$ * IN HIGH COURT OF DELHI AT NEW DELHI Reserved on: 7th September, 2017 Date of decision: 21st September, 2017 + W.P. (C) No. 1773/2016 NOKIA INDIA PRIVATE LIMITED Petitioner Through: Mr. Vikas Srivastava, Mr. Jatinder Pal Singh, Mr. Sumit Mangal and Ms. Kanika Jain, Advocates. versus DEPUTY COMMISSIONER OF INCOME TAX Respondent Through: Mr. Sanjay Jain, ASG with Mr. N. P. Sahni and Mr. Rahul Chaudhary, Senior Standing Counsel. CORAM: JUSTICE S. MURALIDHAR JUSTICE PRATHIBA M. SINGH JUDGMENT % 21.09.2017 Dr. S. Muralidhar, J.: 1. This writ petition by Nokia India Pvt. Ltd. ( Assessee ) seeks quashing of notice dated 14th September 2015 issued by Deputy Commissioner of Income Tax, Circle-18 (2), New Delhi (hereafter Assessing Officer - AO ) under Section 254 read with Sections 144-C and 143 (3) of Income Tax Act, 1961 ( Act ) for Assessment Year ( AY ) 2007-08. Assessee also challenges consequential order dated 2nd December 2015 passed by AO rejecting plea of Assessee that in terms of Section 153 (2A) of Act, proceedings under W.P. (C) No. 1773/2016 Page 1 of 22 aforementioned notice dated 14th September 2015 would be time-barred. Background facts 2. Petitioner, which is engaged in manufacture and sale of mobile handsets, filed its return of income for AY 2007-08 on 1st November 2007 declaring income of Rs. 8,10,62,32,096/-. Since, during AY in question, Assessee was involved in international transactions with its Associated Enterprise ( AE ), reference was made by AO to Transfer Pricing Officer ( TPO ). 3. Assessee filed objections to report of TPO before Dispute Resolution Panel (DRP) contesting transfer pricing (TP) adjustment by which returned income of Assessee stood enhanced. These objections were disposed of by DRP. On basis of directions issued by DRP, AO completed assessment by passing assessment order under Section 143 (3) read with Section 144C (13) of Act on 29th September 2011. total income of Petitioner was assessed at Rs. 12,37,03,19,800/-. 4. In aforementioned final assessment order, AO made following disallowances and additions to income of Petitioner: S. No. Nature of Addition made Amount of addition (INR) 1. Addition on account of disallowance of 87,57,71,395/- Marketing Expenses 2. Addition on account of allowance of 1,03,96,877/- depreciation @ 15% (as against 60%) on computer peripherals. W.P. (C) No. 1773/2016 Page 2 of 22 3. Addition on account of disallowance of amount 62,91,22,970/- claimed as Price Protection Expenses 4. Addition on account of transfer pricing adjustment: a. Advertising, Marketing and Promotion 2,53,48,30,000/- Expenses b. Software Development Services 21,07,34,539/- Total 2,74,55,64,539/- Order of ITAT 5. Aggrieved by above assessment order, Assessee filed appeal being ITA No. 4559/Del/2011 before Income Tax Appellate Tribunal ( ITAT ). decision of ITAT rendered in aforementioned appeal on 18th May 2012 was as under: a. As regards disallowance of expenditure incurred on issue of mobile handsets on 'free of cost' basis, ITAT noted that on identical issue for AY 2000-01 and 2001-02, as well as for AY 2006-07, ITAT had set aside assessment order and remanded matter to file of AO. Accordingly, impugned assessment order was set aside to file of AO with directions to decide issue afresh after affording assessee reasonable opportunity of being heard. b. As regards applicable rate of depreciation on computer peripherals, ITAT allowed Assessee's appeal and directed AO to allow depreciation on computer peripherals at rate of 60% instead of 15% as allowed in original assessment order. W.P. (C) No. 1773/2016 Page 3 of 22 c. As regards disallowance of expenditure on account of price protection expenses, ITAT observed that Since we have admitted additional evidence in respect of other distributors to whom trade price protection has been allowed, we set aside this issue to file of AO with directions to examine case of assessee in light of additional evidence filed before this Tribunal and decide issue on merits. Needless to say AO will provide assessee reasonable opportunity of being heard. d. As regards TP adjustments in relation to provision of software development services to its AEs, ITAT agreed with Assessee that DRP had obtained information under Section 133 (6) of Act and had used such information without affording Assessee opportunity of being heard. Consequently, ITAT held that assessment order needs to be aside to file of assessing officer who will refer matter to DRP for providing necessary opportunity of being heard. We order accordingly. e. As regards working capital adjustment for computing arm's length price ( ALP ) of international transaction, ITAT noted that for AY 2006-07, ITAT had remanded matter to file of AO/TPO for re-consideration in light of fact that said adjustment had been allowed to Assessee in earlier AYs. Accordingly, ITAT set