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TMI Blog2010 (11) TMI 339X X X X Extracts X X X X X X X X Extracts X X X X ..... 96 was processed under section 143(1)(a) of the Act and intimation was forwarded to the assessee. There after, assessment was taken as a scrutiny assessment and notice was issued to the assessee under section 143(2) of the Act. The developments subsequent to service of intimation under section 143(1)(a) with corresponding dates are given hereunder, which are relevant for deciding the issue. (1) Date of issue of assessment notice under sec tion 143(2) March 19, 1996. (2) Date on which auditor was appointed by the Assessing Officer under section 142(2A) after obtaining approval from the Commissioner September 9, 1997. (3) Time granted by the Assessing Officer to the assessee to produce auditor's report December 31, 1997. 4) Date on which the chartered accountant appointed by the Department requested for extension of time for completion of auditing and for filing report December 24, 1997. (5) Date on which the officer after obtaining approval from the Commissioner extended the time for completion of auditing and for filing report in terms of his request January 29, 1998. (6) Time extended by the Assessing Officer for filing the audit report up to February 15, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Assessing Officer, having regard to the nature and complexity of the accounts of the assessee and the interests of the Revenue, is of the opinion that it is necessary so to do, he may, with the previous approval of the Chief Commissioner or Commissioner, direct the assessee to get the accounts audited by an accountant, as defined in the Explanation below sub-section (2) of section 288, nominated by the Chief Commissioner or Commissioner in this behalf and to furnish a report of such audit in the prescribed form duly 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 . . . (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, 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, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation made by the assessee and if the Assessing Officer finds that the assessee has established good and sufficient reason for getting the time extended for furnishing the audit report, he should extend the time. Based on this proviso, the contention raised by the assessee's counsel, which was the contention raised before the first appellate authority as well as the Tribunal is that, once time is fixed by the Assessing Officer for the assessee to produce audit report prepared by the auditor appointed by the Department under sub-section (2A), extension of time can be granted only on request by the assessee. Since the assessee did not apply for extension of time and since extension of time in this case was applied for only by the auditor, the extension of time granted by the Assessing Officer though after obtaining approval from the Commissioner is not in terms of the proviso to sub-section (2C) and so much so, the extension of time so granted by the officer cannot be reckoned for the purpose of extending the limitation for assessment available under clause (iii) of Explanation 1 of section 153(3 of the Act, is the contention of the assessee. The first appellate authority as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the time in consultation with the auditor and by taking into consideration all reasonable suggestions from the auditor. If the powers of the officer to fix time for filing audit report under sub-section (2C) were not left flexible or elastic, the very scheme of section 142(2A) would be frustrated and defeated, if the auditor fails to finish the work within the time originally granted by the officer under sub-section (2C). The proviso to sub-section (2C) entitles the assessee to apply for extension of time for reasons obviously attributable to him and it is for him to produce good and sufficient reason before the Assessing Officer along with application for extension of time for getting the audit done and for producing the audit report. It may so happen that the assessee or his employee may turn sick or may need more time to produce the entire books of account or to answer queries of the auditor to complete the auditing and for producing the audit report within the time originally granted by the Assessing Officer. In that event, the assessee can legitimately approach the Assessing Officer with a request for extension of time for furnishing the audit report. However, the proviso spec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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