2025 (12) TMI 1515

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.... facts and circumstances of the case, the order of assessment passed on 02/07/2024 is barred by limitation as being one passed beyond the period of limitation contemplated u/s.153(1) of the Act. 5A. The impugned addition made to the computation of Long Term Capital Gain and total income based on the report of the DVO based on a reference made u/s.142A of the Act, is unsustainable because, power to make a reference u/s. 142A of the Act envisages estimation of the value of any investment referred to in Section 69, 69A or 69B of the Act, as its object. As a corollary, the alleged overvaluation, in the value of investment could not be verified under the ambit of Section 142A of the Act where the subject matter of examination under sect....

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.... Ltd v. CIT [1998] 229 ITR 383 and also by the decision of Hon'ble Calcutta High Court in PCIT vs. Britannia Industries Ltd. [2017] 396 ITR 677 (Cal). Therefore we are inclined to admit the same for adjudication. 4. The issue raised in Ground No.1 is against the statutory notice issued for scrutiny as well as the order passed by the AO is without jurisdiction and, hence, the entire assessment is liable to be quashed. 5. Facts in brief are that the assessee is an individual and has filed the return of income for the AY 2022-23 on 07.09.2022 declaring a total income of Rs. 30,80,970/-. This case was selected for complete scrutiny the CASS for the following reason: The assessee has reported substantial amount under the head &#39....

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.... 7. Before the ld.CIT(A), the assessee raised the grounds on merit as well as legal ground challenging the validity of the notice issued u/s 143(2) of the Act issued by the AO on the ground that the nature of scrutiny (limited or complete) was not specified as required by CBDT Instruction No. 225/157/2017 dated 23.06.2017. However, the ld.CIT(A) confirmed the addition made by the AO and also rejected the legal ground raised by the assessee holding that the CBDT instructions are administrative in nature and do not override the statutory validity of notices issued under the Act. The notice dated 01.06.2023, though not explicitly stating "limited" or "complete" scrutiny, does not vitiate the assessment proceedings unless prejudice is demonstra....

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....ould be 31.03.2024 i.e. 12 months from the end of the relevant A.Y.2022-2023. Ld.AR thereafter referred to clause (v) to Explanation 1 to Section 153 of the Act which provides that the period commencing from the date on which the Assessing Officer makes a reference to the Valuation Officer under sub-section (1) of section 142A and ending with the date on which the report of the Valuation Officer is received by the Assessing Officer. Ld. AR submitted that but for the extension of period of limitation under clause (v) to Explanation-1, the order of assessment dated 02.07.2024 is barred by limitation. The NFAC cannot take the benefit of the extended period under clause (v) to Explanation-1 to Section 153 of the Act because when a reference u/s....

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....ere an estimate of the value of any investment referred to in sections 69, 69A, 69B are required to be made, the A.O. may require the Valuation Officer to make an estimate of such value and report the same to A.O. Thus the scope of section 142A is limited in its span only to determine the value of investment in respect of certain assets, such as, bullion, jewellery, valuable articles etc. In this section as well there is no power vested with A.O. to seek the help of Valuation Officer in respect of determination of capital gain prescribed undersection 48 of the Act. 6.4. Reading of the above provisions makes it very clear that the Assessing Officer is necessarily to pass the assessment order within the time limit as prescribed under....

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....R vehemently supported the orders of the authorities below and submitted that the order is not barred by limitation. It was also submitted that the AO had exercised his jurisdiction rightly and the notice was issued within prescribed time. The assessee has also not raised this ground was not raised before the AO and has no bearing on the merits of the assessment. In view of the same, the orders passed by both the authorities below deserve to be upheld. 12. After hearing the rival contentions of the parties and perusing the material available on record, we find that in terms of 4th proviso to Section 153(1) of the Act, the order was to be passed on or before 31.03.2024 i.e. twelve months from the end of the relevant assessment i.e. AY.202....