aside matter to file of AO with direction to examine case of assessee and decide issue W.P. (C) No. 1773/2016 Page 4 of 22 afresh in accordance with provisions of law. AO was asked to provide Assessee necessary opportunity of being heard. f. As regards addition on account of Advertising, Marketing and Promotion ( AMP ) expenses, it was noted by ITAT that both parties agreed that issue be set aside in light of amended provisions of Section 92B of Act. Accordingly, ITAT set aside matter to file of AO with directions to decide issue afresh after affording assessee reasonable opportunity of being heard. g. As regards power of TPO to determine ALP in respect of international transactions not referred to him by AO, ITAT held that, in view of amended provisions of Section 92CA of Act with retrospective effect from 1st April 2002, this ground urged by Assessee had become academic. It was accordingly rejected. Proceedings on remand 6. On receipt of ITAT s order, AO referred TP issues to TPO. While matter was pending with TPO, Assessee filed letter dated 31st March 2014 before TPO with copy to AO s office. In said letter, Assessee submitted that under Section 153 (2A) of Act, last date for AO to pass fresh assessment order was 31st March 2015. TPO was requested to take said provision into consideration. 7. On 21st January 2015, TPO responded to aforementioned letter of Assessee. According to TPO, limitation for passing order in W.P. (C) No. 1773/2016 Page 5 of 22 assessment proceedings had to be calculated under Section 153 (3) (ii) of Act. According to TPO, ITAT had only partly restored original order by giving directions to various authorities for considering certain issues afresh after giving reasonable opportunity to Assessee. Referring to paragraph 29 of ITAT's order which stated that appeal of Assessee was being partly allowed for statistical purposes, TPO stated that limitation date for completing and passing of assessment order had to be calculated in terms of Section 153 (3) (ii) of Act. Alternatively, TPO stated that, even in terms of Section 153 (2A) of Act, proceedings were not time-barred as of 31st January 2015. 8. On 29th January 2015, Assessee responded to TPO and copy thereof was also sent to AO. Assessee reiterated that limitation period for passage of fresh order would be calculated in terms of Section 153 (2A) of Act. Thereafter, AO issued impugned notice dated 14th September 2015 calling upon Assessee to attend AO s office on 22nd September 2015 for proceedings under Section 254 read with Sections 144C and 143 (3) of Act for AY 2007-08. 9. On 21st October 2015, Assessee responded to above notice reiterating that Section 153 (2A) of Act was applicable and, therefore, fresh order of assessment was required to be passed within two years from end of financial year in which order of ITAT had been received by Commissioner. It was therefore contended that since proceedings had become time-barred on 31st March 2015, any notice issued thereafter would be without jurisdiction. W.P. (C) No. 1773/2016 Page 6 of 22 10. By impugned order dated 2nd December 2015, AO disposed of above objections by holding that case was not covered under Section 153 (2A) of Act which, according to AO, was applicable only when fresh order of assessment has to be made pursuant to order in appeal or revision. Since assessment had not been totally set aside or cancelled by ITAT and, in fact, had been partly upheld on certain issues, objection regarding limitation was not valid. It was further pointed out that Revenue was also in appeal before High Court against relief allowed by ITAT as well as to some of issues restored by ITAT to AO/TPO and even to DRP. 11. Assessee states that, despite requesting for copy of memorandum of appeal stated to be filed by Revenue in this Court, it was not provided to Assessee. letter was issued by AO on 29 th January 2016 calling upon Assessee to furnish information regarding claim of marketing expenses on account of issue of mobile handsets on free of cost basis as well as copy of additional evidence submitted before ITAT in respect of claim on account of price protection expenses. Assessee replied on 8th February 2016 reiterating that proceedings were time- barred. 12. present petition was listed first for hearing on 29th February 2016 and then again on 2nd March 2016. While directing notice to be issued to Respondents, it was directed that further proceedings may go on before AO but no final order will be passed till next date of hearing. That interim order has continued since. W.P. (C) No. 1773/2016 Page 7 of 22 Submissions of counsel 13. Mr. Vikas Srivastava, learned counsel appearing for Assessee, submitted that it was erroneous on part of AO to conclude that Section 153 (2A) of Act applied only where fresh order had to be passed de novo on fresh inquiry and not when proceedings were remanded to AO with directions from ITAT. According to him, there was no warrant for such interpretation on reading of Section 153 as whole as was further explained by Circular No. 56 dated 19th March 1971 issued by Central Board of Direct Taxes ( CBDT ). Mr. Srivastava relied on decision of this Court in Commissioner of Income-tax v. Bhan Textile (P) Ltd [2008] 300 ITR 176 (Del) and distinguished its decision in Basu Distributors (P) Ltd. v. Income Tax Officer [2007] 292 ITR 29 (Del). 