2023 (8) TMI 1496 - HC - Income Tax

Validity of assessment order passed beyond time limit provided under the third proviso to Section 153(1) - HELD THAT - Qua the judgment rendered by the Madras High Court in Roca Bathroom Products (P) Ltd. 2022 (6) TMI 848 - MADRAS HIGH COURT a Special Leave Petition (SLP) was preferred with the Supreme Court. As stated that leave has been granted in the SLP. We may also point out that in the succeeding AY, i.e., AY 2022-23, an amendment has been brought about, with the insertion of the fourth proviso in Section 153(1), whereby, the timeframe for passing an assessment order has been enhanced to twelve (12) months. According to us, the matter requires further examination. Issue notice. Mr Aseem Chawla, learned senior standing counsel, accepts notice on behalf of the respondents/revenue. Counter-affidavit will be filed within the next four (4) weeks. Rejoinder thereto, if any, will be filed at least five (5) days before the next date of hearing. List the matter on 09.02.2024. Although we have issued notice in the matter, the AO will be at liberty to continue with the assessment proceeding. However, if an order is passed which is adverse to the interest of the petitioner/assessee, the same shall not be given effect to, till further directions of the Court.

Summary

The writ petition concerns Assessment Year 2021-22. The petitioner argues that the time limit for the AO to pass an assessment order has expired. The petitioner relies on judgments from the Bombay High Court and Madras High Court. The respondents mention a Special Leave Petition filed with the Supreme Court. An amendment for AY 2022-23 extends the timeframe for passing an assessment order to twelve months. The court requires further examination and issues notice. The matter is listed for 09.02.2024. The AO can continue with assessment proceedings, but any adverse order will not be enforced without further court directions.