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2022 (2) TMI 274
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....rounds of appeal raised by Revenue in ITA No.112/Rjt/2020 for A.Y. 1998-99 read as under: "1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in quashing the proceedings u/s 147 of the Act in the case of the assessee. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in holding that the notice u/s 148 being issued beyond the period of four years from the end of the relevant assessment year was barred by limitation without appreciating that the Explanation below sec. 149(3), introduced w.e.f. 1.4.2012, clearly gave retrospective operation to section 149(1)(c) and therefore, the Assessing Officer was justified in issuing notice u/s 148 for A.Y. 1998-99. 3. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in quashing the notice u/s 148 of the Act without appreciating that the facts found during the course of search proceedings showed that the members of the assessee group were holding undisclosed foreign bank account in various foreign banks including HSBC Geneva and ABN AMRO Bank, Zurich and, therefore, the ingredients of section 147 were clearly attracted. 4. On the facts and in th....
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....r the assessing officer interest income earned out of the said fund was taxable in the hands of Shir Ravichandra Mehta on substantive basis. 4.2 In view of the discussion made in the assessment order that the funds in the foreign accounts belonged to Shri Ravichandra mehta and therefore interest from the said the bank account are to be taxed in the hand of Shri Ravichandra Mehta on substantial basis and to be taxed in ththe hands of, Shir i Balkrishna Mehta on protective basis only. Accordingly for the assessment years 1998-99 the amount of Rs.l7882389 was treated as total income on protective basis. 5. During the course of appellate proceeding before learned CIT(A), the assessee has made the detailed submission which has been incorporated at page numbers 23-29 of the order of the learned CIT(A). The assessee has stated that whatever investments made was not out of his escape income in India but there was his legitimate investments earned from business in Dubai. The funds were transferred from UAE to ABN AMR bank and HSBC Geneva at the later stage and in the year 1997, after the death of assessee's mother and according to family circumstance, the assessee's father had dec....
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....void ab initio. 6.2 In this regard it has been contented by the appellant that the above referred additional ground is purely legal in nature and therefore, requires admission and adjudication. It is case of the appellant that a search was conducted in his case on 20.3.2013, that Notice u/s 148 was issued for the captioned years on 27.02.2015 that the same has been issued in view of Section 149 (1)(c) of the Income Tax Act which was inserted by the Finance Act, 2012 with effect from 1.7.2012. As per provision of Section 149 as prevalent before the insertion of sub clause (c) to Sub section (1) of Section 149, it was provided that no Notice u/s 148 shall be issued for the relevant assessment year if not more than 4 or 6 years on the case may be, have elapsed from the end of the relevant Assessment Year. Therefore, prior to insertion of sub clause (c) to Section 149(1) the limitation period for issuance of Notice u/s 148 for the captioned years expired on 31.3.2005 for Assessment Year 1998-99 and on 31.03.2012 for Assessment Year 2005-06. Though sub-clause (c) to Section 149(1) provides that Notice u/s 148 can be issued if not more than 16 years have elapsed from the end of the rel....
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....ssee, Shri Balkrishna R Mehta himself for AY 1996-97 and AY 1997-98 ( in ITA No.(s) 407/RJT/2017, and 408/RJT/2017) were the order dated 25-02-2019 in the case of Shri Ravichandra V Mehta has been followed. 6.5 In the case of Shri Ravichandra V Mehta the additional ground of the appellant was that notice u/s.148, pursuant to which impound assessment order is framed is barred by limitation u/s.149 of the act and therefore assessment framed pursuant to such a valid notice is void ab initio. The ground of the Revenue was that the Ld. CIT(A) has erred in law and/or on facts virtually setting aside the order of AO passed u/s.143 rws 147 of the Act dated 27-02-2015, whereas no such power rests with him under the Act and the additional ground was that the Ld. CIT(A) had erred in holding that as per the provision section 5 of the Act the funds of the assesses outside India could not be taxable in the hands of appellant if his status was Resident but Not Ordinarily Resident, even though the section excludes only income accruing or rising outside India to such assesses from ambit of taxation. 6.6 In the judgement dated 25-02-2019 in the case of Shri Ravichandra V Mehta, the Hon'ble I....