14. On other hand, Mr. Sanjay Jain, learned Additional Solicitor General of India ( ASG ), submitted that Section 153 (2A) of Act would apply only where entire assessment was set aside or cancelled. However, as in present case, where AO was required to follow certain specific directions issued to him by ITAT he was chained as far as exercise of discretion was concerned. In such circumstances, Section 153 (2A) of Act would not apply. According to learned ASG, it was only Section 153 (3) (ii) of Act which would apply to present case. 15. Mr. Jain submitted that Section 153 (3) (ii) of Act would not only apply where 'appeal effect' had to be given but cases of assessment and re- assessment as well. Reference was also made to phrases assessment of such income for another assessment year used in Explanation 2 to W.P. (C) No. 1773/2016 Page 8 of 22 Section 153 and assessment of such income on such other person used in Explanation 3 to Section 153 showed that not only cases of re- computation but also cases of assessment/reassessment on specified aspects are governed by Section 153 (3) (ii) of Act. Relying on decision in Basu Distributors (supra), Mr. Jain submitted that distinction was made by this Court between situation where ITAT remands matter to AO by setting aside order under appeal simpliciter and situation where assessment order is partially set aside with remand only on select issues or aspects of assessment . According to him, expression fresh assessment used in Section 153 (2A) indicates situation tantamount to cancellation or setting aside of entire assessment and not where some part of assessment order was upheld. According to him, ratio of decision in Bhan Textile (supra) was, in fact, helpful to Revenue. 16. Mr. Jain painstakingly took Court through each of directions issued by ITAT to emphasize that setting aside and remanding of matter to AO was only in respect of some of issues and that too with directions and therefore it is Section 153 (3) (ii) of Act which would apply. He also referred to decision of Bombay High Court in Rikhabdas Jhaverchand v. CIT [2001] 249 ITR 774 (Bom) and Supreme Court in Rajinder Nath v. CIT [I979] 120 ITR 14 (SC) to distinguish expression 'finding' from expression 'direction'. Legislative History 17. Prior to its amendment by Taxation Laws (Amendment) Act, 1970, Section 153 of Act read as under: W.P. (C) No. 1773/2016 Page 9 of 22 Time limit for completion of assessments and reassessments. 153. (1) No order of assessment shall be made under Section 143 or Section 144 at any time after (a) expiry of (i) four years from end of assessment year in which income was first assessable, where such assessment year is assessment year commencing on or before 1st day of April, 1967; (ii) three years from end of assessment year in which income was first assessable, where such assessment year is assessment year commencing on 1st day of April, 1968; (iii) two years from end of assessment year in which income was first assessable, where such assessment year is assessment year commencing on or after 1st day of April, 1969; or (b) expiry of eight years from end of assessment year in which income was first assessable, in case falling within clause (c) of sub-section (1) of section 271; or (c) expiry of one year from date of filing of return or revised return under sub-section (4) or sub-section (5) of Section 139; whichever is latest. (2) No order of assessment reassessment or recomputation shall be made under Section 147 (a) where assessment, reassessment or recomputation is to be made under clause (a) of that section, after expiry of four years from end of assessment year in which notice under Section 148 was served ; W.P. (C) No. 1773/2016 Page 10 of 22 (b) where assessment, reassessment or recomputation is to be made under clause (b) of that section, after (i) expiry of four years from end of assessment year in which income was first assessable, or (ii) expiry of one year from date of service of notice under Section 148, whichever is later. (3) provisions of sub-sections (1) and (2) shall not apply to following classes of assessments, reassessments and recomputations which may be completed at any time (i) where fresh assessment is made under Section 146 ; (ii) where assessment, reassessment or recomputation is made on assessee or any person in consequence of or to give effect to any finding or direction contained in order under Section 250, 254, 260, 262, 263 or 264 or in order of any court in proceeding otherwise than by way of appeal or reference under this Act; (iii) where case of firm, assessment is made on partner of firm in consequence of assessment made on firm under section 147. Explanation..... 