2019 (1) TMI 1911 - AT - Income Tax

Reopening of assessment u/s 147 - Special audit u/s 142(2A) - period for submission of special audit report - time barring assessment order passed after the prescribed limit i.e. 60 days from the date on which the appellant was required to submit the special audit report - HELD THAT - The time period commencing from the date on which the AO directed the assessee to get its accounts audited under sub-section (2A) of Section 142 of the Act was 21st December 2011 and ending with the last date on which the assessee was required to furnish a report of such audit was 21st March 2012 in the instant case. As the notice u/s 148 was issued on 29.04.2010 therefore the assessment was supposed to completed within 09 months from the end of the F.Y. in which the notice u/s 148 was served which in the instant case was 31st December 2011. However on 21st December 2011 the assessee was directed to get its account audited u/s 142(2A) of the Act with a direction to file audit report within 90 days i.e. on or before 21st March 2012 and thereafter the time gets expired. However it is the case of the Revenue Department that the time for filing of the audit report u/s 142 (2A) was extended by the Assessing Officer on 10.04.2012 for a period of 45 days which was expiring on 05.05.2012. Admittedly the order dated 20-04-2012 does not find mention in the assessment order and the Revenue Department neither established the service of the said extension order upon the assessee nor brought any of the records such as receipt and dispatch register and/or any document maintained for dispatch of the letter dated 20.04.2012 or otherwise in normal routine by which the existence and validity of the said order could be established. We are in agreement with the stand of the Revenue department that even in the absence of application by the assessee the Assessing Officer can extend the period for submission of special audit report however in the instant case order u/s 142(2A) was passed on 21st Dec. 2011 and time limit for filing of the audit report was fixed as 90 days from the receipt of the order which was expired on 21st March 2012 and up to 9th April 2012 nothing happened neither the assessee filed an application of extension of the time for filing of special audit report and/or not extended suo moto by the Assessing Officer therefore once the time limit gets expired by efflux of time then the Assessing Officer is not empowered to extend it further therefore on this reason also the assessment order is void and cannot be acted upon. Hence under the peculiar facts and circumstances of the instant case and in view of considerations deliberations and analyzations made above the assessment order being void passed after the time prescribed under the law consequently liable to be quashed and therefore quashed accordingly.

Summary

Issues Involved:
1. Legality and validity of the assessment order based on the time limit prescribed under Section 153(2) of the Income Tax Act.
2. Jurisdiction of the Assessing Officer as per CBDT guidelines.

Issue-wise Detailed Analysis:

1. Legality and Validity of the Assessment Order:
The primary issue raised by the assessee was the legality of the assessment order dated 06.07.2012, which was claimed to be barred by the limitation period prescribed under Section 153(2) of the Income Tax Act. The assessee argued that the assessment order was issued beyond the 60-day period from the date the special audit report was required to be submitted, making it void and non-enforceable.

The Assessing Officer had directed the assessee to get its accounts audited under Section 142(2A) on 21.12.2011, with an initial deadline of 90 days (21.03.2012) for submission of the audit report. This period was extended by 45 days on 10.04.2012, setting a new deadline of 05.05.2012. However, the Assessing Officer further extended this period to 59 days on 20.04.2012, making the final deadline 20.05.2012. The audit report was received on 08.05.2012, and the assessment order was issued on 06.07.2012.

The assessee contended that the extension order dated 20.04.2012 was not genuine, alleging it was fabricated and never served. The Revenue Department argued that the extension was valid and within the powers of the Assessing Officer, citing the Indian Evidence Act, 1872, which presumes official documents as genuine unless proven otherwise.

The Tribunal examined the affidavits and evidence provided by both parties. The affidavit from the process server claimed that the extension order was served on 21.04.2012, but there was no acknowledgment from the assessee or other authorities. The Tribunal found discrepancies in the records and noted that the Revenue Department failed to provide conclusive evidence of the order's service. Consequently, the Tribunal held that the assessment order dated 06.07.2012 was issued beyond the prescribed time limit and was void.

2. Jurisdiction of the Assessing Officer:
The assessee also raised the issue of jurisdiction, arguing that the Assessing Officer who issued the assessment order did not have the proper jurisdiction as per CBDT guidelines. However, since the Tribunal had already quashed the assessment order on the grounds of being time-barred, it did not delve into the jurisdiction issue, considering it an academic exercise.

Conclusion:
The Tribunal allowed the appeals filed by the assessee, quashing the assessment order dated 06.07.2012 for being issued beyond the prescribed time limit under Section 153(2) of the Income Tax Act. The appeals filed by the Revenue Department were dismissed. The judgment emphasized the importance of adhering to statutory time limits and proper service of extension orders.