The limitation u/s 153 re-starts from date of stay vacation order of HC and not from date of communication – All. HC

The Hon’ble Allahabad High Court has answered an important question regarding the limitation period of assessment.

In this case, the assessment proceedings were stayed by High Court. But lateron the stay was vacated since the assessee failed to bring on record the necessary legal heirs. The order of HC vacating the stay was passed on 01.08.1995 but the said order was communicated to the department on 18.12.1995. The assessment was concluded on 04.01.1996. The question was raised that limitation to complete assessment within 60 days of order of HC vacating the stay, as per provisions of sec. 153, should be counted from date of order of High Court i.e. 01.08.1995 and not from 18.12.1995 and hence the assessment is barred by limitation. The Hon’ble HC decided the matter in favour of the assessee.

Further, the HC also laid down that the original order vacating the stay can not be termed to contain any direction or finding to make the assessment and hence the contention of the revenue that the assessment can be made any-time and limitation u/s 153 does not apply, was rejected.

To read complete text of judgement, click here Chander Bhan Bansal-All HC