18. Taxation Laws (Amendment) Act, 1970 inserted sub-section (2A) in Act with effect from 1st April, 1988 and it reads as under: (2A) Notwithstanding anything contained in sub-sections (1) and (2), in relation to assessment year commencing on 1st day of April, 1971, and any subsequent assessment year, order of fresh assessment under section 146 or in pursuance of ah order, under section 250; section 254, section 263 or section 264, setting aside or cancelling assessment, may be made at any time before expiry of two years from end of financial year in which order under section 146 cancelling assessment is passed by Assessing Officer or order W.P. (C) No. 1773/2016 Page 11 of 22 under section 250 or section 254 is received by Chief Commissioner or Commissioner or, as case may be, order under section 263 or section 264 is passed by Chief Commissioner or Commissioner. 19. Simultaneously, in Taxation Laws (Amendment) Act, 1970, certain highlighted words to that effect were inserted in Section 153(3) as under: (3) provisions of sub-sections (1), (lA), (IB) and (2) shall not apply to following classes of assessments, reassessments and re-computations which may, subject to provisions of sub-section (2A), be completed at any time. 20. By amendment brought about by Finance Act, 2001, general time limit under Section 153 (2A) was reduced to one year. With effect from 1st July 2012, time limit was increased to two years in certain TP cases. Finally, by amendment in 2016, time limit under Section 153 (2A) has been reduced to 9 months. 21. reason behind introduction of sub-section (2A) to Section 153 of Act can be gleaned from para 22 of Circular No. 56 dated 19th March 1971 issued by CBDT which reads as under: Time limit for completion of assessments set aside in appeal or reopened under section 146 22. Section 153, relating to time limits for completion of assessments and reassessments has been amended so as to provide time limit for completion of fresh assessments, to be made in cases where : (i) original assessment made under section 144 has been cancelled by Income Tax Officer on application by assessee under Section 146; or (ii) original assessment is set aside or cancelled in appeal by Appellate Assistant Commissioner or Appellate Tribunal or W.P. (C) No. 1773/2016 Page 12 of 22 in revision by Commissioner. For this sub-section (2A) has been inserted in section 153. Under this sub-section fresh assessment in cases mentioned at (i) may be made at any time before expiry of two years from end of financial year in which original assessment was cancelled by Income-tax Officer under section 146. In cases mentioned at (ii) fresh assessment may be made at any time before expiry of two years from end of financial year in which order of Appellate Assistant Commissioner or Appellate Tribunal is received by Commissioner or, as case may be, order in revision is passed by Commissioner. Such fresh assessments may be completed within above-mentioned time limit even if time limit specified in sub-section (1) or sub-section (2) of section 153 for completion of assessment or reassessment has expired. Under existing provisions of section 153(3), such fresh assessments are not subject to any time limit. time limit laid down under new sub-section (2A) of section 153 will be operative only in relation to assessments for assessment year 1971-72 or any subsequent years." (emphasis supplied) Analysis and reasons 22. Having perused impugned order of ITAT carefully and operative portions qua which assessment order was set aside and matter remanded to AO, Court is unable to agree with contention of learned ASG that aforementioned order of ITAT did not constitute complete setting aside of assessment with directions to AO to pass fresh order. Court does not agree with submission of learned ASG that AO was chained by ITAT's directions and could not have passed fresh assessment order de novo pursuant to such remand. 