2005 (8) TMI 84

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.... an assessment is framed under section 143(3) of the Act by issuing statutory notice beyond the prescribed time limit, the said assessment is bad in law and has to be quashed, ignoring the fact that the assessee has not challenged the jurisdiction of the Assessing Officer during the course of assessment proceedings on the ground that notice under section 143(2) was served beyond the time limit prescribed under the Act and ignoring the decision of the Madhya Pradesh High Court in the case of Dr. H. R. Rai v. CIT [1984] 145 ITR 809?" (ii) Whether the hon'ble Income-tax Appellate Tribunal was right in law and on facts in holding the decision of the Tribunal in the case of Rakesh S. Mardia v. Deputy CIT [2002] 74 ITJ (Ahd) 836, more particular....

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....not merit acceptance. The position in law is well settled that the Commissioner (Appeals) has the same powers that an Assessing Officer has and his powers are co-extensive with those of the Assessing Officer while determining the correct income liable to tax in accordance with the provisions of the Act. Even otherwise, the issue raised is purely a legal issue based on the provisions of the Act and the assessee can raise the same at any stage. The second contention regarding there being acquiescence and/or waiver on the part of the assessee by participating in the proceedings also does not merit acceptance. It is an admitted position that the return of income was filed on March 30, 1997, for the assessment year 1997-98 and the notice under ....

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....aid sub-section states : "Provided that no notice under this sub-section shall be served on the assessee after the expiry of twelve months from the end of the month in which the return is furnished". On a plain reading of the language in which the proviso is couched it is apparent that the limitation prescribed therein is mandatory, the format of the provision being in negative terms. The position in law is well-settled that if the requirements of a statute which prescribes the manner in which something is to be done are expressed in negative language, that is to say, if the statute enacts that it shall be done in such a manner and in no other manner, such requirements are, in all cases absolute and neglect to attend to such requirement wil....

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....ar that: "The aforesaid period of limitation for the service of a notice under sub-section (2) of section 143 of the Act does not allow sufficient time to the Assessing Officers to select returns for scrutiny before assessment. Therefore, the provision was amended to provide that the notice can be served within twelve months from the end of the month in which the return is furnished". It goes without saying that the departmental authorities are bound by the circulars issued by the Central Board of Direct Taxes. In the circumstances, it is not open to the Revenue to contend otherwise. These circulars are explanatory. They give contemporaneous exposition of the legal position. Even otherwise, on a plain reading of the section and the proviso....