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TMI Blog2024 (8) TMI 977X X X X Extracts X X X X X X X X Extracts X X X X ..... for quashing of the impugned notices dated 21.07.2023, dated 09.08.2023 and the recent notice dated 16.08.2023." 2. The admitted facts as made out are that petitioner filed return of income under Section 139 (1) of the Income Tax Act, 1961 ["Act"] for the subject Assessment Year ["AY"] 2004-05, declaring total income INR 45000/-. The return was processed under Section 143 (1) of the Act and the same was accepted. 3. In the year 2008, petitioner was served with notice issued under Section 148 of the Act on the basis of information received that the petitioner has received gifts of Rs. 1 crore from Sh. Harish Kumar. 4. Respondent No. 1 concluded the reassessment proceedings vide order dated 29.12.2008 passed under Section 143 (3)/147 of the Act, assessing the petitioner at Rs. 1,00,45,000/- by making addition of Rs. 1 crore holding that the gifts received by the petitioner were not genuine. 5. Feeling aggrieved, petitioner filed an appeal before the Commissioner of Income Tax (Appeals) ["CIT(A)"] but the appeal was dismissed vide order dated 17.02.2010, thereby confirming the aforesaid addition. 6. Petitioner, then filed an appeal before the Income Tax Appellate Tribunal ["Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , because already huge time have elapsed and by this time either the fate of the appeal of Shri Harish Kumar must have been decided or the assessment order in his case must have attained finality." 12. We are not deciding the issue on merit which has been argued by both the parties and same is kept open. In view of the observation made above, the appeal of the assessee is partly allowed for statistical purposes. 13. Similarly in the case of M/ s. Ramesh Chawla (HUF) also, the Assessing Officer has made the addition on protective basis by making similar observation and even the Ld. CIT (A) has confirmed the addition on protective basis as he has followed the appellate order in the case of Mrs. Kanika Chawla. Accordingly, our finding and direction given above will apply mutatis mutandis in this appeal also. Accordingly, this appeal is also treated as partly allowed for statistical purposes. 14. In the result, both the appeals of the assessees are partly allowed." 10. Despite orders passed by the Tribunal, no action was taken by respondent No. 1 to give effect to the findings and directions of the Tribunal. Petitioner therefore sent a letter dated 27.03.2023 to respondent No. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal would have to be strictly construed in the light of provisions of Section 254 read with Section 153 (3) of the Act. 19. Concededly, the AO has not passed any Assessment Order pursuant to the order dated 11.10.2019 passed by the Tribunal. The petitioner's claim for refund is founded on the basis that assessment for the AY 2004-05 is barred by limitation. 20. Sub Section 3 of Section 153 of the Act stipulates that an order for fresh assessment pursuant to an order under Section 254 or Section 263 or Section 264 of the Act may be made at any time before the expiry of a period of nine months. The said provision further stipulates that the aforesaid period has to be calculated from the end of the financial year in which order under Section 254 of the Act is received by the Authorities mentioned in the said Sections. It would be apposite to extract Section 153 (3) of the Act hereunder:- "(3) Notwithstanding anything contained in [sub-sections (1), (1-A) and (2)], an order of fresh assessment [or fresh order under Section 92-CA, as the case may be,] in pursuance of an order under Section 254 or Section 263 or Section 264, setting aside or cancelling an assessment, [or an order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by respondent No. 1 dated 21.07.2023, 09.08.2023 and 16.08.2023 cannot be sustained and need to be set aside. 23. What then is the effect of the failure to make an order of assessment within the limitation period, after the earlier assessment made is set aside or nullified in appropriate proceedings? This question was dealt by the Supreme Court in the case of Commissioner of Income Tax, Bhopal vs. Shelly Products and Another [(2003) 5 SCC 461]. The relevant paras of the judgment are extracted below:- "35. What then is the effect of the failure to make an order of assessment after the earlier assessment made is set aside or nullified in appropriate proceedings? If the Assessing Authority cannot make a fresh assessment in accordance with the provisions of the Act it amounts to deemed acceptance of the return of income furnished by the assessee. In such a case the Assessing Authority is denuded of its authority to verify the correctness and completeness of the return, which authority it has while framing a regular assessment. It must accept the return as furnished and shall not in any event raise a demand for payment of further taxes. Accepting the income as disclosed in the return ..... X X X X Extracts X X X X X X X X Extracts X X X X
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