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....he Act werre not sustainable and accordingly the assessment orders were quashed and appeal of the assessee were allowed. 6.8 These orders of jurisdictional ITAT are binding and the appeals for AY 1998-99 to AY 2004-05 under consideration are covered by the earlier decisions of the Hon'ble ITAT Rajkot as the notices u/s.148 were issued for these years on 27.02.2015 on the strength of the amended provisions w.e.f.01.07.2012 where on as per the pre-amended provision those notices could not have been issued after 31.03.2005 for Assessment Year 1998-99, 31.03.2006 for Assessment Year 1999-2000, 31.03.2007 for Assessment Year 2000-01, 31.03.2008 for Assessment Year 2001-02, 31.03.2009 for Assessment Year 2002-03, 31.03.2010 for Assessment Year 2003-04 and 31.03.2011 for Assessment Year 2004-05. Following there from the assessment orders u/s. 144 rws 147 made on 31-03-2015 for AY 1998-99 to AY 2004-05 on the strength of the notices u/s. 148 dated 27.02.2015, under consideration in the present appeals, are required to be quashed as notices u/s. 148 issued on 27-02-2015 for those years are void ab initio. Under the circumstances the submissions made on the merits of additions in the impug....
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.... 3rd June, 1970 in the joint name of himself and Shri Balkrishna Ravichandra Mehta and Jawahar Ravichandra Mehta with HSBC Republic Bank, (Suisse), A.A. Geneva. The said account number was changed into account No.432541 on 04.07.2000. Therefore, it is clear that the assessee was holding the said bank account during the period F.Y. 1995-96 relevant to AY 1996-97. 3. During the course of statement recorded u/s.132(4) of the I.T.Act during the course of search from Shri Ravichandra V.Mehta in reply to question No.13 he has submitted that the return of income has not been filed by him from 1994 to 1997. In his statement Shri Ravichandra Mehta in reply to question No.12 has submitted that there was a balance of Rs. 1 crore dollar in the said account in the year 1997. 4. As per second proviso to section 147 of the I.T.Act which has been inserted by the Finance Act, 2012 w.e.f.01.07.2012 nothing contained in the first proviso shall apply in a case where any income in relation to any asset (including financial interest in any entity) located outside India chargeable to tax has escaped assessment in any assessment year. 5. Since the assessee is having a bank account in HSBC Republic B....
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....aning of section 147 of the I.T. Act. Again as per section 149(1)(c) of the I.T. Act, no notice shall be issued if more than 16 years have elapsed, as can be seen from the language of the Act, which is reproduced herein below: "149(1) No notice under section 148 shall be issued for the relevant assessment year.- (c) If your years, but not more than sixteen years, have elapsed from the end of the relevant assessment years unless the income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped assessment." In the present case it is seen that provision of Section 147 has been amended by insertion of 2nd proviso to Section 147 and amending explanation 2 by inserting clause (b) to explanation 2 by Finance Act 2012 with effect from 1.7.2012. Clause (c) to Section 149(1) is also simultaneously inserted, which provides a time limit of 16 years for re-opening an assessment. There is no challenge to the vires of the aforesaid provision. It is not the contention of the appellant that the aforesaid amendments are beyond the law making powers of the government or that the same are contrary to the constitutional right gr....
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....of which limitation had already expired/lapsed before amendment became effective - Held, yes - Whether thus, impugned reassessment notice and all consequent proceedings were to be quashed and set aside - Held, year [Paras 14, 15, 16 an 19] [In favour of assessee]" 8. On the other hand, Ld.DR relied upon the finding of Ld.CIT(A) extracted hereinabove. 9. We have considered rival submissions and gone through the impugned order and the case-laws relied upon by the Ld.AR. The assessee has not challenged the vires of the amendment but has raised legal contention that for a concluded assessment, the subsequent amendment will not revive the time limit for issue of notice u/s.148. Therefore, Ld.CIT(A) misread the provisions to hold that since the time limit prescribed in law has been extended the notice is within the time. We are inclined to differ with the view of Ld.CIT(A). The issue is no more res integra. The issue has first came up before the Hon'ble Supreme Court in the case of S.S. Gadgil vs.Lal & Co. reported in 53 ITR 231(SC). Taking note of the said case, Hon'ble Gujarat High Court in the case of Induprasad Bhatt(supra) held as under: "We are, therefore, of the view that on....
