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TMI Blog2025 (3) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... oval of the assessment order in terms of the CBDT Circular. Thus, we find the order to be vitiated in law. The assessment order cannot be result of an independent application of mind and exercise of discretionary power by the AO in terms of Section 143(3) of the Act and but is an order passed under the influence and directions of the superior officers. As noticed that the consultation with a superior officer would be akin to directions of the superior. There is no room available for discretion where consultation is sought from a superior officer while if a superior officer consults his subordinates, the discretion continues to stay with him. He may choose not to follow the advice of his subordinate but the opposite would be untrue. We are, thus, of firm view that the order has been passed whereby the AO has abdicated his authority and, therefore, the order has become vitiated in law. Non-compliance of principles of natural justice - A presumption cannot be drawn that after a demand is made, the person would have to himself appear without being provided any particular date. In our opinion, the submissions advanced by the respondents, therefore, are misconceived and we are unable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e,Mr. Samarth Chaudhari, Advocate and Mr. Nitesh Bansal, Advocate for the petitioner Mr. Yogesh Putney, Sr. Standing Counsel with Mr. Vaibhav Gupta, Standing Counsel for the respondents/revenue ORDER SANJEEV PRAKASH SHARMA, J. 1. The petitioner-company by way of this writ petition has sought quashing of undated assessment order Annexure P/1, for the assessment year 2022-2023, passed under Section 143(3) of the Income Tax Act, 1961 (for short 'the Act') and penalty notices Annexures P/2 and P/3 dated 04.04.2023 passed under Sections 270A and 271AAC of the Act and has further prayed for quashing the consequential action, which has been taken under the said order/notices. 2. Learned senior counsel for the petitioner submits that the impugned assessment order is liable to be set aside on various grounds. He has invited attention to the provisions of Sections 143(3), 144A, 151 and 153D of the Act, to submit that the Assessing Officer in the case of the present petitioner has not acted in accordance with the provisions of the Act. It is his submission that the Assessing Officer who in his quasi judicial capacity has to make the assessment on his independent application of mind and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mission that the circular would amount to interfere with the quasi judicial power to complete assessment by the Assessing Officer and forces respondent No.1/Assessing Officer to abdicate his quasi judicial function in favour of superior officers, which would be impermissible in law. 6. The second limb of argument advanced by learned senior counsel is with respect to the order of assessment being barred by limitation as laid down for the AY: 2022-2023, in terms of Section 153 of the Act, as the same has been issued after 31.03.2024 and uploaded on the e-filing income tax portal only on 04.04.2024. The last date to make the impugned assessment order in normal course would be on or before 31.03.2024 and no order of assessment could have been passed thereafter. In support thereof, he has invited attention to Annexure P/20 and P/21, which are the screen shot of e-filing portal as on 01.04.2024, reflecting the proceedings open while e- filing portal screen shot of 04.04.2024, reflects of the passing of the assessment order. No real time alert was received by the petitioner on or before 01.04.2024. Further, submitted that no order was sent via email to the petitioner. He refers to Rule 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me in the assessment order. Learned counsel submits that so far as the assessment order is concerned, it is based on a show cause notice issued on 11.03.2024, providing only four days time to furnish reply, which was not sufficient and cannot be said to be in consonance with the fundamental principles of natural justice. 10. In support of his contentions, learned senior counsel has placed reliance on the following judgments:- Anirudhsinhji Karansinhji Jadeja vs. State of Gujarat [1995] 5 SCC 302, Noor Mohammad vs. Khurram Pasha [2022] 9 SCC 23, CIT vs. SPL Siddhartha Ltd. [2012] 345 ITR 223 (Del), Ghanshyam K. Khabrani vs. ACIT [2012] 346 ITR 443 (Bom), CCE vs. Ratan Melting & Wire Industries [2008] 13 SCC 1 (SC) [CB], S.B. Adityan vs. Income Tax Officer [1964] 51 ITR 453 (Mad), LML Ltd. vs. ACIT [1994] 205 ITR 585 (Mad), CIT vs. Barkelite Hylam Ltd. [1999] 237 ITR 392 (AP), Gujarat Gas Co. Ltd. vs. Jt. CIT [2000] 245 ITR 84 (Guj), CCE vs. M.M. Rubber and Company AIR 1991 SC 2141, Government Wood Works vs. State of Kerala [1988] 69 STC 62 (Ker), CIT vs. Rai Bahadur Kishore Chand and Sons [2010] 1 taxmann.com 165 (P&H), Munjal BCU Centre of Innovation and Entrepreneurship vs. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment order and demand notice could not be uploaded through system module system and the DIN so generated mentioned in handwritten form on assessment and demand notice remained unexecuted. It is submitted that the assessment order and demand notice were communicated to the assessee through common function facility with DIN No.ITBA/COM/S/91/2023-24/1063787982(1) and ITBA/COM/S/91//2023-24/1063787900(1) and communicated to the assessee through the aforesaid DINs at 08:26 pm on 31.03.2024. It is highlighted that the intimation sheet is generated by system and the date is also automatically filled on it. The fact is evident from the sheet itself, thus, the Assessing Officer has no role in it. The relevant sheet generated through ITBA contains DIN No.ITBA/COM/S/91/2023-24/1063787982(1) and ITBA/COM/S/91//2023-24/1063787900(1) and, therefore, it cannot be said that the orders were not passed on 31.03.2024. 