2017 (3) TMI 1266 - HC - Income Tax

Appeal Limitation Period: Starts on Officer's Receipt, Not Just 'Concerned' CIT.

The court clarified that the limitation period for filing an appeal under Section 260A (2) (a) of the Income Tax Act, 1961 begins upon receipt of the ... Words 'the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner' in Section 260A (2) (a) interpretation - whether mean only the 'jurisdictional' Principal or Chief Commissioner of Income-tax (CIT) or could it include any CIT including the CIT (Judicial)? - period of limitation - Held that:- The word ‘received’ occurring in Section 260A (2) (a) would mean received by any of the named officers of the Department, including CIT (Judicial). The provision at present names four particular officers i.e. the Principal Commissioner, Commissioner, Principal Chief Commissioner, and the Chief Commissioner of Income Tax. These are the only designations of the officers who could receive a copy of the order. In the absence of a qualifying prefix ‘concerned’, the receipt of a copy of the order of the ITAT by any of those officers in the Department including the CIT (Judicial) will trigger the period of limitation. In Section 260A (2) of the Act, the words CIT, Pr CIT or Chief CIT are not prefixed or qualified by the word 'concerned'. There is no warrant for the Court to read into the provision such a qualifying word. The Court rejects the contention of the Revenue that limitation for the purposes of Section 260A (2) (a) begins to run only when a certified copy of the order of the ITAT is received by the 'concerned' CIT within whose jurisdiction the case of the Assessee falls notwithstanding that it may have been received by any other CIT, including the CIT (Judicial) prior thereto. As far as the obligation of the ITAT under Section 254 (3) of the Act is concerned, the said obligation is satisfied once the ITAT sends a copy of an order passed by it to the Assessee as well as to the Pr CIT or the CIT or even the CIT (Judicial). The ITAT has to be simply go by the details as provided to it in the memo of parties. If there is a change concerning the jurisdiction of the CIT and it is some other CIT who has jurisdiction, it will not have the effect of postponing the commencement of the period of limitation in terms of Section 260A (2) (a) of the Act. The statute is not concerned with the internal arrangements that the Department may make by changing the jurisdiction of its officers. It is for the officer of the Department who first receives a copy of the ITAT’s order to reach it in time to the officer who has to take a decision regarding the filing of an appeal. While there is no requirement for the DR or CIT (Judicial) to apply for a certified copy of the ITAT, in any event under the extant ITAT Rules, a copy of the order is sent to the CIT (Judicial). In the context of Section 260A(2)(a) of the Act, once an order is listed for pronouncement in the ITAT, the DR or the CIT (Judicial) should be taken to be aware of the order. From that point, it is a purely an internal administrative arrangement as to how the DR or CIT (Judicial) obtains and further communicates the order to the officer who has to take a decision on filing the appeal. It is possible that immediately after pronouncement, the AR or the DR or both may apply for a certified copy of the order of the ITAT. In that case, the time taken for the certified copy to be readied for collection by the applicant will be excluded while computing limitation. But here again, if earlier to such date, a copy is received by a party from the ITAT, then such earlier date will be the starting point for limitation. Period of limitation - Held that:- The receipt of a certified copy of the order of the ITAT by CIT (Judicial) would trigger the commencement of the limitation period under Section 260 A (2) (a) of the Act. Where there, is a common order of the ITAT covering the several appeals, limitation would begin to run when a certified copy is received first by either the CIT (Judicial) or one of the officers of the Department and not only when the CIT ‘concerned’ receives it. When the same CIT has jurisdiction for more than one Assessee, the limitation begin to run for all from the earliest of the dates when the DR of CIT (Judicial) or any CIT first receives the order in any of the cases forming part of the batch disposed of by the common order. If there are four separate orders passed, then the limitation begins to run when such separate orders are received first by any officer of the Department. Instructions issued by the Department for its administrative convenience cannot alter the time when limitation would begin to run under Section 260A (2) (a) of the Act. To reiterate these administrative instructions are for the administrative convenience of the Department and will not override the statute, in particular, Section 260A (2) (a) of the Act. Issues Involved:1. Interpretation of the phrase 'the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner' in Section 260A (2) (a) of the Income Tax Act, 1961.2. Commencement of the limitation period for filing an appeal under Section 260A (2) (a).3. Obligation of the ITAT to send a certified copy of its order to the concerned CIT.4. Impact of administrative instructions on the limitation period.5. Relevance of earlier decisions in light of new procedures and amendments.Detailed Analysis:1. Interpretation of 'the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner' in Section 260A (2) (a):The court examined whether the term 'received by the Assessee or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner' includes any CIT, including the CIT (Judicial). The court concluded that the word 'received' in Section 260A (2) (a) means received by any of the named officers of the Department, including CIT (Judicial). The absence of the qualifying prefix 'concerned' indicates that receipt by any of these officers triggers the limitation period.2. Commencement of the Limitation Period:The court rejected the contention that limitation begins only when the 'concerned' CIT receives the order. It held that the limitation period starts when any of the named officers, including the CIT (Judicial), receives the order. The court emphasized that the internal administrative arrangements of the Department cannot extend the statutory period of limitation. The presence of a DR or the CIT (Judicial) during the pronouncement of the order is sufficient to trigger the limitation period.3. Obligation of the ITAT to Send a Certified Copy:The court clarified that the ITAT's obligation under Section 254 (3) is satisfied once it sends a copy of its order to the Assessee and any of the named officers, including the CIT (Judicial). A change in the jurisdiction of the CIT after the order does not affect the commencement of the limitation period.4. Impact of Administrative Instructions:Administrative instructions issued by the Department for its convenience cannot alter the statutory limitation period. The court held that these instructions are for administrative convenience and do not override the statute. The limitation period begins when the order is received by any officer of the Department, irrespective of internal instructions.5. Relevance of Earlier Decisions:The decisions in CIT v. Arvind Construction Co. (P) Ltd. and CIT v. ITAT were rendered in the context of Section 256 and are distinguishable. These decisions do not assist in interpreting Section 260A (2) (a). The court noted that these earlier decisions need to be reconciled with the decision in CIT v. Sudhir Choudhrie, which mandated pronouncement of ITAT orders in open court.Conclusion:The court provided clear answers to the questions referred, emphasizing that the limitation period for filing an appeal under Section 260A (2) (a) begins when any of the named officers, including the CIT (Judicial), receives the order. Administrative instructions cannot extend this statutory period. The court's interpretation aims to prevent unnecessary delays and ensure timely filing of appeals.