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TMI Blog2022 (12) TMI 1425X X X X Extracts X X X X X X X X Extracts X X X X ..... passed u/s 163 of the Act, which means that the commissioner has no power to pass an order u/s 163 of the Act. Though the ld. DR had vehemently stated that the commissioner has concurrent jurisdiction/powers as that of the Assessing Officer, but in light of the aforesaid discussion, we do not find any merit in this contention of the ld. DR. In light of the provisions of section 163 considered in light of the aforementioned discussion, order passed u/s 163 of the Act by the CIT, International-2 deserves to be quashed and treated as nonest. The ld. CIT assumed jurisdiction u/s 263 of the Act on the basis of order passed u/s 163 of the Act. Since the very basis [order u/s 163 of the Act] has been removed, the super structure i.e. order u/s 263 of the Act must fall. Original assessment against company[Non resident] now dissolved - As there is no dispute that the Assessing Officer framed assessment u/s 143(3) of the Act in the case of Monet Limited in the status of non-resident. In our considered opinion and understanding of law, since the principal has been assessed to tax than for the same income, there cannot be a separate assessment in the hands of the representative/a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of natural justice and therefore ought to be quashed. 2. The learned CIT erred in not appreciating that since the original assessment was completed in the case of M/s. Monet Ltd. ( M/s. Monet 1 ), the proceedings under section 263 also ought to be initiated against M/s. Monet and not against the appellant as an agent of M/s. Monet. 3. The learned CIT erred in passing a combined order under section 263 r.w.s 163 of the Act assessing the two entities i.e. the appellant and Cairnhill CGPE Limited. The appellant submits that the order passed by the learned CIT is invalid and bad in law and therefore ought to be quashed. 4. The learned CIT erred in not appreciating that since the appellant was regularly assessed to tax in Mumbai, the learned CIT did not have the jurisdiction to pass the order under section 263 r.w.s 163 against the appellant. 5. The learned CIT erred in passing the order without serving the notice and without providing an opportunity of being heard to the appellant. The appellant therefore prays that the order passed by the learned CIT is violative of the principles of natural justice and therefore ought to be quashed. 6. The learned CIT erred in not s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time before or at the time of appeal hearing. 5. At the very outset, the ld. counsel for the assessee emphatically raised three issues for our kind consideration: (i) The ld. CIT has no power to pass order u/s 163 of the Act; (ii) When the principal has been assessed to tax by the Assessing Officer, can proceedings be initiated against the representative u/s 163 of the Act? (iii) When the principal has been liquidated and is no more in existence, can there be a representative of the said principal u/s 163 of the Act? 6. The representatives of both the sides were heard at length on the above mentioned issues. The case records were carefully perused and the judicial decisions referred to during the course of hearing duly considered. 7. Briefly stated, the facts of the case are that vide share purchase agreement dated 31.03.2015, entered into between Cairnhill CIPEF Limited, Cairnhill CGPE Limited and Monet Limited executed at Mauritius, shares of Mankind Pharma Limited, a public limited company, incorporated in India, were sold to the investors Cairnhill CIPEF Limited and Cairnhill CGPE Limited by Monet Limited. 8. Vide order dated 12.12.2018, assessment was fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, namely: (i) the transactions are carried on in the ordinary course of business through the first-mentioned broker; and (ii) the non-resident broker is carrying on such transactions in the ordinary course of his business and not as a principal. Explanation. For the purposes of this sub-section, the expression business connection shall have the meaning assigned to it in Explanation 2 to clause (i) of sub-section (1) of section 9 of this Act. (2) No person shall be treated as the agent of a non-resident unless he has had an opportunity of being heard by the Assessing Officer as to his liability to be treated as such. 13. A bare perusal of the aforementioned section does not show the authority as to who can pass the order u/s 163 of the Act. Though section 246 of the Act which contains the provisions relating to the appealable orders before the CIT at clause (d) which mentions An order made u/s 163 of the Act treating the assessee as agent of the non agent which means that the order u/s 163 of the Act is to be passed by an authority below the rank of a commissioner, because if the commissioner passes the order, then it cannot be appealed against before the ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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