... (IV) (V) ..... (VI).... ITA NO.1688/AHD/2015 8 (VII).... (VIII) ..... (IX)..... SHALL BE EXCLUDED ' THUS, THE PERIOD FROM THE DATE ON WHICH INTERIM REL IEF WAS GRANTED BY THE HIGH COURT TILL THE DATE OF VACA TION OF RELIEF BY THE HIGH COURT WILL BE EXCLUDED. SUBSEQUE NTLY, THE HIGH COURT WITH ORAL JUDGMENT ORDER DATED 29TH JULY, 2013 PERMITTED THE ASSESSING OFFICER TO PROCEED WIT H THE REASSESSMENT PROCEEDINGS ON THE FIRST GROUND RAISED IN REASONS RECORDED FOR REASSESSMENT. THUS, THE PERIOD FROM 18TH MARCH 2013 TO 29TH JULY 2013, I.E.134 DAY S WILL BE EXCLUDED IN CALCULATING THE PERIOD OF LIMIT ATION [EXPLANATION 1 TO S. 153(4)]. 7. HENCE, THE ASSESSING OFFICER HAD TO PASS THE ORD ER WITHIN 13 DAYS FROM 29TH JULY, 2013 (DATE WHEN HIGH COURT VACATED THE STAY). HOWEVER, AS PER 1ST PROVIS O TO EXPLANATION 1 TO 153(4) IF AFTER VACATION OF STA Y THE TIME PERIOD REMAINING TO PASS AN ORDER IS LESS THAN SIXTY DAYS IT WILL BE EXTENDED TO SIXTY DAYS. THE RELEVANT EXTRACT IS PRODUCED HEREIN BELOW: 'PROVIDED THAT WHERE IMMEDIATELY AFTER THE EXCLUSIO N OF THE AFORESAID TIME OR PERIOD, THE PERIOD OF LIMITATION REFERRED TO IN SUBSECTIONS (1), 65[(1A), (IB),] 66[(2), (2A) AN D (4)] AVAILABLE TO THE ASSESSING OFFICER FOR MAKING AN OR DER OF ASSESSMENT, REASSESSMENT OR RECOMPUTATION, AS THE C ASE MAY BE, IS LESS THAN SIXTY DAYS, SUCH REMAINING PER IOD SHALL BE EXTENDED TO SIXTY DAYS AND THE AFORESAID PERIOD OF LIMITATION SHALL BE DEEMED TO BE EXTENDED ACCORDING LY:' THUS BASED ON THE ABOVE, THE ASSESSING OFFICER OUGH T TO HAVE PASSED THE ORDER BY 27TH SEPTEMBER 2013. THE W HOLE WORKING IS SUMMARISED AS UNDER: SR. NO. PARTICULARS DATES 1. DATE OF ISSUING NOTICE U/S 148 30/03/2012 2. DATE ON WHICH NOTICE U/S 148 WAS SERVED ON THE APPELLANT 30/03/2012 3. END OF THE FINANCIAL YEAR IN WHICH THE NOTICE WAS SERVED 31/03/2012 ITA NO.1688/AHD/2015 9 4 ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH NOTICE WAS SERVED - TIME LIMIT GIVEN FOR ASSESSING OFFICER TO PASS ORDER U/S. 147 (AS PER SECTION 153(2)) 31/03/2013 5 STAY ORDER PASSED BY THE GUJARAT HIGH COURT AGAINST WRIT PETITION FILED BY THE APPELLANT 18/03/2013 6 FINAL ORDER PASSED BY THE GUJARAT HIGH COURT AND STAY VACATED AGAINST WRIT PETITION FILED BY THE APPELLANT 29/07/2013 7 NUMBER OF DAYS WHICH WILL BE EXCLUDED IN COMPUTING THE TIME LIMIT (AS PER EXPL 1 TO SEC 153(4)) [6- 5] 134 8 DA YS REMAINING FOR AO TO COMPLETE THE ASSESSMENT AFTER HC ORDER [4 - 5 ] 13 9 9 SINCE THE TIME REMAINING IS LESS THAN 60 DAYS, TIME PERIOD IS EXTENDED TO 60 DAYS [AS PER PROVISO TO EXPL 1 TO SEC 153(4)] 6 10 DATE WITHIN WHICH ORDER U/S. 147 HAS TO BE PASSED AND SERVED UPON THE ASSESSEE [ 6 + 9 ] 27/09/2013 11 ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) R.W.S. 147 26/02/2014 8. IN VIEW OF THE ABOVE THE REASSESSMENT ORDER WAS PASSED AFTER THE TIME LIMIT PRESCRIBED BY THE STATUTE. SIN CE THE ORDER PASSED IS BARRED BY LIMITATION, THE REASSESSM ENT ORDER PASSED U/S 143(3) RWS 147 BY THE ASSESSING OFFICER IS VOID AB INITIO AND NEEDS TO BE QUASHED. 