TaxTMI 
TaxTMI 
2023 (9) TMI 1787
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.... the Income Tax Act, 1961 30.09.2021 5. 24380 of 2021 2014-15 u/s. 153C of the Income Tax Act, 1961 30.09.2021 6. 24384 of 2021 2015-16 u/s. 143(3) r.w.s. 153A r.w.s. 153C of the Income Tax Act, 1961 28.09.2021 7. 24386 of 2021 2016-17 u/s. 153C of the Income Tax Act, 1961 30.09.2021 8. 24388 of 2021 2017-18 u/s. 143(3) of the Income Tax Act, 1961 30.09.2021 2. The petitioner herein is a Non-Resident Indian (NRI). The premises of M/s. Coastal Energy Pvt. Ltd. and M/s. Coastal Energen Pvt. Ltd., were searched on 15.02.2017 under Section 132 of the Income Tax Act, 1961. Search led to parallel proceedings for the respective assessment years under Section 148 of the Act, 1961, against the petitioner which have culminated in the impugned order dated 28.09.2021 for the Assessment Year 2010-2011 under Section 143(3) read with Section 147 of the Income Tax Act, 1961. 3. For the rest of the assessment years, the assessments were completed on the dates mentioned above at Sl. Nos. 2 to 8 in the above table under Section 153A r.w.s. 153C of the Income Tax Act, 1961. 4. The petitioner and the two companies attempted to sett....
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....ssessment under Sections 148, 153C read with Section 153A of the Income Tax Act, 1961. The impugned assessment orders are primarily challenged on the ground that the respondent should have passed a "Draft Assessment Order" under Section 144C of the Income Tax Act, 1961, as the petitioner became an "eligible assessee". It is the case of the petitioner that the remedy available to the petitioner to approach the Dispute Resolution Panel under Section 144C of the Income Tax Act, 1961 has been denied by directly passing the impugned assessment orders. 8. It is submitted that the assessment proceeding in case of an "eligible assessee" under Section 144C of the Income Tax Act, 1961 can be completed only after a "Draft Assessment Order" is passed in accordance to Section 144C (1) of the Income Tax Act, 1961 after 01.04.2020. 9. It is submitted that as no "Draft Assessment Order" was passed after the petitioner became an "eligible assessee", the impugned order is liable to be quashed. 10. It is submitted that the respondent has exceeded in his jurisdiction as the respondent failed to consider the provisions of Section 144C of the Act, 1961 with effect from 01.04.2020. It is submitt....
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....ny variation after this date, in case of eligible assessee, which is prejudicial to the interest of the assessee, the above provision shall be applicable." 13. The learned counsel for the petitioner has drawn attention to the preamble to the impugned orders, wherein it has been categorically admitted that the petitioner is a "non resident" and since the petitioner is a "non-resident", the petitioner is an "eligible assessee" and therefore it was incumbent on the part of the respondent to pass a "Draft Assessment Order", as is contemplated under Section 144C(1) of the Income Tax Act, 1961. 14. The learned counsel for the petitioner has also drawn attention to the circular issued in the background to insertion of Section 144C of the Income Tax Act, 1961 in the year 2009 after Finance (No.2) Act, 2009 was passed. A reference was made in the explanatory notice to the provisions of the Finance Bill, 2009 and two circulars which were issued by the Central Board of Direct Taxes as detailed as below:- Sl. No. Date Circular Number 1. 03.06.2010 Circular No.5/2010/[F.No.142/13/2010-SO(TPL)] 2 19.11.2013 Circular No.9/2013 [FILE No.142/20/2013-TPL] 15. Spec....
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....were issued to the petitioner. 19. The learned Standing Counsel for the respondent has placed reliance on the decision of this Court in M/s. Vedanta Ltd., Vs. ACIT, reported in (2020) 422 ITR 262, wherein this Court had considered the very same provisions and came to the following conclusion as follows:- "9.In the present case, the provision specifically states that it shall be applicable only with effect from 01.10.2009 and the Finance Act under which it has been inserted also does not state that the provision was to be applied retrospectively. Thus the 2013 clarification that has been relied upon by the Department in the counter to the Supplementary affidavit filed is incorrect in its appreciation and interpretation of the settled position of law." 20. I have considered the decisions referred to by the learned counsel for the petitioner and by the learned Standing Counsel for the respondent. The challenge to the impugned order is inspired from the decision of the Division Bench of the Andhra Pradesh High Court in Zuari Cement Limited vs. Assistant Commissioner of Income Tax, Circle 2 (1) passed in WP No. 5557 of 2012 dated 21.02.2013 and of this Court in Vijay Tele....
