Shell India Markets Private Limited v. Additional/Joint/Deputy/Assistant Commissioner of Income Tax

(i) the completion of any action, referred to in clause (a) of sub-section (1) of section 3 of the said Act, relates to passing of any order,- (a) for assessment or reassessment under the Income-tax Act, and the time limit for completion of such action under section 153 or section 153B thereof, expires on the 30th day of June, 2021 due to its extension by the said notifications, such time limit shall further stand extended to the 30th day of September, 2021; (b) for imposition of penalty under Chapter XXI of the Income-tax Act,—

(i) the 29th day of September, 2021 shall be the end date of the period during which the time limit specified in, or prescribed or notified under, the Income-tax Act falls for the completion of such action; and day of September, 2021 shall be the end date to which the time limit for completion of such action shall stand extended;

(ii) the compliance of any action, referred to in clause (b) of sub-section (1) of section 3 of the said Act, relates to intimation of Aadhaar number to the prescribed authority under sub-section (2) of section 139AA of the Income-tax Act, the time-limit for such the compliance of such action shall stand extended to the 30th day of September, 2021; (B) where the specified Act is the Chapter VIII of the Finance Act, 2016 (28 of 2016) (hereinafter referred to as the Finance Act) and the completion of any action, referred to in clause (a) of sub-section (1) of section 3 of the said Act, relates to sending an intimation under sub-section (1) of section 168 of the Finance Act, and the time limit for completion of such action expires on the 30th June, 2021 due to its extension by the said notifications, such time limit shall further stand extended to the 30th day of September, 2021. [Notification No. 74/2021/ F. No. 370142/35/2020-TPL] SHEFALI SINGH, Under Secy., Tax Policy and Legislation Division Note: The principal notification was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (ii) vide S.O.No. 4805(E) dated 31st December, 2020 and was last amended vide S.O.1703(E) dated 27th April,2021.

10. Sub-section (13) of Section 144C, therefore, is very clear inasmuch as the Assessing Officer shall, upon receipt of the directions issued under sub-section (5), in conformity with the directions, complete the assessment within one month from the end of the month in which such direction is received. Sub-section (13) also provides that the Assessing Officer can complete the assessment without providing any further opportunity of being heard to the assessee. This means that the moment the Assessing Officer receives the directions under sub-section (5), he has to straightaway complete the assessment and he does not even have to hear the assessee. The Assessing Officer shall simply comply with the directions received from the DRP within one month from the end of the month in which such direction is received.

11. Mr. Mistri, Counsel for petitioner, submitted as under:- (a) The three notifications, on which reliance has been placed to complete the assessment, do not extend the time-limit for respondent No.1 to pass the impugned final assessment order under Section 144C(13) of the Act and, therefore, the order dated 30th September 2021 impugned in this petition is clearly without jurisdiction and beyond the time-limit provided under the Act for completion of the assessment proceedings. (b) Section 3(1) of the Relaxation Act extends the time-limit with respect to an act, for which limitation falls between 20th 2020 and 31st December 2020 and as the petitioner’s case does not fall under Section 3 of the Relaxation Act as the time-limit for passing the final order does not fall within the period between 20th March 2020 and 31st December 2020, the provisions of Section 3(1) of the Relaxation Act are not applicable to petitioner.

(c) Notification No.20/2021 issued on 31st March 2021 is also inapplicable as the said notification is applicable only to cases where the time-limit for completion of any action including passing of the order under Section 144C(13) of the Act was upto 31st March 2021. In petitioner’s case, as time-limit for completion of assessment under Section 144C(13) of the Act was upto 30th April 2021, Notification No.20/2021 is clearly inapplicable to the facts of the present case.

(d) Notification No.38/2021 issued on 27th April 2021 is also inapplicable to petitioner’s case because it applies only to cases where the time-limit was expiring on 30th April 2021 “due to its extension by earlier notifications”. In the present case, although the time-limit is expiring on 30th April 2021 for the Assessing Officer to complete assessment and pass an order under Section 144C(13) of the Act as the time-limit was not expiring on 30th April 2021 “due to an earlier notification” but on applicability of Section 144C(13) itself, petitioner’s case does not fall within the ambit of Notification No.38/2021. (e) Notification No.74/2021 dated 25th June 2021 is also inapplicable to the facts of the present case because it extends the time-limit only with reference to the actions to be completed within the time-limits specified in Section 153 or Section 153B of the Act. Since in the present case, time-limit is neither prescribed in Section 153 nor in Section 153B of the Act but the time-limit in the present case is prescribed under Section 144C(13) of the Act, clearly, Notification No.74/2021 issued on 25th June 2021 is inapplicable so as to extend any time-limit for passing the impugned order.