23. Court is also unable to agree with contention that unless entire assessment order is wholly set aside, time limit for passing W.P. (C) No. 1773/2016 Page 13 of 22 fresh order under Section 153 (2A) would not be attracted. There is no warrant for such interpretation. object behind introduction of sub-section (2A) was to prescribe time limit for completing assessment proceedings upon original assessment being set aside or being cancelled in appeal. Clearly, intention was not to restrict applicability of sub-section (2A) only to such cases where entire original assessment order is set aside. It was noted that, Under existing provisions of section 153 (3), such fresh assessments are not subject to any time limit. Indeed, Section 153, as it stood at that time, did not prescribe any time limits. Section 153 (3) (ii), in particular, did not require order passed thereunder to be issued within any particular time limit. Further there is distinction between 'assessment' that is set aside and 'assessment order' being set aside. When assessment on issue is set aside and matter remanded, with direction that issue has to be determined afresh, Section 153 (2A) of Act would get attracted. 24. What is important to note is that, along with insertion of sub-section (2A), sub-section (3) underwent simultaneous change. It was expressly made subject to provisions of sub-section (2A). This meant that Section 153 (3) would thereafter apply only to such cases where Section 153 (2A) did not apply. In other words, in all instances of AO having to pass fresh assessment order upon remand where Section 153 (2A) would apply, AO would be bound to follow time- limit imposed by sub-section (2A). Where AO was only giving effect to appellate order, then Section 153 (3) (ii) of Act would apply. W.P. (C) No. 1773/2016 Page 14 of 22 25. In present case, of seven issues, assessment in respect of five was set aside and issues remanded for fresh determination. Whether remand was to TPO or DRP would not make difference as long as what results from remand is fresh assessment of issue. Clearly, therefore, time limit for completing that exercise was governed by Section 153 (2A) of Act. decision in Basu Distributors 26.1 Turning now to judicial precedents, Court proposes to first discuss decision in Basu Distributors (supra) since considerable reliance was placed on said decision by learned ASG. There, ITAT had allowed Assessee s appeal and directed that It is imperative in interest of justice and fair play to set aside and restore matter to AO for re-consideration after giving sufficient reasonable opportunity to Assessee to furnish necessary details, explanations and evidences in support of above and to pass fresh order as per law, rule and CBDT circulars. 26.2 fact situation in context of which above directions were issued was that AO had made additions to returned income of Assessee pertaining to cash payments made to Ritz Theatres (P) Ltd. ( Ritz ) and to Honey Enterprises ( HE ) which, according to AO, were in violation of Section 40A (3) of Act. grievance of Assessee was that sufficient opportunity had not been given to it to place complete facts and therefore, offer necessary explanation and evidence regarding such cash payment. ITAT agreed with this contention of Assessee and therefore passed remand order after setting aside order of AO W.P. (C) No. 1773/2016 Page 15 of 22 and CIT(A). Although remand order was dated 23rd June 2000, no action was taken by AO for over four years till 2nd September 2004 and final assessment order was passed only on 20th February 2005. 26.3 In above context, Court in Basu Distributors (supra) was called upon to address question whether re-assessment proceedings were time barred under Section 153 (2A) of Act. Court observed as under: 20. Having had advantage of perusing plethora of precedents on aspect of law which has engaged our attention, we are of view that Section 153(2A) is not attracted in facts of present case; no period of limitation is prescribed as per provisions of Section153(3)(ii). It is trite that Parliament is continuously concerned with evils or undesirability of proverbial sword hanging over head of Assessee. Parliament has therefore set-down parameters within which assessment must be completed and over years has shortened span of time in this regard. It has, however, carved out exception to rule where specific, limited or restricted direction is passed by Appellate Authority which is of opinion that it would not be possible to decide appeal before it without clarification on this point. Appellate Authority has also power to set aside Assessment Order and direct de novo enquiry, in which case every aspect, computation and dimension is open for consideration. This partakes of nature of assessment which is akin to original assessment and, therefore, period of limitation applicable to original assessment must apply to fresh assessment. Where Appellate Authority remands case for determination on selected issue or aspect of assessment, uncertainty or discomfort of sword of uncertainty provides no peril to assessee. All parties are fully aware of parameters within which fresh enquiry is circumscribed and limited. It is obviously for this reason that rigours of limitation are totally removed. If W.P. (C) No. 1773/2016 Page 16 of 22 AO is unduly slow in completing assessment, it may be open to assessee to approach High Court under Articles 226 and 227 of Constitution seeking direction for expeditious end and closure to restricted enquiry. 