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TMI Blog2019 (12) TMI 443X X X X Extracts X X X X X X X X Extracts X X X X ..... March 31, 2016 whereas the same has been passed on May 19, 2016 and therefore, the assessment order is barred by limitation and hence, the grounds of appeal of the assessee are accepted. In a nutshell the appeal of the assessee is allowed. - I. T. A. No. 393 /Lkw/ 2018 and Stay Application No. 17 /Lkw/ 2018 (assessment year 2013-14). - - - Dated:- 25-10-2019 - A. D Jain Vice-President And T. S. Kapoor Accountant Member For the Assessee : Rakesh Garg , Advocate For the Department : Ajay Kumar , Departmental representative ORDER T. S. KAPOOR (ACCOUNTANT MEMBER). - 1. This appeal has been filed by the assessee against the order of the learned Commissioner of Income-tax (Appeals)-II, Kanpur dated April 24, 2018. The assessee has taken the legal grounds as well as the ground on the merits. However, only the legal grounds were argued, therefore, we are adjudicating only the following legal grounds taken by the assessee : 1. Because the Commissioner of Income-tax (Appeals) has erred on the facts and in law in upholding the assessment order dated May 19, 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder has been passed on May 19, 2016 which is beyond the prescribed period and therefore, the assessment order needs to be quashed. The learned author- ised representative submitted that the matter under appeal related to com- putation of income under the head Capital gain and the provisions of which are contained in sections 45 to 55A of the Act and there is no pro- vision under section 153(1) for extension of time limit to cover the time taken for obtaining the valuation report under section 55A to frame the assessment in respect of capital gain or its computation. It was submitted that the second reference to the Valuation Officer was made by the Assess- ing Officer on March 16, 2016 and the Assessing Officer had received the second valuation report on March 21, 2016 therefore, the Assessing Officer had ample time available to him to pass the order on or before March 31, 2016 and which he had failed to do and there is no provision under section 153(1) for extension of time limit to cover the time taken for obtaining the valuation report under section 50C(2) of the Act. In view of these facts, it was argued that the assessment order being time barred has to be quashed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned Commissioner of Income-tax (Appeals) and further we were taken to the provisions of section 153(1)(iv) of the Act. 4. The learned Departmental representative, on the other hand, argued that both the references to the valuation cells were made under section 142A of the Act and not section 55A of the Act or section 50 of the Act and the period to be excluded has to be counted from the date of receipt of the valuation report and not from the date of reference and therefore the assessment order was passed well within the prescribed time as the date of order dated May 19, 2016 was framed on 59th day. It was submitted that the Assessing Officer received the valuation report on March 21, 2016 and from March 22, 2016 to March 31, 2016 there was a period of ten days therefore, as per the provisions of law the period was to be extended to 60 days which stood completed on May 20, 2016 and the order was passed on May 19, 2016, therefore, the argument of the learned authorised repre- sentative that the order was passed beyond the prescribed period is wrong and the grounds of appeal needs to be rejected. 5. The learned authorised representative in his rej ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. The learned authorised representative further argued that the second reference to the Valuation Officer was made under section 50C(2) of the Act as the assessee had challenged the stamp valuation and as per the provisions of section 153(1) read with Explanation 1, there is no provision for extension of time other than reference under section 142A of the Act. 6.1 In view of these arguments, it is important to visit the provisions of section 55A, section 142A and section 153(1) of the Act. We find that section 55A for reference to the Valuation Officer is in part of Chapter E which is related to capital gains. The provisions relating to the taxation of capital gain are contained in sections 45 to 55A of the Act. Section 55A, which is the last section of the Chapter, deals with the reference to the Val uation Officer for the purpose of ascertaining the fair market value of the capital asset for the purposes of this Chapter. For the sake of completeness, the provisions of section 55A are reproduced below : 55A. Reference to Valuation Officer.-With a view to ascertaining the fair market value of a capital asset for the purposes of this Chap ter, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section (1) has not been disputed in any appeal or revision or no reference has been made before any other authority, court or the High Court, the Assessing Officer may refer the valuation of the capital asset to a Valuation Officer and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clause (i) of sub-section (1) and sub-sections (6) and (7) of section 23A, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall, with necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section (1) of section 16A of that Act.' 6.3 Moreover, we find the assessment order itself notes the first ref erence was made for ascertaining the fair market value as on April 1, 1981 and the second reference was made to ascertain the value of assets as on the date of transfer of assets. The observations of the Assessing Officer in this respect, as contained in para 4.1 are reproduced below : 4.1. To know the correctness of the value of properties at 86/275 and 86/275 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of calculation of capital gain only therefore, reliance placed by the learned Commissioner of Income-tax (Appeals) on the provisions of section 142A is misplaced. The Chapter under the head Capital gains is a code in itself. Section 142A is not applicable to the Chapter of computing capital gains. The pro visions of section 142A do not govern the provisions of computation of capital gains. Explanation 1 to section 153(1) does not talk about extension of time if the reference is made under section 55A or section 50C(2) of the Act and it talks of extension of time only in the case where reference is made under section 142A of the Act which is apparent from the reading of provisions of section 153(1) read with Explanation 1 and which for the sake of completeness are reproduced below : 153.(1) No order of assessment shall be made under section 143 or section 144 at any time after the expiry of two years from the end of the assessment year in which the income was first assessable. . . Explanation 1.-In computing the period of limitation for the purposes of this section- (i) the time taken in reopening the whole or any part of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner under sub-section (2) of that section ; or (vi) the period commencing from the date on which an applica tion is made before the Authority for Advance Rulings under sub-sec tion (1) of section 245Q and ending with the date on which the order rejecting the application is received by the Principal Commissioner or Commissioner under sub-section (3) of section 245R ; or (vii) the period commencing from the date on which an appli cation is made before the Authority for Advance Rulings under sub- section (1) of section 245Q and ending with the date on which the advance ruling pronounced by it is received by the Principal Com missioner or Commissioner under sub-section (7) of section 245R ; or (viii) the period commencing from the date on which a reference or first of the references for exchange of information is made by an authority competent under an agreement referred to in section 90 or section 90A and ending with the date on which the information requested is last received by the Principal Commissioner or Commis sioner or a period of one year, whichever is less. (ix) the period commencing from the date on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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