| SooperKanoon Citation | sooperkanoon.com/63659 |
| Court | Income Tax Appellate Tribunal ITAT Delhi |
| Decided On | Jul-21-1988 |
| Judge | S Chander, V Elhence |
| Reported in | (1989)28ITD420(Delhi) |
| Appellant | Wealth-tax Officer |
| Respondent | Tej Partap Singh |
In order to appreciate the factual back-drop of the case, we bring into focus the facts which are relevant for determination of this issue.
2. The assessee is a Hindu undivided family and from the following tabulated data the date of filing the original return, the date of assessment and the net wealth assessed can be seen placed in juxtaposition :S. No. Year of Date of Net Net Date of Assessment original wealth wealth assessment Return returned assessed The statistical data noted supra shows that the Wealth-tax Officer completed the assessments for the assessment years 1970-71 to 1974-75 on 31-3-1979 and the assessment for the last year, i.e., 1975-76 was completed by him on 29-3-1980. These assessments were challenged in appeal before the Commissioner of Wealth-tax (Appeals). The learned Commissioner of Wealth-tax (Appeals) made a consolidated order for the appeals relating to assessment years 1970-71 to 1974-75 on 25-2-1981.
He disposed of the appeal relating to the assessment year 1975-76 vide his order dated 30th March, 1981. The above two orders were received by the Commissioner on 9-3-1981 and 6-4-1981 respectively. By these orders the Commissioner of Wealth-tax (Appeals) while setting aside the assessments gave certain directions to the Wealth-tax Officer for re-doing the assessments accordingly. The Revenue, however, did not accept those orders and filed appeals before the Tribunal being WTA Nos. 694 to 698 (Delhi) of 1981 and 1050 (Delhi) of 1981. The Tribunal disposed of these appeals confirming the orders of the Commissioner of Wealth-tax (Appeals) setting aside the assessments for all the assessment years under appeal and dismissed the appeals of the Revenue, vide order dated 9-6-1982. all the years under appeals on 25-3-1987.
The figures of net wealth for each assessment year are the same as in the original assessments made for these years. These assessments were challenged in appeal before the Commissioner of Wealth-tax (Appeals).
3. Before the Commissioner of Wealth-tax (Appeals) it was projected that the asses see had taken up a legal ground before the Wealth-tax Officer that the assessments were barred by time. The learned Commissioner observes that there was no discussion in the body of the impugned assessment orders with regard to this contention. He, "therefore, asked the assessing authority to clarify the position. It was submitted before him in writing on behalf of the Revenue that the time limit for completion of assessments for the assessment years 1970-71 to 1974-75 was 31-3-1985 and that for the assessment year 1975-76, it was 31-3-1986. However, it was pointed out that the orders of the Commissioner of Wealth-tax (Appeals) dated 25-2-1981 and 31-3-1981 respectively received on 9-3-1981 and 6-4-1981 had been challenged in appeal before the Tribunal. It was, therefore, pointed out to him that insofar as limitation provided under Section 17A(3) of the Wealth-tax Act is concerned, the matter was sub judice. It was further contended that the order of the Tribunal was passed on 9-6-1982 for all the years under appeal and as such, the time available for completion of the impugned assessments was up to 31-3-1987. Since the impugned assessments had been completed on 25-3-1987 they were made within the limitation provided under the statute.
4. The learned Commissioner, however, on examination of the provisions of Section 17A(3) of the Act held that the mere fact that the Wealth-tax Officer had gone in appeal before the Tribunal against the Commissioner's order it did not lift the time limit for making fresh assessments as provided under Section 17A(3) which imposed a legal duty on the Wealth-tax Officer to make the assessments afresh within the period of limitation which according to the learned Commissioner for the order of the Commissioner passed on 25-2-1981 ended on 31-3-1985 and for the order passed on 30-3-1981 ended on 31-3-1986. Since all the assessments were framed de novo only on 25-3-1987, these were held as barred by limitation. These were cancelled, hence the appeals of the Revenue.
5. It was contended on behalf of the Revenue that the de novo assessments are made within the time prescribed under the statute in view of the position taken up by the Revenue before the learned Commissioner of Wealth-tax (Appeals) that the limitation is to be reckoned, from the date of the order of the Tribunal and not from the date of the orders of the Commissioner of Wealth-tax (Appeals).
Reliance for this proposition was placed upon the judgment of the Tribunal in the case of Megha Nand v. ITO [1988] 24 ITD 276 (Delhi). It was, therefore, contended that the impugned order of the Commissioner of Wealth-tax (Appeals) may be set aside and the orders of assessment made by the Wealth-tax Officer for the years under appeal be restored.
