Whether proviso to S. 147 curtails time limit prescribed u/s.153(2) of the Income-tax Act ?

Recently the Bangalore Tribunal in the case of Maruthi Mercantile Pvt. Ltd. v. ACIT, (2009 TIOL 142 ITAT Bang.) has held to the effect that proviso to S. 147 of the Income-tax Act, 1961 (hereinafter referred to as the ‘Act’) does not curtail the time limit prescribed u/s.153(2) of the Act. In said decision the learned AR relied upon the decision of the very Tribunal in the case of Amitronics Pvt. Ltd. (ITA No. 299-302/Bang./2003 dated 7-4-2006) and contended that no action can be taken after the end of four years from the relevant assessment year and as no action also includes completion of assessment, no assessment order can be passed after end of four years from the end of the relevant assessment year.

However, the Bangalore Tribunal following the decision of the Ahmedabad Tribunal Special Bench in the case of Gujarat Credit Corporation Ltd. v. ACIT, (113 ITD 133) held that limitation of four years applies to the initiation of reassessment proceedings and held that proviso to S. 147 of the Act does not curtail the time limit prescribed u/s.153(2) of the Act and consequently the reopening was held as valid.

The main reasons for rejecting the plea of the assessee in the said case were as under :

1. Proviso to S. 147 of the Act refers to only initiation/reopening of assessment/reassessment. It does not provide for an assessment u/s.147 of the Act.

2. For making an assessment u/s.147 of the Act, the AO is required to follow the procedures laid down similar to the assessment u/s.143 (3) of the Act and hence provisions of S. 147 of the Act are not separate code in itself.

3. Provisions of S. 153(2) of the Act are specific as against proviso to S. 147 of the Act.

Let us discuss each of the pleas of the ITAT Ahmedabad in details.

1. What is an assessment or reassessment ?

    1.1 With reference to the first contention of the Revenue that proviso to S. 147 of the Act does not deal with making an assessment, it would be necessary to find out the meaning of ‘assessment or reassessment’.

    1.2 Assessment is defined u/s.2(8) of the Act as ‘assessment includes reassessment’. In view of the fact that the word has not been appropriately defined under the Act, it would be necessary to look to the meaning of the word ‘assessment’ as held by several courts.

    1.2.1 The Apex Court in the case of S. Sankappa v. ITO, (1968) 68 ITR 760 has defined the word ‘assessment’. The Apex Court has observed that the word ‘assessment’ is used in the Act in a number of provisions in a comprehensive sense and refers to all proceedings, starting with the filing of the return or issue of notice and ending with determination of the tax payable by the assessee. Though in some Sections, the word ‘assessment’ is used only with reference to computation of income, in other Sections it has more comprehensive meaning mentioned above.

    1.2.2 The word ‘assessment’ is not confined to the definite act of making an order of assessment — Sir Rajendranath Mukerjee v. CIT, (1934) 2 ITR 71 (PC).

    1.2.3 In the normal sense ‘to assess’ means to fix the amount of tax or to determine such amount. The process of reassessment is to the same purpose and is included in the connotation of the term ‘assessment’ — ITO v. K. N. Guruswamy, (1958) 34 ITR 601 (SC).

    1.2.4 The word ‘assessment’ bears different meanings, and in one sense it comprehends the entire process of computation and levy of tax — Addl. ITO v. E. Alfred, (1962) 44 ITR 442 (SC).

    1.2.5 Based on the above interpretation given to the word ‘assessment’, it can be said that ‘assessment’ is not merely an act in itself but it denotes the entire processes. Even though the same word is to be interpreted in a most restrictive sense, it includes computation or determination of tax.

    1.3 From the above it would be noted that assessment is not merely passing an order but is a process; normally, assessment proceedings involve the following actions :

•      Filing of return of income

•      Review/processing of return of income

•     Issuance of notice

•     Service of notice

•      Giving of opportunity of being heard

•      Recording of the proceedings

•      Passing of an order relating to the proceedings

•      Service of demand notice, if any demand is raised pursuant to the said order.

    In statute generally separate provisions are prescribed for filing of return of income, processing of return of income, issuance of notice, so on and so forth till service of demand notice.

    1.4 As per S. 2(8) of the Act, assessment includes reassessment. Hence, whatever is stated above in respect of the word ‘assessment’ will also apply in respect of ‘reassessment’. It would thus be clear that reassessment includes not merely forming an opinion on escaped income or reopening of an assessment but also making an assessment.

