2009 (4) TMI 306 - HC - Income Tax

Block assessment - Tribunal has held that the assessment completed was within the period of limitation - contention on behalf of the appellant is that in his own case, that is, Rajesh Ku mar v. Deputy CIT 2008 - TMI - 6548 - SUPREME Court , the apex court had ruled in his favour, that opportunity of hearing has to be granted to the assessee before proceeding under section 142(2A). Thus, according to the petitioner, the impugned assessment framed under section 158BC of the Income-tax Act by the Assessing Officer is barred by limitation within the meaning of the provisions contained in section 158BE read with section 142(2A) Held , dismissing the appeal that the SC had subsequently in another decision upheld the decision of the asssessee s own case but had clarified that its ruling on the question of law would apply prospectively and that it would not be open to the appellants to urge before the appellate authority that the extended period of limitation under Explanation 1(iii) to section 153(3) of the Act was not available to the Assessing Officer - The decision of the learned Appellate Tribunal based on Sahara India (Firm) is held to be valid.

Summary

Issues:
- Challenge to the consolidated order of the Income-tax Appellate Tribunal
- Bar on assessment under section 158BC due to limitation
- Application of the judgment in Rajesh Kumar case
- Prospective application of the law clarified in Sahara India case
- Validity of the decision based on Sahara India case
- Absence of substantial question of law

Analysis:
1. The appeal under section 260A of the Income-tax Act challenges the consolidated order of the Income-tax Appellate Tribunal, which held the assessment completed within the limitation period. The Tribunal relied on the judgment of the Supreme Court in the Sahara India case to support its decision.

2. The appellant argues that the assessment under section 158BC is time-barred as per section 158BE read with section 142(2A) of the Act. Citing the Rajesh Kumar case, the appellant contends that the opportunity of hearing must be granted to the assessee before proceeding under section 142(2A).

3. The respondent, supported by the counsel, justifies the Tribunal's decision based on the Sahara India case. The Supreme Court, in Sahara India, acknowledged the ruling in Rajesh Kumar but held that the law would apply prospectively. The appellant cannot challenge the limitation before the appellate authority, as clarified in the judgment excerpts.

4. The judgment in Sahara India allows the appellants to question the correctness of the material gathered based on the audit report but upholds the validity of the decision made by the Appellate Tribunal. The Tribunal's decision aligns with the observations made in the Sahara India case.

5. The High Court concludes that no substantial question of law necessitates consideration and dismisses the appeal accordingly. The judgment affirms the decision of the Appellate Tribunal, based on the application of the law clarified in the Sahara India case.