Findoc Finvest Private Limited v. Deputy Commissioner of Income Tax and Anr

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INoTHEoHIGHoCOURToOFoPUNJABoANDoHARYANAoo AToCHANDIGARHo o o CWP-9658-2024o(O&M)o Reservedoono:o17.12.2024o thPronouncedoono:o07 oMarch,o2025o o o FinDocoFinvestoPrivateoLtd.o o o o o ooooo…Petitioneroo o o o Vs.o DeputyoCommissioneroofoIncomeoTaxoCentraloCircle-01oandoanotheroooooooo o …Respondentso o o CORAM:oo HON'BLEoMR.oJUSTICEoSANJEEVoPRAKASHoSHARMAo o o HON'BLEoMR.oJUSTICEoSANJAYoVASHISTHo o Present:o Mr.oGurminderoSingh,oSr.oAdvocateowithoo o o Mr.oRohitoJain,oAdvocate,o o o Mr.oRiteshoMohindra,oAdvocate,oo o o Mr.oParasoMoneyoGoyal,oAdvocate,o o o Mr.oSamarthoChaudhari,oAdvocateoandoo o o Mr.oNiteshoBansal,oAdvocateoforotheopetitioner.oo o o o Mr.oYogeshoPutney,oSr.oStandingoCounselowithoo Mr.oVaibhavoGupta,oStandingoCounseloo forotheorespondents/revenue.oo o ***oo o o oooo o oooo SANJEEVoPRAKASHoSHARMA,oJ.o

1.oo o Theopetitioner-companyobyowayoofothisowritopetitionohasosoughto quashingoofoundatedoassessmentoorderoAnnexureoP/1,oforotheoassessmentoyearo 2022-2023,opassedounderoSectiono143(3)oofotheoIncomeoTaxoAct,o1961o(foro shorto'theoAct')oandopenaltyonoticesoAnnexuresoP/2oandoP/3odatedo04.04.2023o passedounderoSectionso270Aoando271AACoofotheoActoandohasofurtheroprayedo foroquashingotheoconsequentialoaction,owhichohasobeenotakenounderotheosaido order/notices.oo

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2.oo o Learnedo senioro counselo foro theo petitionero submitso thato theo impugnedoassessmentoorderoisoliableotoobeosetoasideoonovariousogrounds.oHeo hasoinvitedoattentionotootheoprovisionsoofoSectionso143(3),o144A,o151oando 153Doofotheo Act,o too submitothatotheo Assessingo Officeroino theo caseo ofotheo presentopetitionerohasonotoactedoinoaccordanceowithotheoprovisionsoofotheoAct.o Ito iso hiso submissiono thato theo Assessingo Officero whoo ino hiso quasio judicialo capacityohasotoomakeotheoassessmentoonohisoindependentoapplicationoofomindo andothereoisonoorequirementoinolawoofoobtainingoapprovalofromohisosuperioro officersobeforeofinalizingoanoorderoofoassessment.oItoisostatedothatowhileothereo existoprovisionsounderotheoAct,owhereinoapproval/recommendationoofosuperioro authorityohasobeenostatedotoobeoprescribedolikeotheoprovisionsounderoSectiono 144A,oSectiono151oando153D;obutothereoisonoosuchosimilaroprovisionoundero Sectiono143(3)oofotheoAct.oo

3.o o Ito iso hiso furthero submissiono thato eveno sucho approval/o recommendationounderotheoaforesaidoprovisionsoareojusticiableoandocanobeo challengedo beforeo theo Courto ono theo groundo of;o approval/recommendationo beingo noto appropriate;o grantedo mechanicallyo oro obtainedo fromo wrongo authority.ooHowever,owhereothereoisonooprovision,otheoorderoofoassessmento wouldobeovitiatedoinolawoifotheoAssessingoOfficeroconsultsooroseeksoapprovalo ofotheoassessmentofromohisosuperioroofficers.oItoisohisosubmissionothatoinotheo petitioner'socase,otheoAssessingoOfficerohasomentionedoofohavingoconsultedo threeotimesohisosuperioroofficersoi.e.orespondentoNo.2oandodiscussedotheocaseo ono26.10.2023,o11.01.2024oando14.03.2024oandothereafteropassedotheoordero afterodueoapprovalofromohim.oo

4.o o Carryingo hiso submissiono further,o learnedo senioro counselo haso statedothatotheofirstoshowocauseonoticeowhichowasoreceivedobyotheoassessee-

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petitioneroisodatedo11.03.2024,orequiringotheopetitionerotoosubmitoitsoresponseo ono15.03.2024.oHeotherefore,ocontendsothatotheoAssessingoOfficeroarrivedoato conclusiono basedo upono theo discussionso witho hiso superioro officers.o Beforeo replyotooshowocauseowasoreceived,otheorespondentoNo.2owasoneveroconsultedo andotherefore,otheoapprovalowasomechanicallyograntedobyorespondentoNo.2otoo theoassessmentoorder.oo

5.o o Ino responseo too theo submissiono ofo theo respondentso relyingo ono CBDTocircularodatedo15.07.2022,oitoisosubmittedothatoSectiono119oofotheoActo onlyo empowerso CBDTo too issueo orders/instructions/directionso foro administrationoofotheoActoandonotointerferingowithotheoquasiojudicialofunctiono ofotheoAssessingoOfficerooroCITo(Appeals)ooroempowersoitotooissueobeneficialo instructions/odirectionsorelaxingotheoprovisionsoinotermsoofoSectiono190(2)(Ao too C).o Ino theo circumstances,o heo argueso thato theo CBDTo circularo datedo

15.07.2022,owouldobeocontraryotootheoprovisionsoofoSectiono119oofotheoActo provisoo(a),oasoitorequiresotheoAssessingoOfficerotoocarryooutoassessmentoofoano assesseeoinoaoparticularomanner.oItoisohisosubmissionothatotheocircularowouldo amountotoointerfereowithotheoquasiojudicialopowerotoocompleteoassessmentobyo theo Assessingo Officero ando forceso respondento No.1/Assessingo Officero too abdicateo hiso quasio judicialo functiono ino favouro ofo superioro officers,o whicho wouldobeoimpermissibleoinolaw.oo

