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TMI Blog2005 (1) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... e facts of the cases before them, the Tribunal have held that the orders under sections 201(1) and 201(1A) having been made by the Assessing Officer after the expiry of 4 years from the end of the financial year, should be treated as having been made beyond a reasonable period and, therefore, for that reason should also be treated as barred by limitation. In this view of the matter, it can by no means be held that there is an infallible time-limit of four years from the end of the financial year in operation in respect of every order under sections 201(1) and 201(1A) made or to be made by the Assessing Officer. ( ii )Factual background in the appeals before us is vastly different and distinguishable from the facts of the cases relied upon by the assessee. We see considerable force in the contention of the learned DR that there was no unreasonable delay on the part of the Assessing Officer. The assessee made certain payments to its employees on different counts but did not deduct tax at source. This fact was not highlighted by the assessee in certificate of tax deduction at source issued in Form No. 16. The Assessing Officer was thus left unaware of the facts relating to non-deducti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pheld subject to re-computation. The assessee s appeals regarding orders u/s 201(1) were allowed, and the revenue s appeals were dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... DR argued that there was some confusion as to the limitation of time in view of the erstwhile provisions of section 231. That provision was interpreted by some courts as laying down in a time-limit. However, section 231 had been omitted from the statute book w.e.f. 1-4-1989. That was a clear manifestation of the intention of Legislature that there should be no time-limit in respect of recovery of tax dues and application of the provisions such as sections 201(1) and 201(1A). The learned DR strongly relied upon the judgment of Hon'ble Kerala High Court in Secretary, Sultan Battery Co-operative Housing Society Ltd. v. CIT [2003] 261 ITR 364 in support of his contention. 6. The learned DR argued that it was a well-settled legal position that the authorities created adjudication of disputes arising under an enactment cannot read any foreign proposition into the statutory provisions of that enactment, more so when statutory provision is clear and unambiguous. In support of this contention, the learned DR cited the judgment of Hon'ble Supreme Court in the case of Smt. Tarulata Shyam v. CIT [1977] 108 ITR 345. The learned DR also mentioned that in the decision in U.P. State Industrial D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inate delay. 8. The learned DR vehemently argued that as far as orders under section 201(1A) were concerned, the same merely translated into action mandatory provisions of statute. The courts had held in a number of cases that levy of interest under section 201(1A) was compensatory in nature and, therefore, the expression "shall" in the statutory provision should be read "shall" only. In respect of these contentions, the learned DR relied upon the judgments in Bennet Coleman & Co. Ltd. v. Mrs. V.P. Damle Third ITO [1986] 157 ITR 8121 (Bom.); British Airways v. CIT [1992] 193 ITR 4392 (Cal.); CIT v. Dhanalakshmy Wvg. Works [2000] 245 ITR 133 (Ker.) and above all the judgments of jurisdictional High Court in CIT v. Prem Nath Motors (P.) Ltd. [2002] 253 ITR 7054 (Delhi). 9. In reply the learned counsel for the assessee argued that it was cardinal principle of law that all actions prejudicial to a person should be initiated and completed within time. He argued that insofar as the judgments of Hon'ble Calcutta High Court relied upon by the learned DR were concerned, the same had already been considered by the Tribunal in the case of Raymond Woollen Mills Ltd. (supra) as well as Mitsub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se Tribunal decisions the learned counsel has sought to argue that since the orders under sections 201(1) and 201(1A) in the case of the assessee for financial years 1986-87 to 1991-92 have been made on 5th June, 1996 i.e., four years after the last day of the financial year, the orders were required to be quashed as already barred by limitation when they were passed. 14. It is well settled legal position that a judgment is an authority only for what it actually decides, as pointed out by Lord Halsbury in Quinn v. Letham [1901] AC 495 (HL). It is, therefore, essential to carefully ascertain as to whether there is really any assistance or harm to the case of the litigant from the earlier decided cases. The first, decision relied upon by the learned counsel for the assessee is that of Income-tax Appellate Tribunal in the case of Raymond Woollen Mills Ltd. v. ITO [1996] 57 ITD 536 (Bom.). In that case the assessee did deduct tax at source from payments on account of interest and paid the same to the credit of Central Government. There was, however, some delay in the deposit of tax to the account of Government for assessment years 1978-89 to 1986-87. The Assessing Officer passed order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i.e., the Assessing Officer levying interest after lapse of 5 to 10 years in respect of delay of one to 3 months and in few cases six to 12 months in making payments when all the relevant facts were available to the Assessing Officer all the while. 