INCOME TAX ACT, 1961

Section 144

Assessment - Best judgment assessment - Assessee contended that assessment was time barred -

Issue arose for consideration as to whether AO was justified in passing a draft assessment order on the facts of this case, and, whether assessee chose to issue the draft assessment order, even though he was not required to pass the draft assessment order, would result in affecting the normal time limit within which the normal assessment order under section 143(3) was to be issued. Held: There was no dispute that if no draft assessment order was to be issued in this case, the assessment would have been time barred but present assessment order was passed on 17-8-2018. No draft assessment order could have been issued in this case, as the provisions of section 144C(1) could not have been invoked in this case, the time limit of completion of assessment was available only upto 31-12-2017. The mere issuance of draft assessment order, when it was legally not required to be issued, cannot end up enhancing the time limit for completing the assessment under section 143(3). Therefore, assessment order was indeed time barred.

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2014-15

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