M/S.sanmina-Sci Technology India Private Limited v. Https://Hcservices.ecourts.gov.in/Hcservices

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 12.03.2021 CORAM THE HONOURABLE DR. JUSTICE ANITA SUMANTH W.P. Nos.954 of 2020 & 35909 of 2019WMP. No.36831 & 36829 of 2019, 1162 & 1161 of 2020 M/s.Sanmina-SCI Technology India Private LimitedRepresented by its authorised signatoryMr.Nimai Charan Nayak… Petitioner in both WpsVs. 1.The Assistant Commissioner of Income Tax Corporate Circle 6(1) 7th Floor, Wanaparthy Block Aayakar Bhavan Nungambakkam Chennai-6000342.Principal Commissioner of Income Tax, Chennai-6 Aayakar Bhavan, Nungambakkam Chennai-600034…Respondents in both WPs Prayer in W.P.No.954 of 2020: Writ Petition filed under Article226 of the Constitution of India praying to issue Writ of cer-tiorari calling for the records on the file of the 1stRespondent and quash the order passed by the 1st respondentdated 29.12.2019 under Section 143(3) r.w. Section 147 of theIncome Tax Act in DIN-20131179274 along with corrigendum dated10.01.2020 in DIN No.ITBA/COM/F/17/2019-20/1023761766(1). Prayer in W.P.No.35909 of 2019: Writ Petition filed under Arti-cle 226 of the Constitution of India praying to issue Writ ofcertiorari calling for the records on the file of the 1stRespondent and quash the order in ITBA/AST/F/17/2019-20/1023281415(1) dated 27.12.2019 along with notice dated29.03.2019 in Notice No. ITBA/AST/S/148/2018-19/1015527916 (1)in PAN: for the assessment year 2013-14. In both WPsFor Petitioner : Mr.N.V.Balaji For Respondents: Mr.A.P.Srinivas Senior Standing Counsel C O M M O N O R D E R Heard Mr.N.V.Balaji, learned counsel for the petitioner andMr.A.P.Srinivas, learned Senior Standing Counsel for therespondents. 2. The petitioner has filed the present writ petitionschallenging proceedings under Section 147 of the Income Tax Act,1961 (in short 'Act') for re-assessment in relation toassessment year 2013-14. W.P.No.35909 of 2019 is dismissed asinfructuous seeing as it challenges an order dated 27.12.2019that stands telescoped in order of assessment dated 29.12.2021.Though an interim stay was obtained initially, the Departmentproceeded to pass a final order of assessment, which has come tobe challenged in W.P.No.954 of 2020 which is decided by way ofthe following order. 3. The petitioner had filed a return of income within timeaccompanied by Form 56F, a report under Section 10A and 10AA ofthe Act making a full disclosure in relation to the deductionclaimed under the provisions of Section 10AA in connection withits eligible unit engaged in export of IT enabled serviceslocated in MEPZ Chennai. 4. The petitioner participated in proceedings forassessment that culminated in an order of assessment passedunder Section 143(3) dated 30.03.2016 wherein the claim forexemption was examined in detail, the respondent AssessingOfficer, upon perusal of Form 56F proceeding to effect variousadjustment to the exemptions claimed. 5. While this is so, a notice under Section 148 has come tobe issued on 29.03.2019 beyond the period of four years asstipulated in Section 147 of the Act in compliance with whichthe petitioner filed a return and also sought reasons on thebasis of which the proceedings for re-assessement wereinitiated, vide communication dated 23.04.2019. The reasons havebeen supplied on 19.06.2020 reading as follows: As per your request, it is hereby stated thatthe basis of forming reason to believe and details ofescapement of income during the AY 2013-14 givenbelow: "the assessee claimed deduction u/s 10AA @ 100%for the 10th year, whereas in the first five years100% deduction is allowed u/s 10AA, hence the balance 50% amounting to Rs.60027729/- is required to beadded back to assessed income." Therefore, you are requested to furnish requisite details on or before 21.06.2019. As per your request, it is hereby stated thatthe basis of forming reason to believe and details ofescapement of income during the AY 2013-14 givenbelow: "the assessee claimed deduction u/s 10AA @ 100%for the 10th year, whereas in the first five years100% deduction is allowed u/s 10AA, hence the balance 50% amounting to Rs.60027729/- is required to beadded back to assessed income." Therefore, you are requested to furnish requisite details on or before 21.06.2019. 6. The basis of the re-assessment is the alleged excessclaim of deduction under Section 10AA of the Act. The instantproceedings initiated beyond a period of four years will thushave to conform to limitation prescribed under the proviso toSection 147 of the Act. The provisions of Section 147 prescribea limitation of four years normally, extended to six years incases where an order of scrutiny has been passed at the firstinstance. In addition, the petitioner should have defaulted infiling of the return, or the proceedings for re-assessmentshould be based on the failure of the petitioner to have madefull and true disclosure of income. 7. These conditions are not satisfied in the present case,seeing as the return of the petitioner has, admittedly, beenfiled within time and the disclosure of the petitioner is alsonot in question. In fact, the original order passed underSection 143(3) proceeds to examine the claim of exemption underSection 10AA, minutely. 8. No error is pointed out in the returns or annexuresfiled by the petitioner or any of the details filed at the timeof assessment and in such an instance, the proceedings forassessment, initiated beyond a period of four years, is barredby limitation. It appears that the Assessing Officer had lostsight of the issue now raised. 9. Explanation 2(c) to Section 147, relied on by therevenue, reads as follows: Where an assessment has been made but incomechargeable to tax has been under assessed or suchincome has been made the subject of excess reliefunder this Act or excessive allowance under the Acthas been computed, 10. Explanation 2(c) to Section 147 will not come to theaide of the relevance as, while the income chargeable has beenmade subject to excessive relief, the explanation cannotoverride the statutory prescription of limitation as set out inthe proviso to Section 147. The purpose of the Explanation ismerely to explain the scope of re-assessment as set out in thestatutory provision and not to expand on or tinker with thelimitation set out thereunder. 11. The impugned order is thus quashed and W.P.No.954 of2020 is allowed. Connected miscellaneous petitions are closed.No costs. Sd/- Assistant Registrar(CS III) //True Copy// Sub Assistant RegistrarskaTo1.The Assistant Commissioner of Income Tax Corporate Circle 6(1) 7th Floor, Wanaparthy Block Aayakar Bhavan Nungambakkam Chennai-600034.2.Principal Commissioner of Income Tax, Chennai-6 Aayakar Bhavan, Nungambakkam Chennai-600034.+1cc to Mr.A.P.Srinivas, Advocte Sr.16020+1cc to M/s.N.V.Balaji, Advocate Sr.16812W.P. Nos.954 of 2020 & 35909 of 2019WMP. No.36831 & 36829 of 2019, 1162 & 1161 of 2020 gp[co]srg 09/07/2021 https://hcservices.ecourts.gov.in/hcservices/