6.o o Theo secondo limbo ofo argumento advancedo byo learnedo senioro counseloisowithorespectotootheoorderoofoassessmentobeingobarredobyolimitationo asolaidodownoforotheoAY:o2022-2023,oinotermsoofoSectiono153oofotheoAct,oaso theo sameo haso beeno issuedo aftero 31.03.2024o ando uploadedo ono theo e-filingo incomeotaxoportaloonlyoono04.04.2024.oTheolastodateotoomakeotheoimpugnedo assessmentoorderoinonormalocourseowouldobeoonoorobeforeo31.03.2024oandonoo

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orderoofoassessmentocouldohaveobeenopassedothereafter.oInosupportothereof,oheo hasoinvitedoattentionotooAnnexureoP/20oandoP/21,owhichoareotheoscreenoshotoofo e-filingoportaloasoono01.04.2024,oreflectingotheoproceedingsoopenowhileoe-filingo portalo screeno shoto ofo 04.04.2024,o reflectso ofo theo passingo ofo theo assessmentoorder.oNoorealotimeoalertowasoreceivedobyotheopetitioneroonooro beforeo01.04.2024.oFurther,osubmittedothatonooorderowasosentoviaoemailotootheo petitioner.oHeorefersotooRuleo127oofotheoIncomeoTaxoRules,oCBDTonotificationo 02/2016oandotheointimationoofotheoemailoaddressoprovidedotootheoauthoritiesoino termsoofoRuleo127(2)(b)(4).oDocumentoAnnexureoR/1,ohasoalsoobeenoreferredo whereinotheodeliveryostatusoreflectso'sendingofailed',oemailoIDo'notospecified',o particularso ofo documentso 'noto specified'o ando assessmento byo taxo payero ono

04.04.2024.oo

7.o o TheodocumentoAnnexureoP/22,ohasobeenoreferredotooreflectothato theotaxoororeturnoconfirmationoinoemailoalsooshowsothereobeingonooordersosento priorotoo04.04.2024.oItoisoalsoosubmittedothatothereohasobeenonooorderosentobyo physicalo posto ando theo penaltyo noticeso wereo issuedo onlyo ono 04.04.2024.o Learnedo counselo haso alsoo assailedo theo ordero ono theo groundo ofo assessmento orderonotoaccompaniedobyoformoITNS-150AowhichoreflectsothatoformoITNS-150Aoalthoughodatedo31.01.2024,owasoissuedo14.05.2024,oDINonumberoreferso tooFY:o2024-2025oandoRTIoresponseoconfirmsothatoDINoofoformoITNS-150Ao wasogeneratedoono14.05.2024.oo

8.o o Heohasofurtheroinvitedoattentionotootheoassessmentoorderowhicho reflectsothatoitoisoundatedoandoDINonumberomentionedoinotheoassessmentoordero andotheodemandonoticesoareoinvalidowhichohasobeenoadmittedobyotheorevenue.o E-filingoportaloscreenoshotsodatedo15.05.2024,oAnnexureoP/23,oreflectsotwoo DINso issuedo ono PANo ofo theo petitionero ono 31.03.2024.o Theo DINo numbero

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ITBA/COM/S/91/2023-24/1063787982(1)o relateso too intimationo lettero ando DINoITBA/COM/M/17/2023-24/1063787900(1)orelatesotooassessmentoorder.o ThereoisonooseparateoDINoforodemandonotice.oAnnexureoP/28,oe-filingoportalo rdscreeno shoto datedo 16.05.2024,o reflectso 3 o DINo showno too beo issuedo ono

31.03.2024,o whicho relateso too ITNS-150A.o Heo therefore,o submitso thato theo assessmentoorderohasoneveroleftotheocontrolooforespondentoNo.1oonoorobeforeo

01.04.2024oandothus,oitohasotoobeodeclaredoinvalidoandobarredobyolimitation.oo

9.o o Theothirdolimboofoargumentoadvancedobyolearnedoseniorocounselo iso witho regardo too theo assessmento proceedingso havingo beeno completedo ino violationo ofo theo principleso ofo naturalo justice.o Ito iso statedo thato ao personalo hearingo waso specificallyo requestedo byo theo assessee-petitionero buto theo saido requestowasoneitheroaccededotoonoroaddressedoinotheoimpugnedoorderobyotheo AssessingoOfficer.oHeosubmitsothatotheoAssessingoOfficerohasothusopre-judgedo hisocaseobasedoonoexoparteodocumentsowhichowereoneveroconfrontedotootheo petitioneroandowereorevealedoonlyoforotheofirstotimeoinotheoassessmentoorder.o Learnedocounselosubmitsothatosoofaroasotheoassessmentoorderoisoconcerned,oitoiso basedoonoaoshowocauseonoticeoissuedoono11.03.2024,oprovidingoonlyofourodayso timeotoofurnishoreply,owhichowasonotosufficientoandocannotobeosaidotoobeoino consonanceowithotheofundamentaloprinciplesoofonaturalojustice.ooo

10.o o Inosupportoofohisocontentions,olearnedoseniorocounselohasoplacedo relianceoonotheofollowingojudgments:-o o Anirudhsinhjio Karansinhjio Jadejao vs.o Stateo ofo Gujarato [1995]o5oSCCo302,oNooroMohammadovs.oKhurramoPashao[2022]o9oSCCo 23,oCITovs.oSPLoSiddharthaoLtd.o[2012]o345oITRo223o(Del),oGhanshyamo K.o Khabranio vs.o ACITo [2012]o 346o ITRo 443o (Bom),o CCEo vs.o Ratano Meltingo&oWireoIndustrieso[2008]o13oSCCo1o(SC)o[CB],oS.B.oAdityanovs.o

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IncomeoTaxoOfficero[1964]o51oITRo453o(Mad),oLMLoLtd.ovs.oACITo[1994]o 205oITRo585o(Mad),oCITovs.oBarkeliteoHylamoLtd.o[1999]o237oITRo392o

(AP),oGujaratoGasoCo.oLtd.ovs.oJt.oCITo[2000]o245oITRo84o(Guj),oCCEovs.o M.M.o Rubbero ando Companyo AIRo 1991o SCo 2141,o Governmento Woodo Worksovs.oStateoofoKeralao[1988]o69oSTCo62o(Ker),oCITovs.oRaioBahaduro Kishoreo Chando ando Sonso [2010]o 1o taxmann.como 165o (P&H),o Munjalo BCUoCentreoofoInnovationoandoEntrepreneurshipovs.oCITo2024:oPHHC:o 030865-DBoandoSumanoJeetoAgarwalovs.oITOo[2022]o449oITRo517o(Del).o