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....he end of the assessment year. The amendment was made on 8th Sept., 1958, but was given effect to from 1st April, 1956. Since the time within which notice could be issued against a person deemed to be an agent of a non-resident was extended to two years from the end of the assessment year, it was contended on behalf of the ITO that the notice issued by him was within the terms of the amended provision and was, therefore, a valid notice. Now the notice issued on 27th March, 1957, was clearly within a period of two years from the end of the assessment year 1954-55 and if the amended provision applied, the notice would be a valid notice. It was, however, held by this Court that the notice was not a valid notice inasmuch as the right of the ITO to reopen the assessment of the assessee under the unamended provision became barred on 31st March, 1956, and the amended provision did not operate against him so as to authorise the ITO to commence proceedings for reopening the assessment of the assessee in a case where, before the amended provision came into force, the proceedings had become barred under the unamended provision. At page 240 of the report, Shah, J., speaking for the Court, obse....
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....on 31st March 2012, the Amending Act being Finance Act, 2012 inserting sub clause (c) Section 149 (1) w.e.f. 01-07-2012 cannot give a fresh lease of life for reopening the same which has already become barred by limitation on 31.12.2012. In view of the above, the Notice issued u/s.148 being beyond the limitation prescribed u/s.149 is bad in law and hence consequential assessment framed pursuant to such invalid notice is also required to be quashed and set aside." 9.2. Once against that issue arose before the Hon'ble Supreme Court in the matter of K.M. Sharma vs. ITO 254 ITR 772 (SC), wherein the Hon'ble Court held as under:- "13. In KM Sharma's case (supra) the assessee‟s land was acquired under the Land Acquisition Act, 1894 and an award was passed in 1967 granting compensation in favour of the assessee. Thereafter, the Additional District Judge by judgment dated 20.05.1980 held the assessee to be entitled to 1/32th share of the compensation and the assessee was granted total compensation of Rs. 1,18,810 in the year 1981. Subsequently, by another judgment dated 31.07.1991, the assessee was awarded sum of Rs. 1,10,20,624, which was received by it between 15.10.1992 ....
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....on behalf of the department has made an effort to persuade this Court to accept his construction of the provisions of section 150(1)and (2). It is argued that it is for the specific purpose of assessing income, which might accrue on the basis of any decision of any Court in any proceeding in any other law, that the provision has been amended to lift bar of limitation for reassessment. 13. Fiscal statute, more particularly a provision such as the present one regulating period of limitation must receive strict construction. The law of limitation is intended to give certainty and finality to legal proceedings and to avoid exposure to risk of litigation to litigant for indefinite period on future unforeseen events. Proceedings, which have attained finality under existing law due to bar of limitation cannot be held to be open for revival unless the amended provision is clearly given retrospective operation so as to allow upsetting of proceedings, which had already been concluded and attained finality. The amendment to subsection (1) of section 150 is not expressed to be retrospective and, therefore, has to be held as only prospective. The amendment made to sub-section (1) of section 1....
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....9. As is sought to be done by the High Court, sub-section (2) of Section 150 cannot be held applicable only to reassessments based on Orders 'in proceedings under the Act' and not to Orders of Court 'in proceedings under any other law'. Such an interpretation would make the whole provision under Section 150 discriminatory in its application to assessments sought to be reopened on the basis of Orders under the IT Act and other assessments proposed to be reopened on the basis of Orders under any other law. Interpretation, which creates such unjust and discriminatory situation, has to be avoided. We do not find that sub-section (2) of section 150 has that result. Sub-section (2) intends to insulate all proceedings of assessments, which have attained finality due to the then existing bar of limitation. To achieve the desired result it was not necessary to make any amendment in sub-section (2) corresponding to sub-section (1), as is the reasoning adopted by the High Court. 18. Sub-section (2) aims at putting embargo on reopening assessments, which have attained finality on expiry of prescribed period of limitation. Sub-section (2) in putting such embargo refers to whol....
