Limitation for income-tax assessment turns on signature date, and late-signed assessment documents were treated as time-barred and invalid.

A time-bound assessment under section 153(1) of the Income-tax Act is made only when the competent authority signs the operative document, because signature marks the point at which the authority no longer retains locus poenitentiae. The Bombay HC treated the assessment order, computation sheet and notice of demand as invalid where they were dated within time but digitally signed after the statutory limitation had expired. Applying the statutory requirement that issued documents be signed and the principle that an order is not complete until signature, the Court held that late-signature documents could not be regarded as made within time and quashed them as time-barred.

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Issues: Whether the assessment order and notice of demand for Assessment Year 2023-24 were barred by limitation because they were digitally signed after the expiry of the period prescribed under section 153(1) of the Income-tax Act, 1961, and whether an order can be said to be made only when it is signed by the competent authority.

Analysis: The assessment year in question attracted the twelve-month limitation under the fourth proviso to section 153(1), making 31 March 2025 the outer limit for completion of the assessment. The assessment order, computation sheet, and notice of demand were all dated 21 March 2025 but were digitally signed only on 25 December 2025, 24 December 2025, and 12 December 2025 respectively. The governing principle applied was that an assessment or other operative order is made only when it is signed and thereby ceases to remain within the authority's locus poenitentiae. The Court also relied on the statutory requirement that notices or documents issued under the Act must be signed, and treated the absence of timely signature as fatal to validity where the act is time-bound. On that basis, documents signed after the limitation period could not be regarded as having been made within time.

Conclusion: The assessment order, computation sheet, and notice of demand were held to be time-barred and invalid, and were quashed.

Ratio Decidendi: For a time-limited assessment under section 153(1) of the Income-tax Act, 1961, the order is made only upon signature by the competent authority, and any assessment-related document signed after expiry of the prescribed limitation is invalid.

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