2004 (7) TMI 292 - AT - Income Tax

Summary

Issues:
Appeals challenging orders of the Commissioner of Income-tax (Appeals) regarding addition made by the Assessing Officer and assessment under section 154/155 for the assessment year 2001-02.

Analysis:
1. The appeals were filed by different assessees challenging the orders of the Commissioner of Income-tax (Appeals) for the assessment year 2001-02. The issue involved in all the appeals was identical, leading to a joint hearing and disposal for convenience. The main contention was the confirmation of additions made by the Assessing Officer and the assessment under section 154/155 by the appellate authority.

2. In the case of one assessee, the land was acquired by the Haryana Government in 1989, and the assessee received enhanced compensation with interest. The Assessing Officer noticed discrepancies in the income declared by the assessee and the interest shown. The Assessing Officer issued a notice under section 139(9) and subsequently held the assessee liable to pay tax for all financial years in which income was earned, including those beyond ten years. The Commissioner of Income-tax (Appeals) upheld the addition, citing provisions of the Income Tax Act regarding tax liability and TDS credit.

3. The assessee contended that the Assessing Officer was not authorized to open the case beyond the last ten years without higher authorities' permission. The arguments were based on the interpretation of relevant provisions of the Act, specifically section 153(3)(ii) and section 199.

4. The Tribunal analyzed the provisions of the Act and relevant case laws to determine the assessee's tax liability. It was established that the bar of limitation could be lifted in case of a court order, and the assessee could only claim TDS credit if the income was offered for assessment. The Tribunal found no merit in the assessee's plea that tax payable or deduction of TDS was limited to the last ten years.

5. Referring to a Supreme Court decision, the Tribunal emphasized that interest on enhanced compensation had to be spread over on an annual basis. This further supported the rejection of the assessee's argument regarding the limitation on tax liability beyond ten years.

6. Ultimately, the Tribunal upheld the orders of the Commissioner of Income-tax (Appeals) and dismissed all five appeals filed by the assessees, rejecting the amended grounds challenging the additions made by the Assessing Officer and the assessment under section 154/155 for the assessment year 2001-02.