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TMI Blog2022 (12) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... The jurisdiction assumed by an officer in terms of Section 120 of the Act is activated by issuance of notice under Section 143(2), and as a consequence, failure to issue the statutory notice will lead to the inevitable result of the Officer not having assumed jurisdiction, for all practical purposes. Period when the matter was pending before the Assessing Officer for compliance of the procedure set out should stand excluded in computing the period of 6 months required to issue notice under Section 143(2) - As the statutory period of six months cannot be altered except in the situations contemplated under Explanation to Section 153. The Explanation takes note of events that might intervene in the course of assessment proceedings, and excluded the time taken for those events to run their course, in computation of limitation. These are the only situations where statutory limitation under Section 153 may be expanded. On 10.01.2020, reasons had been supplied and on 04.03.2020, the petitioner filed its objections. These objections have been disposed only on 23.07.2021, after a period of one year and four months. There was nothing that prevented the assessing officer to have call ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tice under Section 148, in compliance of which a return was filed, in line with the regular return filed earlier. iv) The petitioner also sought the reasons on the basis of which the notice under Section 148 had been issued. v) In line with the procedure laid down by the Hon ble Supreme Court in GKN Drive shafts (India) Ltd. V. Income Tax Officer (259 ITR 19), objections were raised by the petitioner to the assumption of jurisdiction under Section 147 of the Act. vi) The objections were kept pending and a reference had been made by the assessing officer/R1, even pending such objections, to the Transfer Pricing Officer/R2, for determination of Arms Length Price of international transactions entered into by the petitioner with Associated entities situated outside the country. vii) R2 issued a notice under Section 92CA of the Act on 24.11.2020. In response thereto, the petitioner requested that the TPO defer the matter till such time the objections to assumption of jurisdiction were disposed by R1. viii) The request was ignored and a notice once again came to be issued on 01.07.2021 calling for compliance with the requirements under earlier notice dated 24.11.2020. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Blue Moon (321 ITR 362(SC)) (ii)Deputy Commissioner of Income Tax Another v. Indus Towers Limited [SLP(Civil) Diary No(s).34285/2018 dated 21.01.2019] (iii) Sapthagiri Finance Investments v. Income-tax Officer, Ward 1(4), Kanchipuram [(2012) 25 taxmann.com 341 (Mad.)] (iv) Commissioner of Income-tax, Chennai v. Alstom T D India Ltd. [(2014) 45 taxmann.com 424 (Madras)] (v) N.Ahamed Ali, Legal heir of Shri S.Naina Mohammed (deceased) v. The Income Tax Officer, Ward II(2), Erode [Tax Case (Appeal) No.766 of 2014 dated 19.11.2014] (vi) The Commissioner of Income Tax, Trichy v. M/s.Fathima Thanga Maaligai, 141/1, Bharathiar Road, Karaikal 609 602 [TCA.Nos.582 583 of 2014 dated 15.09.2014] (vii) CIT V.Alstom T D India Ltd. (226 Taxman 103) (Mad.) (viii) PR. Commissioner of Income-tax v. Shri Jai Shiv Shankar Traders (P) Ltd. (383 ITR 448 (Del.)) (ix) Pr. Commissioner of Income-tax v. Silver Line (383 ITR 455 (Del.)) (x) Commissioner of Income Tax v. Deep Baruah (329 ITR 362 (Gauhati)) ( xi ) Indus Towers Ltd. v. Deputy Commissioner of Income tax, Circle-11(1) [(2017) 82 taxmann.com 430 (Delhi)] ( xii ) Alpine Electronics Asia Pte. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of a search assessment, the assumption of jurisdiction is conveyed with the issuance of a notice under Section 153A, in the case of a searched entity, and recording of a satisfaction note and issuance of notice under Section 153C, in the case of a third party. A notice under Section 143(2) is thus redundant and unnecessary to the scheme of assessments under section 153A or C. 11. The question arising in this matter is no longer res integra, having been considered and answered by this Court in Sapthagiri Finance Investments (supra), wherein the Division Bench at paragraph 13, holds as follows: 13. As far as the present case is concerned, the provisions of Section 148 also uses the expression so far as may be apply accordingly as if such return were a return required to be furnished under Section 139 . Thus, understanding this provisions in the background of the decision of the Apex Court, on the facts available, we are of the view that in completing the assessment under Section 148 of the Act, compliance of the procedure laid down under Sections 142 and 143(2) is mandatory. On the admitted fact that beyond notice under Section 142(1), there was no notice issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) and various decisions of the Delhi, Bombay, Rajasthan, Kerala, Karnataka, Calcutta, Gauhati, Chattisgarh and Allahabad High Courts, to similar effect, have also been noticed. So too in the case of Silver Line (supra) by the same Bench of the Delhi High Court that passed the order in the case of Shri Jai Shiv Shankar Traders (P) Ltd. (supra). 16. This view has been reiterated by another Bench of the Delhi High Court in Alpine Electronics Asia Pte. Ltd. (supra), wherein at paragraph 24, the Bench states as follows: 24. Section 143(2) is applicable to proceedings under Sections 147/148 of the Act. Proviso to Section 148 of the Act protects and grants liberty to the Revenue to serve notice under Section 143(2) of the Act before passing of the assessment order for returns furnished on or before 1st October, 2005. In respect of returns filed pursuant to notice under Section 148 of the Act after 1st October, 2005, it is mandatory to serve notice under Section 143(2) of the Act, within the stipulated time limit. 17. The decision of the Delhi High Court to identical effect in the case of IndusTowers Limited (supra) was carried in appeal before the Hon ble Supreme Court, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ead to the inevitable result of the Officer not having assumed jurisdiction, for all practical purposes. 24. As a last ditch effort, learned standing counsel would point out that the impugned order rejecting the objections to assumption of jurisdiction came to be passed only on 23.07.2021 and thus, the period when the matter was pending before the Assessing Officer for compliance of the procedure set out by the Hon ble Supreme Court in the case of GKN Driveshafts (supra), should stand excluded in computing the period of 6 months required to issue notice under Section 143(2) of the Act. 25. This argument is misconceived for more than one reason. Firstly, the statutory period of six months cannot be altered except in the situations contemplated under Explanation to Section 153. The Explanation takes note of events that might intervene in the course of assessment proceedings, and excluded the time taken for those events to run their course, in computation of limitation. These are the only situations where statutory limitation under Section 153 may be expanded. 26. The procedure set out by the Hon ble Supreme Court has, no doubt, to be adhered to strictly, within the statuto ..... X X X X Extracts X X X X X X X X Extracts X X X X
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