12. Mr. Suresh Kumar, per contra, very firmly opposed the petition and submitted as under:- (a) The order impugned in the petition has been passed within the time prescribed as extended by the Relaxation Act read with the notifications issued under the said Act. (b) The notifications under the Relaxation Act were issued by the Government of India to mitigate the problems of the tax-payers and the common citizens in general caused by lock-down and restrictions due to Covid-19 pandemic. The same yardstick applies to the government officers and officials who were also prevented from working in normal conditions. The Government tried its best to save the citizens including tax-payers and officers of the government departments and hence, the provision should be given a purposive interpretation.

(c) Subsequent to the directions issued by DRP on 20th

2021, the Assessing Officer had to pass the consequential order on or before 30th April 2021. Therefore, the Assessing Officer could have passed the consequential order by 31st March 2021 also. In other words, the Assessing Officer had time from 21st March 2021, having received DRP directions on 20th 2021, upto 30th April 2021 to pass the consequential order. As per the Notification No.20/2021 of 31st March 2021, the limitation dates were extended to 30th April 2021, thereafter vide Notification No.38/2011 dated 27th April 2021, the date was extended to 30th June 2021 and again it was further extended to 30th September 2021 by Notification No.74/2021 of 25th June 2021.

(d) Notification No.74 of 2021 of 25th June 2021 says “for assessment or re-assessment under the Income-tax Act, and the time-limit for completion of such action under Section 153 or Section 153B thereof…”. To give purposive interpretation, the word ‘and’ used should be read as “or”. (e) In view of the above, passing of order under Section 143(3) read with Section 144C(13) and Section 144B of the Act dated 30th September 2021 was also covered under the Relaxation Act, which is within the extended period under the notifications issued by CBDT under the Relaxation Act.

13. Heard the Counsel and also considered the petition, documents annexed thereto and the affidavit in reply. Though the petition is listed for admission, with the consent of the parties, since pure question of law is involved, we decided to dispose the petition at the admission stage itself.

14. We are inclined to agree with the submissions made by Mr. Mistri. We would also add that there was no dispute that the Assessing Officer, but for the Relaxation Act and the notifications issued therein, had to complete the assessment under Section 144C(13) latest by 30th April 2021.

15. Sub-section (1) of Section 3 of the Relaxation Act extends the timelimit with respect to an act for which limitation falls between the period from 20th March 2020 to 31st December 2020. Since the directions of DRP were issued and received by Assessing Officer only on 20th March 2021, petitioner’s case does not fall under sub-section (1) of Section 3 of the Relaxation Act as the time-limit for completion of assessment does not fall within the period from 20th March 2020 to 31st December 2020.

16. Sub-section (1) of Section 3 of the Relaxation Act also provides that the Central Government, by notification, can extend the period to such other date after 31st December, 2020. Therefore, CBDT issued the first Notification No.20/2021. Clause A of this notification provides that where the specified Act is the Income-tax Act, and the completion of any action referred to in clause (a) of sub-section (1) of Section 3 of the Act relates to passing of an order under Section 144C(13) of the Act and 31st March 2021 is the end date, during which the time-limit specified in the Act falls for completion of such action, 30th April 2021 shall be the end date to which the time-limit for completion of such action shall stand extended. The notification, therefore, provides that if the time-limit to complete the assessment under Section 144C(13) was expiring on any date upto 31st March 2021, the said date for completion was extended upto 30th April

2021. Since in this case, the time-limit for completion of assessment was not expiring as of 31st March 2021, in our view, Notification No.20/2021 is not applicable.

17. Coming to the applicability of Notification No.38/2021 issued on 27th April 2021, Clause (A) of the notification provides that where the specified Act is the Income-tax Act, and the completion of any action referred to in clause (a) of sub-section (1) of Section 3 of the Relaxation Act, relates to passing of an order under Section 144C(13) of the Act and the time-limit for completion of such action expires on 30th April 2021 “due to its extension by earlier notifications”, such time-limit shall further stand extended to 30th June 2021. The expiry of time-limit for completion of assessment or for passing the order in petitioner’s case under Section 144C(13) of the Act on 30th April 2021 was not due to an earlier extension of time-limit by an earlier notification but was on account of the fact that the directions were issued by the DRP on 20th March 2021. As per Section 144C(13) of the Act, an assessing officer has one month from the date of the end of the month in which the directions are received by him to pass the final order / complete assessment, therefore, in our view, the time-limit of 30th April 2021 not being on account of extension by earlier notification, Notification No.38/2021 is also inapplicable to petitioner’s case.