    1.5 In addition to the above, it may be worthwhile to refer to specific provisions relating to re-assessment proceedings which have been enacted in S. 147 to S. 152 of the Act :

•      S. 147 of the Act provides for assessment of escaped income.

•      S. 148 of the Act provides for issuance of notice before starting of re-assessment proceedings.

•      S. 149 of the Act prescribes time limit for issuance of notice for re-assessment.

•      S. 150 of the Act prescribes time limit for issuance of notice for assessment or reassessment in pursuance of the order under an appeal.    

• S. 151 of the Act stipulates that in case where assessment has been made u/s.143(3) or u/s.147 of the Act, notice u/s.148 of the Act would be required to be issued by an officer of a rank of ACIT1 or above and if the officer below the rank of ACIT issues notice, then sanction of JCIT2 would be required. Proviso to S. 151 of the Act states that no notice should be issued after the end of four years from the end of relevant assessment year unless CCIT3 or CIT4 is satisfied for the reasons recorded by the AO5 that the same is a fit case for issuance of such notice.

    S. 152 of the Act prescribes that tax on such income should be levied as if the income under reference has not escaped assessment.
 

From the above, it would be clear that special provisions dealing with the reassessment or recomputation have been prescribed u/s.147 to u/s.152 of the Act, which call for an assessment u/s.147 of the Act.

1.6 Reference may also be made to S. 153 of the Act, which prescribes time limit for completion of assessments. S. 153(1) refers to time limit for comple-tion of assessment u/s.143(3) of the Act, whereas S. 153(2) of the Act refers to completion of assessment u/s.147 of the Act.

1.7 S. 246A of the Act prescribes orders which are appealable before the Commissioner (Appeals). Clause (a) to Ss.(1) refers to the order of assessment passed u/s.143 (3) of the Act as an appealable or-der, whereas clause (b) to Ss.(1) refers to the order of assessment passed u/s.147 of the Act.

1.8 In the said Special Bench decision, the Ahmedabad Tribunal has relied upon Gujarat High Court decision in the case of Praful Chunilal Patel v. M. J. Makwana, ACIT (236 ITR 832). The ITAT in its decision in the case of Gujarat Credit Corporation Ltd. (supra) has stated that the additional ground raised by Gujarat Credit Corporation Ltd. is squarely covered by the decision of the Gujarat High Court. However, the ITAT Special Bench has erred inas-much as facts and the question before the adjudicating authority in each of the two cases. The case before the CIT(A) was validity of reopening of the assessment and meaning of ‘reason to believe’ when assessment u/s.143(3) of the Act has been concluded by the Assessing Officer, whereas the additional ground raised before the Special Bench talks about limitation on making assessment after end of 4 years from the relevant assessment year. Hence, reliance on the Gujarat High Court decision is totally mis-placed and the decision of the Gujarat High Court is totally distinguishable. In substance, the Gujarat High Court has dealt with a case when the Assessing Officer has reopened the completed assessment based on the point which was not discussed/dealt with in the regular assessment or was missed out by the Assessing Officer. Hence, to that extent the decision of the Gujarat High Court is not applicable to the facts and circumstances of the case of Gujarat Credit Corporation Ltd.

1.9 From the above, it would be clear that order of assessment is required to be made u/s.147 of the Act and assessment is not restricted to merely initiation of proceedings but includes actions up to and including service of notice of demand.

2. It may worthwhile to consider as to whether any other interpretation is possible ?

2.1 The intention of the statute has been explained by Explanatory notes to the Direct Tax Laws Amendment Act, 1987 as initiation of proceedings is required to be done within four years from the end of the relevant year. However, the wording of the provisions indicate the other way, hence this leads us to a situation as to whether a statutory provision can be given a meaning other than or rather broader than what was required/intended ?

2.2 One classic and interesting case before us is of interpretation given to the provisions of Chapter XII-H of the Act relating to fringe benefit tax. The Legislature has intended to tax only those expenses which are expended by the organisation and result into benefit to more than one employee of the organisation rather than one specified or identified employee so that deficiency in not being able to tax as perquisite can be cured. However, by virtue of the wording of the provisions of the Act, the intention has been lost and the scope has been broadened to include all such expenses which come within the listed category of expenses by virtue of deeming fiction created by using different language in the statutory provision.

2.3 The comparison with provisions of Chapter XII-H of the Act have been made with one specific reason that both the provisions, viz. provisions of S. 147 of the Act and provisions of S. 115WE of the Act refer to assessment.

