Tribunal allows appeal, deems final assessment order time-barred, additional grounds not examined.

The Tribunal allowed the appeal, holding that the final assessment order dated 22.02.2011 is barred by limitation. The additional grounds raised by the assessee were admitted for adjudication, but as the final assessment order was deemed time-barred, the merits of the case were not examined.

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Issues Involved:
1. Admissibility of additional grounds raised by the assessee.
2. Applicability of Section 144C of the Income Tax Act, 1961.
3. Whether the final assessment order dated 22.02.2011 is barred by limitation.

Issue-wise Detailed Analysis:

1. Admissibility of Additional Grounds:
The assessee moved a petition under Rule 11 of the Income Tax Appellate Tribunal Rules, 1963 for admission of additional grounds, arguing that the assessment order passed by the AO u/s 143(3)/144C of the Act dated 22.02.2011 is barred by limitation. The Tribunal noted that the issue is purely legal, and the facts are available on the assessment and appellate records. Therefore, the additional grounds were admitted for adjudication.

2. Applicability of Section 144C of the Income Tax Act, 1961:
The assessee argued that Section 144C, introduced by the Finance (No.2) Act, 2009, applies prospectively from the assessment year 2011-12, as held by the Hon'ble Madras High Court in Vedanta Limited vs. ACIT. The Tribunal noted that the provision of Section 144C does not merely prescribe procedure but involves a substantive exercise in assessment, granting substantive rights to the parties. The Tribunal relied on the CBDT Circulars and the Madras High Court's decision, concluding that Section 144C is applicable only from the assessment year 2011-12.

3. Whether the Final Assessment Order Dated 22.02.2011 is Barred by Limitation:
The Tribunal examined the time limit for completion of assessments under Section 153 of the Act. For the assessment year 2007-08, the final assessment order should have been framed on or before 31.12.2010. However, the order was passed on 22.02.2011. The Tribunal observed that procedural amendments affecting vested substantive rights are prospective unless explicitly made retrospective. The Tribunal cited various legal precedents, including the Hon'ble Supreme Court's rulings, to support the view that changes in the forum are substantive and not merely procedural. Consequently, the Tribunal held that the final assessment order dated 22.02.2011 is barred by limitation.

Conclusion:
The Tribunal allowed the appeal filed by the assessee, holding that the final assessment order dated 22.02.2011 is barred by limitation. As the additional ground was adjudicated in favor of the assessee, the merits of the case were not examined, rendering them academic.

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