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2023 (10) TMI 915 - AT - Income TaxValidity of assessment u/s 144C - time limit for completing the assessment - HELD THAT - We find that the issue is covered in favour of the assessee by the order of the Tribunal in the case of S.A. Chitra Ventures Ltd. 2022 (7) TMI 1474 - ITAT DELHI wherein the co-ordinate bench on similar facts considering the decision of IPF India Property Cyprus 2020 (2) TMI 1500 - ITAT MUMBAI held that the assessment order passed is barred by limitation. There is no dispute that if no draft assessment order was to be issued in this case, the assessment would have been time barred on 31 st December 2017 - Once we hold that no draft assessment order could have been issued in this case, as the provisions of Section 144C(1) could not have been invoked in this case, the time limit of completion of assessment was available only upto 31st December 2017. The mere issuance of draft assessment order, when it was legally not required to be issued, cannot end up enhancing the time limit for completing the assessment under section 143(3). We, therefore, uphold the plea of the assessee on this point as well. Thus we hold that the assessment order passed under section 143(3) read with section 144C(13) is barred by limitation for both the assessment years 2015-16 and 2016-17 - Decided in favour of assessee.
Issues Involved:
1. Admission of additional grounds of appeal. 2. Jurisdiction of the Tribunal to admit additional grounds of appeal. 3. Limitation period for passing assessment orders under Section 143(3) read with Section 144C of the Income Tax Act, 1961. Summary: Issue 1: Admission of Additional Grounds of Appeal The assessee filed appeals against the orders of the Commissioner of Income Tax (Appeals) for the assessment years 2015-16 and 2016-17, seeking the admission of additional grounds of appeal. The Tribunal admitted the additional grounds, noting they were purely legal issues that did not involve any investigation of facts, referencing the Supreme Court decision in National Thermal Power Co. Ltd. v. CIT [1998] 229 ITR 383 (SC). Issue 2: Jurisdiction of the Tribunal to Admit Additional Grounds of Appeal The Tribunal cited the Supreme Court's ruling in Jute Corporation of India Ltd. v. CIT [1991] 187 ITR 688, which established that appellate authorities have all the powers of the original authority in deciding questions before them. The Tribunal confirmed its jurisdiction to examine questions of law arising from the facts found by lower authorities and having a bearing on the tax liability of the assessee. Issue 3: Limitation Period for Passing Assessment Orders The assessee argued that the assessment orders for the years 2015-16 and 2016-17 were barred by limitation. The Tribunal examined the sequence of events and noted that the final assessment orders were passed beyond the statutory period allowed under Section 153(1) of the Income Tax Act. The Tribunal referred to its own decision in the case of ACIT vs. SA Chitra Ventures Ltd. and the ITAT Mumbai's decision in IPF India Property Cyprus (No. 1 Ltd.), concluding that the assessment orders were indeed time-barred. Conclusion: The Tribunal held that the assessment orders for both years were barred by limitation and allowed the additional grounds raised by the assessee. Consequently, all other issues raised in the appeals became academic and infructuous. The appeals of the assessee were allowed, and the order was pronounced in the open court on 25/09/2023.
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