Rich Capital and Finance Services Ltd. Vs CIT And Another (Allahabad High Court)
The Allahabad High Court considered appeals arising from the ITAT Lucknow order concerning Assessment Years 1993-94, 1994-95 and 1995-96 under Section 21 of the Interest Tax Act, 1974 read with Section 260A of the Income Tax Act, 1961.
For AY 1993-94, the assessee was reassessed under Sections 8(3) and 10 of the Interest Tax Act, with interest tax of ₹3,67,360 assessed pursuant to a reassessment notice stated to have been dispatched on 01.05.1998. The CIT(A), by order dated 07.03.2002, noted that there was no proof of service of the notice, set aside the reassessment order and remitted the proceedings to the Assessing Authority. A fresh reassessment order was subsequently passed on 10.11.2003, reiterating the earlier view. The CIT(A) sustained it on 04.02.2005, and the ITAT confirmed the order on 20.03.2008.
The principal question before the High Court was whether the reassessment proceedings were time-barred under Section 10A of the Interest Tax Act.
The Court noted that Section 10A(2) permits an order to be passed within two years from the date of issuance of notice. It held that the fresh reassessment order dated 10.11.2003 was passed within two years from the remand by the CIT(A) on 07.03.2002. Since the revenue authority was permitted to issue a fresh show-cause notice and there was no dispute regarding its existence, the limitation bar under Section 10A(2) was not attracted. The Court found no error in the ITAT’s conclusion.