14. It is his assertion that the limitation as on 31.03.2024 is for making of an order and not for the communication of the order, in terms of the limitation prescribed under Section 153 of the Act. Learned counsel submits that the issue is no more res-integra in view of the judgmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ections to other income-tax authorities as it may deem fit for the proper administration of this Act, and such authorities and all other persons employed in the execution of this Act shall observe and follow such orders, instructions and directions of the Board: Provided that no such orders, instructions or directions shall be issued :- (a) so as to require any income-tax authority to make a particular assessment or to dispose of a particular case in a particular manner; or (b) so as to interfere with the discretion of the [the Joint Commissioner (Appeals) or] the [Commissioner (appeal] in the exercise of his appellate functions. (2) Without prejudice to the generality of the foregoing power:- (a) the Board may, if it considers it necessary or expedient so to do, for the purpose of proper and efficient management of the work of assessment and collection of revenue, issue, from time to time (whether by way of relaxation of any of the provisions of sections 3[115P, 115S, 115WD, 115WE, 115WF, 115WG, 115WH, 115WJ, 115WK,] 4[139,] 143, 144, 147, 148, 154, 1555[, 158BFA], 6[sub-section (1A) of section 201, sections 210,211, 234A, 234B, 234C 7[, 234E]], 8[270A,] 271 9[, 271C, 27 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xx xx" (b) xx xx (c) xx xx 19. From the perusal of the aforesaid provisions, we find that the limitation provided under Section 153(1) of the Act, for issuance of notice and making of an order of assessment under Section 143 or 144 of the Act, is only twelve months for the assessment year commencing on or after 1st day of April, 2022 from the end of assessment year in which the income was first assessable. Thus, the period would end on 31.03.2024. 20. As regards Section 119 of the Act as noticed above, we find that while Section 119(1) of the Act, restrains the Board from issuing any instructions to subordinate authorities, which may lay down instructions of such a nature requiring the Income Tax Authorities to make particular assessment in a particular manner or to interfere with the discretion of the Joint Commissioner and Commissioner (Appeals) while exercising their appellate function. However, the Board would be within its powers to instruct and lay down guidelines for efficient management of assessment work and collection of revenue or issue guidelines/principles/procedure which are to be followed by Income Tax Authorities for work relating to assessment. The Circular d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decide the matter for himself, instead of forwarding an order which another authority had purported to pass. 13. It has been stated by Wade and Forsyth in 'Administrative Law', 7th Edition at pages 358 and 359 under the heading 'SURRENDER, ABDICATION, DICTATION' and sub- heading "Power in the wrong hands" as below:- "Closely akin to delegation, and scarcely distinguishable from it in some cases, is any arrangement by which a power conferred upon one authority is in substance exercised by another. The proper authority may share its power with some one else, or may allow some one else to dictate to it by declining to act without their consent or by submitting to their wishes or instructions. The effect then is that the discretion conferred by parliament is exercised, at least in part, by the wrong authority, and the resulting decision is ultra vires and void. So strict are the courts in applying this principle that they condemn some administrative arrangements which must seem quite natural and proper to those who make them ". "Ministers and their departments have several times fallen foul of the same rule, no doubt equally to their surprise ". 14. The present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the reply was received and the order was passed by the Assessing Officer, the same has been approved by the Joint Commissioner. As such, we find that the Joint Commissioner has in fact comprehensively and actively participated in the making of the assessment order while his role was only limited to the approval of the assessment order in terms of the CBDT Circular. Thus, we find the order to be vitiated in law. 24. In view of the above, the assessment order cannot be result of an independent application of mind and exercise of discretionary power by the Assessing Officer in terms of Section 143(3) of the Act and but is an order passed under the influence and directions of the superior officers. It is to be noticed that the consultation with a superior officer would be akin to directions of the superior. There is no room available for discretion where consultation is sought from a superior officer while if a superior officer consults his subordinates, the discretion continues to stay with him. He may choose not to follow the advice of his subordinate but the opposite would be untrue. We are, thus, of firm view that the order has been passed whereby the Assessing Officer has abdicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng time barred. At the cost of repetition, we reiterate that the last date for making the order of assessment was 31.03.2024. In M.M. Rubber case (Supra), the Hon'ble Supreme Court was examining the then provisions of the Income Tax Act, 1922, Section 33(A)(2) with reference to right of revision provided to an aggrieved assessee and limitation provided under Section 33(A)(a) to suo-moto call for record by the authority for revising the order and observed as under:- "12. It may be seen therefore, that, if an authority is authorised to exercise a power or do an act affecting the rights of parties, he shall exercise that power within the period of limitation prescribed there for. The order or decision of such authority comes into force or becomes operative or becomes an effective order or decision on and from the date when it is signed by him. The date of such order or decision is the date on which the order or decision was passed or made: that is to say when he ceases to have any authority to tear it off and draft a different order and when he ceases to have any locuspaetentiae. Normally that happens when the order or decision is made public or notified in some form or when it can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g passed after the statutory time limit and ultimately, the Departmental Representative stated before the Tribunal that the matter may be decided in the light of the facts on record of the case. While dismissing the appeal of the revenue , the Tribunal has given a categoric finding that no evidence has been adduced by the Department to show that the impugned order dated 26-3- 2004 passed by the assessing officer was indeed passed before the statutory time limit." 30. The revenue before us has contended that the order which is undated, was actually passed and made on 31.03.2024 and was also placed on portal on 31.03.2024. In support of their contention, they further submitted that the order of demand placed on portal along with order of assessment on 04.04.2024, mentions of the assessment order having been passed on 31.03.2024 and, therefore, it has taken pains to submit that actually the order of assessment was made on 31.03.2024 and a presumption should be drawn in their favour. We are unable to accept the contention raised by learned counsel for the revenue that the orders were made on 31.03.2024 and therefore, it is not relevant as to when they were communicated. Since there is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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