Revenue appeals dismissed, assessment void ab initio for special audit extension breach.

The appeals of the revenue were dismissed, and the cross objections of the assessee were allowed, declaring the assessment order void ab initio due to the invalid extension of the special audit period. The tribunal emphasized adherence to statutory provisions and the specific authorities' powers in tax proceedings, highlighting that any deviation can render proceedings invalid.

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Issues Involved:
1. Deletion of additions under various sections of the Income Tax Act by the Commissioner of Income Tax (Appeals) [CIT(A)].
2. Validity of the assessment order under Section 153A.
3. Legality of the extension granted for special audit under Section 142(2A).

Detailed Analysis:

1. Deletion of Additions by CIT(A):
The revenue raised multiple grounds challenging the CIT(A)'s decision to delete various additions made by the Assessing Officer (AO) under different sections of the Income Tax Act, including:
- Section 40(A)(3): Deletion of disallowance related to cash payments exceeding the prescribed limit.
- Section 40(a)(ia): Deletion of disallowance for non-deduction of tax at source.
- Section 14A read with Rule 8D: Deletion of disallowance related to expenditure incurred in relation to income not includible in the total income.
- Disallowance of Brokerage Expenses: Deletion of disallowance related to brokerage expenses.
- Section 40A(2)(b): Deletion of disallowance related to payments to specified persons.
- Disallowance of Depreciation: Deletion of disallowance related to depreciation.
- Bikaner Project: Deletion of addition related to profits from the Bikaner project.

2. Validity of the Assessment Order under Section 153A:
The assessee raised legal grounds challenging the validity of the assessment order under Section 153A, arguing that:
- The audit conducted under Section 142(2A) was not required as no complexity was pointed out in the books of accounts.
- The extension of time for the special audit was invalid as it was granted by the CIT instead of the AO, thus violating Section 142(2C).

3. Legality of the Extension Granted for Special Audit under Section 142(2A):
The core issue was whether the extension of time for the special audit granted by the CIT, Central-II, was legally valid. The statute mandates that the extension should be granted by the AO, not the CIT. The relevant provisions are:
- Section 142(2A): Requires the AO to direct a special audit with the previous approval of the CIT.
- Section 142(2C): Specifies that the AO may extend the period for the audit, not exceeding 180 days in total.

The tribunal examined the following:
- The sequence of events leading to the extension request.
- The statutory provisions and the respective authorities' powers.
- The argument that the CIT's involvement was merely administrative and not a substitution of the AO's statutory power.

Tribunal's Findings:
- The tribunal found that the extension of time for the special audit was granted by the CIT, not the AO, which is beyond the statutory powers vested by the Act.
- The extension should have been granted by the AO after due application of mind and examination of the circumstances.
- The extension granted by the CIT was invalid, rendering the assessment completed after the due date void ab initio.

Conclusion:
- The appeals of the revenue were dismissed.
- The cross objections of the assessee were allowed, declaring the assessment order void ab initio due to the invalid extension of the special audit period.

This judgment emphasizes the importance of adhering to statutory provisions and the specific authorities' powers in tax proceedings. The tribunal's decision underscores that any deviation from the prescribed statutory framework can render the proceedings invalid.

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