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TMI Blog2013 (8) TMI 439X X X X Extracts X X X X X X X X Extracts X X X X ..... (Judicial Member).-The appeals are filed by the Department whereas the cross-objections are filed by the assessees against the order of the Commissioner of Income-tax (Appeals) passed for the assessment year 2007-08 in the case of the assessees. Since the assessees are husband and wife and the issues in both appeals pleaded by the Department and the issues in both the cross-objections are common and similar, they were heard together and are disposed of by this common order for the sake of convenience and brevity. The assessee Dr. Tulsi Prasad Mohapatra, is an individual. He is employed with M. K. C. G. Medical College and Hospital, Berhampur as associate professor (urology) and derives income from serving in Cuttack Urology Centre, a proprietary concern of his wife Smt. Debadutta Mallick and interest income on fixed deposits. The assessee, Dr. Smt. Debadutta Mallick, is an individual engaged in the business of running a nursing home in the name and style of Cuttack Urology Centre in proprietorship. A survey operation under section 133A of the Income-tax Act, 1961 was conducted in the clinical premises of M/s. Cuttack Urology Center on January 16, 2007. Based on the material gathe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ders within the time-limit prescribed in the statute. The service of the said orders to the assessee is not at all contemplated in the Act. Hence, the learned Commissioner of Income-tax (Appeals) went wrong in observing that communication of order is a condition precedent for an order of assessment becoming effective. Apart from that the learned Departmental representative has relied on the following decisions : 1. Kodidasu Appalaswamy and Suryanarayana v. CIT [1962] 46 ITR 735 (AP) ; 2. Ramanand Agarwalla v. CIT [1985] 151 ITR 216 (Gauhati) ; 3. K. U. Srinivasa Rao v. CWT [1985] 152 ITR 128 (AP) ; 4. India Ferro Alloy Industry P. Ltd. v. CIT [1993] 202 ITR 671 (Cal) 5. Prem Nath Motors P. Ltd. v. CST [1991] 82 STC 124 (Delhi) (copy placed on paper book on pages 24-28) ; 6. The decision of the Income-tax Appellate Tribunal, Kolkata in the case of Elkom Enterprises P. Ltd. v. ITO in I. T. A. No. 1081/KOL/2009 dated April 30, 2010 (copy placed on paper book on pages 29-40) ; and 7. The decision of the Income-tax Appellate Tribunal, Cuttack in the case of Torsteel Ltd. v. Asst. CIT [2012] 16 ITR (Trib) 425 (Cuttack) in I.T.A. No. 059/CTK/2011 dated June 17, 2011 (copy placed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay approximately of 130 days was taken in service of orders to the assessee. This itself implies that the Assessing Officer has not passed the order on the date mentioned in the assessment order. He might have passed it at a later date, and issued a copy of the orders along with demand notice, etc., for service on the assessee after expiry of 130 days from the date of end of the limitation provided under the Act. It is held by the judicial forums that such a service does not support the orders having passed orders before the time limit provided in the Act as the service was made after the expiry of the limitation period and in the present case after approximately 130 days. Therefore, the learned Commissioner of Income-tax (Appeals) has rightly held that the assessments are barred by limitation and hence, they are non est and ineffective in law. Accordingly, he sought for dismissing the appeals of the Department and allow the cross-objections of the assessee. On a careful analysis of the orders passed by the Departmental authorities it is found that the learned Commissioner of Income-tax (Appeals) has found from the assessment record that the assessment orders were passed by the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sachi Mukharji, as he then was, held that communication is a condition precedent to an order of assessment becoming effective. Therefore, the learned Commissioner of Income-tax (Appeals) has come to the conclusion that the assessment orders in these cases though made on December 31, 2009, those were served on the assessee on May 10, 2010, i.e., after 130 days from the date of order. Since the condition precedent to an order of assessment being effective and there is delay of 130 days in serving the assessment orders along with demand notices, the learned Commissioner of Income-tax (Appeals) held that the assessment orders for the assessment year in case of both assessees are barred by limitation and accordingly they were held ineffective and non est in law. Now coming to the judicial pronouncements relied on by the learned Departmental representative, it is found that the Tribunal's order of the Jodhpur Bench was appealed before the hon'ble Rajasthan High Court and it is pending adjudication, but it is not the case of the Department that the hon'ble High Court has stayed the operation of the said order of the Income-tax Appellate Tribunal. In the case of Kodidasu Appalaswamy and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment record revealed that the assessment order for the assessment year 2005-06 was in existence on January 15, 2008. In this peculiar facts and circumstances of the case, the Income-tax Appellate Tribunal, Kolkata Bench held that the assessment order was very much ready on January 15, 2008. In the case of Torsteel Ltd. v. Asst. CIT [2012] 16 ITR (Trib) 425 (Cuttack), Income-tax Appellate Tribunal, Cuttack Bench has considered the issue whether the assessment order dated November 26, 2007 served on February 24, 2010 is barred by limitation. In this case, the Bench has held that the assessment order despatched after the delay of the above two years was not barred by limitation. The demand notice had already been sent to the assessee on March 31, 2008 which is amply clear that there was a demand notice which will arise out of the assessment order. This proves that the said assessment order was passed within the period of limitation. On comparison of the present facts and circumstances available in the present case on hand, the facts and circumstances of the above cases are distinguishable more so when the demand notice and assessment orders in the present case were served on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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