The Commissioner Of Income Tax … vs Mohammed Meeran Shahul Hameed on 7 October, 2021


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Supreme Court of India

The Commissioner Of Income Tax … vs Mohammed Meeran Shahul Hameed on 7 October, 2021

Author: M.R. Shah

Bench: M.R. Shah, A.S. Bopanna

                                                                             REPORTABLE

                                    IN THE SUPREME COURT OF INDIA
                                     CIVIL APPELLATE JURISDICTION

                                     CIVIL APPEAL NO.6204 OF 2021


         The Commissioner of Income Tax, Chennai                              ..Appellant(S)


                                                     Versus


         Mohammed Meeran Shahul Hameed                                      ..Respondent(S)


                                               JUDGMENT

M. R. Shah, J.

1. Feeling aggrieved and dissatisfied with the impugned

judgment and order dated 03.07.2019 passed by the High

Court of Judicature at Madras in Tax Case Appeal No.429 of

2019, by which the High Court has dismissed the said appeal

preferred by the revenue and has confirmed the order dated

04.04.2013 passed by the learned Income Tax Appellate

Tribunal (hereinafter referred to as the learned ITAT) in ITA

Signature Not Verified No.2244/Mds/2012, the revenue has preferred the present
Digitally signed by R
Natarajan
Date: 2021.10.07
16:34:47 IST
Reason: appeal.

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2. The facts leading to the present appeal in nutshell are as

under:­

2.1 The Assessing Officer (hereinafter referred to as the AO)

passed an assessment order under Section 143 (3) of the

Income Tax Act (hereinafter referred to as the Act) for the

assessment year (AY) 2008­09 vide assessment order dated

30.12.2010. The Commissioner of Income Tax initiated

revision proceeding under Section 263 of the Act to revise the

assessment order passed by the learned Assessing Officer

and issued a notice to the assessee ­ respondent herein on

01.02.2012. The assessee – respondent herein filed written

submissions on 07.03.2012 and 12.03.2012. That the

learned Commissioner passed an order under Section 263 of

the Act on 26.03.2012 holding that the Assessing Officer had

failed to make relevant and necessary enquiries and to make

correct assessment of income after due application of mind

and thus the assessment order made under Section 143 (3)

of the Act was held to be erroneous and prejudicial to the

interest of the revenue. The learned Commissioner set aside

the assessment order with a direction to Assessing Officer to

make necessary enquiries on the aspects mentioned in the

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order under Section 263. The order passed by the learned

Commissioner in exercise of powers under Section 263 of the

Act was challenged by the assessee – respondent herein

before the learned ITAT. At this stage, it is required to be

noted that the order passed under Section 263 of the Act was

dispatched by the office of the Commissioner on 28.03.2012.

2.2 The assessee – respondent herein filed an appeal before the

learned ITAT on 29.11.2012 submitting that it had come to

know about the revision order only when he received notice

dated 06.08.2012 under Section 143 (2) read with Section

263 of the Act from the office of the Assessing Officer.

Thereafter, the respondent had requested the Assessing

Officer to furnish the copy of the order passed by the learned

Commissioner which was supplied to him on 29.11.2012.

Before the learned ITAT, it was the case on behalf of the

assessee – respondent herein that the order passed by the

learned Commissioner was beyond the period of limitation

prescribed/mentioned under Section 263 (2) of the Act. Vide

order dated 04.04.2013 the learned ITAT accepted the

contention on behalf of the assessee – respondent herein and

allowed the appeal filed by the assessee by holding that the

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revision order passed by the learned Commissioner was

passed beyond the period of limitation.

2.3 Feeling aggrieved and dissatisfied with the order passed by

the learned ITAT quashing and setting aside the revisional

order passed by learned Commissioner under Section 263 of

the Act and holding that the order passed by the learned

Commissioner was beyond the period of limitation prescribed

under Section 263 (2) of the Act, the revenue – appellant

herein preferred appeal before the High Court, raising the

following substantial question of law:­

“Whether, on the facts and in the
circumstances of the case, the case, the
Tribunal had applied its mind and was right
in holding that the revision order of the
Commissioner of Income Tax under section
263
dated 26.3.2012 revising the assessment
order dated 31.12.2010 is barred by
limitation provided under section 263(2) by
assuming that the last date for passing the
assessment order is 31.3.2012 and on the
ground that the order was served on
29.11.2012?”

2.4 By the impugned judgment and order, the High Court has

dismissed the said appeal and has confirmed the order

passed by learned ITAT holding that the order passed by the

learned Commissioner under Section 263 of the Act was

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barred by limitation. The High Court held that the date on

which the order was received by the assessee – respondent

herein is the relevant date for the purpose of determining the

period of limitation under Section 263 (2) of the Act.

2.5 Feeling aggrieved and dissatisfied with the impugned

judgment and order passed by the High Court, the revenue –

appellant herein has preferred the present appeal.

