TaxTMI 
TaxTMI 
2014 (8) TMI 557
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...., overlooking Section 150 of the Income Tax Act?" 2. The appeal relates to addition of Rs. 32 lakhs under Section 68 of the Income Tax Act, 1961 (Act, in short), which the respondent-assessee had claimed that they had received from Jaconde Overseas Pvt. Ltd. The addition was initially made in the assessment year 2001-02, but the Tribunal allowed the appeal filed by the respondent-assessee vide order dated 11th September, 2008 recording the following findings:- "8. On going through this provision it is clear that this section 68 essentially contains a deeming provision which applies if any sum found credited in the books of an assessee maintained for a previous year may be charged to income tax as the income of the assessee of that previou....
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....ficer under section 68 of the Act for assessment year 2001-02 under consideration before us cannot be sustained and so the orders of the tax authorities below in this regard are set-aside and additional ground of appeal taken by the assessee is allowed. 3. In view of the aforesaid order, that the credit entries related to earlier assessment year 2000-01, the Assessing Officer initiated proceedings by issue of notice under Section 147/148 of the Act for the said year and passed an order dated 29th December, 2009, making addition of Rs. 32 lakhs. The respondent-assessee, however, succeeded before the Commissioner of Income Tax (Appeals), who held that the notice under Section 147/148 for the assessment year 2000-01 was belatedly issued on 12....
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....id order, provided such other person was given an opportunity of being heard before the said order was passed." 6. Section 150(2), which prescribes limitation period for issue of notice under Section 148 of the Act, reads as under:- "Section 150 - Provision for cases where assessment is in pursuance of an order on appeal, etc. x x x x x (2) The provisions of sub-section (1) shall not apply in any case where any such assessment, reassessment or recomputation as is referred to in that sub-section relates to an assessment year in respect of which an assessment, reassessment or recomputation could not have been made at the time the order which was the subject-matter of the appeal, reference or revision, as the case may be, was made by reaso....
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....other words, a finding in respect of a different year can also be used for the purposes of invoking the provisions of Section 150 of the said Act, by virtue of the deeming provision contained in Explanation 2 in Section 153 of the said Act. This would otherwise not have been available in view of the decision of the Supreme Court in Murlidhar Bhagwan Das (Supra). Similarly, Explanation 3 stipulates that where, by an order inter-alia passed by the Tribunal in an appeal, any income is excluded from the total income of one person and held to be the income of another person, then, assessment of such income on such other person shall, for the purposes of Section 150 as also Section 153, be deemed to be one made in consequence of or to give effect....
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....64 or in an order of any Court in a proceeding otherwise than by way of appeal or reference under the Act. 14. The language employed in Explanation 2 to section 153 makes it abundantly clear that under the said provision, when an order in appeal, revision or reference is made whereby any income is excluded from the total income of an assessee for an assessment year, then an assessment of such income for another assessment year shall be deemed to be one made in consequence of or to give effect to any finding or direction contained in the said order for the purpose of section 150 or section 153. Thus, for the purpose of resorting to the exception provided under sub-section (3)(ii), it is not necessary that there should be any specific findin....
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....sment of such income for another assessment year shall, for the purposes of section 150 and section 153, be deemed to be one made in consequence of or to give effect to any finding or direction contained in the said order. 19. On a combined reading of sub-section (1) of section 150 and sub-section (3) of section 153, it is apparent that in cases falling under clause (ii) of sub-section (3) of section 153 read with Explanation 2 thereunder, the provisions of subsection (1) of section 150 would be applicable and the bar of limitation under section 149 would not be applicable. While section 150(1) and section 153(3) contemplate issuance of notice under section 148 and completion of assessment, reassessment and recomputation respectively, in c....