2016 (2) TMI 1168 - AT - Income Tax

Reopening of assessment - notices u/s 148 beyond period of limitation - Held that - Notices issued u/s. 148 was dated 30.03.2005 and 31.03.2006 for AYs 1998-99 and 1999-2000 respectively but, these were issued, as admitted by Ld. Sr. DR, after 31.03.2005 and 31.03.2006. And records clearly shows that both the notices were handed over to Postal Authorities on 05.04.2005 and 07.04.2006 for AYs 1998-1999 and 1999-2000 respectively. Notices have been dispatched/left the control of the officer only after the end of the financial year and the same was served only on 16.05.2005 for AY 1998-99 and 05.06.2006 for AY 1999-2000 respectively. It means that the same have clearly been issued beyond the prescribed period of limitation - Decided in favour of assessee.

Summary

Issues:
1. Delay in filing appeals by the assessee.
2. Legal issue regarding the notice u/s. 148 of the Income Tax Act being barred by limitation.

Analysis:

1. Delay in filing appeals by the assessee:
The appeals filed by the assessee were delayed by 105 days, and the assessee provided reasons for the delay due to health issues. The Tribunal considered the reasons provided and condoned the delay of 44 days, admitting both appeals. The delay was attributed to the health ailment of the assessee, and the Tribunal found the cause reasonable for the delay.

2. Legal issue regarding the notice u/s. 148 being barred by limitation:
The primary legal issue raised by the assessee was that the notice u/s. 148 of the Income Tax Act was barred by limitation. The notices for the assessment years 1998-99 and 1999-2000 were issued after the prescribed dates, as admitted by the Senior DR. The Tribunal examined the case records and found that the notices were handed over to the Postal Authorities after the end of the financial year, leading to a delay in service. Referring to the decision of the Hon'ble Gujarat High Court in a similar case, the Tribunal held that the notices were issued beyond the prescribed period of limitation. Consequently, the Tribunal allowed the appeal of the assessee on the jurisdictional issue, following the precedent set by the Gujarat High Court.

In conclusion, the Tribunal allowed the appeal of the assessee based on the jurisdictional issue of the notice u/s. 148 being barred by limitation, thereby not delving into the merits of the case. The decision was pronounced in the open court on 17.02.2016.