GURUDAYAL SINGH,KEONJHAR vs. ACIT, CUTTACK

Per Pavan Kumar Gadale, JM

This is an appeal filed by the revenue against the order of CIT(A)-

Cuttack, dated 26.12.2012, for the assessment year 2007-08.

assessee. However, written submission dated 27.4.2017 was filed and is

on record.

sole issue requires for adjudication before us is whether the assessment

order and demand notice dated 29.12.2009 served on the assessee was

barred by limitation u/s.153(1) of the I.T.Act, 1961 or not.

2 ITA No. 165/CT K/ 2013 Asse ssment Year : 20 07- 08

business of trading of ores and minerals and filed the return of income on

15.11.2007 and the case was selected for scrutiny. Notices u/s. 142(1) and

143(2) of the Act were issued to the assessee. Subsequently, the case

was fixed for hearing and ld A.R. appeared and the case was adjourned to

29.12.2009 with specific direction to produce further evidence/documents

in support of alleged enhancement of share capital, sundry creditors, etc.

Since, there was no compliance from the assessee, the Assessing Officer

made best judgment assessment u/s.144 of the Act, inter alia, making

addition in respect of donations and subscriptions, introduction of share

capital and sundry creditors.

has filed an appeal before the CIT(A). The CIT(A) relied on the decision of

this co-ordinate Bench of the Tribunal in the case of the assessee for the

assessment year 2007-08 in ITA No.416/CTK/2011 and C.O.

No.13/CTK/2012, wherein, the matter was restored to the file of the CIT(A).

The CIT(A) examined the assessment record for the said assessment year

and called for the photocopy of documents evidencing service of

assessment order and demand notice for the impugned assessment,

whereas the Assessing Officer vide letter dated 13.12.2012 intimated to

the CIT(A) that date of service of the assessment order is 16.4.2010 and

copy of the demand notice was received by the assessee on 16.4.2010.

The limitation date of the assessment is 31.12.2009 whereas the Assessing

3 ITA No. 165/CT K/ 2013 Asse ssment Year : 20 07- 08 officer has passed the order u/s.144 on 29.12.2009 and there is a delay of

106 days beyond the statutory period of limitation being 31.12.2009 and

the CIT(A) relied on the decision of co-ordinate Bench in the case of ACIT

vs. Orissa Stevendors Ltd. (2012) 16 ITR (Trib) 431 (CTC), and observed

that the assessment order and demand notice served is time barred by

limitation and non-est in law and allowed the appeal of the assessee.

with the Tribunal .The Ld D.R argued on the grounds that the CIT(A) erred

in treating the service as barred by limitation and action of service of

assessment order as non-est in law. whereas the demand notice and the

assessment order are not barred by limitation u/s.153(1) of the Act. Ld

D.R. relied on the provisions of section 153(2) of the I.T.Act, 1961, and the

decision of Hon’ble Calcutta High Court in the case of Badri Prasad Bajoria

vs CIT (197) 64 ITR 362 (Cal) and other judicial decisions and contended

that the action of the CIT(A) is not in accordance with law and prayed for

restoring the order of the Assessing officer.

decisions supporting the action of the CIT(A).

i) Karnani Industrial Bank Ltd., (1978) 113 ITR 380 (Cal)

ii) Viswanathan Chettiar, 25 ITR 79 (Mad)

iii) N. Subba Rao, 48 ITR 808 (Mys)

iv) Badri Prasad Bajoria(1967) 64 ITR 362 (Cal)

v) Andhra Pradesh vs M Rama Krishitah & Co. (1994) 93 STCZ 406 (SC) vi) Tulsi Mohyapatra (ITA Nos.412 & 413/CTk/2011)

4 ITA No. 165/CT K/ 2013 Asse ssment Year : 20 07- 08 vii) Delhi Foot Wear vs Sales Tax Officer order dated 25.9.2014 in W.P(C0 No.2971 of 2009

findings of the Assessing Officer and the arguments of ld D.R., we are of

the considered opinion that this issue is similar to the decision of this Bench

of the Tribunal in the case of Orissa Stevedors Ltd (supra), wherein, it has

been held as under:

“that the demand notices and assessment orders were served on the same day i.e. March 26,2010 though they were purportedly made on December 29, 2009. There was no material in the assessment records which could indicate that initiative was taken by the AO to serve the assessment orders alongwith demand notices immediately after passing of the assessment orders on December 29,2009. The Commissioner (Appeals) rightly came to the conclusion that the assessment orders in these cases though made on December 29,2009 were served on the assessee on March 26,2010 i.e. after 85 days from the date of order. Since there was a delay of 85 days in serving the assessment orders alongwith demand notices the assessment orders for these years were barred by limitation and accordingly they were ineffective and non-est in law.”

the case of Delhi Foot Wear vs Sales Tax Officer order dated 25.9.2014 in

W.P(C0 No.2971 of 2009, wherein, the Hon’ble High Court held that if the

notice issued is in valid for any reason, then the proceeding initiated in

pursuance of such notice would be illegal and invalid. In the case before us,

the assessment order was made on 29.12.2009 and served on the assessee

alongwith demand notice on 16.4.2010, and, there is a delay of 106 days,

which is beyond the limitation time. Accordingly, we find that the disputed

issue is covered by the decision of the co-ordinate bench of the Tribunal in

5 ITA No. 165/CT K/ 2013 Asse ssment Year : 20 07- 08 the case Orissa Stevedors Ltd (supra) and the decision of Hon’ble

Jurisdictional High Court in the case of Delhi Foot wear (supra), and we

respectfully follow the same and concur with the observations of the CIT(A)

and dismiss the ground taken by the revenue.

Order pronounced in the open court on 24 /05/2017 in the presence of parties. Sd/- sd/- (N.S Saini) (Pavan Kumar Gadale) ACCOUNTANT MEMBER JUDICIAL MEMBER Cuttack; Dated 24 /05/2017 B.K.Parida, SPS Copy of the Order forwarded to : 1. The Appellant : ACIT, Circle 2(2), Cuttack 2. The Respondent. M/s. New Age Data Net Pvt Ltd., C/O. Multi Tech Computer, High Court Square, Chandin Chowk, Cuttack 3. The CIT, Cuttack 4. Pr.CIT, Cuttack 5. DR, ITAT, Cuttack 6. Guard file. //True Copy// BY ORDER,

SR.PRIVATE SECRETARY ITAT, Cuttack