TaxTMI 
TaxTMI 
2005 (7) TMI 53
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....r under section 271(1)(c) had been passed after the expiry of the limitation period stipulated under section 275 of the Income-tax Act, 1961?" Brief facts of the case are that the assessee-respondent (hereinafter referred to as "the assessee") for the assessment year 1972-73 filed two returns of income one for the period April 1, 1971 to June 30, 1971, disclosing the income of Rs. 34,510 and another return for the period July 1, 1971 to March 31,1972, disclosing the income of Rs. 1,76,172. The Income-tax Officer completed one assessment in respect of both the periods at Rs. 9,15,710 vide order dated March 25, 1975. This order was subsequently rectified by the Income-tax Officer on June 27, 1975, under section 154 of the Act whereby the i....
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....tmental appeal while the assessee's appeal in respect of the claim under section 35B was allowed and the matter was restored to the Commissioner of Income-tax (Appeals). The other points in respect of the assessee's appeal were decided by the Tribunal on the merits and it was allowed in part. When the matter came before the Commissioner of Income-tax (Appeals) he forwarded the case to the Assessing Officer vide his order dated January 6, 1981. The Income-tax Officer reframed the assessment on March 11, 1983, and has computed the income at Rs. 1,26,301 in respect of the period April 1, 1971 to June 30, 1971. While completing this assessment he has also issued notice under section 271(1)(c) of the Act. It may be mentioned here that the penalt....
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....order of the Tribunal was received by the Commissioner of Income-tax. The period of limitation, therefore, would have expired at the end of January or February, 1981, as against which the proceedings have been completed by the Assessing Officer on March 7, 1986. I am also of the view that the Assessing Officer was not justified in initiating penalty proceedings against the reassessment order framed by him on March 11, 1983, as such proceedings had already been initiated in the original assessment order dated March 25, 1975, which had not been completed. Thus it is clear that the issue of notice of penalty in the order dated March 11, 1983, was only a pretext to save limitation, which had already expired. It is therefore, held that the proce....
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....ssioner or, as the case may be, the Appellate Tribunal is received by the Commissioner, whichever period expires later.' As rightly observed by the Commissioner of Income-tax (Appeals), the period of '6 months' as mentioned in sub-clause (ii) in respect of an appeal filed before the Tribunal would apply only when the appeal is filed under sub-section (2) of section 253 and which speaks of appeals filed by the Department since sub-section (1) deals with appeals filed by an assessee. Taking note of the aforesaid provision, the Commissioner of Income-tax (Appeals) found that the appeal of the Department had been dismissed by the Tribunal vide order dated June 27, 1980, and the penalty proceedings should have been finalized within six mon....
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....on." Heard Sri Shambhu Chopra, learned standing counsel appearing on behalf of the Revenue. No one appears on behalf of the assessee. Learned standing counsel submitted that after setting aside the assessment order by the Commissioner of Income-tax (Appeals), Lucknow, the assessing authority reframed the assessment on March 11, 1983, but the income was finally determined on January 27, 1986, after giving effect to the order of the Tribunal and penalty order passed on March 7, 1986, was within limitation as contemplated under section 275 of the Act. We do not agree with the submission of learned standing counsel. The Commissioner of Income-tax (Appeals) has held that the order of the Tribunal dismissing the appeal filed by the Depar....