2.4 In view of the above, if intention of the statute is not required to be given undue importance if the language of the provisions is clear, then the provisions of S. 147 should be interpreted to include all actions up to and including service of notice rather than merely initiation of proceedings.

Now reverting back to the issue of curtailing limitation period u/s.153(2) of the Act to the decision on the Ahmedabad Special Bench in the case of Gujarat Credit Corporation Ltd. v. ACIT, (supra), the Special Bench has decided that the proviso to S. 147 of the Act does not curtail the time limit prescribed under the provisions of S. 153(2) of the Act.

3. Whether provision of S. 147 of the Act is complete code in itself ?

3.1 The Apex Court in the case of R. Dalmia & Anr. v. CIT, 236 ITR 480 has held that provisions of S. 147 is not a separate code in itself. It goes on to say that as the assessment u/s.147 is to be made as per the procedure laid down u/s.143 or 144 of the Act, the same is an assessment u/s.143(3) r.w. S. 147 of the Act. With due respect to ITAT Special Benchs decision it may be stated that the entire issue has been misdirected in the sense that the issue was whether the phrase ‘no action’ denotes only initiation or also includes ‘making assessment’. By referring to the Apex Court’s decision which categorically stated that “in making assessment and re-assessment u/ s.147, the procedure laid down in Section subsequent to S. 139 including that laid down by S. 144B has to be followed”. Hence, if it can be inferred that following procedure leads to passing an order u/ s.143 of the Act instead of u/s.147, it will result in number of issues.

3.2 Only by adhering to the procedure prescribed will not alter the order to be passed. This can be explained very well by an illustration regarding deduction u/s.80IB of the Act. Deduction u/s.80IB of the Act is subject to compliance with certain conditions as specified u/s.80IA of the Act. This does not lead to an interpretation that deduction is effectively allowed or claimed u/s.80IA of the Act. The very nature of the deduction will remain un-changed with regard to deduction u/s.80IB of the Act, even though the same is subject to certain conditions prescribed u/s.80IA of the Act.

3.3 Similarly, following machinery procedures laid down subsequent to S. 139 of the Act up to 144B of the Act merely enable the AO to ask for certain information in certain manner as far as assessment u/s.147 of the Act is required to be done. However, the very nature of assessment will remain un-changed at reassessment or recomputation u/s.147. Moreover, the language of provisions of S. 147 of the Act clearly states that it covers in its scope “he may assess, reassess such income”.

3.4 Even the Apex Court in the decision of R. Dalmia & Anr. v. CIT, (236 ITR 480) has held that ‘procedure’ to be followed and has not commented anything on ‘action’. Provisions subsequent to S. 139 and up to and including 144B prescribe various Sections for procedure to be followed for making an assessment and also assessment provisions. However, the Apex Court decision requires that ‘procedure’ as contained in provisions subsequent to S. 139 of the Act up to S. 144B of the Act are required to be followed. Hence, the Apex Court has expressed its view only regarding ‘procedure’. Reliance is totally misplaced on the said decisions along with other decisions like Punjab and Haryana High Court, Andhra Pradesh High Court and Delhi Special Bench Decision when the Special Bench was dealing the word ‘action’ which is much wider in its meaning and application than ‘procedure’.

3.5 This leads us to the practice followed in gen-eral by tax authorities as well as assessees, when order is passed in respect of any reassessment pro-ceedings, the same is termed as order u/s.143(3) read with S. 147 of the Act. However, in light of the above discussion, the same should be order u/s.147 read with S. 143(3) of the Act. The above change of phrase is important as when we refer to the former phrase, it indicates the order is primarily passed u/ s.143(3) of the Act by observing procedure laid down as per S. 147 of the Act, however, the same is not correct as S. 147 of the Act is a separate code in itself. The very fact is indicated by the intention of the statute which has reference in many other Sections of the Act, which say ‘order of assessment/ reassessment u/s.147’. Hence, ideally, the order should be referred as order u/s.147 read with S. 143(3) of the Act as it provides procedures applicable to order passed u/s.143(3) of the Act.

4. Whether proviso to S. 147 is special provision or provisions of S. 153(2) of the Act ?

4.1 The Special Bench has held that as S. 153 pre-scribes time limit for various types of assessments/ reassessments and S. 147 of the Act are ‘subject to’ provisions of S. 148 to S. 153 of the Act, S. 153(2) of the Act is a special provision over proviso to S. 147 of the Act.

