2009 (7) TMI 829 - AT - Income Tax

Search and Seizure - it is found that undisputedly the assessment orders though passed before the period of limitation contemplated under the relevant provisions of law, the copies of the orders were served to the assessee after the expiration of the limitation provided under the relevant provision. - assessments are barred by limitation - No order of assessment under s. 18 or assessment or reassessment under sub-s. (1) Of this section shall be made after the expiry of five years from the end of the year in which the agricultural income was first assessable - assessment orders as non est having been passed beyond the period of limitation prescribed under law - appeals of the assessee are allowed on question of law - appeals of the Department dismissed

Summary

Issues:
Assessment orders barred by limitation

Analysis:
The judgment involves a bunch of 23 appeals by the assessee and the Department for assessment years. The common issue in all appeals is whether the assessment orders were barred by limitation. Both parties presented their arguments regarding the issue of limitation in framing assessment by the Assessing Officer (AO). The assessees contended that even though the assessment orders were passed before the period of limitation, they were served to the assessees after the expiration of the limitation period, making them invalid and void. On the other hand, the Departmental Representative argued that the assessment orders were passed within the period of limitation and provided detailed evidence supporting their claim.

Upon careful consideration of the material and submissions from both parties, the Tribunal found that the assessment orders were dispatched to the assessees after the period of limitation had expired. The Tribunal referred to relevant provisions of law, including section 153B of the Income Tax Act and section 35(2) of the Agricultural Income Tax Act, to analyze the issue of limitation. Drawing parallels with a judgment by the Kerala High Court, the Tribunal concluded that the assessment orders, though passed on a certain date, were dispatched beyond the period of limitation, rendering them ineffective and non est under the law.

Based on the above analysis and precedents, the Tribunal held that the assessments in all the years under consideration were barred by limitation. Consequently, the assessment orders were deemed non est and ineffective under the law. As a result, the appeals of the assessees were allowed, while the appeals of the Department were dismissed. The Tribunal did not delve into the merits of the additions made in the assessment orders, as the primary issue of limitation had already rendered the assessment orders invalid.

In conclusion, the judgment extensively analyzed the issue of assessment orders being barred by limitation, considered relevant legal provisions and precedents, and ultimately ruled in favor of the assessees based on the findings regarding the limitation period being exceeded in serving the assessment orders.