Time limit extendable in case of non-cooperation during conduct of special audit

Rajan Batra Vs DCIT (ITAT Amritsar)

ITAT Amritsar held that in case of non-cooperation during conduct of special audit under section 142(2A) of the Income Tax Act, the time limit to do the same can be extended at the end of the department.

Facts- The assessment of the assessee was completed u/s 153A/144 of the Act. A search was conducted on 05.12.2012 in the premises of the assessee u/s 132(1) of the Act. The notice was issued u/s 153A and served upon the assessee. Special audit was conducted on assessee u/s 142(2A) of the Act. For nature and complexity of the accounts, doubts about the correctness of the account and in interest of revenue special audit of the books of account of the assessee was contemplated u/s 142 (2A) of the Act. The assessee has challenged the limitation for completion of the assessment after taken care of the special audit report by the revenue. The assessee also challenged the other legal ground related to incriminating material for completion of assessment u/s 153A. The assessment was completed, and the demand was raised addition on multiple heads.

Aggrieved assessee filed an appeal before the ld. CIT(A). After considering the submission of the assessee the ld. CIT(A) partly allow the appeal of the assessee but dismissed the legal ground in relation to the limitation and jurisdiction of the assessment order. Aggrieved assessee and the revenue are filed appeal before us.

Conclusion- Hon’ble Punjab & Haryana High Court in the case of Jagatjit Sugar Mills Co. Ltd. vs. CIT has held that in case the assessee does not cooperate during conduct of Special Audit; the time limit to do the same can be extended at the end of Department.

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