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....ficer was less than 60 days and therefore, the remaining period was extended to another 60 days as per proviso to Section 153(1). Thus, the period got extended up to 24.02.2019. 28. Meanwhile, the petitioner had filed a settlement application before the Income Tax Settlement Commission (for short ITSC) Additional Bench, Chennai vide SA No.TN/CN 51/2018-19/64/IT on 12.12.2018 for the Assessment Years 2010-11 to 2017-18. The ITSC had rejected the petitioner's Application vide order under Section 245D(1) of the Act. dated 19/12/2018. 29. Subsequently, the petitioner had filed another Settlement Application before the ITSC, Additional Bench, Chennai vide SA No. TN/CN 51/2018-19/122/IT on 14/02/2019 for the Assessment Years 2010-11 to 2017-18. The ITSC has rejected the petitioner's Settlement Application vide order under Section 245D(1)of the Income Tax Act, 1961 dated 21.02.2019. 30. Subsequently, the petitioner had filed another Settlement Application before the ITSC, Additional Bench, Chennai vide SA No. TN/CN 51/2018-19/12-IT on 16.04.2019. This Application was treated as defective by the Hon'ble ITSC vide its letter in F.No. TN/CN 52/2019- 20/10-12/IT dated 25.....
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....y held or evidence recorded by the Settlement Commission in the course of the proceedings before it, as if such material, information, inquiry and evidence had been produced before the Assessing Officer or other income-tax authority or held or recorded by him in the course of the proceedings before him. 38. In Zuari Cement Limited vs. Assistant Commissioner of Income Tax, Circle 2 (1) passed in WP No. 5557 of 2012 dated 21.02.2013, the Division Bench of the Andhra Pradesh High Court held as under:- "A reading of the above section shows that if the assessing officer proposes to make, on or after 01.10.2009, any variation in the income or loss returned by an assessee, then, notwithstanding anything to the contrary contained in the Act, he shall first pass a draft assessment order, forward it to the assessee and after the assessee files his objections, if any, the assessing officer shall complete assessment within one month. The assessee is also given an option to file objections before the Dispute Resolution Panel in which event the latter can issue directions for the guidance of the Assessing Officer to enable him to complete the assessment. In the case of the p....
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....g of the Board/Central Government of the statutory provisions, but it will not bind this Court or the Supreme Court. It cannot interfere with the jurisdiction and power of this Court to declare what the legislature says and take a view contrary to that declared in the circular of the CBDT (Ratan Melting and Wire Industries Case (1 Supra), Indra Industries (2 supra). The Revenue has not been able to pursuade us to take a contra view by citing any authority. In this view of the matter, we are of the view that the impugned order of assessment dated 23.12.2011 passed by the respondent is contrary to the mandatory provisions of S.144C of the Act and is passed in violation thereof. Therefore, it is declared as one without jurisdiction, null and void and unenforceable. Consequently, the demand notice dated 23.12.2011 issued by the respondent is set aside." 39. Against the above decision of the Division Bench of the Andhra Pradesh High Court, the Revenue went on appeal before the Honourable Supreme Court. The Hon'ble Supreme Court however dismissed the Special Leave Petition on 27.09.2013. 40. The Andhra Pradesh High Court in Zuari Cements V ACIT Circle-2(1) vide order d....
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.... The learned Single Judge of this Court Vijay Television (P) Ltd., vs. Dispute Resolution Panel & Ors, has concluded that there is a violation of Section 144C of the Act, while passing final order of assessment and therefore such order cannot be cured by way of corrigendum dated 15.04.2013 as it is issued only after the limitation period for completing assessment under Section 153 of the Income Tax Act, 1961 has expired whereas this is not the case here. 44. This Court in Vijay Television (P) Ltd., vs. Dispute Resolution Panel & Ors, has also referred to the decision of the Allahabad High Court in Commissioner of Income Tax vs. Shital Prasad Kharag Prasad, 280 ITR 541. The Court was influenced by Memorandum explaining the Finance Bill, 2009 which preceded passing of Finance (No. 2) Act, 2009, wherein it was stated that Section 144C of the Act would take effect from 01.10.2009 and therefore it was held Circular No. 5/10 issued by CBDT stating that Section 144C would apply only from the assessment year 2010-11 and subsequent years and not for the assessment year 2008-09 was held contrary to the express language in Section 144C(1) and the view of the Revenue was found unacceptable.....