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TMI Blog2014 (6) TMI 315X X X X Extracts X X X X X X X X Extracts X X X X ..... owing the decision of Thai Airways International Public Co. Ltd. vs. ACIT (2005) 2 SOT 389 (Del.). 3. Whether on the facts and circumstances of the case the CIT(A)-II erred in not appreciating the fact that no limit has been envisaged under IT Act for passing order u/s. 201(1) and 201(1A). Even no time limit has been prescribed for initiation of the proceedings. This fact is strengthened by the omission of section 231 w.e.f. from 01.04.1989. There are various case laws which support the contention of the Department. Reference may be drawn to CIT vs. Tirchur Co-op. Bank Ltd. (2003) 184 CTR (Ker), Secretary Sultan Battery Co-op Housing Society Ltd. vs. CIT (2003) 181 CTR (Ker) 219, ITAT decision in the case of Gujarat Ambuja Cements vs. DCIT (2005) 2 SOT 784 (Mumbai). 3. Brief facts of the issue are that the assessee is engaged in the business of publication of newspaper, manufacture of food and dairy products and also electronic media. A survey was carried out in the case of the assessee. Subsequent to the survey, show cause letter was issued to the assessee company seeking various informations. During post survey enquiries and analysis of information submitted by the assessee, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1987 w.e.f. 01.04.1989 and consequently, with the omission of section 231 w.e.f. 01.04.1989, the restriction about the limitation was taken by the legislature. With effect from 01.04.1989, since there was no limitation period prescribed for recovery of taxes, several courts and tribunals have given their own interpretation about what is the reasonable period for passing an order u/s 201 and 201(1A) of the IT Act. In the present case, the CIT(A) relied on the judgement given by the Tribunal 'A' Bench in the case of A.P. State Civil Supplies Corporation in ITA Nos. 1117 to 1122 / Hyd/07 for A.Ys. 1999-2000 to 2004-05, vide dated 01.08.2008 wherein the Tribunal has relied on Tribunal Mumbai Bench in SBI vs. ACIT (2007) 106 ITD 589 (Mum) and CIT vs. NHK Japan Broadcasting Corp (2008) 217 CTR (Delhi) 392. The DR submitted that the Income Tax department has filed an appeal before the Hon'ble A.P. High Court u/s 260A of the IT Act, 1961, dated 15.02.2008 with the following grounds of reference. a) Whether the Appellate Tribunal is justified in prescribing the "limitation period" of 4 years from the end of the financial year for completion of proceeding u/s 201 r/w 201(l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer may be upheld for the reasons mentioned above. 10. The learned AR submitted that as regards the reliance placed by the CIT(A) on the decision of Tribunal in the case of A.P. State Civil Supplies Corporation in ITA Nos. 1117 to 1122/H/07 dated l-8-2008, the Department has merely stated that the said decision has not been accepted and has been appealed before the Honble High Court of A.P. This submission by the Department does not detract from the fact of existence of the said decision and the applicability of the same and the ratio laid down therein 11. The AR submitted that the Department has also referred to the decision of the Special Bench-H of the Tribunal, Mumbai in the case of Mahindra & Mahindra Ltd Vs. DCIT 122 TTJ 216 and various issues decided therein. In this connection the AR submitted that in para 17.10 of its order, the Tribunal Special Bench Mumbai has held that passing of order under Sec. 201(1) and 201(1A) has to be within one year from the end of the financial year in which proceedings u/s. 201(1) have been initiated. He submitted that page 1 in each of the orders of the Assessing Officer shows that proceedings were initiated in the year 2006 and the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs or 6 years from the end of the relevant AY, as the case may be depending upon the amount of income in respect of which the person responsible is sought to be treated as the assessee in default. The order passed u/s 201(1) or 201(1A) cannot be held as barred by limitation if it is passed within 4 years from the end of the relevant AYs or 6 years as the case may be. In the present case, time limit available for passing the order u/s 201(1) and 201(1A) is as follows: Sl. No. AY Time limit available for passing order Actual date of passing order 1 2001-02 31/03/2008 02/04/2008 2. 2002-03 31/03/2009 - do- 3. 2003-04 31/03/2010 -do- 14. As seen from the above table, the order passed for AY 2001-02 u/s 201(1) and 201(1A) on 02/04/2008 as the time limit for passing the order was 31/03/2008, therefore, the order passed for AY 2001-02 is barred by limitation. However, for the AYs 2002-03 and 2003-04, the order was passed within time i.e. within 6 years from the end of the relevant AYs as the order passed on 02/04/2008. Therefore, the order passed in AY 2002-03 and 2003-04 cannot be held as barred by limitation. 15. In view of the order of the Special Bench of ITA ..... X X X X Extracts X X X X X X X X Extracts X X X X
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