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....fore it was amended in 1956. This Court in the case of S.S. Gadgil (supra) accepted the contention of the assessee and held as under: ". The legislature has given to section 18 of the Finance Act, 1956, only a limited retrospective operation, i.e., up to April 1, 1956, only. That provision must be read subject to the rule that in the absence of an express provision or clear implication, the legislature does not intend to attribute to the amending provision a greater retrospectivity than is expressly mentioned, nor to authorise the Income-tax Officer to commence proceedings which before the new Act came into force had by the expiry of the period provided become barred." 20. On a proper construction of the provisions of Section 150 (1) and the effect of its operation from 1.4.1989, we are clearly of the opinion that the provisions cannot be given retrospective effect prior to 1.4.1989 for assessments which have already become final due to bar of limitation prior to 1.4.1989. Taxing provision imposing a liability is governed by normal presumption that it is not retrospective and settled principle of law is that the law to be applied is that which is in force in the assessment year....
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....osed by the revenue has the potential of arming its authorities to re-open settled matters, in respect of issues where the citizen could genuinely be sanguine and had no obligation of the kind which the Revenue seeks to impose by the present amendment. All the more significant, is the fact that absent a clear indication, every statute is presumed to be prospective. The revenue had sought to contend that the amendment (to Section 149) is merely procedural and no one has a vested right to procedure; and that procedural amendments can be given effect any time, even in ongoing proceedings. 17. This court is of the opinion that there is no merit in the revenue‟s contention. In Sri Prithvi Cotton Mills Vs Broach Borough Municipality, AIR 1970 SC 192, examined the validity of the retrospective amendment of a statute in light of Article 19(1)(g) of the Constitution of India, i.e. a fundamental right to practice any profession, or to carry on any occupation, trade or business. The court said: "In testing whether a retrospective imposition of a tax operates so harshly as to violate fundamental rights under article 19(1)(g), the factors considered relevant include the context in whi....
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....sequent proceedings are hereby quashed and set aside. The writ petition is allowed; however without order on costs." 10. Thus, in all above cases Courts have held that when the time limit for issuing notice u/s.148 has expired before any amendment in law from a prospective date will not revive. The time limit for those years for which limitation has already expired on the date of amendment. There was no challenge to vires of the amendment but still the Courts have held that notice issued u/s.148 is beyond limitation period. In the present case in our hand, prior to amendment in section 149 and the time limit for issuance of notice u/s.148 for AY 1996-97 expired on 31/03/2003 and that for 1997-98 expired on 31/03/2004. The amendment of section 149 is with effect from 01/07/2012 and is not retrospective in nature. Thus, the time limit which have already been expired could not have been revived by subsequent amendment. For all these reasons and complying the ratio laid down by above cited cases, we hold that notice issued u/s.148 on 25/03/2013 for both the above years is beyond jurisdiction and accordingly quashed. Since the notice is held to be invalid, subsequent assessment order ....
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....xed in India on a global income including the income from whatever sources derived which accrue or arises to him outside India as per section 5(l)(c) of the act. Similarly the interest of Rs. 4,71,207/- shown why Shiri Jawahir Mehta have to be added on substantive basis in the hands of the assessee. 12. ITA No.86/Rjt/2020 by the assessee & ITA No. 119/Rjt/2020 for A.Y. 2005-06 by the Revenue in case of Sh. Balkrishna Ravichandra Mehta:- 13. Both these appeal by the assessee and revenue are interconnected on similar facts therefore for the sake of convenience both these appeals are adjudicated together. During the course of assessment the assessing officer stated that the funds in the account number 4432533 with the HSBC Geneva belongs to Shiri Ravichandra Mehta therefore the interest from the said account shown by the assessee at Rs. 77,55,720/- is taxable in the hands of Shri Ravichandra Mehta on substantive basis. In the case of the assessee not only the income offered tax being interest from foreign bank accounts and assessee being the resident has been treated as income on protective basis but also other addition of Rs. 19,09,60,000/- and Rs. 23,76,000/- have also been added ....
