9911796707
TMI Blog2022 (4) TMI 739X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Court in the case of CIT Vs. Gujarat Forging P.Ltd [ 2008 (7) TMI 1029 - GUJARAT HIGH COURT] following Supreme Court judgment in the case of Alagendran Finance Ltd. [ 2007 (7) TMI 304 - SUPREME COURT] held that revision proceedings initiated under section 263 is beyond period of limitation and quashed the same. In view of the above binding judgment, we have no hesitation in holding that Revision proceedings initiated under section 263 by the Pr.CIT is beyond period of limitation, since the issue of computation of book profit under section 115JB towards grants, subsidies, consumer contributions are not subject matter of re-assessment proceedings and but arising from original assessment proceedings vide order dated 3.12.2010 which is clearly is time barred. Thus, the additional ground raised by the assessee are allowed. Thus order passed by the AO neither an erroneous nor prejudicial to the interest of Revenue and therefore the initiation of 263-proceeings itself is unwarranted - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee-company is engaged in the business of distribution of electricity. The assessee filed its return of income on 30.9.2008 declaring NIL income and set off of current year's loss of Rs.(-)₹ 12,85,67,801/-. Assessment under section 143(3) was completed on 30.12.2010 determining total loss at (-) ₹ 5,06,04,324/- (under normal provision) and book profit under section 115JB was determined at ₹ 2,77,73,370/-. Subsequently, assessment was reopened under section 147 and notice under section 148 of the Act was issued to the assessee on 18.3.2015. In response thereto, the assessee filed a revised return on 29.4.2009. Ultimately, re-assessment was completed by making addition on account of prior period expenses of ₹ 16,02,98,000/-. Thereafter the ld.Pr.CIT-2 sought to revise the assessment order by invoking revisionary power under section 263 of the Act. Accordingly, the ld.Pr.CIT-I issued a show cause notice dated 13.3.2018 proposing as to why an order under section 263 should not be passed. The contents of the show cause notice read as under: "Sub: Show cause notice u/s.263 of the Income Tax Act in the case of Madhya Gujarat Vij Co. Ltd. A.Y.008-09 (PAN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B towards, grants subsidies and consumers' contribution, as has already been made under regular provision. You reply should be submitted in this office on 19.3.18 at 11:30 AM and you may also appear personally or through an authorized representative. In case, no reply is received on this date, a decision will be taken on the basis of material available on record without providing any further opportunity to you. 4. The assessee filed his reply dated 19.3.2018. Relevant part of the reply reads as follows: "…. At the outset it is submitted that the impugned notice under section 263 of the Act is void ab initio inasmuch as the same is issued without verification of the records. This is because till the time the latest assessment order for the year under consideration was passed under section 143(43) rws 147 on 30-12-2015, in none of the assessment years in the company's case the additions on account of capital grants subsidies and consumer contributions were made. Such additions have been made for the first time only in the Asstt.Year 2013-14 and 2014-15 for which years the assessment orders have been passed on 21-11-2016 and 26-12- 2016 respectively. Thus, the very base vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 147 read with section 143(3) was passed on 30.12.2015 and disallowed "prior period expenditure" of ₹ 16,02,98,000/- and determined the total income at ₹ 10,96,93,680/-. Thereafter, Pr.CIT issued show cause notice under section 263 on 13.3.2018. 8. The ld.AR further pleaded that the show cause notice issued under section 263 is relating to the re-assessment order made on 30.12.2015 wherein the issue of government grants, subsidies and contribution are not subject matter of additions/disallowances but these are dealt only in the original assessment order dated 30.12.2010. Thus, the show cause notice issued by Pr.CIT under section 263(2) is barred by limitation. Therefore, the revision order passed by the Pr.CIT is liable to quashed on the point of limitation, for which he relied upon judgment of Hon'ble Supreme Court in the case of CIT Vs. Alagendran Finance Ltd., 162 taxmann.com 465 (SC) and judgment of jurisdictional High Court in the case of Gujarat Forging P.Ltd. in ITR No.42 of 1996, and ITAT, Delhi Benches in the case of Jindal Steel & Power Ltd., in ITA No.4607/Del/2019 dated 14.5.2020. 9. Per contra, the ld.DR submitted that the revision order was passed well ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner of Income-tax exercising its revisional jurisdiction reopened the order of assessment only in relation to lease equalization fund which being not the subject of the reassessment proceedings, the period of limitation provided for under sub-section (2) of section 263 of the Act would begin to run from the date of the order of assessment and not from the order of reassessment. The revisional jurisdiction having, thus, been invoked by the Commissioner of Income-tax beyond the period of limitation, it was wholly without jurisdiction rendering the entire proceeding a nullity. 16. The Tribunal and the High Court, therefore, in our opinion, were correct in passing the impugned judgment. The appeal, therefore, being devoid of any merit is dismissed with costs. Counsel's fee assessed at ₹ 25,000." 11. Further, jurisdictional High Court in the case of CIT Vs. Gujarat Forging P.Ltd., in Tax Reference No.42 of 1996 dated 2.7.2008 following Supreme Court judgment in the case of Alagendran Finance Ltd. (supra) held that revision proceedings initiated under section 263 is beyond period of limitation and quashed the same. In view of the above binding judgment, we have no hesitation ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