6. On the other hand, the learned counsel for the assessee submitted that the provisions regarding limitation of assessments under the Wealth-tax Act are abundantly clear and provide for computation of the period of limitation from the orders of various appellate authorities and the period of limitation is to be reckoned with respect to each appellate order because there is no provision indicating that when an appeal is filed against the order of the Commissioner of Wealth-tax (Appeals) the limitation ceases to run. He relied upon the following authorities to support his contentions : 7. We have given careful consideration to the rival submissions. Prior to the insertion of Section 17A of the Wealth-tax Act, 1957 by the Taxation Laws (Amendment) Act, 1975 with effect from 1-1-1976, there was no limitation provided in this statute for completion of assessments or re-assessments under the Act. Section 17A except for clause (in) of Explanation I (which came into effect from 1-4-1976) became effective from 1-1-1976. This section provides time limit for completion of regular assessment under Section 16 as contained in Sub-section (1) of this section. Subsection (2), ibid provides for limitation for an order of assessment or re-assessment under Section 17 of this Act. It is Sub-section (3) of Section 17A that provides for limitation for an order of fresh assessment in pursuance of an order passed on or after the',| first day of April, 1975 under Section 23, Section 24 or Section 25 setting aside or cancelling an assessment.
Fresh assessment as provided under this Sub-section may be made at any time before the expiry of 4 years from the end of the financial year in which the order under Section 23 or Section 24 is received by the Commissioner.
8. Explanation 1 to this section provides for certain contingencies and lays down the periods of limitation for those contingencies. However, in these proceedings, we are not concerned with those contingencies.
All that we are required to consider is whether the provision of Section 17A(3) are in accord with the interpretation placed upon its provisions by the Revenue so as to claim that limitation has to be reckoned from the order of the Tribunal or from the orders of the Commissioner of Wealth-tax (Appeals) which were challenged in appeal before the Tribunal by the Revenue. Sub-section (3) of Section 17A, reads as under : 17A. (3) Notwithstanding anything contained in Sub-sections (1) and (2), an order of fresh assessment in pursuance of an order passed on or after the 1st day of April, 1975, under Section 23, Section 24 or Section 25, setting aside or cancelling an assessment, may be made at any time before the expiry of four years from the end of the financial year in which the order under Section 23 or Section 24 is received by the Commissioner or, as the case may be, the order under Section 25 is passed by the Commissioner.
A careful reading of this Sub-section shows that limitation has been prescribed by the Legislature in respect of an order passed on or after the 1st day of April, 1975 under Section 23, Section 24 or Section 25 independently of each other. This becomes clear as Section 17A(3) provides that fresh assessment in pursuance of an order setting aside or cancelling an assessment, may be made at any time before the expiry of four years from the end of the financial year in which the order under Section 23 or Section 24 is received by the Commissioner. We find that mention of an order under Section 23 or Section 24 is indicative of the fact that limitation is to be reckoned from the date of receipt of only such an order as can be said to be passed under any one of these sections, namely, an order setting aside or cancelling an assessment.
9. It may be noted that Section 23 of the Act provides for an appeal to the Appellate Assistant Commissioner from orders of Wealth-tax Officers. On the other hand, Section 24 provides for an appeal to the Appellate Tribunal from orders of the Appellate Asstt. Commissioners or the Commissioner of Appeals as the case may be. Therefore, the interpretation placed on Sub-section (3) of Section 17A of the Act by the Revenue that where an appeal is filed against the order of the Commissioner of Wealth-tax (Appeals)/Appellate Assistant Commissioner the period of limitation does not commence till the order is made by the Income-tax Appellate Tribunal has no jurisdiction whatsoever. The limitation has been provided by the Legislature relating to each of the orders toy the appellate authorities and Sections 23 and 24 have been indicated in a disjunctive manner to make it clear tixat limitation relates to each order under each section independent of the other. To our mind, this is clear from a plain reading of the section and no two reasonable views on this aspect are conceivable. We are not to doubt the wisdom of the Legislature and have to see what is clearly and plainly said.
10. In the light of what we have observed above, we have to find out whether the impugned orders made by the Wealth-tax Officer were within the limitation provided in the statute. There is no dispute about the fact that the orders of the Commissioner of Wealth-tax (Appeals) relating to assessment years 1970-71 to 1974-75 dated 25-2-1981 and 30/31-3-1981 were received by the Commissioner on 9-3-1981 and 6-4-1981 respectively. In view of the limitation provided in Section 17A(3) the Wealth-tax Officer could pass orders afresh for the assessment years 1970-71 to 1974-75 on or before 31st March, 1985 and for the assessment year 1975-76 on or before 31-3-1986 as the order of the Appellate Tribunal cannot be construed as an order setting aside or cancelling the assessment. However, all the impugned orders were made on 25th March, 1987. These were, therefore, clearly beyond the period of limitation. These were rightly cancelled by the learned Commissioner of Wealth-tax (Appeals). As such, there is no justification made out by the Revenue for any interference in his impugned order.
12. Before we close, we would like to observe that we have carefully gone through the authorities cited from both the sides and since we found these authorities not directly on the issue before us, we have refrained from mentioning any of them discussing the same in the body of this order because the issue before us is really res Integra.