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....The relevant part of the decision is reproduced as under:- "19. Thus, upon considering the entire aspect of the matter, in view of the above we do not find any case in favour of the Revenue holding that the assessee is the owner of the funds who has acted on the basis of the power of attorney for giving instructions to transfer of funds from one account to another that too to the accounts belong to his two sons in the absence of any clinching evidence in support of the said observation and conclusion thereon. 20. Further fault in making addition of income of the son Balkrishna Mehta is glaring on the face of the records since Balkrishna Mehta has already shown the said income in his personal return and paid tax thereon. We would like to refer the assessment order of Shri Balkrishna Mehta all dated 27.02.2015 for A.Y. 2006-07, 2007-08, 2008-09 and 2009-10 respectively under Section 153A r.w.s. 143(3) of the Act. It is evident that addition were made in the hands of the said assessee as appearing from Page 88 to 133 for A.Y. 2006-07 and 2007-08 and the returns so filed by the said assessee were accepted for A.Y. 2008-09 and 2009-10 as appearing from Page 137 to 143 of the Paper B....
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....ndisclosed income. The addition made on the company was then held to be bad and deleted since the same was suffering from the principle of double taxation. The income which was taxed in the case of the partnership farm cannot be taxed in the hands of the partner again as has been held by the Hon'ble Gujarat High Court in the case of Kanubhai Maganlal Patel reported in (2017) 79 taxman.com 257 as relied upon by the Ld. AR has also been considered by us. 22. Thus, considering the above facts and proposition of law we do not hesitate to hold that the addition made in the hands of the assessee suffers from the principle of double taxation. Needless to mention that our view has been strengthened by the principle laid down by the Hon'ble Jurisdictional High Court in the cases as discussed above. Hence, the addition is liable to be deleted." 19. Following the finding of the coordinate bench of the ITAT as above we allow l the ground of appeal of the assessee that the income already offered cannot be made protective again in the case of the assessee. Similarly the ITAT in the above referred case of the assessee has held that the interest income from the bank account which has already be....
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.... R.Mehta. The Assessing officer has also estimated the interest income at the rate of 10% and added the same on substantive basis in the hands of Shiri Ravichandra V. Mehta and on protective basis in the hands of Balakrishnan Mehta. 27. The learned CIT(A) has dismissed the appeal of the assessee. 28. In the course of appellant proceeding before us the learned counsel contended that the identical issue on similar facts has been adjudicated by the ITAT as referred above in the cases of the assessee vide ITAT order in own case in IT(SS)A Nos.10 to 13/Rjt/2018 for A.Y.2006-07 to 2009-10. On the other side the learned departmental representative is fair enough to could not controvert these undisputed fact that identical issue on similar facts is covered by the decision of the ITAT in the own case of the assessee. 29. With the assistance of learned representatives we have gone through the decision of the ITAT. The relevant part of the decision is already reproduced in para 18 of this order. 30. Thus, in parity with the decision of the ITAT in the case of the assessee as supra holding that interest income belonged to the sons of the assessee therefore this of appeal of the assessee is....
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.... bases at the rate of 10% Rs. 57,21,806/- on protective basis and substantive addition was made in the hand of father of the assessee Shiri Ravichandra V. Mehta. During the course of assessment as per the material placed in the paper book the assessee had filed the sporting documents and details and the learned CIT(A) in his finding made at para 7.3 of the appellant order has commented that the submission made by the assessee was referred to the assessing officer for examination and his comments but no proper remand report was submitted by the assessing officer. The learned CIT(A) has also mentioned that reasoning of the assessing does not hold water because it is a settled principal in law that a plausible and reasonable explanation submitted by a taxpayer should be accepted and such explanation cannot be rejected without bringing on record any cogent material to refute the reasonable explanation of the assessee. The learned CIT(A) has further stated in these observation that to this extent the action of the assessing is not legally tenable. It is observed that the learned CIT (A) at the last sustained the impugned additions without substantiating his decision with relevant reason....
