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Issues involved: Appeal against order by CIT, Tiruchirapalli dated 30.03.2009. Grounds of appeal: 1) Order barred by limitation, 2) Order on merits of the case u/s 143(3) of the Income-tax Act, 1961.
Issue 1: Order Barred by Limitation The appeal questions the limitation of the order passed by the ld. CIT on 30.3.2009. The original assessment was completed u/s 143(3) of the Act on 29.3.2004, with reassessment proceedings initiated u/s 148 for interest accrued on securities. The contention is that the issues revised by the ld. CIT u/s 263 were all from the original assessment and thus barred by limitation on 30.3.2009. The argument is that the reassessment order dated 29.12.2006 addressed the interest on securities issue, and the ld. CIT's order u/s 263 is beyond the limitation period. Issue 2: Merits of the Case The appeal also contests the merits of the case, specifically the ld. CIT's failure to appreciate the Assessing Officer's considerations u/s 143(3) and the relevance of decisions by higher courts. The ld. CIT's order u/s 263 is challenged as erroneous and prejudicial to the revenue's interest. The argument presented is that the ld. CIT's revision order was unjustified and beyond the scope of reassessment proceedings initiated by the Assessing Officer. The Tribunal found that the ld. CIT's order u/s 263 was indeed barred by limitation as per the provisions of section 263(2) of the Act. The Tribunal emphasized that the Assessing Officer's jurisdiction in reassessment is limited to the escaped income and not all issues from the original assessment. Citing legal precedents, the Tribunal concluded that the ld. CIT's order revising the original assessment issues was time-barred and set aside the order. The appeal by the assessee was allowed, and the ld. CIT's order u/s 263 was deemed bad in law.
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