11.o o Learnedocounseloappearingoforotheorespondentosupportsotheoordero passedo byo theo Assessingo Officer.o Heo furthero submitso thato theo powero iso availableotootheoCBDTotooissueoinstructionsotoosubordinateoauthoritiesoandotheo circularo haso beeno issuedo byo theo CBDTo ono 15.07.2022,o whicho requireso respondentoNo.1/AssessingoOfficerotooobtainoapprovalofromorespondentoNo.2o prioro too passingo ofo theo assessmento order.o Theo saido circularo issuedo byo theo CBDToisovalidoandoinoaccordanceowithotheoprovisionsoofoSectiono119(2)(A)oofo theo Acto ando eveno otherwise,o thereo cannoto beo anyo harmo ino theo Assessingo Officerotakingoapprovalofromohisosuperiorsoforopassingoofoassessmentoorder.o Heosubmitsothatonooprejudiceocanobeosaidotoohaveobeenocausedotootheoassessee-petitioneroonoaccountoofotheosame.oTheoauthoritiesocannotobeosaidotoobeohavingo anyo maliceo aso againsto theo petitionero ando too reacho ao finalo conclusiono theo Assessingo Officer'so actiono ofo consultingo hiso superiorso foro theo purposeo ofo issuingonoticeooroforoexaminingotheoconcealmentoinoreturn,ocannotobeosaidoino anyomannerotoobeounjustifiedonoroitoprejudicesotheocaseoofotheopetitioners.oItoiso hisosubmissionothatomerelyobecauseothereoisonoodateomentionedoinotheoorder,o

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12.o o Learnedo counselo haso furthero submittedo thato theo ordero waso actuallyo passedo ono 31.03.2024o ando waso deliveredo too theo assesseeo electronicallyothroughoe-proceedingsoono31.03.2024oato8:26:39opm.oItowasoao clericalomistakeothatotheodateowasonotomentionedoinotheoassessmentoorder.o However,otheodateoofoassessmentowasomentionedoinotheodemandonoticeowhicho hasobeenoissuedoonoaolaterodateoi.e.o04.04.2024.oItoisosubmittedothatotheodateoono theodemandonoticeohasonoorelevanceowithotheoassessmentoorderoorotheoviceo versa.oo

13.o o Heofurtherosubmitsothatotheodepartmentohasotwoooptionsotoouploado assessmento ordero eithero firstlyo too uploado theo scannedo ordero througho assessmento moduleo ono ITBAo ando secondlyo too uploado theo sameo througho commono functiono moduleo ono ITBA.o Whileouploadingoscannedo assessmento orderoinoassessmentomoduleoofoITBA,osystemogeneratedoDIN,owhichohasobeeno writteno manuallyo ono theo assessmento ordero bearingo No.ITBA/AST/M/o 143(3)/23-24/1063772490(1)oandoITBA/AST/M/143(3)/2023-24/1063772472o

(1),ohowever,owhileosubmittingotheoorderoonosystemofinally,odueotootechnicalo glitch-systemo error,o assessmento ordero ando demando noticeo couldo noto beo uploadedo througho systemo moduleo systemo ando theo DINo soo generatedo mentionedoinohandwrittenoformoonoassessmentoandodemandonoticeoremainedo unexecuted.oItoisosubmittedothatotheoassessmentoorderoandodemandonoticeowereo communicatedotootheoassesseeothroughocommonofunctionofacilityowithoDINo No.ITBA/COM/S/91/2023-24/1063787982(1)o ando ITBA/COM/S/91//2023-24/1063787900(1)oandocommunicatedotootheoassesseeothroughotheoaforesaido DINsoato08:26opmoono31.03.2024.oItoisohighlightedothatotheointimationosheetoiso generatedobyosystemoandotheodateoisoalsooautomaticallyofilledoonoit.oTheofactoiso evidentofromotheosheetoitself,othus,otheoAssessingoOfficerohasonooroleoinoit.oTheo

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relevanto sheeto generatedo througho ITBAo containso DINo No.ITBA/COM/S/91/2023-24/1063787982(1)o ando ITBA/COM/S/91//2023-24/1063787900(1)oand,otherefore,oitocannotobeosaidothatotheoordersowereonoto passedoono31.03.2024.oo

14.o o Ito iso hiso assertiono thato theo limitationo aso ono 31.03.2024o iso foro makingoofoanoorderoandonotoforotheocommunicationoofotheoorder,oinotermsoofo theo limitationo prescribedo undero Sectiono 153o ofo theo Act.o Learnedo counselo submitsothatotheoissueoisonoomoreores-integraoinoviewoofotheojudgmentopassedo byo theo Hon'bleo Supremeo Courto ino theo caseo ofo 2022o (1)o SCCo 112,o Theo CommissioneroofoIncomeoTax,oChenniovs.oMohammedoMeeranoShahulo Hameed,owherein,oitohasobeenoheldothatotheodateoofolimitationohasotoobeoseeno onotheodateowhenotheoorderohasobeenomadeonototheodateowhenoitohasobeeno receivedo oro communicated.o Learnedo counselo alsoo reliedo ono theo judgmento passedobyotheoJharkhandoHighoCourtoatoRanchioinoPrakashoLaloKhandelwalo vs.o Theo Commissionero ofo Incomeo Tax,o Ranchio ando others,o WP(T)o No.1901oofo2022,odecidedoono21.02.2023,owhereinotheosaidojudgmentowaso followed.oo

15.o o Aso regardso noto grantingo ofo personalo hearingo iso concerned,o heo submitsothatotheopetitionerowasoservedowithoseveralonoticesobeforeo11.03.2024,o buto heo dido noto respondo too theo sameo ando onlyo submittedo hiso replyo ono

15.03.2024.oTakingointooconsiderationoallohisocontentions,otheoorderohasobeeno passedoandoonofactsoheohasoalsoosubmittedothatothereoisohugeoviolationoofotaxo concealmentowhichocannotobeobrushedoasideoonotheogroundoofoviolationoofo principlesoofonaturalojustice.oItoisofurtherosubmittedothatothereowasonoodenialotoo fileofurtheroreplyoandowhileotheopetitionerodidoono20.03.2024oando22.03.2024,o ando theyo haveo alsoo beeno considered.o Ito iso submittedo thato theo concepto ofo