21. Reverting to facts of case at hand it is manifestly clear that in substance entire assessment had not been set aside. Assessee's contention was that Section 40A(3) had not been violated in its spirit since no expenditure exceeding Rupees Twenty Thousand had been incurred in cash; these were incurred by effecting entries in Books of Accounts and hence were as undisputable as payments made by Account Payee Cheques or Account Payee Bank Draft. It was only on this restricted aspect of assessment that Tribunal had remanded case to AO. entire assessment exercise, therefore, had not been undertaken de novo, thereby, rendering Section 153 (2A) of Act inapplicable to case. 22. We conclude by holding that writ petition under Articles 226 and 227 of Constitution is always maintainable if High Courts find that any authority is acting contrary to powers bestowed upon it. Writ petitions, therefore, cannot be dismissed per se. objection on this score cannot be appreciated; Revenue would be justified in contending that in facts of case invoking extraordinary Jurisdiction of this Court was not called for. Considerable time of this Court has been needlessly spent on adjudicating on this preliminary objection. However; we dismiss writ petitions as meritless since, in facts and circumstances of case, it cannot be argued that Section 153(2A) is attracted and constitutes absolute power on assessment proceedings. This is obviously manner in which all authorised representatives of Petitioners understood law since they chose to address AO on merits of case. Petitioners have chosen to file present petitions after considerable delay in vain attempt to avoid payment of Income Tax on technicalities which do not exist in their favour. We would have dismissed writ petitions with heavy costs but decline from doing so W.P. (C) No. 1773/2016 Page 17 of 22 because Revenue has unreasonably raised preliminary objection pertaining to maintainability of writ petitions. 27. From para 20 of aforementioned judgment, it is plain that ITAT had in fact set aside entire assessment order and directed de novo enquiry. Court noted that where remand is on selected issue or aspect of assessment, uncertainty or discomfort of sword of uncertainty provides no peril to assessee. enquiry to be undertaken by AO upon evidence being furnished by Assessee was indeed fresh enquiry and if no time limit was prescribed for that exercise, Assessee would undoubtedly have sword of uncertainty hanging. Considering additions made, there was, in fact, no other substantive issue that had to be examined afresh by AO. Therefore, Court, in terms of its own analysis of Section 153 (2A) in aforementioned decision, required fresh assessment order to be made by undertaking de novo enquiry. For such exercise limitation in Section 153 (2A) had to apply. On facts of Basu Distributors (supra), it is not understood how Section 153 (2A) would not apply. 28. Be that as it may, as far as present case is concerned, aforementioned decision in Basu Distributors (supra) would, not in fact, come to aid of Revenue. facts in present case fully answer description of case which in para 20 of decision in Basu Distributors (supra) was held to be subject to limitation under Section 153 (2A) viz., where order of appellate authority results in assessment order being set aside and AO is asked to undertake "a de novo enquiry, in which case every aspect, computation and dimension is W.P. (C) No. 1773/2016 Page 18 of 22 open for consideration." Other decisions 29. Turning now to other decision of this Court, i.e. Bhan Textile (supra), it requires to be noticed at outset that although for some reason, Court in Bhan Textile (supra) did not refer to earlier decision in Basu Distributors (supra), its interpretation of Section 153 (2A) did not contradict interpretation in Basu Distributors (supra). In Bhan Textile (supra), Court observed that setting aside of assessment order became necessary as AO did not give opportunity to Assessee to place its evidence on record. CIT (A) had in effect cancelled assessment order although those specific words were not used. This Court held that, in such situation, Section 153 (2A) is clearly applicable. This decision, therefore, fully supports case of Assessee. 