9. ON THIS ISSUE, WE FURTHER CLARIFY THAT THE LIMI TATION PERIOD FOR COMPLETING ASSESSMENT WOULD START FROM DATE WHE N HIGH COURT VACATED THE STAY ORDER AND NOT FROM DATE WHEN ASSESSING OFFICER RECEIVED SUCH VACATION ORDER. THU S IN THE PRESENT THE LIMITATION PERIOD WOULD START WITH EFFE CT FROM ITA NO.1688/AHD/2015 10 27TH JULY 2013. THE DATE OF RECEIPT OF THE VACATION ORDER BY THE ASSESSING OFFICER IS IRRELEVANT. 10. IN THIS REGARDS, FIRSTLY IT IS SUBMITTED THAT T HE JUDGMENT OF THE HON'BLE HIGH COURT WAS PASSED IN AN OPEN COU RT WHEREIN THE DEPARTMENTAL REPRESENTATIVE WAS PRESENT . THE ORDER OF THE HIGH COURT, WAS PASSED IN PRESENCE OF REVENUE COUNSEL. THUS THE DATE OF KNOWLEDGE OF THE DISMISSA L OF SUCH WRIT PETITION TO THE ASSESSEE OR AO IS IMMATER IAL PARTICULARLY WHEN THE DECISION WAS PRONOUNCED IN OP EN COURT. FURTHER AN AFFIDAVIT IN REPLY WAS ALSO FILED BY THE DEPARTMENTAL REPRESENTATIVE ON 21ST JUNE 2013. THIS SHOWS THAT THE DEPARTMENTAL REPRESENTATIVE WAS AWAR E OF THE COURT PROCEEDINGS. HENCE THERE WAS NO REQUIREMENT FOR THE ASSESSING OF FICER TO WAIT FOR THE COMMUNICATION OF THE HIGH COURT ORDER AS WITH THE PASSING OF THE ORDER, THE STAY AS PROVIDED BY T HE HON'BLE HIGH COURT CAME TO AN END. THE DATE OF COMMUNICATION OF ORDER WOULD BE IRRELEVANT. 8. A PERUSAL OF THE ABOVE DETAILS WOULD INDICATE TH AT 194 DAYS ARE AVAILABLE TO THE AO FROM 29.7.2013. BUT HE PASSED THE ASSESSMENT ORDER AFTER MORE THAN 200 DAYS. THE AO WAS OF THE OPINION THAT TIME LIMIT FOR PASSING THE ASSESSMENT ORDER WOULD COMMEN CE FROM THE DATE OF COMMUNICATION OF THE ORDER. IT HAS BEEN OBSERVE D THAT THIS ORDER WAS COMMUNICATED TO HIM ON 14.2.2014 AND HE WAS TO PASS AN ORDER WITHIN 60 DAYS FROM THIS DATE. ACCORDINGLY, HE HAS PASSED IT ON 26.2.2014. BUT THIS INTERPRETATION OF THE EXPLANATION (1)(II) APPENDED TO SECTION 153(1) HAS NOT BEEN APPROVED BY THE LD.C IT(A). THE FINDING OF THE LD.CIT(A) IS BASED UPON ORDERS OF THE ITAT, WHEREIN THE TRIBUNAL HAS CONSIDERED SCOPE OF EXPLANATION (1)(II) TO SECTION 153(1) OF THE INCOME TAX ACT. THIS EXPLANATION HAS FALLEN FOR CONSIDERATION BEFORE THE HONBLE HIGH ALLAHABAD COURT AND WHILE CONSIDER ING THIS EXPLANATION, THE HONBLE HIGH COURT HAS OBSERVED AS UNDER: THE AFORESAID WRIT PETITIONS HAVING BEEN DISMISSED ON 01/8/1995, AS PER PROVISO TO EXPLANATION 1 TO SECTION 153, THE AS SESSMENT WAS TO BE COMPLETED BY 30/9/1995, BUT IN THE PRESENT CASE THE ASSESSMENT WAS COMPLETED ON 04/1/1996 I.E. BEYOND 30/9/1995. T HE SUBMISSION ITA NO.1688/AHD/2015 11 OF SHRI SHAMBHU CHOPRA, LEARNED COUNSEL APPEARING F OR THE REVENUE TO SAVE THE ASSESSMENT FROM BEING BEYOND THE PERIOD OF LIMITATION IS THAT THE PERIOD OF 60 DAYS IS TO BE COMPUTED FROM T HE DATE OF COMMUNICATION OF THE ORDER. HE SUBMITS THAT THE ORD ER OF THE HIGH COURT DATED 01/8/1995, DISMISSING THE WRIT PETITION S COULD BE RECEIVED BY THE OFFICE OF THE ACIT (INVESTIGATION) ON 18/12/ 1995. THERE ARE TWO REASONS DUE TO WHICH THE SAID SUBMISSION CANNOT BE ACCEPTED. FIRSTLY, THE ORDER OF THE HIGH COURT DATED 01/8/1995, DISMIS SING THE WRIT PETITIONS WAS PASSED IN THE PRESENCE OF THE LEARNED COUNSEL FOR THE REVENUE, HENCE