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.... as per the respective ledger furnished before the Revenue. The interest income of Rs. 1,32,94,549/- has been found correct. Thus, the interest income of Rs. 1,76,94,093/- as admitted by the Ld. AO by applying the exchange rate as on 31st March of that year has been rightly rejected by the Ld. CIT(A) and consequently deletion of addition of the difference amount of Rs. 43,99,544/- is in our considered opinion just and proper and without any ambiguity so as to warrant interference. Hence, the ground of appeal preferred by Revenue is found to be devoid of any merit and, thus, dismissed." 35.2 After taking into consideration the aforesaid facts and finding of the ITAT, it is observed that the AO has not given any basis to compute the interest income on estimated bases at the rate of 10% is without disproving the facts and material furnished by the assessee, therefore the action of the learned CIT(A) is not justified which is also demonstrated from the dissatisfaction of the learned CIT(A) shown on the action of the assessing officer as elaborated above in this order. Therefore this appeal of the assessee is allowed. ITA Nos. 88/Rjt/2020 & ITA No. 89/Rjt/2020 - A.Ys. 2011- 2012 & 201....
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.... 410/ RJT/ 2017 and 451/RJT/ 2017 and also the subsequent order of ITAT Rajkot dated 25th June, 2019 in the case of the assessee. 42. The relevant Part of the decision of learned CIT appeal is reproduced as under:- "5.2 It has already been mentioned before that during the appeal proceedings, the appellant has taken two additional grounds separately - one related to the residential status of the appellant and other related to the legality of the notices u/s.148 which led to the assessment order(s) impugned in these appeals under consideration and has made submission praying for admission of these grounds and also submission for admission of additional evidences (related to the appellant's case that the funds were earned outside India and were of 1970s). They were sent to the AO for comments & verification. It may be mentioned that in the remand reports the AO has stated that the additional grounds and additional evidences should not be admitted and on merits it has been contended that the additional evidences cannot be considered for few defects pointed out by him. It may also be mentioned that the predecessor Ld.CIT(A) in the appeal for AY 1995-96 and AY 1996-97 held the a....
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....ct from 1.7.2012. For the purpose reliance has been placed on the decision of Hon'ble Gujarat High Court in the case of Induprasad Bhatt Vs. J.P. Jani (ITO) (58 ITR 559) where the Hon'ble High Court of Gujarat held that on proper construction of section 297(2)(d)(ii) of the Act the ITO cannot issue notice u/s. 148 to reopen the assessment of an assessee in the case where the right to reopen the assessment was barred under the old (pre-amended) Act at the date when new Act (new amendment) came into force. The said decision was confirmed by the Supreme Court in the case of J.P. Jani Vs. Induprasad Devshankar Bhatt (72 ITR 595). Similar decisions were made by the Hon'ble High Court of Bombay in S.C. Prashar Vs. Vasantsen Dwarkadas [1956] 29 ITR 857, and by the Supreme Court in S.S. Gadgil v. Lal & Company [1964]. 5.4 It is the argument of the Learned.AR that in view of these the reopening of cases for Assessment Years 1996-97 to 2004-05, which had become barred by limitation on 31st March 2011 ( for Assessment Year 2004-05 ) and the Amending Act being Finance Act, 2012 inserting sub clause (c) to Section 149 (1) w.e.f. 01.07.2012 only cannot give a fresh lease of life for reopen....
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.... of Shri Ravichandra V Mehta is as under "10. Thus, in all above cases Courts have held that when the time limit for issuing notice u/s. 148 has expired before any amendment in law from a prospective date will not revive. The time limit for those years for which limitation has already expired on the date of amendment. There was no challenge to vires of the amendment but still the Courts had held the u/s. 148 is beyond limitation period. In the present case in our hand, prior to amendment in section 149 and the time limit for issued of notice under section 148 for Ay 1996-97 expired on 31-03-2003 and date for 1997-98 expired on 31-03-2004. The amendment of section 149 is with effect from 01-07-2012 and its not retrospective in nature. Thus the time limit which has already in expired could not have been revived by subsequent amendment. For all these reasons and complying the ratio laid down above cited cases, we hold that notice issued u/s. 148 on 25-03-2013 for both the above years is beyond jurisdiction and accordingly quashed. Since the notice is held to be invalid, subsequent assessment order pursuant to the said notice as are also quashed and set aside. 11. In the result app....