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personalohearingoonospecificorequestoofotheoassesseeoisoapplicableoinotheocaseo ofofacelessoscrutinyoassessmentsoonlyoandotheoofficeoofotheoDCIT,oCentralo Circle-I,obeingoaopartoofotheoCentraloCharges,oisoexemptedofromotheoconceptoofo facelessoscrutiny.oItoisostatedothatowhenotheoassesseeohadofiledoitsoreplies,oheo couldohaveoreachedotheoofficeoandosoughtopersonalohearingoalsoowhichoheodido notomakeoand,otherefore,oitocannotobeosaidothatotheoorderoisovitiatedoonotheo groundoofoviolationoofoprinciplesoofonaturalojustice.oo

16.o o Ito iso furthero submittedo thato soo faro aso theo demando noticeso areo concerned,otheyowereoissuedoono04.04.2024,obutocannotobeosaidotoobeobeyondo limitationoasotheyoareoseparatelyogovernedoandohaveotoobeonecessarilyopassedo afterotheoassessment.oHeohasoinvitedoattentionotooSectiono275oofotheoActoforo theosaidopurpose.oo

17.o o Weohaveoconsideredotheosubmissionsoandopleadingoplacedobeforeo us.oo

18.o o Beforeoweodealowithotheofactsoofotheocase,oitowouldobeoappositeotoo quoteorelevantoprovisionsoofoSectiono119,o153oando275:o o o oInstructionsotoosubordinateoauthorities.o o o 119o

(1)o Theo Boardo may,o fromo timeo too time,o issueo sucho orders,o instructionsoandodirectionsotoootheroincome-taxoauthoritiesoasoito mayodeemofitoforotheoproperoadministrationoofothisoAct,oandosucho authoritiesoandoallootheropersonsoemployedoinotheoexecutionoofo thisoActoshalloobserveoandofollowosuchoorders,oinstructionsoando directionsoofotheoBoard:o Providedothatonoosuchoorders,oinstructionsoorodirectionsoshallobeo issuedo:-o

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(a)osooasotoorequireoanyoincome-taxoauthorityotoomakeoao particularoassessmentoorotoodisposeoofoaoparticularocaseoino aoparticularomanner;ooroo

(b)osooasotoointerfereowithotheodiscretionoofotheo[theoJointo Commissionero(Appeals)oor]otheo[Commissionero(appeal]o inotheoexerciseoofohisoappellateofunctions.o

(2)oWithoutoprejudiceotootheogeneralityoofotheoforegoingopower:-o

(a)otheoBoardomay,oifoitoconsidersoitonecessaryooroexpedientosootoo do,oforotheopurposeoofoproperoandoefficientomanagementoofotheo workoofoassessmentoandocollectionooforevenue,oissue,ofromotimeotoo timeo(whetherobyowayooforelaxationoofoanyoofotheoprovisionsoofo sectionso 3[115P,o 115S,o 115WD,o 115WE,o 115WF,o 115WG,o 115WH,o115WJ,o115WK,]o4[139,]o143,o144,o147,o148,o154,o155o 5[,o158BFA],o6[sub-sectiono(1A)oofosectiono201,osectionso210,o 211,o 234A,o 234B,o 234Co 7[,o 234E]],o 8[270A,]o 271o 9[,o 271C,o 271CA]o ando 273o oro otherwise),o generalo oro specialo orderso ino respectoofo10[anyoclassoofoincomesoorofringeobenefits]ooroclassoofo cases,o settingo fortho directionso oro instructionso (noto beingo prejudicialo too assessees)o aso too theo guidelines,o principleso oro proceduresotoobeofollowedobyootheroincome-otaxoauthoritiesoinotheo worko relatingo too assessmento oro collectiono ofo revenueo oro theo initiationoofoproceedingsoforotheoimpositionoofopenaltiesoandoanyo suchoorderomay,oifotheoBoardoisoofoopinionothatoitoisonecessaryoino theopublicointerestosootoodo,obeopublishedoandocirculatedoinotheo prescribedomanneroforogeneraloinformation;o

(b)oxxoxxoo

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Timeolimitoforocompletionoofoassessment,oreassessmentoandore-computation.o o

153.o

(1)oNooorderoofoassessmentoshallobeomadeounderosectiono143ooro sectiono144oatoanyotimeoafterotheoexpiryoofotwenty-oneomonthso fromotheoendoofotheoassessmentoyearoinowhichotheoincomeowaso firstoassessable.:o Provided:oxxoo Providedofurther:oxxoo Providedoalso:oxxoo Provided:oxxoo Providedofurther:oxxoo Providedoalso:oxxoo Providedoalso:oxxoo Provided:oxxoo Providedofurthero:oxxoo Providedoalso:oxxoo Providedoalso:oxxoo Provided:oxxoo Providedofurther:oxxoo Providedo:oxxo Providedofurther:oxxoo Providedoalso:oxxoo Providedoalso:othatoinorespectoofoanoorderoofoassessmentorelatingo sttootheoassessmentoyearocommencingoonooroafterotheo1 odayoofo April,o2022,otheoprovisionsoofothisosub-Sectionoshallohaveoeffect,o

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aso ifo foro theo wordso 'twenty-oneo months',o theo wordso 'twelveo months'ohadobeenosubstituted.ooo Baroofolimitationoforoimposingopenalties.o 275o 2[(1)]oNooorderoimposingoaopenaltyounderothisoChapteroshallobeo passed.oo

(a)oInoaocaseowhereotheorelevantoassessmentoorootheroorderoisotheo subject-mattero ofo ano appealo too theo [Jointo Commissionero (Appeals)oorotootheoCommissionero(Appeals)ounderoSectiono246]o [orosectiono246A]ooroanoappealotootheoAppellateoTribunaloundero sectiono253,oafterotheoexpiryoofotheofinancialoyearoinowhichotheo proceedings,oinotheocourseoofowhichoactionoforotheoimpositionoofo penaltyohasobeenoinitiated,oareocompleted,oorosixomonthsofromotheo endoofotheomonthoinowhichotheoorderoofotheo(JointoCommissionero (Appeals)oorotheoCommissionero(Appeals)oor,oasotheocaseomayo be,otheoAppellateoTribunaloisoreceivedobyotheo[PrincipaloChiefo Commissionero oro Chiefo Commissioner]o oro [Principalo Commissionero oro Commissioner],o whichevero periodo expireso later:o Providedo:oxxoxx"o

