TaxTMI 
TaxTMI 
TaxTMI 
2024 (11) TMI 703
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....no longer in existence having regard to the circumstance that M/s. Infovision Information Services Pvt. Ltd. merely underwent a name change and had responded to the Revenue's notices, having regard to Section 292B of the Income Tax Act, 1961 ["Act"]? B. Whether the order imposing penalty upon the respondent assessee was barred by limitation?" FACTUAL BACKGROUND: 2. The undisputed facts are that assessee M/s. Adma Solutions Pvt. Ltd. (formerly known as M/s. Infovision Information Services Pvt. Ltd.) is a corporation engaged in the business of rendering Call Centre Services and derives income from such business. 3. A survey operation under Section 133A of the Income Tax Act, 1961 ["the Act"] was conducted by the TDS Wing of the Income Tax Department at the business premises of the assessee company to verify whether TDS has been correctly deducted under the various heads of TDS provisions and its timely deposit into Government account in the years under consideration, wherein, certain non-compliances of TDS provisions were detected. 4. Assessee changed its name from "M/s. Infovision Information Services Pvt. Ltd." to "M/s. Adma Solutions Pvt. Ltd." and the registered offi....
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....ervices Pvt. Ltd and no notice has been served upon the assessee, the defect is incurable." 13. Learned counsel for the appellant has submitted that ITAT has failed to consider Section 292-B of the Act, which provides that no notice or assessment or any proceedings can be deemed to be invalid merely for the reason of any mistake, defect or omission in such notice, assessment or other proceedings. 14. Learned counsel places reliance upon the decision of the Coordinate Bench of this Court in CIT Vs. Jagat Novel Exhibitors P. Ltd. [2013] 356 ITR 559 (Del), wherein, the Court came to the conclusion that mis-description of a party in a reassessment notice could not render the entire proceedings to be null and void and it would be a curable defect as envisaged under Section 292-B of the Act. He has also placed reliance on the decision of this Court in Sky Light Hospitality LLP v. Assistant Commissioner of Income-Tax [2018] 405 ITR 296 (Del), wherein, the Supreme Court held that the wrong name given in the notice was merely a clerical error which could be corrected under Section 292-B of the Act. 15. Learned counsel for the assessee/respondent at the very outset has fairly conceded th....
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....ated under Section 274 of the Act, it could not have been delayed interminably, as has been done by the Revenue in this case. It is further submitted that the Courts have read in the concept of "reasonable period" for commencing proceedings when there is no such justification given in the statute. He has also drawn the attention of this Court to Section 275 (1) (c) of the Act and has submitted that if the stand of the Revenue that the period of completion of proceedings under Section 271-C of the Act will only commence when the SCN under Section 274 of the Act issued to be accepted, it will lead to a situation where the proceedings could be delayed endlessly causing grave prejudice to the assessee. 20. Learned counsel of the Revenue, in rebuttal, submits that since the legislature has not provided a trigger point for completion of proceedings under Section 271-C, the date of commencement can only be that date when the SCN is issued under Section 274 of the Act. 21. Having heard the learned counsels for the parties, we find that at the heart of the matter, is the interpretation that is required to be given to the provisions contained under Section 275 (1) (c) of the Act. For the s....
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....he Act and they are on a completely different footing and, therefore, do not merit consideration for the purposes of this case. 19. Even though the period of three years would be a reasonable period as prescribed by section 153 of the Act for completion of proceedings, we have been told that the Income-tax Appellate Tribunal has, in a series of decisions, some of which have been mentioned in the order which is under challenge before us, taken the view that four years would be a reasonable period of time for initiating action, in a case where no limitation is prescribed. 20. The rationale for this seems to be quite clear - if there is a time-limit for completing the assessment then the time-limit for initiating the proceedings must be the same if not less. Nevertheless, the Tribunal has given a greater period for commencement or initiation of proceedings. 21. We are not inclined to disturb the time-limit of four years prescribed by the Tribunal and are of the view that in terms of the decision of the Supreme Court in Bhatinda District Co-op. Mil (P.) Union Ltd.'s case (supra) action must be initiated by the competent authority under the Income tax Act where no limitatio....
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....ion for the delay of nearly five years in the ACIT acting on the said recommendation. The Court held that the starting point would be the 'initiation' of penalty proceedings. Given the scheme of Section 275 (1) (c) it would be the date on which the AO wrote a letter to the ACIT recommending the issuance of the SCN While it is true that the ACIT had the discretion whether or not to issue the SCN, if he did decide to issue a SCN, the limitation. would begin to run from the date of letter of the AO recommending 'initiation '*of the penalty proceedings." 26. Dealing with a similar question of the date of initiation of penalty proceedings, another Division Bench of this Court in Principal Commissioner of Income-Tax v. JKD Capital and Fin/ease Ltd., 2015 SCC OnLine Del 12836, held as under:- "3 ... While finalising the assessment order dated December 28, 2007 the Assessing Officer ("the A0'') in the concluding paragraph issued a direction to initiate proceedings against the assessee under sections 271 (1) (c) and 271E of the Act. Admittedly, under section 271E (2) of the Act, any penalty under section 271E (1) can only be imposed by the Joint Commissioner of In....