18. Coming to Notification No.74/2021 issued on 25th June 2021, Clause (A) of the notification provides that where the specified Act is the Incometax Act, and the completion of any action referred to in clause (a) of subsection (1) of Section 3 of the Relaxation Act, relates to passing of an order for assessment or re-assessment under the Act and the time limit for completion of such action under Section 153 or Section 153B thereof expires on 30th June 2021 due to its extension by earlier notifications, such time-limit shall further stand extended to 30th September 2021. There is no extension of time-limit under this notification for completion of assessment or passing of any order under Section 144C(13) of the Act. In our view, therefore, Notification No.74/2021 is also not applicable to the case at hand.

19. Even if we hold that the Relaxation Act was applicable to petitioner’s case as well, still, the extension vide Notification No.74/2021 is applicable only to cases where the time-limit has already been extended by earlier notifications. Since the time-limit in petitioner’s case has not been extended by earlier notifications, Notification No.74/2021 was not applicable to petitioner’s case.

20. Coming to Mr. Suresh Kumar’s submissions that the Assessing Officer could have passed a consequential order by 31st March 2021 also and the Notifications No.20/2021 and 38/2021 were applicable along with Notification No.74/2021, the Relaxation Act is very clear inasmuch as it would apply only to those cases for which limitation falls within the period 20th March 2020 and 31st December 2020 or such other date after 31st December 2020 as the Central Government may, by notification, specify in this behalf. The time-limit in petitioner’s case was 30th April 2021 and hence, the provisions of Relaxation Act will not be applicable to petitioner’s case at all.

21. As far as Mr. Suresh Kumar’s submission that the Notification No.74/2021 dated 25th June 2021, to give purposive interpretation the word ‘and’ used should be read as ‘or’ as noted in paragraph No.12(d) above, statutes have to be construed in such a way that every word has a place and everything is in its place. If the precise words used are plain and unambiguous, the courts are bound to construe them in the ordinary sense in their judgments. The words of statute are to be first understood in the natural, ordinary or popular sense and phrases and sentences are construed according to their grammatical meaning, unless that leads to some absurdity or unless there is something in the context or in the object of the statute to suggest to the contrary. The reason for doing so is to give effect to the intention of the Parliament. Therefore, by reading the notification as it stands, and not as suggested by Mr. Suresh Kumar, neither does it lead to any absurdity nor does it suggest anything to the contrary. Therefore, we cannot and we should not read the word ‘and’ as ‘or’.

22. Even if for a moment we hold that Relaxation Act is applicable to petitioner’s case, the time-limit provided by Notification No.38/2021 expired on 30th June 2021. Notification No.74/2021, on which respondents have relied upon to submit that time has been extended upto 30th September 2021, specifically excludes Section 144C(13) of the Act. If that also was to be included, Notification No.74/2021 would have expressly provided for it as it has provided in Notifications No.20/2021 and 38/2021.

23. Notification No.20/2021 and Notification No.38/2021 specifically referred to the time-limit for passing the final assessment order under Section 144C(13) of the Act. There is, however, no specific reference to the time-limit under Section 144C(13) of the Act in Notification No.74/2021. Therefore, it is clear that CBDT has not extended the time-limit for passing any order under Section 144C(13) of the Act vide Notification No.74/2021 dated 25th June 2021, and hence, there is no extension of time-limit to 30th September 2021 to pass the order under Section 144C(13) of the Act.

24. In the circumstances, we are inclined to allow the petition in terms of prayer clause (a), which reads as under:- “(a) that this Hon’ble Court be pleased to issue a Writ of Certiorari or any other writ order or direction under Article 226 of the Constitution of India calling for the records of the case leading to and passing of the impugned assessment order (Exhibit I) dated 30th September 2021 under Section 143(3) read with Section 144C(13) and 144B of the Act for the assessment year 2016-17, Computation of Income (Exhibit I-1) and the Demand Notice dated 30th September 2021 (Exhibit I-2) issued under Section 156 of the Act and Penalty Notice dated 30th September 2021 (Exhibit I-3) issued under Section 274 read with Section 270A of the Act and after going through the same and examining the question of legality thereof quash, cancel and set aside the impugned assessment order (Exhibit I) dated 30th September 2021 passed under Section 143(3) read with Section 144C(13) and 144B of the Act for the assessment year 2016- 17, Computation of Income (Exhibit I-1) and the Demand Notice dated 30th September 2021 (Exhibit I-2) issued under Section 156 of the Act and Penalty Notice dated 30th September 2021 (Exhibit I-3) issued under Section 274 read with Section 270A of the Act.”

25. Petition disposed. No order as to costs.

26. Mr. Mistri states that after the petition was filed, to be on the safer side, petitioner filed an appeal as well impugning the assessment order. He undertakes to withdraw the appeal within two weeks from today. Undertaking accepted. (N. J. JAMADAR, J.) (K. R. SHRIRAM, J.) Minal Parab