(b)oxxoxxo

(c)oxxoxxo

19.oo o Fromotheoperusaloofotheoaforesaidoprovisions,oweofindothatotheo limitationoprovidedounderoSectiono153(1)oofotheoAct,oforoissuanceoofonoticeo andomakingoofoanoorderoofoassessmentounderoSectiono143ooro144oofotheoAct,oiso stonlyotwelveomonthsoforotheoassessmentoyearocommencingoonooroaftero1 odayo

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ofoApril,o2022ofromotheoendoofoassessmentoyearoinowhichotheoincomeowasofirsto assessable.oThus,otheoperiodowouldoendoono31.03.2024.o

20.o o AsoregardsoSectiono119oofotheoActoasonoticedoabove,oweofindothato whileo Sectiono 119(1)o ofo theo Act,o restrainso theo Boardo fromo issuingo anyo instructionsotoosubordinateoauthorities,owhichomayolayodownoinstructionsoofo sucho ao natureo requiringo theo Incomeo Taxo Authoritieso too makeo particularo assessmentoinoaoparticularomanneroorotoointerfereowithotheodiscretionoofotheo Jointo Commissionero ando Commissionero (Appeals)o whileo exercisingo theiro appellateofunction.oHowever,otheoBoardowouldobeowithinoitsopowersotooinstructo andolayodownoguidelinesoforoefficientomanagementoofoassessmentoworkoando collectionooforevenueooroissueoguidelines/principles/procedureowhichoareotoobeo followedobyoIncomeoTaxoAuthoritiesoforoworkorelatingotooassessment.oTheo Circularo datedo 15.07.2022,o issuedo byo theo CBDTo reliedo upono byo theo respondentsodirectsotheoAssessingoOfficerotooseekoapprovaloofotheoassessmento madeo byo himo undero Sectiono 143o oro 144o ofo theo Acto fromo theo Jointo Commissioner.ooTheoCircularodatedo15.07.2022,ocannotobeoobjectedotooando comesowithinotheoambitoofopowersoavailableotootheoCBDToasoabove.oo

21.o o Although,o theo approvalo cano beo takeno fromo theo Jointo Commissionero ofo theo assessmento order,o theo questiono ariseso thato whileo examiningotheoreturnoandoconductingoassessment,ocanotheoAssessingoOfficero seekoguidanceoorodiscussotheocaseowithotheoJointoCommissioneroandowhethero hisoconsultationowithotheoJointoCommissionerowouldoamountotooabdicationoofo hisopowers.oInoAnirudhsinhjioKaransinhjioJadejaocaseo(supra),otheoHon'bleo SupremeoCourtowasoexaminingotheoissueorelatingotootheopowersovestedowitho DSPobyoSectiono20-AoofotheoTerroristoandoDisruptiveoActivitieso(Prevention)o Act,o1987oandohasoobservedoasounder:-o

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"11.oTheocaseoagainstotheoappellantsooriginallyowasoregisteredo ono19thoMarch,o1995ounderotheoArmsoAct.oTheoDSPodidonotogiveo anyoprioroapprovaloonohisoownotoorecordoanyoinformationoabouto theocommissionoofoanooffenceounderoTADA.oOnotheocontrary,oheo madeoaoreportotootheoAdditionaloChiefoSecretaryoandoaskedoforo permissionotooproceedounderoTADA.oWhy?owasoitobecauseoheo waso reluctanto too exerciseo jurisdictiono vestedo ino himo byo theo provisionoofoSectiono20Ao(1)?oThisoisoaocaseoofopoweroconferredo upono oneo authorityo beingo reallyo exercisedo byo another.o Ifo ao statutoryoauthorityohasobeenovestedowithojurisdiction,oheohasotoo exerciseoitoaccordingotooitsoownodiscretion.oIfotheodiscretionoiso exercisedounderotheodirectionooroinocomplianceowithosomeohighero authority'so instruction,o theno ito willo beo ao caseo ofo failureo too exerciseo discretiono altogether.o Ino othero words,o theo discretiono vestedo ino theo DSPo ino thiso caseo byo Sectiono 20Ao (1)o waso noto exercisedobyotheoDSPoatoall.o

12.oReferenceomayobeomadeoinothisoconnectionotooCommissionero ofoPoliceovs.oGordhandasoBhanji,o1952oSCRo135,oinowhichotheo actionoofoCommissioneroofoPoliceoinocancellingotheopermissiono grantedotootheorespondentoforoconstructionoofocinemaoinoGreatero BombayoatotheobehestoofotheoStateoGovernmentowasonotoupheld,o aso theo concernedo ruleso hado conferredo thiso powero ono theo Commissioner,o becauseo ofo whicho ito waso statedo thato theo Commissionero waso boundo too bearo hiso owno independento ando unfetteredojudgmentoandodecideotheomatteroforohimself,oinsteadoofo

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forwardingoanoorderowhichoanotheroauthorityohadopurportedotoo pass.o

13.oItohasobeenostatedobyoWadeoandoForsythoino'Administrativeo Law',o 7tho Editiono ato pageso 358o ando 359o undero theo headingo 'SURRENDER,oABDICATION,oDICTATION'oandosub-oheadingo "Poweroinotheowrongohands"oasobelow:-o "Closelyoakinotoodelegation,oandoscarcelyodistinguishableofromo ito ino someo cases,o iso anyo arrangemento byo whicho ao powero conferredo upono oneo authorityo iso ino substanceo exercisedo byo another.oTheoproperoauthorityomayoshareoitsopowerowithosomeo oneo else,o oro mayo allowo someo oneo elseo too dictateo too ito byo decliningotooactowithoutotheiroconsentoorobyosubmittingotootheiro wishesooroinstructions.oTheoeffectothenoisothatotheodiscretiono conferredobyoparliamentoisoexercised,oatoleastoinopart,obyotheo wrongoauthority,oandotheoresultingodecisionoisoultraoviresoando void.oSoostrictoareotheocourtsoinoapplyingothisoprincipleothato theyocondemnosomeoadministrativeoarrangementsowhichomusto seemoquiteonaturaloandoproperotoothoseowhoomakeothem.....".oo "Ministersoandotheirodepartmentsohaveoseveralotimesofalleno fouloofotheosameorule,onoodoubtoequallyotootheirosurprise....".oo

