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Facts
The assessee filed an appeal against the final assessment order dated 23/05/2024 for AY 2018-19. The original assessment order was set aside by the Tribunal, and the matter was remanded to the AO. The assessee contended that the subsequent assessment order was passed beyond the statutory limitation period prescribed under Section 153(5) of the Act.
Held
The Tribunal held that the impugned assessment order dated 23/05/2024 was barred by limitation as prescribed under Section 153(5) of the Act. Following the jurisdictional High Court's decisions in similar cases, the Tribunal quashed the assessment order.
Key Issues
Whether the assessment order passed by the AO was barred by limitation under Section 153(5) of the Income Tax Act, 1961, after a remand from the Tribunal.
Sections Cited
143(3), 254, 153(5), 92CA(3), 144C(13), 144B, 270A, 153(3), 153(4), 244A
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Income Tax Appellate Tribunal, DELHI
Before: S. RIFAUR RAHMAN & SHRI YOGESH KUMAR U.S.
from the end of the month in which order u/s 254 of the Act received by the Principal Chief Commissioner of Income Tax.
Hon'ble Delhi High Court in the case ofHuawei Telecommunications India Company Private Limited vs ACIT in W.P.
(c) 7792/2024 and CM Appeal No. 32296/2024, in the similar circumstances, held that the order of the TPO/AO stand time barred under Section 153(5) of the Act. The relevant partition of the same are as under:-
“13. Undisputedly, the learned ITAT had pronounced the order in open court on 24.02.2021 as is expressly set out in the said order. The order also indicates that the Revenue was duly represented by the departmental representative (Sh. Surender Pal, CIT). Thus, the timeline for passing an order under Section 153(5) of the Act commenced from 24.02.2021.
In view of the above settled position, there can be no dispute regarding the date of receipt of the order passed by the learned ITAT. Concededly, further proceedings by the TPO or by the AO pursuant to the remand by the learned ITAT are now barred as the time stipulated for passing an order under Section 153 of the Act has since expired. Consequently, the petitioner's return is required to be considered as accepted.
The petition is allowed in the aforesaid terms. The pending application is also disposed of.”
The Hon'ble Delhi High Court's in the case of Aircom International India Private Limited vs DCIT (WP(C) No 16153/2023), held that since the AO has not passed the assessment orders in accordance with the orders of remand passed by the ITAT within the time stipulated under Section 153(3) read with Section 153(4) and Section 153(5) of the Act, the returned position are directed to be accepted. Relevant extract of the ruling is provided hereunder:
Hitachi Astemo Haryana Pvt. Ltd. Vs. ACIT 6. Accordingly, the present batch of matters is disposed of with a direction to the AO to pass appeal effect orders in accordance with law within eight weeks. In the event, the AO has not passed the assessment orders in accordance with the orders of remand passed by the ITAT within the time stipulated under Section 153(3) read with Section 153(4) and Section 153(5) of the Act, the returned assessments are directed to be accepted on the said issues. The AO shall also release the refunds, if any, alongwith applicable interest in accordance with Section 244A of the Act within a further period of eight weeks. This Court clarifies that it has passed this order, as it is settled law that assessment is complete only when the AO passes an assessment order determining the total income and the demand notice determining the tax payable by the assessee is issued.”
In view of the above facts and circumstances and also following the ratio laid down by the Jurisdictional High Court in the case of Huawei telecommunications India Company private limited (supra)and Aircom International India Private Limited (supra),we are of the opinion that the order impugned dated 23/05/2024 passed by Assistant Commissioner of Income Tax, Circle 10(1), Delhi is barred by limitation as prescribed u/s 153(5) of the Act. Accordingly the order impugned dated 23/05/2024 is hereby quashed. Since we have quashed the assessment order dated 23/05/2024 being barred by limitation, other grounds of Appeal requires no adjudication.