2025 (12) TMI 1112

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....r on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in quashing the assessment years 2005-06, 2006-07 and 2007-08 by holding that the assessee was not specifically appointed as statutory agent for each of the aforesaid years ignoring the correct legal position that the assessee was all along acting as an agent under the General Law and therefore the question of specific treatment as agent under Section 163 did not arise? (ii) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in quashing the assessments for the assessment years 2002-03 and 2005-06 on the ground that the notices under Section 148 were time barred as per the provisions of....

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.... notice is to be made on him as the agent of such non-resident, the notice shall not be issued after the expiry a period of two years from the end of the relevant assessment year.' 4. Admittedly, the notices under Section 148 of the Act in respect of A.Y.s 2002-03 and 2005-06 were issued on 31.03.2009 and 19.01.2009, long past expiry of two years from the end of the assessment year in question. In light of this admitted factual position, substantial question of law No.2 is answered in the affirmative and against the Revenue. 5. The first question now survives only in respect of AYs. 2006-07 and 2007-08, and relates to whether a notice is required to be issued prior to treating the assessee as a representative assessee/agent. It is an ....

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....oner of Income Tax (325 ITR 540) on the merits of tax liability in the context of a commission agent. 9. Mr.Chidambaram, learned counsel on behalf of the assessee/respodnent would rely upon the judgment in H.L. Sud, Income Tax Officer (supra) pointing out that the two statutory provisions were in pari materia with each other. 10. We have heard the parties and perused the material papers. Section 163, dealing with 'who may be regarded as agent' reads as follows: Who may be regarded as agent. 163. (1) For the purposes of this Act, "agent", in relation to a non-resident, includes any person in India - (a) who is employed by or on behalf of the non-resident; or (b) who has any business connection with t....

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....Per contra, the learned D.R. fairly submitted that there was no fresh appointment done in years after assessment year 2002-03. Nevertheless, according to him, such technical issues would not make the assessments invalid.' It is thus an admitted position that notice under Section 163 of the Act has been issued only in respect of AY 2002-03 and no period thereafter. 13. As far as Section 43 is concerned, the second proviso to Section 43 states that an opportunity of being heard should be given to the assessee, and the relevant portion of Section 43 is extracted below: '43. Agent to include persons treated as such - Any person employed by or on behalf of a person residing out of the taxable territories, or having any business co....