14.oTheopresentowasothusoaoclearocaseoofoexerciseoofopoweroono theobasisoofoexternalodictation.oThatotheodictationocameoonotheo prayeroofotheoDSPowillonotomakeoanyodifferenceotootheoprinciple.o TheoDSPodidonotoexerciseotheojurisdictionovestedoinohimobyotheo statuteo ando dido noto granto approvalo too theo recordingo ofo informationounderoTADAoinoexerciseoofohisodiscretion."o

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22.oo o Ino SPLo Siddharthao Ltd.o caseo (supra),o ito waso heldo thato theo procedureolaidodownounderotheoIncomeoTaxoAct,ohasotoobeostrictlyofollowed.o Thus,o principallyo theo lawo iso settledo aso heldo ino Naziro Ahmedo v.o Kingo Emproer1936o(BC)o253o(2),oapplyingotheoprincipleoofo'taylorov.otaylor'oCh.Do

(431),othato'whereoaopoweroisogivenotoodooaocertainothingoinoaocertainoway,otheo thingo musto beo doneo ino thato wayo oro noto ato allo ando thato othero methodso ofo performanceoareonecessarilyoforbidden,oappliedotooJudicialoOfficersomakingoao recordounderoSectiono164.'.oThus,oasoheldoinoCITovs.oAnjumoM.H.Ghaswalao &oOrs.2002o(1)oSCCo633,obyotheoConstitutionaloBenchothato'itoisoaonormalo ruleoofoconstructionothatowhenoaostatueovestsocertainopowersoinoaoauthorityotoo beoexercisedoinoaoparticularomannerothenotheosaidoauthorityohasotooexerciseoito onlyo ino theo mannero providedo ino theo statueo itself.o Ifo thato beo so,o sinceo theo CommissionocannotoexerciseotheopowerooforelaxationofoundoinoSectiono119(2)o

(a)inotheomanneroprovidedothereinoitocannotoinvokeothatopowerounderoSectiono 119(2)(a)o too exerciseo theo sameo ino itso judicialo proceedingso byo followingo ao procedureocontraryotoothatoprovidedoinosub-sectiono(2)oofoSectiono119.'o

23.o o Sectiono116oofotheoAct,odefinesotheoIncomeoTaxoAuthoritiesoaso differentoandodistinctoauthorities.oSuchodifferentoandodistinctoauthoritiesohaveo tooexerciseoitsopowersoinoaccordanceowitholawoinospecifiedocircumstances.o Thus,o theo Assessingo Officero wouldo haveo tooexerciseoitsoowno discretionotoo reachoaoconclusionoandowouldonotobeoinfluencedobyoanyootheroofficer.oInoviewo thereto,oweofindoforceoinotheocontentionoraisedobyotheolearnedoseniorocounselo forotheopetitionerothatotheoconcernedoAssessingoOfficerowasoinfluencedobyotheo consultationoandodiscussionowithohisosuperioroofficers.oInofactotheoorderopassedo byotheoAssessingoOfficeroappearsotoohaveobeenoalreadyopreparedoevenobeforeo theo replyo waso receivedo aso theo consultationso haveo beeno conductedo ono

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26.10.2023,o 11.01.2024o ando 14.03.2024o byo theo Assessingo Officero aso mentionedobyohimoinotheoorderoitself.oAgainoafterotheoreplyowasoreceivedoando theoorderowasopassedobyotheoAssessingoOfficer,otheosameohasobeenoapprovedo byotheoJointoCommissioner.oAsosuch,oweofindothatotheoJointoCommissionerohaso ino facto comprehensivelyo ando activelyo participatedo ino theo makingo ofo theo assessmento ordero whileo hiso roleo waso onlyo limitedo too theo approvalo ofo theo assessmentoorderoinotermsoofotheoCBDToCircular.oThus,oweofindotheoorderotoo beovitiatedoinolaw.o

24.o o Inoviewoofotheoabove,otheoassessmentoorderocannotobeoresultoofoano independentoapplicationoofomindoandoexerciseoofodiscretionaryopowerobyotheo AssessingoOfficeroinotermsoofoSectiono143(3)oofotheoActoandobutoisoanoordero passedounderotheoinfluenceoandodirectionsoofotheosuperioroofficers.ooItoisotoobeo noticedo thato theo consultationo witho ao superioro officero wouldo beo akino too directionsoofotheosuperior.oThereoisonooroomoavailableoforodiscretionowhereo consultationo iso soughto fromo ao superioro officero whileo ifo ao superioro officero consultsohisosubordinates,otheodiscretionocontinuesotoostayowithohim.oHeomayo chooseonototoofollowotheoadviceoofohisosubordinateobutotheooppositeowouldobeo untrue.oWeoare,othus,oofofirmoviewothatotheoorderohasobeenopassedowherebyotheo AssessingoOfficerohasoabdicatedohisoauthorityoand,otherefore,otheoorderohaso becomeovitiatedoinolaw.oo

25.oo o Theonextoaspectowhichorequiresotoobeoexaminedoisotheocontentiono relatingotootheonon-complianceoofoprinciplesoofonaturalojustice.o

26.oo o Whileotheolearnedocounseloforotheorevenueocontendsoothatotheyo hadosentoseveralonoticesotootheopetitioner,owhichowereodeliberatelyoignored,oweo findothatotheopetitionerohadoconveyedoandointimatedotheorespondentsoofoitso freshoemailoIDsoandotheonoticesoissuedotootheopetitionerounderoSectiono142(1)o

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ofo theo Act,o ono 08.09.2023,o 15.09.2023,o 17.10.2023,o 06.12.2023o ando

19.12.2023,owereoneveroreceivedoasotheyowereosentoonoaodifferentoemailoofotheo Charteredo Accountanto whoo waso noo moreo workingo witho theo petitioner'so company.o Theo noticeso servedo datedo 11.03.2024,o waso servedo ono themo ono

