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TMI Blog2016 (3) TMI 1318X X X X Extracts X X X X X X X X Extracts X X X X ..... - Dated:- 11-3-2016 - SHRI D. MANMOHAN, VICE PRESIDENT For the Appellant : Shri D. Anand, Advocate For the Respondent : Shri Pathlavath Peerya, CIT/DR ORDER On account of difference of opinion between the learned Accountant Member and learned Judicial Member, the matter was referred to the Hon'ble President for nominating a Third Member under section 255(4) of the Income Tax Act, 1961, to resolve the points of difference. It may be noted that even while framing the points of difference, there was a difference of opinion. According to the learned Judicial Member, the following questions need to be resolved: (1) In the facts and circumstances of the case, in the absence of any specific finding/direction to assess the income for the assessment year 2001- 02 in the order of this Tribunal dated 31.05.2010, can there be an inference/presumption, especially, when no proceeding for the assessment year 2001-02 was before the Tribunal, as held by Apex Court in CIT v. Green World Corporation (2009) 314 ITR 81? (2) In the facts and circumstances of the case, when admittedly, the assessment for the assessment year 2001-02 was not subject matter of appeal before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he points of difference as under: 1. Whether the notice issued u/s 148 r.w.s 150(1)of the Act dated 10.6.2011 for the assessment year 2001-02 is based on any finding or direction issued by the ITAT in I.T.A.Nos.327 328/Mds/2010? 2. In the event of holding that there is a finding or direction, whether the notice issued u/s 148 of the Act dated 10.6.2011 is barred by limitation or not? 4. Since both the parties have agreed to the reframed questions, I have proceeded to dispose of the points of difference accordingly. 5. Facts necessary in this context are referred to in brief. In respect of the assessment year 2001-02, the assessee disclosed total loss of ₹ 56,758/- in response to notice u/s 148 of the Act whereas the assessment was completed by determining the total loss at ₹ 2,442/- by an order dated 30.3.2006. 6. It is to be noticed that there was an agreement for joint development of property on 25.12.2000 and the assessee handed over the possession of the property to the builder on the same date. The assessee offered to tax the capital gains thereon in the assessment years 2003-04 and 2004-05, but at a later stage, it was contended that no transfer t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as placed upon several judgments including the judgment of the Apex Court in K.M.Sharma vs ITO (2002) 254 ITR 772. 8. The learned Judicial Member has observed that while disposing of the appeals for assessment years 2003-04 and 2004-05, the limited contention of the assessee was that the capital gains arising out of the transfer of asset cannot be taxed in assessment years 2003-04 and 2004-05 which was ultimately accepted on the ground that the joint development agreement was entered into on 25.12.2000 and the possession of the property was also handed over on the same date. This cannot be equated to a finding or direction. He also analysed the provisions of sec. 150(1) and 150(2) of the Act to highlight that the provisions of sec. 150(1) are not applicable in respect of assessment year in which the assessment, re-assessment or re-computation could not have been made if the proceedings are already barred by limitation by the date the Tribunal passed the order and the AO initiated proceedings. He further observed that sec. 149 of the Act provides for maximum period of six years from the end of the relevant assessment year in case the income chargeable to tax exceeds ₹ 1 lak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... limit for reopening of assessment, the learned Accountant Member was of the opinion that the provisions of sec. 150 of the Act enable the Assessing Officer to issue notice. This section clearly says that Notwithstanding anything contained in section 149 notice may be issued at any time and thus, there is no time limit for reopening the assessment in the instant case. He was thus, of the opinion that the Assessing Officer was justified in reopening the assessment and it is not barred by limitation in view of the overriding provisions of sec. 150(1) of the Act. 13. On account of difference of opinion, the matter was referred to the Hon'ble President u/s 255(4) of the Act and the Hon'ble President, in turn, was pleased to nominate me as Third Member to resolve the points of difference. As already stated hereinabove, the precise points of difference were reframed and placed before both the parties who have accepted that the points of difference as reframed would correctly focus the issues. Arguments were advanced accordingly. 14. The learned Counsel appearing for the assessee submitted that apart from the two judgments of the Apex Court cited by the learned Judicia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the capital gains is attracted in assessment year 2003-04 and 2004-05; but there is no specific finding or direction that it is assessable to tax in assessment year 2001-02. Even if it is assumed that there is a finding or direction, in my humble opinion, the Hon'ble Madras High Court, in the case of M/s Goldmine Investments (supra), has considered an identical issue wherein it was held that in respect of any assessment year wherein further proceedings are barred by limitation, the same cannot be reopened merely by virtue of an opinion expressed by any higher forum at a later date i.e. subsequent to the date of limitation period. In fact, the judgments of the Apex Court are also on the same lines. Having regard to the circumstances of the case, I am of the view that the reopening of assessment is bad in law since the proceedings u/s 148 of the Act are sought to be initiated by issuing a notice after the period of limitation. In the light of the above findings, the reframed questions are answered as follows: (1) The notice issued u/s 148 r.w.s 150(1) of the Act, cannot be said to be based on any finding or direction issued by the ITAT in I.T.A.Nos.327 328/Mds/2010. (2) E ..... X X X X Extracts X X X X X X X X Extracts X X X X
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