ITAT quashed notice u/s148 (of Income Tax Act, 1961) as there was no satisfaction of escapement of income
ITAT quashed notice u/s148 (of Income Tax Act, 1961) as there was no satisfaction of escapement of income
AO initiated proceedings u/s 147 (of Income Tax Act, 1961) framed assessment u/s 147 (of Income Tax Act, 1961)/143(3) in pursuance of CBDT guidelines for selection of cases under "Compulsory Scrutiny category" where additions of Rs.10 lakhs or more was made and sustained by the CIT(A) in the preceding F.Y. CIT(A) upheld the order. ITAT quashed the notice as there was no satisfaction of the escapement of income which is a sine qua non for assuming jurisdiction u/s 148 (of Income Tax Act, 1961).-501147
1. AO initiated proceedings u/s 147 (of Income Tax Act, 1961) and framed assessment u/s 147 (of Income Tax Act, 1961)/143(3) of the Act in pursuance of CBDT guidelines for selection of cases under "Compulsory Scrutiny category" where additions of Rs.10 lakhs or more was made and sustained by the CIT(A) in the preceding F.Y.
2. CIT(A) upheld the action of the AO.
3. On appeal, the ITAT held as under:
"4. From the above, it is evident that Section 148 (of Income Tax Act, 1961) was utilized for the purpose of scrutiny of the case. Thus, the department issued notice u/s 148 (of Income Tax Act, 1961) for scrutiny of the case because notice u/s 143(2) (of Income Tax Act, 1961) could not be issued within the period of limitation prescribed for issuing notice u/s 143(2) (of Income Tax Act, 1961). In our opinion, Section 147 (of Income Tax Act, 1961) is not a substitute for getting more time for issue of notice u/s 143(2) (of Income Tax Act, 1961). Otherwise, there would be no sanctity of the time limit for issue of notice u/s 143(2) (of Income Tax Act, 1961). When the assessee has filed the return of income and the department wants to scrutinize the return, it must issue notice u/s 143(2) (of Income Tax Act, 1961) within the time limit prescribed in the said Section. In view of the above, we are of the considered opinion that notice u/s 148 (of Income Tax Act, 1961) cannot be issued for scrutiny of the case. In the reasons recorded, there is no satisfaction of the escapement of income which is a sine qua non for assuming jurisdiction u/s 148 (of Income Tax Act, 1961). In view of the above, we quash the notice u/s 148 (of Income Tax Act, 1961) and consequentially, the assessment order framed in pursuance to such notice is also quashed.”
Case Reference - M/s Shree Ram Straw Products Limited Vs. Income Tax Officer.
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH 'G 'G' : NEW DELHI
BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND
SHRI SUDHANSHU SRIVASTAVA,
SRIVASTAVA, JUDICIAL MEMBER ITA No.
No.2349/Del/2013
Assessment Year : 2005- 2005-06
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