30. similar view has been taken by Gujarat High Court in Instruments and Control Co. v. Chief Commissioner of Income-tax [2012] 349 ITR 571 (Guj). There, Gujarat High Court discussed entire scheme of Section 153 and also followed decision of this Court in Bhan Textile (supra). It was observed by Gujarat High Court as under: 22. Under circumstances, class of cases of fresh assessment to be made pursuant to order under section 250 etc. would fall under section (2A) of section 153 of Act, and period of limitation prescribed therein would operate. In those cases where there is no need for fresh assessment and are not covered under section (2A) of section 153 of Act, but are covered under clauses (i), (ii) and (iii) of section 153, limitation prescribed under sub-section (2A) of section 153 would not apply and expression assessment, reassessment and re-computation be completed at any time may W.P. (C) No. 1773/2016 Page 19 of 22 enable revenue to continue proceedings of assessment even beyond period prescribed under sub-sections (1) and (2) of section 153 of Act and would also ;not be hindered by prescription of limitation under section (2A) of section 153 of Act. 31. facts and conclusion of that case are set out by Gujarat High Court in paras 24 and 25 of above decision as under: 24. With this background in mind, we may revert back to facts of case. Tribunal on appeal filed by assessee, upheld assessee's contention that commission was disallowed in case of two agencies, placing reliance on statements recorded behind back of assessee without affording cross-examination of such witnesses. It was on this count that Tribunal remitted matter to file of Assessing Officer with direction to summon those two parties again and allow assessee opportunity to cross-examine them so that true facts may emerge in relation to payment of commission by assessee company to these two agencies. While doing so, (be Tribunal also granted liberty to Assessing Officer to probe into matter further by way of inquiry and investigation into alleged payment of commission to such parties. 25. To our mind, case on band would fall under sub-section (2A) of section 153 of Act. Tribunal may not have used words of "setting aside assessment", nevertheless, when it remitted matter back to Assessing Officer for summoning two witnesses again for cross-examination by assessee and permitted further probe to Assessing Officer, necessarily it must be understood to have set aside assessment under challenge. Tribunal, otherwise in law, could not have remitted proceedings to Assessing Officer for fresh consideration after summoning two witnesses and carrying out such probe as may be necessary. We may record that such commissions paid to two agencies was sole dispute between assessee and Department. In W.P. (C) No. 1773/2016 Page 20 of 22 original assessment, Assessing Officer discussed only this issue and made corresponding disallowance. In essence, thus, Assessing Officer was required to pass fresh order of assessment which was necessary on account of order passed by Tribunal under section 254 of Act cancelling assessment framed by Assessing Officer. period of limitation prescribed in section 153(2A), therefore, would apply. While such order was served on Commissioner on 3.8.1994, within period of two years of end of such financial year, fresh order of assessment had to be passed by Assessing Officer. same not having been done, in our view, such proceedings have become time-barred. assessment placed before Assessing Officer by Tribunal's order, therefore, must be treated as having abated. In that view of matter, declaration prayed for by petitioner must be granted. 32. In considered view of Court, aforesaid decision of Gujarat High Court fully supports case of Assessee here. decisions of Madhya Pradesh High Court in Gulabchand Motilal v. Commissioner of Income-tax [1988] 174 ITR 117 (MP), High Court of Punjab and Haryana in Bharti Engineering Corporation v. Union of India [2008] 298 ITR 400 (P&H) and Deep Chand Jain v. ITO [1984] 145 ITR 676 (P&H), and Karnataka High Court in CIT v. Paul Noel Rodrigues [2015] 231 Taxman 811 (Kar), all hold likewise. Kerala High Court in Patel R.P. v. ACIT 2015 (5) KHC 370 held that Section 153 (2A) of Act would apply even where more than one issue is involved i.e. even where one of issues has been remanded to AO for fresh determination. 33. analysis of terms finding and directions by Supreme Court in Rajinder Nath (supra) was in context of Section 153 (3) (ii) of Act at time when Section 153 (2A) of Act had not been introduced W.P. (C) No. 1773/2016 Page 21 of 22 since relevant AY in that case was 1956-57. said decision is, therefore, not of help to Revenue. Conclusion 34. For all aforementioned reasons, Court holds that, in present case, assessment proceedings had to necessarily be completed by AO within time limit specified in Section 153 (2A) of Act. Inasmuch as AO failed to do so, impugned notice dated 14th September 2015 issued by AO and all proceedings consequential thereto including order dated 2nd December 2015 passed by AO are hereby set aside. 35. writ petition is allowed in above terms but, in circumstances, with no orders as to costs. S. MURALIDHAR, J. PRATHIBA M. SINGH, J. SEPTEMBER 21, 2017 rd W.P. (C) No. 1773/2016 Page 22 of 22 Nokia India Private Limited v. Deputy Commissioner of Income-tax