3. Shri Vikramjit Banerjee, learned Additional Solicitor General

(ASG) appearing on behalf of the revenue – appellant has

vehemently submitted that the High Court as well as the

learned ITAT both have misconstrued and misinterpreted the

provision of Section 263, more particularly sub­section (2) of

Section 263 of the Act. It is submitted that the High Court

has erred in holding that the revision order dated 26.03.2012

passed by the Commissioner under Section 263 of the Act

was barred by period of limitation provided under Section

263 (2) of the Act.

3.1 It is submitted that the High Court has materially erred in

holding that the order passed under Section 263 is barred by

limitation provided under Section 263 (2) on the ground that

order under Section 263 was served on the assessee –

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respondent herein on 29.11.2012 which was after the expiry

of two years from the end of the financial year in which the

order was sought to be revised.

3.2 It is vehemently submitted by learned ASG that sub­section

(2) of Section 263 of the Act provides that no order shall be

‘made’ under sub­section (1) of Section 263 after the expiry

of two years from the end of the concerned financial year and

the relevant date in the present case to pass the order under

Section 263 would be 31.03.2012. It is submitted that in the

present case the order in fact was passed on 26.03.2012 and

in fact dispatched on 28.03.2012. It is submitted that

therefore the order passed by the learned Commissioner

under Section 263 was within the period of limitation

prescribed under Section 263 (2) of the Act.

3.3 Shri R. Sivaraman, learned Advocate appearing on behalf of

the respondent – assessee relying upon para 15 of the

counter affidavit has submitted that as such the order

passed by the learned Commissioner under Section 263 of

the Act has been acted upon before it was set aside by

learned ITAT and thereafter a fresh assessment order has

been passed by the Assessing Officer. It is submitted that

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therefore as such the issue involved in the present appeal

has become academic.

4. We have heard the learned counsel appearing on behalf of

the respective parties at length. Though it is the case on

behalf of the respondent – assessee that by now the issue

involved in the present appeal has become academic,

considering the fact that the question of law raised in the

present appeal is the pure question of law and therefore we

are inclined to decide the said question of law.

4.1 The short question of law which is posed for consideration

before this court is, whether in the facts and circumstances

of the case, the High Court and the learned ITAT are right in

holding that the order passed by the learned Commissioner

passed under Section 263 was barred by period of limitation

provided under Section 263 (2) of the Act? Whether the High

Court is right in holding that the relevant date for the

purpose of considering the period of limitation under Section

263(2) of the IT Act would be the date on which the order

passed under Section 263 by the learned Commissioner is

received by the assessee?

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4.2 While deciding the aforesaid issues and question of law,

Section 263 (2) of the Income Tax Act, which is relevant for

our consideration is required to be referred to, which reads

as under:­
“(2) No order shall be made under sub­section (1)
after the expiry of two years from the end of the
financial year in which the order sought to be
revised was passed.”

4.3 On a fair reading of sub­section (2) of Section 263 it can be

seen that as mandated by sub­section (2) of Section 263 no

order under Section 263 of the Act shall be “made” after the

expiry of two years from the end of the financial year in

which the order sought to be revised was passed. Therefore

the word used is “made” and not the order “received” by

the assessee. Even the word “dispatch” is not mentioned in

Section 263 (2). Therefore, once it is established that the

order under Section 263 was made/passed within the period

of two years from the end of the financial year in which the

order sought to be revised was passed, such an order cannot

be said to be beyond the period of limitation prescribed under

Section 263 (2) of the Act. Receipt of the order passed under

Section 263 by the assessee has no relevance for the purpose

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of counting the period of limitation provided under Section

263 of the Income Tax Act. In the present case, the order was

made/passed by the learned Commissioner on 26.03.2012

and according to the department it was dispatched on

28.03.2012. The relevant last date for the purpose of passing

the order under Section 263 considering the fact that the

assessment was for the financial year 2008­09 would be

31.03.2012 and the order might have been received as per

the case of the assessee – respondent herein on 29.11.2012.

However as observed hereinabove, the date on which the

order under Section 263 has been received by the assessee is

not relevant for the purpose of calculating/considering the

period of limitation provided under Section 263 (2) of the Act.

Therefore the High Court as such has misconstrued and has

misinterpreted the provision of sub­section (2) of Section 263

of the Act. If the interpretation made by the High Court and

the learned ITAT is accepted in that case it will be violating

the provision of Section 263 (2) of the Act and to add

something which is not there in the section. As observed

hereinabove, the word used is “made” and not the “receipt

of the order”. As per the cardinal principle of law the
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provision of the statue/act is to be read as it is and nothing

is to be added or taken away from the provision of the statue.

Therefore, the High Court has erred in holding that the order

under Section 263 of the Act passed by the learned

Commissioner was barred by period of limitation, as provided

under sub­section (2) of Section 263 of the Act.

5. In view of the above and for the reasons stated above the

question of law framed is answered in favour of the revenue –

appellant and against the assessee – respondent herein and

it is held that the order passed by the learned Commissioner

under Section 263 of the Income Tax Act was within the

period of limitation prescribed under sub­section (2) of

Section 263 of the Act. The present appeal is allowed

accordingly. No costs.

…………………………………J.

(M. R. SHAH)

…………………………………J.

(A. S. BOPANNA)

New Delhi,
October 07, 2021.

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