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TMI Blog2009 (9) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... 0-10-2008 for the assessment year 2001-02. ITA No. 3415/Delhi/2008 is assessee s appeal and ITA No. 3588/Delhi/2008 is an appeal filed by the revenue against the order of ld. CIT(A)-II, New Delhi in appeal No. DEL/CIT(A)-II/2007-08/82/ 279, dated 19-9-2008 for the assessment year 2002-03. ITA No. 3416/Delhi/2008 is assessee s appeal and ITA No. 3589/Delhi/2008 is an appeal filed by the revenue against the order of ld. CIT(A)-II, New Delhi in appeal No. DEL/CIT(A)-II/2007-08/83/278, dated 19-9-2008 for the assessment year 2003-04. ITA No. 3608/Delhi/2008 is assessee s appeal and ITA No. 3039/Delhi/2009 is an appeal filed by the revenue against the order of ld. CIT(A)-II, New Delhi in appeal No. DEL/CIT(A)-II/2007-08/84/177, dated 28-7-2008 for the assessment year 2004-05. ITA No. 3670/Delhi/2008 is assessee s appeal and ITA No. 359/Delhi/2009 is an appeal filed by the revenue against the order of ld. CIT(A)-II, New Delhi in appeal No. DEL/CIT(A)-II/2007-08/85/385, dated 20-11-2008 for the assessment year 2005-06. Mrs. Rano Jain Shri V. Mohan CA appeared on behalf of the assessee and Shri A.K. Pandey, CIT DR and Ms. Pratima Kaushik, Sr. DR represented on behalf of the revenue. As a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cular No. 1 issued by CBDT dated 27-3-2009 wherein in para 27.4, the applicability of the amendment has been specified to have effect from 1-4-2008. It was the submission that at the relevant time the Assessing Officer did not have the suo motu powers to extend the time for special audit, the subsequent extension made by the orders dated 7-3-2007, 17-4-2007 and 17-5-2007 were all invalid and cannot be taken into consideration for the purpose of extending the limitation for completing the assessment under section 153A. 4. In reply, the ld. D.R. submitted that for the purpose of computation of the limitation, section 142(2C) was not to be considered. It was the submission that the provisions of section 142(2A) was on a stand-alone basis and the provisions of section 142(2B) and (2C) need not be consi-dered. It was the submission that once the Assessing Officer directed the assessee to get the accounts audited by an accountant as specified, the Assessing Officer could specify the time-limit within which such audit was to be completed and the audit report submitted. It was the submission that no specified time-limit was provided in the provisions of section 142(2A) and consequent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y signed and verified by such accountant and setting forth such particulars as may be prescribed and such other particulars as the Assessing Officer may require : Provided that the Assessing Officer shall not direct the assessee to get the accounts so audited unless the assessee has been given a reasonable opportunity of being heard." "The provisions of section 142(2C) read as follows : (2C) Every report under sub-section (2A) shall be furnished by the assessee to the Assessing Officer within such period as may be specified by the Assessing Officer : Provided that the Assessing Officer may, suo motu, or on an application made in this behalf by the assessee and for any good and sufficient reason, extend the said period by such further period or periods as he thinks fit; so, however, that the aggregate of the period originally fixed and the period or periods so extended shall not, in any case, exceed one hundred and eighty days from the date on which the direction under sub-section (2A) is received by the assessee." "The Provisions of Explanation ( ii ) to section 153B read as follows : Explanation. In computing the period of limitation for the purposes of thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on his own. The amendment will take effect from 1-4-2008 (Cause 28) . "Circular No. 1, dated 27-3-2009 Paras 27 to 27.4 reads as follows: Direct Tax Circular No. 1, dated 27-3-2009. Explanatory Notes to the Provisions of the Finance Act, 2008. 1. Introduction 1.1 The Finance Act, 2008 (hereafter referred to as "the Act") as passed by the Parliament, received the assent of the President on the 10th day of May, 2008 and has been enacted as Act No. 18 of 2008. This circular explains the substance of the provisions of the Act relating to direct taxes. 27. Granting of power to the Assessing Officer to extend the time for completion of special audit under sub-section (2A) of section 142. 27.1 Sub-sections (2A) to (2D) of section 142 deal with the power of Assessing Officer to order a special audit. Such power is required to be exercised by the Assessing Officer having regard to the nature and complexity of the accounts of the assessee and the interest of the revenue. 27.2 Sub-section (2C) of the said section specified the period within which the audit report is to be furnished. The provision to said sub-section empowers the Assessing Officer to extend this period of f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 42(2A) is received by the assessee. This is because the opening words of section 142(2C) specify that it applies to every report under sub-section (2A). A perusal of the Circular No. 1, dated 27-3-2009 as also the memorandum explaining to the provisions in the Finance Bill, 2008, clearly shows that the Legislature as also the CBDT categorically were of the view that sub-section (2A), (2B), (2C) and (2D) of section 142 deal with the powers of the Assessing Officer to order a special audit fix the time-limit with overall period of 180 days etc., and these provisions to be read together as complete code in these matters. In these circumstances, it cannot be held that the provisions of section 142(2A) had a stand-alone position and was unfettered by section 142(2C). 5.2 Further, a perusal of the proviso to section 142(2C) shows that the Assessing Officer did have the powers to extend the period by further period or periods as he thinks fit subject to the maximum limitation of a period of 180 days from the date on which the direction under section 142(2A) was received by the assessee. On the facts of the present case, it is noticed that the assessee has not made any application for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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