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....w that on a true construction of s. 297(2)(d)(ii), the ITO cannot issue a notice under s. 148 in order to reopen the assessment of an assessee in cases where the right to reopen the assessment was barred under the old Act at the date when the new Act came into force. The right of the ITO to reopen the assessment of the petitioner in the present case was admittedly barred under s. 34(1)(a) at the commencement of the new Act and it was, therefore, not competent to the ITO to issue a notice under s. 148 in order to reopen the assessment of the petitioner and to reassess the income of the petitioner by relying on the provision enacted in s. 297(2)(d)(ii). The notice dt. 13th Nov., 1963, was, therefore, beyond jurisdiction and must be set aside. Along with that notice, the subsequent notice dt. 9th Jan., 1964, must also fail." 9.1. On further appeal by the Revenue against in quashing the notice u/s.148 of the Act, the Hon'ble Supreme Court approving the judgement of Hon'ble Gujarat High Court in the case of J.P. Jani vs. Induprasad Devshankar Bhatt (72 ITR 595) held as under: "We considered that the language of the new section must be read as applicable only to those cases where the....
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....urt, observed as follows : "As we have already pointed out, the right to commence a proceeding for assessment against the assessee as an agent of a non-resident party under the IT Act before it was amended, ended on 31st March, 1956. It is true that, under the amending Act, by s. 18 of the Finance Act, 1956, authority was conferred upon the ITO to assess a person as an agent of a foreign party under s. 43 within two years from the end of the year of assessment. But the authority of the ITO under the Act before it was amended by the Finance Act of 1956, having already come to an end, the amending provision will not assist him to commence a proceeding even though at the date when he issued the notice it is within the period provided by that amending Act. This will be so, notwithstanding the fact that there has been no determinable point of time between the expiry of the time provided under the old Act and the commencement of the amending Act. The legislature has given to s. 18 of the Finance Act, 1956, only a limited retrospective operation, i.e., up to 1st April, 1956, only. That provision must be read subject to the rule that in the absence of an express provision or clear implic....
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....5.10.1992 and 25.05.1993. The said amount comprised of principal compensation as well as interest up to 18.05.1992. As land acquired was agricultural land, principal amount was not chargeable to tax; however, interest amounting to Rs. 76,84,829 was chargeable on year to year basis. The assessee claimed that proceedings till assessment year 1982-83 had already attained finality and therefore, filed letter requesting the assessing officer to initiate proceedings for subsequent assessment years for bringing to tax interest component relatable to the said assessment years. The assessee was, however, issued notices under section148 of the Act for fifteen assessment years, viz., assessment years 1968-69 to 1971-72 and assessment years 1981-82 to 1992-93 which were challenged on the ground of limitation. This court declined to exercise jurisdiction; on appeal, the Supreme Court held that the provision regulating period of limitation ought to receive strict construction. The Supreme Court held that the law of limitation was intended to give certainty and finality to legal proceedings and therefore, proceedings, which had attained finality under the existing law due to bar of limitation, co....
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....of section 150 which intends to lift embargo of period of limitation under section 149 to enable authorities to reopen assessments not only on the basis of orders passed in proceedings under the Act but also on order of a Court in any proceedings under any law, has to be applied prospectively on or after 1.4.1989 when the said amendment was introduced to sub-section (1). The provision in sub-section (1), therefore, can have only prospective operation to assessments, which have not become final due to expiry of period of limitation prescribed for assessment under section 149. 14. To hold that the amendment to sub-section (1) would enable the authorities to reopen assessments, which had already attained finality due to bar of limitation prescribed under section 149 as applicable prior to 1.4. 1989, would amount to give sub section (1) a retrospective operation which is neither expressly nor impliedly intended by the amended sub-section. 15. On behalf of the assessee before the High Court and in this Court reliance has been placed on the provisions contained in sub-section (2) of section 150. It is submitted that the provision contained in sub-section (2) of section150 is in the n....
