M/S SADHU SINGH HAMDARD TRUST,JALANDHAR vs. ASSISTANT COMMISSIONER OF INCOME TAX, JALANDHAR

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR. BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER

I.T.A. Nos.15 to 22/Asr/2017 A.Ys.: 1984-85 to 1991-92

Sadhu Singh Hamdard Trust, Vs. Asstt. Commissioner of Nehru Garden Road ,Jalandhar. Income Tax, Circle-III, [PAN: AAATS3278A] Jalandhar. (Respondent) (Appellant)

Appellant by Sh.Gunjeet Singh Syal, Adv. Respondent by Sh. RadheyShyam Jaiswal, Sr. DR

Date of Hearing 13.12.2022 Date of Pronouncement 20.12.2022

ORDER Per: Bench:

In the aforesaid appeals of the assessee for various Assessment Years, the grievance of the assessee is common i.e., the limitation for passing the order by the

assessing authority u/s 143(3)/147 on dated 21.03.2014. Apart from the limitation

I.T.A. Nos. 15 to 22/Asr/2017 2 A.Ys.: 1984-85 to 1991-92

issue, other issues are challenged before the ld. Commissioner of Income

Tax(Appeal)-2, Jalandhar, for impugned Assessment Years. But the ld. CIT(A) had

upheld the order of the ld.AO. Being aggrieved assessee challenged the order of

the ld. AO before the bench. With the consent of both the parties ITA No-

15/Asr/2017 is taken as lead case.

only the additional ground interms of Rule 11 of the Income Tax (Appellate

Tribunal) Rules, 1963. The additional ground is extracted as below: “1. That on the facts and circumstances of the case and in law, the impugned assessment order was passed on 21.03.2014 and is barred by limitation as per proviso to section 153(4), the same being passed beyond period of 60 days from the date of receipt of order of the Hon’ble High Court dated 04.07.2013 in CWP No. 16897/1995.” 3. We find that now only the single issue to be decided related to limitation of

passing the order by the assessing authority.

3.1 The ld. Counsel for the assessee argued that the notice of the ld.AO u/s 148

was challenged before the Hon’ble High Court of Punjab & Haryana at

Chandigarh. The Hon’ble Court had stayed the proceeding of the ld. assessing

I.T.A. Nos. 15 to 22/Asr/2017 3 A.Ys.: 1984-85 to 1991-92

authority, copy of the said order dated 11.04.1996 bearing C.W.P. No.16890, 16891, 16893 to 16899/1995 is placed during hearing before the Bench. The ld.

counsel for the assessee further argued that the Hon’ble High Court had passed the order finally related to C.W.P. No. 16890, 16893/1995 to 16899/1995 on dated 04.07.2013. The relevant para 28 is reproduced as below: “28. Since the question is one of a fact, we leave it open to the Assessing Officer to examine the questions of fact, but we are unable to agree with the argument raised that the assessment is sought to be reopened only on account of change of opinion. In fact the return is sought to be reopened on account of non- disclosure of material facts relating to application of the income for charitable purposes. Consequently, we do not find any merit in the present set of writ petitions. The same are accordingly dismissed.” 3.2 The ld. counsel vehemently argued and placed that the order of the Hon’ble

High Court was passed on 04.07.2013. In persuasion of this order the ld. AO has

passed the order u/s 143(3)/147 on dated 21.03.2014, which had violated the

limitation u/s 153(4) of the Act. As per the ld. counsel the order should be passed

by the ld. AO within the 60 days after receiving the order of the Hon’ble High

I.T.A. Nos. 15 to 22/Asr/2017 4 A.Ys.: 1984-85 to 1991-92

Court and the assessing authority has passed the order beyond the limitation by

contravening section 153(4) of the Act. Accordingly, the order of the ld. AO is

abrogated for barred by limitation. No other issue was agitated before the bench

other than the limitation issue. The ld. counsel for the assessee also informed the

bench that the additional ground was not agitated before the lower authority and

the issue was taken first time as per the Rule 11 of the Income TaxRule 1963 and

respectfully following the decision of Supreme Court in the case of National

Thermal Power Co. Ltd. vs. CIT 229 ITR 383 (SC).

revenue authorities. The ld. Sr. DR vehemently argued and mentioned that there is

no barred by limitation by the ld. AO for violating section 153(4). In bird’s eye

view the date & events are reproduced as per tabular format.

