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TMI Blog2019 (7) TMI 1053X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue has proposed the following two questions of law : "(i) Whether, on the facts and in the circumstances of the case and in law, the Income Tax Appellate Tribunal is right in treating the assessment as bad in law ? (ii) Whether, on the facts and in the circumstances of the case and in law, the Income Tax Appellate Tribunal is right in its interpretation of Section 148 of the Income Tax Act ?" 3. It appears from the materials on record that the Directorate of Revenue Intelligence received information that the respondent - assessee had imported polyester films by resorting to undervaluation of the import price to the tune of Rs. 13,11,73,783=00 during the Financial Year 2010-11. At the relevant point of time, it was noticed that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r passed by the CIT(A) dismissing his appeal, preferred further appeal before the Income Tax Appellate Tribunal. The principal argument of the assessee before the ITAT was that the assessment order under Section 143(3) read with Section 147 of the Act was illegal and erroneous in law as the assessment proceedings initiated under Section 142(1) of the Act were pending on the date of the issue of the notice under Section 148 of the Act. The ITAT, while allowing the appeal preferred by the assessee, held as under : "...We have heard both the sides and perused the material on record carefully. At the outset, we are considering the additional ground filed by the assessee stating that assessment order u/s. 143 r.w.s. 147 of the act was wrong, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 42(1) is 31-03-2014, therefore, issuing of notice u/s. 148 of the act during the pendency of assessment proceedings on 16-01-2013 is bad in law and invalid. The existence of this fact is very clearly demonstrated from the findings of the assessing officer mentioned in his order passed u/s. 143(3) r.w.s 147 of the act on 27th March, that a notice u/s. 142(1) of the act was issued to the assessee on 1st December, 2011 and asked the assessee to file return of income for the assessment year 2011-12 by 9th December, 2011 and in response to the notice u/s. 142(2) of the act the assessee has not filed return of income therefore the assessing officer should have completed the assessment on or before 31st March, 2014 however the case was reopened u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trict the Assessing Officer to make assessment under Section 147 where notice has been issued under Section 142(1) of the Act. 7. Ms.Raval submitted that the ITAT quashed the notice under Section 148 of the Act and authenticated the issue of notice under Section 142(1) of the Act. She submitted that the assessment completed in response to the notice under Section 148 of the Act came to be treated as the assessment completed in response to the proceedings initiated under Section 142(1) of the Act and annulled the same only on the ground of limitation. Ms.Raval submitted that the ITAT overlooked the fact that in the case on hand the assessment had been completed well within the time limit, i.e. on 27th March 2014. She pointed out that the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the Patna High Court in the case of Commissioner of Income Tax v. Sayed Rafiqur Rahman, reported in 1991(189) ITR 476, wherein the following has been observed : "From the statement of case, it is clear that the assessment proceedings for the assessment year 1972-73 were pending when notice under Section 148 was issued by the Incometax Officer. Therefore, the notice for reassessment issued during the pendency of the assessment proceedings cannot be held to be valid. Income cannot be said to have escaped assessment if, at that time, proceedings for the assessment of the assessee's income have not yet culminated in a final assessment thereof." 12. At this stage, Ms.Raval, the learned counsel appearing for the Revenue, invited our ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue that it suffered loss at both the ends is concerned, we may remind the Revenue of the observations made by the Supreme Court in the case of Parashuram Pottery Works Co. Ltd. v. Income Tax Officer, Circle I, Ward A, Rajkot, reported in (1977)106 ITR 1, which read thus : "It has been said that the taxes are the price that we pay for civilization. If so, it is essential that those who are entrusted with the task of calculating and realising that price should familiarise themselves with the relevant provisions and become well-versed with the law on the subject. Any remissness on their part can only be at the cost of the national exchequer and must necessarily result in loss of revenue." 16. In the overall view of the matter, we are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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