16. The second case relied upon by the learned counsel for the assessee is that of Sahara Airlines Ltd. v. Dy. CIT [2002] 83 ITD 11 (Delhi). On perusal of the order of the Tribunal, it is clear to us that that judgment is heavily upon the particular facts and circumstances of that that case. There is no similarity at all between the facts of Sahara Airlines Ltd.'s case (supra) and those in the appeals before us. After having decided the matter in favour of the assessee on the particular facts of the case, in passing, towards the end the Tribunal dealt with the assessee's plea of limitation in the following manner :-- "42. The last issue arising out of these appeals is whether the orders of Assessing Officer under section 201 of the Act were passed within the period of limitation. It has been admitted by the ld. counsel for the assessee that no period of limitation is prescribed for passing of such orders but it was contended by him th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed on 10-5-2000. Four years from the end of assessment year means 5 years from the end of financial year. In the present case, the orders have been passed with reference to financial years. Therefore, it is held that the order under section 201 of the Act for the financial year 1994-95 was barred by limitation. Other orders for the financial years 1995-96 to 1998-99 are within the period of limitation. Accordingly, the order under section 201(1) for financial year 1994-95 is quashed while other orders are held to be passed within reasonable period." 17. It is, thus, seen that on the particular facts and circumstances of the case, the Hon'ble Delhi Bench have in the case of Sahara Airlines Ltd. (supra) preferred to rely upon the decision of ITAT in the case of Raymond Woollen Mills Ltd. (supra) though it was admitted that the issue was covered directly in favour of the assessee by the judgment of Hon'ble Calcutta High Court in the case of CIT v. Blackwood Hodge (India) (P.) Ltd. [1971] 81 ITR 807. It was felt by the Bench that the judgment of Hon'ble Calcutta High Court was contrary to the decision of the Hon'ble Supreme Court in the case of S.B. Gurbux Singh v. Union of India AIR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of the Tribunal in the case of Raymond Woollen Mills Ltd. (supra) and Sahara Airlines Ltd.'s (supra), the Tribunal held that orders under section 201(1)/201(1A) pertaining to financial years 1988-89 to 1994-95 were time barred. Before doing so the Hon'ble Tribunal recorded submissions of the revenue in paragraph 36 in the following words :-- "36. On the other hand, the learned CIT DR has opposed such contention by arguing that no period of limitation has been prescribed by the Legislature for passing order under section 201 and consequently, such order could be passed at any time. Reliance was also placed on the judgment of Calcutta High Court in the case of British Airways v. CIT [1992] 193 ITR 439 and in the case of CIT v. Blackwood Hodge (India) (P.) Ltd. [1971] 81 ITR 807 (Cal.). She further submitted that section 231, which was interpreted by the courts as laying down a time-limit, has been omitted from the statute book from 1-4-1989. According to her, such omission shows the intention of the Legislature that no time-limit is required. It was also submitted that it is a well settled legal position that nothing can be read into the provisions where such provisions are clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 201(1A) should be declared as void on account of having become barred by limitation should not be accepted :-- (i)There is no doubt that the Hon'ble High Court have in the case of CIT v. Blackwood Hodge (India) (P.) Ltd. [1971] 81 ITD 807 and in the case of British Airways v. CIT [1992] 193 ITR 4391 (Cal.) clearly held that the argument of the assessee that the amount of tax deducted at source had become irrecoverable being barred by limitation cannot be sustained. In the various decisions relied upon by the learned counsel of the assessee, this proposition is not in dispute. However, on the facts of the cases before them, the Tribunal have held that the orders under sections 201(1) and 201(1A) having been made by the Assessing Officer after the expiry of 4 years from the end of the financial year, should be treated as having been made beyond a reasonable period and, therefore, for that reason should also be treated as barred by limitation. In this view of the matter, it can by no means be held that there is an infallible time-limit of four years from the end of the financial year in operation in respect of every order under sections 201(1) and 201(1A) made or to be made by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cle 142 of the Constitution of India to pass such orders as deemed fit for doing complete justice in the matter before them. That being so, the extreme view as to the illegality of an order passed by the authority in the absence of statutory support should be taken only in rare cases where the authority acted in complete disregard of reasonability. We do not find any such circumstance existing in these appeals so as to warrant the action of annulment of the orders under sections 201(1) and 201(1A) made by the Assessing Officer. 23. In view of the discussion in the foregoing paragraphs, we reject the assessee's plea as to the orders being illegal on account of having been made beyond the time-limit in the eyes of law. 24. We shall now come to the merits of the orders under sections 201(1) and 201(1A) as disputed in these appeals by the assessee as well as revenue. During the course of hearing before us both the parties agreed that the issues involved and their respective arguments thereupon are the same as presented before us during the course of elaborate hearing in relation to assessee's appeals in TDS Appeal Nos. 50 and 51 (Del)/95 for financial year 1992-93. Accordingly our fi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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