Case Law Details
Once an appeal against the order passed by an authority is preferred and is decided by the appellate authority, the order of the said authority merges into the order of the appellate authority; with this merger, order of the original authority ceases to exist and the order of the appellate authority prevails; the limitation for the purpose of section 154(7) is to be counted from the date of this order of CIT (A) and not the date of original order of assessment.
Once we opine that the assessment order had merged with the order of CIT(A) passed on 28.6.2004, the limitation for the purpose of sub-section (7) of Section 154 is to be counted from this date.
No doubt, the rectification order passed under Section 154 would mean the assessment order as rectified and the assessment order is not obliterated thereby. However, what would be the position when assessment order is not challenged and amended by the appellate authority. Once rectification order under Section 154 of the Act is passed it would mean that the appeal effect order is rectified.
The Tribunal misdirected itself in law by calculating limitation under Section 154(7) of the Act with reference only to the date of original order of assessment.
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