THE SUBMISSION THAT IT WAS COMMUNICA TED ON 18/12/1995 HAS NO RELEVANCE, AND SECONDLY THE PROVI SION OF EXPLANATION 1 (II) OF SECTION 153 OF THE ACT, 1961 WHICH IS TO THE FOLLOWING EFFECT: 'EXPLANATION 1- IN COMPUTING THE PERIOD OF LIMITATI ON FOR THE PURPOSES OF THIS SECTION -(I) ............. (II) THE PERIOD DURING WHICH THE ASSESSMENT PROCEED ING IS STAYED BY AN ORDER OR INJUNCTION OF ANY COURT, OR ........... ..SHALL BE EXCLUDED'. THE ABOVE STATUTORY SCHEME CLEARLY INDICATES THAT F OR COMPUTING THE PERIOD OF LIMITATION THE PERIOD DURING WHICH THE AS SESSMENT PROCEEDINGS IS STAYED SHALL BE EXCLUDED. IN EXCLUDI NG THE ABOVE PERIOD, THE CONCEPT OF COMMUNICATION OF THE ORDER O F THE COURT CANNOT BE IMPORTED. THE EXCLUSION OF THE PERIOD HAS BEEN P ROVIDED BECAUSE OF STAY OR INJUNCTION BY ANY COURT DURING WHICH THE ASSESSMENT PROCEEDINGS ARE STAYED. THE INTENTION IS CLEAR THAT WHEN THE LIMITATION FOR ASSESSMENT HAS STARTED IT CAN BE STAYED ONLY BY AN ORDER OR INJUNCTION OF ANY COURT AND AS SOON AS THE ORDER OR INJUNCTION OF THE COURT IS VACATED, THE PERIOD OF LIMITATION SHALL RE -START SINCE AFTER THE VACATION OF THE ORDER OF THE COURT, THERE IS NO EMB ARGO ON THE AUTHORITIES TO PROCEED WITH THE ASSESSMENT. THE SUB MISSION OF SHRI SHAMBHU CHOPRA LEARNED COUNSEL APPEARING FOR THE RE VENUE THAT THE LIMITATION WILL START AGAIN ONLY WHEN THE ORDER IS COMMUNICATED TO THE DEPARTMENT THUS CANNOT BE ACCEPTED. THE OTHER REASO N FOR NOT ACCEPTING THE ABOVE SUBMISSION IS ALSO EQUALLY POTE NT. EXPLANATION 1 (V) AND (VI) TO SECTION 153 OF THE ACT, 1961 ARE AL SO PART OF THE SAME STATUTORY SCHEME. IN EXPLANATION 1 (V) AND (VI) TO SECTION 153 OF THE ACT, 1961 THE STATUTORY SCHEME PROVIDES FOR COMPUTI NG THE PERIOD OF LIMITATION FROM THE DATE WHEN THE ORDER UNDER SUB-S ECTION (1) OF SECTION 245D AND 245Q IS RECEIVED BY THE COMMISS IONER. THUS, THE LEGISLATURE HAS PROVIDED FOR EXCLUDING THE PERI OD FROM THE DATE OF COMMUNICATION OF THE ORDER WHERE THEY SO INTENDED. THE USE OF CONCEPT OF COMMUNICATION OF RECEIVING THE ORDER IN THE SAME PROVISION WHICH IS ABSENT IN EXPLANATION 1 (II) CONCERNED CLE ARLY INDICATES THAT ITA NO.1688/AHD/2015 12 FOR THE PURPOSES OF EXPLANATION 1 (II), THE COMMUNI CATION OF THE ORDER OF THE COURT VACATING THE STAY ORDER OR INJUNCTION IS NOT CONTEMPLATED. 9. THE HONBLE ALLAHABAD HIGH COURT THEREAFTER CONS IDERED A LARGE NUMBER OF DECISIONS RENDERED BY VARIOUS HIGH COURTS AND ARRIVED AT A CONCLUSION THAT CONCEPT OF COMMUNICATION OF ORDER O F THE COURT CANNOT BE IMPORTED. THE LD.CIT(A) HAS APPRECIATED THE CON TROVERSY IN RIGHT PERSPECTIVE. DISPUTE IS SQUARELY COVERED BY THE DE CISION OF THE HONBLE ALLAHABAD HIGH COURTS AS WELL BY TWO ORDERS OF THE ITAT, WHOSE DISCUSSIONS HAVE BEEN REPRODUCED BY THE LD.CIT(A) I N THE IMPUGNED ORDER. THEREFORE, WE DO NOT SEE ANY REASONS TO INT ERFERE IN THE ORDER OF THE LD.CIT(A). ACCORDINGLY, THE APPEAL OF THE REVE NUE IS DISMISSED. 10. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE COURT ON 5 TH MAY, 2017 AT AHMEDABAD. SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER