SAROJIN SATPATHY,BHUBANESWAR vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-5(1), BHUBANESWARW, BHUBANESWAR

Shri P.K.Mishra, P.K.Mishra, ld AR appeared for the assessee and Shri the assessee and Shri S.C.Mohanty, Sr. S.C.Mohanty, Sr. DR appeared for the revenue.

The appeal of the assessee is delayed by 61 days. The The appeal of the assessee is delayed by 61 days. The The appeal of the assessee is delayed by 61 days. The assessee has filed condonation petition supported by affidavit, wherein, he has mentioned filed condonation petition supported by affidavit, wherein, he has mentioned filed condonation petition supported by affidavit, wherein, he has mentioned

It was submitted by ld AR that the assessee had filed his return of income for the impugned assessment year on 25.9.2017. It was the submission that without processing the said return filed, the Assessing Officer had initiated the proceedings of reopening by issuance of notice u/s.148 on 23.5.2018. It was the submission that the time limit for issuance of notice u/s.143(2) was available till 30.9.2018. Consequently, notice issued u/s.148 of the Act on 23.5.2018 was bad in law. Ld AR placed reliance on the decision of Hon’ble Madras High Court in the case of K.M.Pachayappan (2008) 304 ITR 264 (Mad), wherein, following the decision of Hon’ble Supreme Court in the case of Trustees of H.E.H. The Nizama’s Supplemental Family Trust vs CIT, 242 ITR 381 (SC) and also the decision of Hon’ble Delhi High Court in the case of KLM Royal Dutch Airlines vs Asst. Director of Income Tax, 292 ITR 49 (Del) held that no action could be initiated u/s.147 of the Act when there is pendency of the return before

In reply, ld Sr DR vehemently supported the order of the AO and ld CIT(A). It was the submission that in view of the provisions of section 124(3) of the Act, the assessee having not challenged the reopening within one month before the Assessing Officer, the reopening is liable to be upheld.

We have considered the rival submissions. A perusal of the provisions of section 124(3) of the Act clearly shows that the provision is in relation to the jurisdiction of the Assessing Officer over an assessee. In the present case, the assessee has not challenged the jurisdiction of the AO. The assessee has challenged the action of the Assessing Officer in reopening of the assessment during the pendency of a valid return remaining live before the Assessing Officer. Admittedly, in the present case, the return has been filed on 25.9.2017 and the time limit for issuance of notice u/s.143(2) of the Act expires only on 30.9.2018. Consequently, the issuance of notice u/s.148 of the Act on 23.5.2018 when the return was live before the Assessing Officer is bad in law and is liable to be quashed and we do so. Our view finds support from P a g e 3 | 4 the decision of Hon’ble Madras High Court in the case of CIT vs. K.M.Pachayappan (supra) and in the case of Qatalys Software Technologies Ltd (supra). Consequently, notice issued u/s.148 of the Act is quashed and the consequential assessment also stands quashed.

In the result, appeal of the assessee stands allowed.