4.2 The Special Bench has relied on the phrase ‘subject to provisions of S. 148 to S. 153’ as used in S. 147 of the Act and held that the proviso to S. 147 is also subject to provisions of S. 148 to S. 153 including provisions of S. 153(2) of the Act. This leads us to the basic interpretation issue as to when any Section is made subject to provisions of some other Section, then the effect of such other Section is required to be given first, hence provisions of such other Section would override the basic Section which makes itself subject to other provisions of the Act.

4.3 Hence, when provisions of S. 147 of the Act are concerned, the assessment or reassessment u/s.147 of the Act should be done subject to provisions of S. 148 to S. 153 of the Act. Hence, before making as-sessment u/s.147, notice as required u/s.148 of the Act should be provided within the time limit pre-scribed u/s.149 and complying with other provi-sions of S. 150 and S. 151 if applicable. Tax should be levied in manner prescribed u/s.152 of the Act and the order of assessment u/s.147 of the Act should be passed in time prescribed u/s.153(2) of the Act.

4.4 Proviso to S. 147 of the Act has been worded as under :

Provided that where an assessment U/ss.(3) of S. 143 or this Section has been made for the relevant assessment year, no action shall be taken under this sec-tion after the expiry of four years from the end of the relevant assessment year, unless any income charge-able to tax has escaped assessment for such assessment year by reason of the failure on the part of the asses-see to make a return u/s.139 or in response to a notice issued U/ss.(1) of S. 142 or S. 148 or to disclose fully and truly all material facts necessary for his assess-ment, for that assessment year. (emphasis supplied)

4.5 The proviso has been made applicable to the entire S. 147 of the Act, hence the same makes an exception to the entire Section. In view of this, whether ‘subject to’ has to be read first or proviso has to be read first and then to apply the other so as to restrict one by another.

4.6 Action u/s.147 is subject to provisions of S. 148 to S. 153 of the Act i.e., any action u/s.147 of the Act can be taken by satisfying the conditions and pro-cedures laid down u/s.148 to u/s.153 of the Act. This includes taking an action of completion of an assessment u/s.147 of the Act within the time limit prescribed u/s.153(2) of the Act. This applies to all the reassessment proceedings whether all the material and information relating to income which has escaped assessment have been disclosed by the assessee or not disclosed by the assessee.

4.7 However, the proviso provides for an exception to the reassessment made u/s.147 of the Act, which (i.e., reassessment) should be in conformity with the provisions/conditions laid down u/s.148 to u/s.153 of the Act, and state that such action (i.e., any action from initiation of proceedings to service of demand notice) should not be taken after certain time period.

4.8 This clearly indicates that even though action u/s.147 of the Act which requires making of an assessment or reassessment to be completed within time frame prescribed u/s.153(2) of the Act, such action (which is in conformity with provisions of S. 148 to S. 153 of the Act) cannot be taken after the end of four years from the end of relevant assessment year. This means that any action u/s.147 of the Act is required to be in conformity with the provi-sions of S. 148 to S. 153 of the Act and hence whether proviso applies or not, all the reassessments need to be in compliance with provisions of S. 148 to S. 153 of the Act. In the cases where proviso is applicable due to the satisfaction of the conditions prescribed thereunder; the action which otherwise would have been validly taken up will now not been taken up.

4.9 Proviso restricts application of main Section which is also supported by the legal interpretation of application of ‘proviso’ in any tax statute.

4.10 Another issue raised by the Special Bench is regarding application of rule of special over general as S. 153(2) of the Act which provides for time limit for completion of the assessment, the same is a special provision and will override proviso to S. 147 of the Act which is general in its application.

4.11 S. 153 of the Act prescribes time limits for completion of assessments/reassessments under various provisions of the Act. S. 153(2) of the Act prescribes time limit for completion of assessment u/s.147 of the Act. Hence, any reassessment u/s.147 of the Act requires to be completed within the time limit prescribed u/s.153(2) of the Act if no other exception is provided thereto. Hence, provisions of S. 153(2) of the Act apply in all the reassessment proceedings irrespective whether assessee has disclosed all the material facts or not or whether assessment has been made u/s.143(3) or u/s.144 or u/s.147 of the Act.

4.12 This indicates that S. 153(2) of the Act is a general provision prescribing time limit for completion of the reassessment proceedings as far as application of or making of reassessment u/s.147 of the Act is concerned.