13.03.2024oandotheocompanyohasosubmittedoitsoreplyoono20.03.2024,owherein,o opportunityoofopersonalohearingohasobeenodemanded.oFromotheoreplyowhicho hasocomeoonorecord,oitoisoapparentothatotheopetitionerowasonotoprovidedoanyo opportunityoofopersonalohearingoalbeitotheorespondentsohaveostatedothatoitowaso theoresponsibilityoofotheopetitionerotoohaveoapproachedoandoappearedobeforeo theoconcernedoauthorityoandoifotheyowouldohaveoappeared,otheoauthorityowouldo haveoheardothemopersonally.oo

27.oo o Theoprovisionoofoprovidingopersonalohearingoemanatesofromotheo principlesoofonaturalojusticeo'audioalteramopartem'oandoaopersonoisorequiredotoo beogivenosuchoanoopportunity,osoothat,oallotheoaspectsowhichohe/sheowantsotoo convey,owouldobeoattendedoto.oTheocaveatoisosuchoanoopportunityomustobeo demanded.oAopresumptionocannotobeodrawnothatoafteroaodemandoisomade,otheo personowouldohaveotoohimselfoappearowithoutobeingoprovidedoanyoparticularo date.oInoouroopinion,otheosubmissionsoadvancedobyotheorespondents,otherefore,o areo misconceivedo ando weo areo unableo too accepto theo contentionso ofo theo respondentsothatoitowasotheodutyoofotheopetitioner'socompanyotooappearobeforeo theoconcernedoAssessingoOfficeroafterohavingofiledoitsoreply.oWe,otherefore,o heldothatotheoAssessingoOfficerohasofailedotoofollowotheobasicoprinciplesoofo naturalojusticeowhileopassingotheoimpugnedoorderoandotheopetitionerowasonoto providedofairoandoreasonableoopportunityotooputoupoitsodefenceoandotheoordero passedois,otherefore,oliableotoobeostruckodownoasoillegaloandoarbitrary.oo

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28.oo o Theonextocontentionoraisedobeforeousoisowithoregardotootheoordero ofoassessmentobeingotimeobarred.oAtotheocostooforepetition,oweoreiterateothato theolastodateoforomakingotheoorderoofoassessmentowaso31.03.2024.oInoM.M.o Rubberocaseo(Supra),otheoHon'bleoSupremeoCourtowasoexaminingotheotheno provisionsoofotheoIncomeoTaxoAct,o1922,oSectiono33(A)(2)owithoreferenceotoo rightooforevisionoprovidedotooanoaggrievedoassesseeoandolimitationoprovidedo undero Sectiono 33(A)(a)o too suo-motoo callo foro recordo byo theo authorityo foro revisingotheoorderoandoobservedoasounder:-o "12.oItomayobeoseenotherefore,othat,oifoanoauthorityoisoauthorisedo tooexerciseoaopoweroorodooanoactoaffectingotheorightsoofoparties,o heo shallo exerciseo thato powero withino theo periodo ofo limitationo prescribedothereo for.o Theo ordero orodecisiono ofosucho authorityo comesointooforceoorobecomesooperativeoorobecomesoanoeffectiveo orderoorodecisionoonoandofromotheodateowhenoitoisosignedobyohim.o Theodateoofosuchoorderoorodecisionoisotheodateoonowhichotheoordero orodecisionowasopassedooromade:othatoisotoosayowhenoheoceasesotoo haveoanyoauthorityotootearoitooffoandodraftoaodifferentoorderoando wheno heo ceaseso too haveo anyo locuspaetentiae.o Normallyo thato happensowhenotheoorderoorodecisionoisomadeopublicooronotifiedoino someoformoorowhenoitocanobeosaidotoohaveoleftohisohand.oTheodateo ofo communicationo ofo theo ordero too theo partyo whoseo rightso areo affectedo iso noto theo relevanto dateo foro purposeso ofo determiningo whethero theo powero haso beeno exercisedo withino theo prescribedo time.o

13.oSoofaroasotheopartyowhooisoaffectedobyotheoorderoorodecisiono foroseekingohisoremediesoagainstotheosame,oheoshouldobeomadeo

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awareo ofo passingo ofo sucho order.o Thereforeo Courtso haveo uniformlyolaidodownoasoaoruleoofolawothatoforoseekingotheoremedyo theo limitationo startso fromo theo dateo ono whicho theo ordero waso communicatedotoohimoonotheodateoonowhichoitowasopronouncedooro publishedounderosuchocircumstancesothatotheopartiesoaffectedobyo itohaveoaoreasonableoopportunityoofoknowingoofopassingoofotheo orderoandowhatoitocontains,oTheoknowledgeoofotheopartyoaffectedo byo Sucho ao decision,o eithero actualo oro constructiveo iso thuso ano essentialoelementowhichomustobeosatisfiedobeforeotheodecisionocano beosaidotoohaveobeenoconcludedoandobindingoonohim.oOtherwiseo theopartyoaffectedobyoitowillohaveonoomeansoofoobeyingotheoordero oro actingo ino conformityo witho ito oro ofo appealingo againsto ito oro otherwiseo havingo ito set.o Thiso iso basedo upon,o aso observedo byo Rajamanner,oCJoinoMuthiaoChettiarov.oCIT,osuprao"aosalutaryo andojustoprinciple".oTheoapplication'oofothisoruleosoofaroasotheo aggrievedopartyoisoconcernedoisonotodependantoonotheoprovisionso ofotheoparticularostatute,obutoitoisosoounderotheogeneralolaw."o

29.oo o Ino Raio Bahaduro Kishoreo Chando caseo (supra),o theo Divisiono BenchoofothisoCourtohasoobservedoasounder:-o "5.o Weo findo noo forceo inotheo contentionoraisedobyo theolearnedo Counseloforotheorevenue.oTheobasicoquestionotoobeodecidedoinothiso caseo iso"Whethero theo impugnedoassessmentoordero wasopassedo withinotheostatutoryoperiodoofolimitationouptoo31-3-2004ooronoto ?"o Theo Tribunalo aftero perusingo theo evidenceo ono recordo ando takingo intoo accounto theo non-productiono ofo assessmento recordo beforeotheoBenchohasogivenoaofindingoofofactothatotheoimpugnedo