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....o refers to whole of sub-section (1) meaning thereby to insulate all assessments, which have become final and may have been found liable to reassessments or re-computation either on the basis of Orders in proceedings under the Act or Orders of Courts passed under any other law. The High Court, therefore, was in error in not reading whole of amended sub-section (1) into sub- section (2) and coming to the conclusion that reassessment proposed on the basis of order of Court in proceedings under Land Acquisition Act could be commenced even though the original assessments for the relevant years in question have attained finality on expiry of period of limitation under Section 149of the Act. On a combined reading of sub-section (1) as amended with effect from 1.4.1989 and sub-section (2) of Section 150 as it stands, in our view, a fair and just interpretation would be that the Authority under the Act has been empowered only to reopen assessments, which have not already been closed and attained finality due to the operation of the bar of limitation under Section 149. 19. This Court took similar view in the case of S.S. Gadgil (supra) in somewhat comparable situation arising from the ret....
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....the assessment year unless otherwise provided expressly or by necessary implication. Even a procedural provision cannot in the absence of clear contrary intendment expressed therein be given greater retrospectivity than is expressly mentioned so as to enable the Authorities to affect finality of tax assessments or to open up liabilities, which have become barred by lapse of time. Our conclusion, therefore, is that sub-section (1) of Section 150, as amended with effect from 1.4.1989, does not enable the Authorities to reopen assessments, which have become final due to bar of limitation prior to 1.4.1989 and this position is applicable equally to reassessments proposed on the basis of Orders passed under the Act or under any other law." 14. The ratio of K.M Sharma and S.S. Gadgil, in the opinion of this court covers the facts of this case. Reassessment for 1998-99 could not be reopened beyond 31.03.2005 in terms of provisions of Section 149 of the Act as applicable at the relevant time. The petitioner‟s return for assessment year 1998-99 became barred by limitation on 31.03.2005. The question of revival of the period of limitation for reopening assessment for AY 1998-99 by ta....
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....e the context in which retroactivity was contemplated such as whether the law is one of validation of taxing statute struck-down by courts for certain defects; the period of such retroactivity, and the decree and extent of any unforeseen or unforeseeable financial burden imposed for the past period etc." 18. In Govinddas v Income Tax Officer AIR 1977 SC 552the Supreme Court held that Section 171 (6) of the Income Tax Act was prospective and inapplicable for any assessment year prior to 1st April, 1962, the date on which the Act came into force and observed that: "11. Now it is a well settled rule of interpretation hallowed by time and sanctified by judicial decisions that, unless the terms of a statute expressly so provide or necessarily require it, retrospective operation should not be given to a statute so as to take away or impair an existing right or create a new obligation or impose a new liability otherwise than as regards matters of procedure. The general rule as stated by Halsbury in Vol. 36 of the Laws of England (3rd Edn.) and reiterated in several decisions of this Court as well as English courts is that all statutes other than those which are merely declaratory or w....
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....nt assessment order pursuant to the said notices are also quashed and set aside." 44. We find that issues raised before the tribunal in these years are similar to proceeding assessment years. It would not be appropriate for us to deviate from the view taken in earlier years without pointing out any material change in the facts and circumstances in subsequent years. The learned departmental representative has not disputed about the decision of the tribunal in the earlier years on the similar nor able to state how the facts in the earlier assessment years are different from the year under consideration. Since identical issues were dealt by the tribunal in earlier years as cited (supra) in the assessee own cases, following the principle of consistency we don't find any force in the appeal of the revenue, therefore all the appeal of the Revenue vide ITA Nos. 112 to 128 /Rjt/2020 for assessment year 1998-99 to 2004-05 are dismissed. 45. In the result appeals of the Revenue vide ITA Nos. 112 to 128 /Rjt/2020 are dismissed. ITA No. 81/Rjt/2020 - A.Y. 2005-06 - Assessee's appeal (in case of Shri Jawahir Ravichandra Mehta) 46. The solitary appeal of the assessee is directed against ....