Document Fragment View

Matching Fragments

(ii), the communication of the order of the Court vacating the stay order or injunction is not contemplated.”

7.In the case of A.P.Shanmugaraj Vs. Deputy Commissioner of Income Tax, reported in [2020] 424 ITR 347, the Hon'ble Division Bench of the Madras High Court made an observation as under:

“6.On a bare perusal of the provisions of the Act quoted above, it is very clear that the period of limitation prescribed in Section 158BE of the Act excludes the period commencing from the date on which the Assessing Officer directs the Assessee to get his accounts audited viz., the date of the order under Section 142(2A) of the Act. The date of order or direction to get the accounts audited is important and not the date on which such order or direction under Section 142(2A) of the Act is served on the Assessee or received by the Assessee. In the present case, the order under Section 142(2A) of the Act was made by the Assessing Authority on 17.04.2000 directing the Assessee to get the special audit completed and furnished the report on or before 31.07.2000. The difference between these two dates is 105 days. If these 105 days are added to the last date before which the Audit https://www.mhc.tn.gov.in/judis/ W.P. Nos.28836 & 28837 of 2014 Report was furnished viz., 31.07.2000, the date of assessment will get extended upto 13.11.2000. The assessment for block period in the present case was made by the Assessing Authority admittedly on 13.11.2000 itself and therefore apparently the said assessment is within limitation.
11.The learned Standing Counsel appearing on behalf of the https://www.mhc.tn.gov.in/judis/ W.P. Nos.28836 & 28837 of 2014 respondents disputed the contentions raised by the petitioner, by stating that the impugned orders of re-assessment were passed within the period of limitation, as contemplated under the Act and the calculation of period of limitation made by the petitioner is not correct. The Income Tax Officials are expected to act only on receipt of the order copy from the High Court and not based on the oral informations provided by the learned counsel or in writing by the learned counsels. The order of the Court, in its letter and spirit, must be understood by the Income Tax Officials for the purpose of its implementation. Therefore, mere vacating the stay order by the Court cannot be a ground to reckon the period of limitation and the date of communication of the order to the department would be appropriate for the purpose of reckoning the period of limitation with reference to Sub Clause
16.In support of the said judgment, the learned counsel for the petitioner drawn the attention of this Court regarding the facts considered by the Hon'ble Supreme Court in para 13, which reads as under:
“13.Looking to the facts of the case we do not accept the said submission because in the instant case the appellants and their father had made all possible efforts to stall the proceedings and only on account of the litigation initiated by them, the acquisition proceedings had been stayed. Ultimately, the stay granted by the High Court had been vacated but intimation of the order, whereby stay was vacated, i.e. dated 23rd July, 2002 was communicated, for the first time, to the Land Acquisition Collected on 27th March, 2003. When the order dated 23rd July, 2002, vacating the earlier stay order was passed, the counsel appearing for respondent no.3, namely, the Land Acquisition Collector or the government was not present and, therefore, intimation of the said order was not given to the Land Acquisition Collector, who was duty bound to make an award as per the provisions of Section 11 A of the Act within two years from the date of publication of the declaration under Section 6 of the Act. ”

20.Let us now consider the spirit of Sub Clause (ii) of Explanation 1 to Section 153 of the Income Tax Act, which states that in computing the period of limitation for the purposes of Section 153, the period during which the assessment proceeding is stayed by an order or injunction of any Courts.

21.Constructive interpretation of the provision would be that the period during which the assessment proceedings is stayed. Thus, the date of grant of stay and vacating the order of stay is to be considered for the purpose of reckoning the period of limitation. In both the cases, where the date of stay as well as vacating the order of stay, the authorities of the Income Tax Department is expected and bound to act only if the stay order is communicated or vacating the interim stay order is communicated. Neither the stay order nor vacating the stay order can be acted upon in the absence of communication of the order passed by the High Court with its seal. Thus, the importance of the official communication cannot be brushed aside.