Subrata Roy vs. ITO (ITAT Kolkata)

S. 143/ 153: Despatch of assessment order after limitation period renders it void

For AY 2006-07, the last date for passing the s. 143(3) assessment order was 31.12.2008. The AO passed an order dated 31.12.2008 which was served on the assessee on 16.02.2009 vide registered post. The assessee claimed that the envelope by which the order was dispatched showed that the assessment order was delivered to the post office on 12.2.2009 and that the assessment order was “passed” after the limitation period and was void. The CIT (A) rejected the claim. On appeal by the assessee to the Tribunal, HELD allowing the appeal:

S. 153 provides that no assessment order shall be “made” u/s 143 after the expiry of two years from the end of the assessment year. There is no requirement that service must be effected before the expiry date. However, an order can be considered to have been made/ passed only when it leaves the control of the authority concerned. The mere signing of an order on the last date of limitation does not mean that it has been made/ passed if it is not handed over to the person who is authorized to serve it. In order to make the assessment order complete and effective, it should be issued so as to be beyond the control of the authority concerned for any possible change or modification and this should be done within the limitation period though actual service of the assessment order may be beyond that period. When an assessment order has been purported to have been passed within the prescribed period of limitation but the same is served on the assessee after unreasonable delay without being an explanation coming forward for such delay, in the absence of any explanation whatsoever it can safely be presumed that the order was not made on the date on which it purports to have been made and on the basis of such presumption it can be held that the order was passed after the expiry of limitation. On facts, the Department could not produce any evidence to prove that the assessment order was ready and dispatched on 31.12.2008. Thus, the assessee’s contention that the assessment order was not passed on 31.12.2008 has to be accepted and it has to be held that the order was barred by limitation (Kanu Bhai M. Patel (HUF) 334 ITR 25 (Guj) & other judgements followed)