INCOME TAX ACT, 1961

Section 201(1)/(1A)

Tax deduction at source - Assessee-in-default - Passing of order beyond four years from the end of relevant assessment years - No limitation prescribed at the time of initiation of proceedings

AO by way of Order dated 21-11-2006 for assessment years 2000-01 to 2002-03 treated assessee as one in default in terms of section 201(1)/201(1A). Held: It is axiomatic that reasonable period for initiation of proceedings in respect of assessment years in question, at the time where no limitation was prescribed, had been held to be four years. It was not in dispute that in the instant case, proceedings under sections 201(1) and 201(1A) had been initiated after a period of four years. Therefore, same could not be held to be initiated within reasonable time and consequently, proceedings could not be sustained in the eyes of law.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2000-01 to 2002-03

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