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The revenue contended that the Learned Commissioner of Income Tax (Appeals) ['Ld. CIT(A)'] erred in rejecting the application u/s 154 without giving an opportunity to the AO. The Ld. CIT(A) held that there was no mistake apparent from the record. The revenue prayed that the order of the CIT(A) be set aside and that of the AO be restored.
Issue 2: Assessment completed beyond the time limit prescribed in section 153(1)(a) of the ActThe revenue argued that the Ld. CIT(A) was not justified in holding that the assessment completed on 31.03.2016 was beyond the time limit prescribed in section 153(1)(a) of the Act. The Ld. CIT(A) had set aside the assessment order on the ground that it was barred by limitation, as it was passed beyond the due date of 31.03.2015.
The assessee filed its return of income on 29.09.2012, and the assessment was completed u/s 143(3) on 30.03.2016. The Ld. AO had made several additions and disallowances, including an addition of Rs. 2319,54,67,195/- on account of the transfer of shares without consideration and disallowance of expenses u/s 37.
The Ld. AO filed a miscellaneous application before the Ld. CIT(A) contending that the decision suffered from a mistake apparent from the record, arguing that a reference was made to the Mauritius Revenue Authority (MRA) u/s 90, which should extend the time limit for assessment by one year. However, the Ld. CIT(A) dismissed this application.
Upon appeal, the Tribunal reviewed the chronology of events, noting that the information from MRA was received by the competent authority (PCIT) on 14.07.2015. According to Explanation 1(viii) of Section 153, the period for completing the assessment should exclude the time taken for the foreign reference. The Tribunal concluded that the assessment should have been completed by 12.09.2015, and since it was completed on 30.03.2016, it was time-barred and invalid.
The Tribunal dismissed the revenue's appeals, holding that the assessment order was time-barred and bad in law. The orders pronounced in the open court on 17th April 2023 confirmed the dismissal of the revenue's appeals.
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