Bihar Police Building Construction Corporation Pvt. Ltd. Through Itsmanaging Director Mr. Sunil Kumar, 5 B M P Campus, Po Veterinarycollege, Ps Veterinary Colle v. Principal Chief Commissioner Of Income Tax, C R Building, Bir Chandpatel Path, Patna

IN THE HIGH COURT OF JUDICATURE AT PATNACivil Writ Jurisdiction Case No.16890 of 2017 ====================================================== Bihar Police Building Construction Corporation Pvt. Ltd. Through itsManaging Director Mr. Sunil Kumar, 5 B M P Campus, PO VeterinaryCollege, PS Veterinary College, Distt. Patna, Bihar ... ... Petitioner/s Versus 1.Principal Chief Commissioner Of Income Tax, C R Building, Bir ChandPatel Path, Patna -800001 Patel Path, Patna -800001 2.Commissioner of Income Tax, C.R. Building, Bir Chand Patel Path Patna.800001 800001 3.Joint Commissioner of Income Tax, Lok Nayak Bhawan Dakbanglow Road,Patna 800001. Patna 800001. 4.Deputy Commissioner of Income Tax, Lok Nayak Bhawan, DakbanglowRoad, Patna 800001 Road, Patna 800001 5.Assistant Commissioner, of Income Tax, Lok Nayak Bhawan, DakbanglowRoad, Patna 800001 Road, Patna 800001 ... ... Respondent/s ======================================================Appearance :For the Petitioner/s: Mr.Prakash Sahay, AdvocateFor the Respondent/s: Mr.Archana Sinha @ Archana Shahi Sr. Standing Counsel ====================================================== CORAM: HONOURABLE MR. JUSTICE JYOTI SARAN and HONOURABLE MR. JUSTICE ANJANI KUMAR SHARANORAL JUDGMENT(Per: HONOURABLE MR. JUSTICE JYOTI SARAN) Date : 14-05-2019 Heard Mr. Prakash Sahay for the petitioner and Ms. Archana Sinha, learned Sr. Standing Counsel for the Income TaxDepartment. The petitioner is aggrieved by the assessment orderpassed for the Assessment Year 2004-05 pertaining to the FinancialYear 2003-04 together with appellate order passed in AppealNo.466/CIT(A)-1/2006-07 by the Commissioner of Income Tax (Appeals), which orders are impugned at Annexures-1 and 3,respectively to the writ petition. The exercise is under Section 143of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). Mr. Prakash Sahay, learned counsel representing thepetitioner, submits that even on merits the petitioner has a strongcase as according to him the interest accrued on the deposit, cannotbe treated as income because it simply adds to the grant releasedby the State Government from time to time and the interest amountis reduced to that extent from the fresh grant that the petitioner-Police Building Construction Corporation would receive from theState. He states that the findings on other issues as well are notsustainable but the issue which closes the contest in favour of thepetitioner is that the assessment order passed under Section 143 of‘the Act’ is time barred and hit by the proviso attached to Section143(2) of ‘the Act’ which, inter alia, mandates that no notice in thisregard can be served on the assessee on the expiry of six monthsfrom the end of the financial year in which the return was filed. Mr. Sahay with reference to the assessment order itselfsubmits that while the return for the assessment year 2004-05 wasfiled under Section 139 of the Act by the assessee on 30.09.2004,the limitation prescribed under the proviso attached to Section143(2) of ‘the Act’ expires on 30[th] September, 2005, i.e. six months of the end of the financial year in which the return was filed. Hesubmits that since the return was filed on 30.09.2004, in thefinancial year 2004-05 ending on 31.03.2005, the six monthsperiod prescribed in the proviso to Section 143(2) of ‘the Act’would end on 30.09.2005. Learned counsel with reference to theassessment order submits that as per the Assessing Authority itselfthe notice under Section 143(2) of ‘the Act’ read along sideSection 142(1) of ‘the Act’ was issued on 08.08.2006 and which isclearly hit by limitation so prescribed by proviso attached toSection 143(2) of ‘the Act’. of the end of the financial year in which the return was filed. Hesubmits that since the return was filed on 30.09.2004, in thefinancial year 2004-05 ending on 31.03.2005, the six monthsperiod prescribed in the proviso to Section 143(2) of ‘the Act’would end on 30.09.2005. Learned counsel with reference to theassessment order submits that as per the Assessing Authority itselfthe notice under Section 143(2) of ‘the Act’ read along sideSection 142(1) of ‘the Act’ was issued on 08.08.2006 and which isclearly hit by limitation so prescribed by proviso attached toSection 143(2) of ‘the Act’. Ms. Archana Sinha, Sr. Standing Counsel, whileaccepting the legal position submits that the petitioner having notraised the issue of limitation at any stage, he cannot be permittedto raise it for the first time before this Court and, on merits, thepetitioner would have no case because the interest accrued on thedeposit of the assessee lying in the bank, whatever be theunderstanding between the petitioner and the State Government,the element of interest would be treated as ‘income from othersources’ in terms of the provision underlying Section 2(24) readwith Section 56(id) of ‘the Act’. Having heard learned counsel for the petitioner andhaving perused the materials on record, for the present, we do not think that we need to look into the inter-party merits because inour opinion the petitioner succeeds on the issue of limitation andeven if the assessee has failed to raise this objection at any stage ofthe proceedings, where law itself prohibits initiation of aproceeding on happening of an event, a waiver by the assessee toraise such issue and his participation in the proceeding neitherprecludes him to raise such issue at any stage of the proceedingnor provides sanction to a void proceedings. On the facts available on record, there is no dispute thatthe return was filed in the financial year 2004-05 which ended on31.03.2005 and the notice under Section 143(2) of ‘the Act’ wasbeing issued on 08.08.2006 as admitted by the Assessing Authorityhimself, which was far beyond the limitation prescribed under theproviso attached to Section 143(2) of ‘the Act’ which ended on30.09.2005 and thus was clearly hit by limitation. In such view of the matter, the entire exercise by theAssessing Authority under Section 143(3) of ‘the Act’ is illegaland time barred and its affirmation by the appellate authority is anillegality perpetuated. For the reasons discussed, we quash the entireproceedings including the assessment order passed by the Assessing Authority for the assessment year 2004-05 together withthe appellate order impugned at Annexures -1 and 3, respectively. The writ petition is allowed. (Jyoti Saran, J) ( Anjani Kumar Sharan, J) mrl./- AFR/NAFRNAFRCAV DATEN.A.Uploading Date21/05/2019Transmission DateN.A.