TaxTMI 
TaxTMI 
2008 (3) TMI 49
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....ct and the assessment under Section 143(3) read with Section 147 was completed on 14.2.2003 on a total income of Rs.17,01,235. Various additions and disallowances were made in this assessment. 2. The assessee filed an appeal before the CIT (Appeals) and besides contesting the disallowances made in the assessment, took up a ground that the assessment was time barred in view of section 153(2) of the I.T.Act and, therefore, the same should be quashed. It was contended that under section 153(2), the assessment proceedings have to be completed within one year from the end of the financial year in which the notice under section 148 was served. It was pointed out that the notice was served on the assessee on 11.01.2001, which is a day which fell before 01.06.2001 and, therefore, in such a case, the assessment ought to have been completed on or before 31.03.2002. Since it was completed only on 14.02.2003, the assessment, it was contended was beyond the period of limitation 3. The Commissioner of Income Tax (Appeals) held that since section 153(2) was amended with effect from 01.06.2001 to reduce the time limit available for completion of the assessment from tw....
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....ained loan against her FDRs with the bank on higher rate of interest, and gifted it for the construction of the College Building. The deduction on account of interest claimed to have been paid to the bank is not allowable. Keeping in view the facts that interest income is assessable under the head "Income from other sources". I therefore, have reasons to believe that wrong deduction has been claimed and allowed on income from interest on FDR and income to the extent of Rs.16,54,795/-(1679717-249221) has escaped assessment. 6. In response to this notice, the assessee declared the same income as declared in the original return. During the reassessment proceedings, the Assessing Officer noted that the assessee had received interest of Rs.16,79,717/- against which interest of Rs.16,54,794/- had been claimed as deduction as paid to the bank. 7. The Assessing Officer held that interest paid was not allowable as deduction as the income from investment out of the loan was not taxable. He also held that the loans taken were for investment in the FDRs. The interest paid on the borrowings against which the FDRs were pledged, was not wholly and exclusively for ear....
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....tiate subsequent proceedings under Section 147 of the Income Tax Act, 1961 in a case where on same set of facts previous proceedings culminating in the passing of assessment order under Section 143(3) read with Section 147 has been set aside on account of being time barred by the Income Tax Appellate Tribunal?" 11. Learned counsel for the appellant-assessee has argued that the assessment in the case was made under Section 143(3) on 14.2.2003 and the same could not be reopened after a lapse of four years from the end of the relevant assessment year unless there was an escapement of income tax due to failure on the part of the assessee in declaring true and full material facts necessary for the assessment. It has been further argued by the learned counsel for the appellant that the Assessing Officer with a view to circumvent the order of the Tribunal holding that the assessment framed by the Assessing Officer was barred by time and therefore, not sustainable in law, again issued a notice under Section 147/148 of the Act by recording the same reasons which had been recorded in the first instance and framed the assessment under Section 143(3) read with Section 147 of the Act. 12.....
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....under the existing law of limitation the right to initiate a proceeding has already become time-barred then a subsequent enlargement of time by an amendment of law cannot be availed of. In such a case, the matter having attained finality, would vest a party with substantive right which has already accrued. This accrued right cannot be taken away by a subsequent amendment. Substantive laws determine the rights and liabilities of the parties concerned, whereas procedural laws govern the manner in which such rights or obligations are to be enforced or realised." 16. In Commissioner of Income-Tax v. Air Craft Radio Corporation (2007) 292 ITR 64 (P&H) this Court held that after the reassessment had been set aside by the Appellate Court, the Assessing Officer had no jurisdiction to once again embark upon the same proceedings. 17. The Hon'ble Supreme Court in the case of CIT v. Rao Thakur Narayan Singh (1965) 56 ITR 234 observed as under: "....The Tribunal held in the earlier proceedings that the Income-tax Officer knew all the facts at the time he made the original assessment in regard to the income he later on sought to tax. The said finding necessarily implies that the Income-....