4.13 However, proviso to S. 147 of the Act provides for some exceptions for taking an action (which also includes completion of assessment as discussed above), where the following conditions are fulfilled :

i) The assessment for the concerned year has been completed u/s.143(3) or u/s.147 of the Act, and

ii) The assessee has not defaulted in any of the followings :

    a. Making return u/s.139 of the Act

    b. Making return in pursuance to notice u/s.142(1) of the Act

    c. Making return in pursuance to notice u/s.148 of the Act

    d. Disclosing fully and truly all material facts important for making assessment for the concerned assessment year.

4.14 Hence, if all the above conditions are fulfilled, the proviso would apply in respect of the reassessment being otherwise validly completed within the time limit prescribed u/s.153(2) of the Act. The proviso provides for an action (which includes completion of assessment as discussed above) within four years from the end of the relevant assessment year.

4.15 From the above, it is clear that as far as completion of reassessment is concerned, proviso to S. 147 of the Act is a special provision as compared to pro-visions of S. 153(2) of the Act. Hence, in the event any judicial authority holds that rule of special over general will apply, then also proviso will apply and proviso to S. 147 of the Act will override provisions of S. 153(2) of the Act.

5. If proviso to S. 147 overrides provisions of S. 153(2), it would result in absurdity :

5.1 Another issue raised by the Special Bench of Ahmedabad is regarding absurd results if proviso overrides provisions of S. 153(2) of the Act.

5.2 First and most important thing to be understood is when there does not exist any doubt and statute is clear in its words, the absurdity cannot be a ground to give another meaning to the provisions of taxing statute.

5.3 The answer to the issue raised by the Special Bench of Ahmedabad is regarding absurdity of statutory provisions if proviso overrides provisions of S. 153(2) of the Act, lies in change brought out vide the Direct Tax Laws (Amendment) Act, 1987 w.e.f. April 1, 1989.

5.4 The Tribunal has erred in not referring to the scheme of provisions of S. 147 and amendment brought in the said provisions of the Act vide the Finance Act, 1989 w.e.f. 1-4-1989. For better understanding of the provisions of S. 147 of the Act, provision existing and in force prior to 1-4-1989 u/s.147 and u/s.153(2) of the Act are reproduced.

5.6 From the above, we can note the following amendments (without referring to Departmental Circular as the same is not binding on the assessee) :

•     Provisions of S. 147 of the Act had two sub-sections (a) and (b) to deal with two separate situations and similarly provisions of S. 153(2) of the Act had two clauses (a) and (b) to provide for time limits for both the situations separately.

•     Provisions of sub-sections (a) and (b) of the S. 147 of the Act have been merged into one Section. Moreover, one may notice that the condition of S. 153(2)(a) of the Act is merely repetitive and has already been taken care of vide clause (b)(i) or (b)(ii) of S. 153(2) of the Act, hence the same has been removed in view of merger of two sub-sec-tions u/s.147 of the Act.

•     Provisions of S. 147(b) of the Act refer to the situation where there is no mistake or omission on the part of the assessee to disclose all the materials truly and correctly and the same situation is envisaged by proviso to S. 147 of the Act with further reduction in scope of the proviso, the statute has provided for the condition that there should have been an assessment or reassessment u/s.143(3) or u/s.147 of the Act. Therefore, it can be said that proviso provides for the situation which was envisaged in provisions of S. 147(b) of the Act as the former is narrower in scope than the latter.

•     Hence, for cases following u/s.147(b) of the Act, the time limit applicable in case of prior to amendment was 153(2)(b) of the Act was later of the two time limits which resulted into redundancy of condition mentioned in S. 153(2)(b)(i) of the Act as in the cases where all the materials are disclosed to the tax officer, reassessment will be initiated after end of 2 years only, which will result in applicability of condition prescribed u/ s.153(2)(b)(ii) of the Act as the same would only be later date than 153(2)(b)(i) of the Act.

•     However, now one may say that out of the two time limits, only one remains in the S. 153(2) of the Act and the second condition of erstwhile S. 153(2)(b) of the Act has been made a part of the proviso to S. 147 of the Act. Interestingly, one may note that there is absence of phrase ‘whichever is later’ which was existing in provisions of S. 153(2)(b) of the Act. In light of absence of such phrase, we need to give harmonised construction to both the conditions so that none of the provisions become redundant.