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assessmentoorderoforotheoassessmentoyearo2001-02owasopassedo afterotheostatutoryotimeolimit.oTheoTribunalohasonotedotheofacto thatotheorevenueowasogivenomoreothano5oopportunitiesotooproduceo recordoofotheoDepartmentotoochallengeotheospecificogroundsoofo appealotakenobyotheoassesseeotootheoeffectothatoassessmentoordero datedo26-3-2004owasonotoservedouponohimowithinotheostatutoryo periodoofolimitationoandoasosuchotheosameoisoliableotoobeoquashedo beingopassedoafterotheostatutoryotimeolimitoandoultimately,otheo DepartmentaloRepresentativeostatedobeforeotheoTribunalothatotheo matteromayobeodecidedoinotheolightoofotheofactsoonorecordoofotheo case.oWhileodismissingotheoappealoofotheorevenueo,otheoTribunalo hasogivenoaocategoricofindingothatonooevidenceohasobeenoadducedo byotheoDepartmentotooshowothatotheoimpugnedoorderodatedo26-3-2004opassedobyotheoassessingoofficerowasoindeedopassedobeforeo theostatutoryotimeolimit."o

30.o o Theorevenueobeforeousohasocontendedothatotheoorderowhichoiso undated,owasoactuallyopassedoandomadeoono31.03.2024oandowasoalsooplacedoono portaloono31.03.2024.oInosupportoofotheirocontention,otheyofurtherosubmittedo thatotheoorderoofodemandoplacedoonoportaloalongowithoorderoofoassessmentoono

04.04.2024,o mentionso ofo theo assessmento ordero havingo beeno passedo ono

31.03.2024oand,otherefore,oitohasotakenopainsotoosubmitothatoactuallyotheoordero ofoassessmentowasomadeoono31.03.2024oandoaopresumptionoshouldobeodrawno inotheirofavour.oWeoareounableotooacceptotheocontentionoraisedobyolearnedo counselo foro theo revenueo thato theo orderso wereo madeo ono 31.03.2024o ando therefore,oitoisonotorelevantoasotoowhenotheyowereocommunicated.oSinceothereo isonoodateoonotheoorder,oaopresumptionoofotheoorderohavingobeenoissuedoono

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31.03.2024,ocannotobeomade.oItoappearsothatotheoofficersoofotheodepartmento havingonoticedotheirofolly,oinoorderotoosaveothemselvesofromotheoquestionoofo passingo orderso beyondo limitationo periodo (presumingo ito too beo 31.03.2024),o mentionedoofotheoordersobeingoissuedoono31.03.2024oinotheodemandonotice.oo

31.o o Theoanotherocontentionoraisedoonobehalfoofotheorevenueothatosinceo theoorderowasomadeoono31.03.2024,otheosameoisoinotermsoofotheolimitationo prescribedounderoSectiono153oofotheoActoandotheojudgmentopassedobyotheo Hon'bleo Supremeo Courto ino Mohammedo Meerano Shahulo Hameedo caseo (supra)oandotheoorderocannotobeosetoasideoonothatocount,oinoouroopinion,oiso misconceived.oo

32.oo o Firstlyo aso noticedo above,o thereo iso noo dateo mentionedo ono theo assessmentoorder,ohence,oitocannotobeopresumedothatotheoorderowasomadeoono

31.03.2024.o Weo alsoo noticeo thato portalo ofo theo assesseeo waso activeo aso ono

01.04.2024oandoitoreflectedothereinothatonooassessmentohasobeenomade,oasoiso apparentofromotheoscreenoshotsoplacedoonorecordobyotheopetitionerowhichohaveo notobeenodisputedobyotheorespondents.oWhileotheoassessmentoorderoisoreflectedo onoportaloono04.04.024oinoorderotoofurtheroverify,oweoaskotheocounseloforotheo revenueo too placeo ono recordo theo emailo sento byo themo too theo petitionero ono

31.03.2024,orelatingotoohavingopassedotheoassessmentoorderobutotheorevenueo filedo evasiveo application,o whereino detailso ofo dateso wheno emailso wereo sento haveo beeno showno buto fromo theo charto placedo beforeo uso alongo witho theo application,oitoisoapparentothatonooemailowasosentotootheoassesseeocontainingo theo assessmento ordero ono 31.03.2024.o Ao flimsyo attempto haso beeno madeo too coveroupotheomistake.oo

33.oo o Ito iso ao facto thato foro coveringo oneo mistakeo youo makeo moreo mistakesooneoafterotheoother.oHowever,oweoareosatisfiedoafteroexaminingoallo

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theodocumentsoplacedobeforeousothatothereohasoactuallyobeenonooorderomadeoono

31.03.2024o and,o therefore,o theo judgmento passedo byo theo Hon'bleo Supremeo CourtoinotheocaseoofoMohammedo Meerano Shahulo Hameedocaseo(supra),o wouldo haveo noo applicationo ando wouldo noto saveo theo timeo barredo ordero ofo assessment.oWeoalsoofindothatosoofaroasotheopartyowhooisoeffectedobyotheoordero orodecisionowouldoonlyoconsiderotheolimitationofromotheodateoitoacquiresotheo knowledgeoandoforohimotheolimitationowouldostartofromotheosaidodate.oBeothato asoitomay,osinceoweohaveoreachedotootheoconclusionothatoorderopassedowasonoto madeouptoo31.03.2024,otheoperiodoinotermsoofoprovisooaddedovideoFinanceo Act,o2022ow.e.f.o01.04.2022,owilloapplyotootheofactsoofotheocaseoandotheoordero isotoobeotermedoasotimeobarredoandobeyondotheoperiodoofolimitationoprescribedo therein.oo

34.oo o Inoviewoofotheoaforesaidodiscussion,otheoorderoofoassessmentoiso foundotoobeononoestoandonotosustainableoinotheoeyesoofolaw.oAccordingly,oordero ofoassessmentoisoquashedoandosetoaside.ooConsequencesothereofoshallofollow.o Writopetitionoisoallowedoaccordingly.oo

35.o o Allopendingomisc.oapplication(s)oalsoostandodismissed.o o o o o o (SANJEEVoPRAKASHoSHARMA)o JUDGEo o o o (SANJAYoVASHISTH)o o o o o o o o ooooooooooooJUDGEo th07 oMarch,o2025.o rajesho

1.oWhetherospeaking/reasoned?oo :o Yes/Noo

2.oWhetheroreportable?o o o :o Yes/Noo