Date & Events of Completion of Assessment

Asstt. Date of issue Date of Due date for Time barring date Year notice passed completion after excluding the stay u/s 148 of Act Asstt. Order of assessment duration 1984-85 04.08.1994 21.03.2014 31.03.1997 26.06.2014 1985-86 30.03.1995 19.03.2014 31.03.1997 26.06.2014 1986-87 04.08.1994 21.03.2014 31.03.1997 26.06.2014

I.T.A. Nos. 15 to 22/Asr/2017 5 A.Ys.: 1984-85 to 1991-92

1987-88 30.05.1995 21.03.2014 31.03.1998 24.06.2015 1988-89 30.05.1995 21.03.2014 31.03.1998 24.06.2015 1989-90 30.05.1995 21.03.2014 31.03.1997 26.06.2014 1990-91 19.08.1994 21.03.2014 31.03.1997 26.06.2014 1991-92 04.08.1994 21.03.2014 31.03.1997 26.06.2014

The ld. Sr. DR had argued that the assessee in the above noted case has raised an

additional ground on 13/12/2022 claiming that these cases were completed after

date of limitation for passing an order u/s147/143(3) in view of explanation 1 (ii)

of section 153. In this connection, it is submitted that the section 153 (2) stood as

under as on 01/04/1994, the year in which the notice u/s 148 was issued:

"[(2) No order of assessment, reassessment or re-computation shall be made under

section 147 after the expiry of two years from the end of the financial year in which

the notice under section 148 was served:

Provided that where the notice under section 148 was served on or before the 31st

day of March, 1987, such assessment, reassessment or re-computation may be

made at any time up to the 31st day of March, 1990.1"

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Accordingly, the assessment under section 147 was time barring only on

31.03.1997/31.03.1998 as notice u/s 148 was issued on 04/08/1994 or later as per

chart attached.

Further argued that the ld. AR of the assessee has furnished a copy of interim order

dated 11/04/1996 in the above writ petitions. In this order of Hon'ble Court, it has

been mentioned "Stay to continue'. It appears that stay was granted by the Hon'ble

High Court on any date earlier than 11/04/1996.

Relevant portion of explanation 1 to para 153 is reproduced as under: "[Explanation 1.- In computing the period of limitation for the purposes of this

section-

( i) the time taken in reopening the whole or any part of the proceeding or in

giving an opportunity to the assessee to be re-heard under the proviso to section

129, or

(ii) the period during which the assessment proceeding is stayed by an order or

injunction of any court, or…”

From this explanation, it is clear that the period during which the stay is effective

will be excluded while calculating the period of limitation.

I.T.A. Nos. 15 to 22/Asr/2017 7 A.Ys.: 1984-85 to 1991-92

The Assessing Officer has taken only eight months and 17 days for completion of

assessment from the date on which the final order was passed by Hon'ble Court

[i.e. 04/07/2013 to 21/03/14]. Therefore, it is clear that the AO completed the

assessment within the time legally available to him.

It may not be out of place to mentioned that section 153(4) is not applicable in case

of the assessee as it is applicable to Transfer Pricing cases referred u/s 92CA.

Further the proviso under explanation 1 is also not required to be invoked as the

AO already had time more than 60 days after the order of Hon'ble High Court.

record. First, we consider the additional ground placed by the ld. counsel before

the bench. The additional ground is accepted and taken for adjudication. The ld. Sr.

DR had not made any objection for acceptance of the additional ground before the

bench. The section 153(4) is reproduced as below: - “153 (4) Notwithstanding anything contained in sub-sections (1), (2) and (3),

where a reference under sub-section (1) of section 92CA is made during the course

of the proceeding for the assessment or reassessment, the period available for

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completion of assessment or reassessment, as the case may be, under the said sub- sections (1), (2) and (3) shall be extended by twelve months.”

Relevant provision mentioned by the ld. Counsel is reproduced as below: - “153(9)……………………………. Explanation 1.—For the purposes of this section, in computing the period of limitation— (i)………………………………….. To (xiii) shall be excluded: Provided that where immediately after the exclusion of the aforesaid period, the period of limitation referred to in sub-sections (1), (2), (3) and sub-section (8) available to the Assessing Officer for making an order of assessment, reassessment or recomputation, as the case may be, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid period of limitation shall be deemed to be extended accordingly:”

5.1 We thoughtfully considered that the submission of the ld. counsel to section 153(4) is related to the transfer pricing u/s 92CA. But the issue of the assessee is related to domestic tax which is not related to transfer pricing. The entire issue is raised before the bench first time without agitating before the lower authority. The

submission of the ld. Sr Dr is in view that the assessment orders are not barred by limitation. The ld. AO had completed assessment within limitation as per provision

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of Act. We find that the legal issue should be remanded back to ld. CIT(A) for further adjudication de novo. Needless to say, that the CIT(A) shall provide proper

and adequate opportunity of being heard to the assessee in set aside proceedings.

The evidence /explanation submitted by assessee in its defence shall be admitted

by the ld. CIT(A) and adjudicate in accordance with law. No other grounds are

pressed during the hearing. We order accordingly.

Order pronounced in the open court on 20.12.2022

Sd/- Sd/-

(Dr. M. L. Meena) (ANIKESH BANERJEE) Accountant Member Judicial Member

AKV Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T.