• This is also supported by the reason for amendment in provisions of S. 147 of the Act by amending Act, 1987 which says the same as ‘rationalisation’ of the provisions of S. 147 of the Act. Vide the Amending Act, 1987, new scheme of assessment has been inserted which has brought into practice assessment by exception i.e., the Assessing Officer will not be required to pass an assessment order in all the cases and will be required to pass assessment order only in cases where the case has been selected for scrutiny. Here, the rationalisation can be seen from the amended provisions of S. 147 of the Act also as reference to assessment order u/s.143(3) of the Act which was missing in earlier provisions have been introduced to restrict the application of provisions of S. 147 of the Act in the cases where the assessing officer has already exercised its power and right to investigate the claims of the asses-see over period of not less than 2 years. Hence, the amended provisions, supports the view by naming the same as rationalising the provisions of S. 147 of the Act as once the case of the assessee has been scrutinised u/s.143(3) of the Act and if there is no mistake on the part of assessee, then extra-ordinary or special provision should not apply to all the cases which otherwise get covered.

5.7 The above discussion clearly suggests that the provisions had been amended to give its proper effect. If we need to take an interpretation that time limit prescribed u/s.153(2) of the Act needs to be seen, the proviso to S. 147 becomes redundant and hence harmonised construction should be applied particularly when the phrase ‘whichever is later’ is absent in new amended provisions, we need to interpret the provisions in a manner which do not lead to redundancy in anyone of the two provisions, which imply that we need to read ‘whichever is earlier’ so as to give due weightage to both the provisions which give time limits for completion of assessment u/s.147 of the Act.

5.8 In view of above discussion, it would be logical to conclude that should the proviso to S. 147 prevail over provisions of S. 153(2) of the Act when the case of the assessee is squarely covered by the conditions prescribed under proviso to S. 147 of the Act. This is supported by the following logical and reasoned observations;

5.8.1 Phrase ‘no action’ as used in the proviso to S. 147 of the Act also includes completion of assessment as assessment is required to be completed u/ s.147 of the Act otherwise even provisions of S. 147 of the Act should not have used the words ‘subject to provisions of S. 148 to 153’ in which provisions of S. 153 of the Act refer to time limit for completion of the assessment/reassessment.

5.8.2 Proviso to S. 147 of the Act makes an exception or restriction to the applicability of provisions of S. 147 of the Act to a particular case, which if not so restricted could have been rightly been applied application.

5.8.3 Proviso to S. 147 of the Act is more specific than provisions of S. 153(2) of the Act as provisions of S. 153(2) of the Act apply to all the reassessment proceedings, however, proviso applies in specific cases where conditions prescribed thereunder are satisfied.

5.8.4 In light of the fact that amended provisions of S. 153(2) of the Act do not contain the word ‘whichever is later’, it indicates that we need to give harmonise construction to the provisions of S. 153(2) of the Act and proviso to S. 147 of the Act which contains the time limit which was existing prior to amendment in provisions of S. 153(2) of the Act.

5.8.5 When the statutory provisions are clear and unambiguous, natural meaning has to be given than the intended meaning as far as tax statute is concerned.

6. Conclusion :

In view of the above discussions on the contentions raised not by the Department but by the Tribunal, I can form only one and single opinion that provisions of S. 147 of the Act require making an assessment which include all the acts, procedure and actions from formation of reason to belief that income has escaped assessment till service of notice of demand relating to assessment framed u/s.147 of the Act. The provisions of S. 147 of the Act is a special provision enabling tax authority to take recourse against the assessee in specific situation and hence to take any action, the condition prescribed for the same needs to be fulfilled and hence assessment needs to be framed within the time limit prescribed u/s.153(2) of the Act read with proviso to S. 147 of the Act. Hence, the time limit for completion of the reassessment proceedings shall be earlier of the following two :
 

(i) Time limit prescribed u/s.153(2) of the Act; and

(ii)  When assessment has already been framed u/ s.143(3) or u/s.147 of the Act and assessee has disclosed all the material fully and truly, then within 4 years from the end of relevant assessment year.

Hence, I am of the opinion that the ITAT Ahmedabad has without appreciating the statutory provisions in its letter and to some extent spirit of the statute has interpreted as per the general under-standing which is completely not required where issue involved is interpretation of taxing statute is concerned. Hence, I am of the opinion that harmonious construction is required to be given to both the time limits so that none of them become redundant. Hence, here is not the question whether proviso to 147 overrides 153(2) or vis-à-versa, but here the issue is giving harmonious interpretation to both the provisions so that sanctity of both remains, which can be possible only through reading the phrase ‘whichever earlier of the two’ even though unwritten. Hence, the question started with has been answered in positive only to the extent of its final conclusion or otherwise it may be a situation when 153(2) of the Act may override proviso to S. 147 of the Act.