2019 (7) TMI 1041 - HC - Income Tax

Dismissed appeal due to untimely communication of revision order under Income Tax Act

The High Court dismissed the Revenue's appeal under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal for ... Revision of assessment barred by limitation under Section 263(2) - communication/dispatch of order as triggering date for limitation - failure to prove dispatch or obtain acknowledgment of service - tribunal's factual conclusion on limitation - no substantial question of lawRevision of assessment barred by limitation under Section 263(2) - communication/dispatch of order as triggering date for limitation - failure to prove dispatch or obtain acknowledgment of service - tribunal's factual conclusion on limitation - Whether the order of the Commissioner under Section 263 dated 26.3.2012 was barred by limitation because it was not communicated to the assessee within the period prescribed under Section 263(2). - HELD THAT: - The Tribunal set aside the Commissioner's revision order not on its merits but on the ground that it was communicated beyond the two year period prescribed by Section 263(2). The Tribunal examined the Assessing Officer's letter and found that the order was forwarded to the assessee only on 26.11.2012 at the assessee's request, that there was no evidence the order had earlier been supplied, and that neither the dispatch register nor any acknowledgement of receipt was produced. Drawing an adverse inference against the Revenue, the Tribunal relied on authority holding that an authority cannot pass an order and keep it in file to be communicated at its pleasure; communication to the aggrieved person in a manner known to law is necessary and the date of communication, not merely the date of passing, is relevant for limitation. The High Court found no substantial question of law, endorsed the Tribunal's factual findings on non communication and limitation, and declined to entertain the appeal. [Paras 4, 5, 6]Tribunal rightly held the revision order was time barred for want of proof of communication within the limitation period; the appeal raises no substantial question of law and is dismissed.Final Conclusion: The appeal is dismissed; the substantial question of law is answered against the Revenue and the Tribunal's order setting aside the Section 263 revision on limitation grounds is upheld. Issues:1. Appeal filed by Revenue under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal.2. Substantial question of law regarding the revision order under Section 263 of the Act being barred by limitation.3. Tribunal setting aside the order under Section 263 passed by the Commissioner of Income Tax on the ground of being communicated beyond the limitation period.Analysis:1. The High Court heard the appeal filed by the Revenue against the order of the Income Tax Appellate Tribunal. The appeal was directed against the order dated 04.4.2013 for the assessment year 2008-09. The substantial question of law raised was whether the Tribunal was right in holding that the revision order under Section 263 was barred by limitation.2. The High Court pointed out that there was no substantial question of law in the appeal. The Tribunal had set aside the order under Section 263 not on merits but due to being communicated beyond the limitation period. The Tribunal found that the order was communicated well beyond the period of limitation as prescribed under Section 263(2) of the Act.3. The Tribunal's findings indicated that the order of the Commissioner of Income Tax was forwarded to the assessee on 26.11.2012, well beyond the prescribed period. The Tribunal observed that there was no evidence to show that the order was dispatched on time. Citing the provisions of Section 263(2), the Tribunal inferred that the order was never properly communicated to the assessee within the specified timeframe.4. Additionally, the Tribunal referred to a decision of the Kerala High Court, emphasizing the importance of timely communication of orders to the concerned parties. The Tribunal found that the order should not only be passed but also properly communicated within the legal framework. The Departmental Representative failed to counter the submissions made by the authorized representative of the assessee.5. In conclusion, the High Court dismissed the appeal, stating that no substantial question of law arose for consideration. The substantial question of law raised was answered against the Revenue, affirming the Tribunal's decision to set aside the order under Section 263 due to being communicated beyond the limitation period.