Canton Traders Pvt. Ltd., Kolkata V. ACIT, CIRCLE- 30, New Delhi

CO 24/DEL/2018

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3780 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 30 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 28-05-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 29-01-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Reopening of assessment; Search and seizure; Document seized; Period of limitation; Question of law; Scheme of amalgamation; Time period of passing order; Documents seized
• Section: 143(3); 142(1); 153A; 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B, NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO.5673/DEL/2016 ASSESSMENT YEAR : 2006-07 ACIT, CENTRAL CIRCLE- 30, NEW DELHI. VS. CANTON TRADERS PVT. LTD., 16 B, SHAKESPEAR SARANI, KOLKATA. PAN : AABCC0457F (APPELLANT) (RESPONDENT) C.O. NO.24/DEL/2018 (IN ITA NO.5673/DEL/2016) ASSESSMENT YEAR : 2006-07 CANTON TRADERS PVT. LTD., (NOW KNOWN AS LUCKY HOLDINGS PVT. LTD.), 16 B, SHAKESPEAR SARANI, KOLKATA. VS. ACIT, CENTRAL CIRCLE- 30, NEW DELHI. PAN : AABCC0457F (APPELLANT) (RESPONDENT) DEPARTMENT BY : MS. RACHNA SINGH, CIT-DR, ASSESSEE BY : SHRI AJAY VOHRA, SR. ADV. MS. DEEPASHREE RAO, CA MR. VIBHU GUPTA, CA DATE OF HEARING : 08-05-2018 DATE OF PRONOUNCEMENT : 28-05-2018 O R D E R PER R. K. PANDA, AM : THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 31.08.2016 OF CIT(A)- 30, NEW DELHI RELATING TO ASS ESSMENT YEAR 2006-07. 2 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 THE ASSESSEE HAS FILED THE CROSS OBJECTION AGAINST THE APPEAL FILED BY THE REVENUE. FOR THE SAKE OF CONVENIENCE, THESE WERE H EARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT A SEARCH A ND SEIZURE OPERATION U/S 132 OF THE I.T. ACT, 1961 WAS CONDUCTED BY THE INVE STIGATION WING OF THE DEPARTMENT ON 14.11.2011 IN THE JINDAL GROUP OF CAS ES. DURING THE SEARCH, THE DOCUMENTS/BILLS BELONGING TO THE ASSESSEE, M/S CANTON TRADERS PVT. LTD., 1- RAJ BALLAV SAHA LANE, HOWRAH WERE ALSO FOUND AND SEIZED FROM THE RESIDENTIAL PREMISES OF SHRI S.S. JINDAL, MRS. SUBH ADRA JINDAL, MR. BHAVESH JINDAL & MS. AAKRITI JINDAL, 12A, GREEN AVENUE, VAS ANT KUNJ, NEW DELHI IN WHOSE NAME SEARCH WARRANT OF AUTHORIZATION WAS I SSUED. SUBSEQUENTLY, THE CASE OF THE ASSESSEE WAS CENTRALIZED WITH CENTR AL CIRCLE- 14, NEW DELHI VIDE ORDER F.NO. CIT-KOL-1/CENT./12-13/5922 DELHI D ATED 27.12.2012. ACCORDINGLY, THE FOLLOWING SATISFACTION NOTE WAS RE CORDED :- SATISFACTION NOTE FOR INITIATING PROCEEDINGS UNDER SECTION 153C READ WITH 153A OF THE INCOME TAX ACT, 1961 IN THE CASE OF M/S CANT ON TRADERS PVT. LTD. (PAN-AABCC0457F) THE CASE OF M/S CANTON TRADERS PVT. LTD. WAS CENTRA LIZED U/S 127 OF THE INCOME TAX ACT, 1961 WITH THE ASSESSING OFFICER, CE NTRAL CIRCLE- 14, NEW DELHI VIDE ORDER NO.CIT- III/CENT./09-10/2692 DELHI DATED 10-11-2009 PASSED BY CIT V, NEW DELHI. ACTION UNDER SECTION 132 OF THE INCOME TAX WAS TAKE N IN JINDAL GROUP OF CASES BY INVESTIGATION DIRECTORATE, NEW DELHI ON 14 .11.2011 AT ITS BUSINESS & RESIDENTIAL PREMISES. DURING THE COURSE OF SEARCH PROCEEDINGS FROM DIFFERENT RESIDENTIAL/BUSINESS PREMISES SEVERAL DOCUMENTS WER E FOUND AND SEIZED. WHILE EXAMINING THE SEIZED DOCUMENTS/BOOKS OF ACCOUNT ETC , I HAVE COME ACROSS THE FOLLOWING DOCUMENTS: PREMISE FROM WHERE DOCUMENTS FOUND AND SEIZED: OFFI CE/RESIDENCE OF SH. S.S. JINDAL, MR. BHAVESH JINDAL; ADDRESS 12A, GREEN AVEN UE, SECTOR- D, POCKET- 3, VASANT KUNJ, NEW DELHI PARTY NO.R4. 3 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 ANNEXURE NO. PAGE NO. DESCRIPTION A9 33-44 SCHEME OF AMALGAMATION OF SHEKHAVATI VANIJ YA VIKASH, RITU MARKETING, CANTON VINIMAY, CANTON TRADERS .. .. PREMISE FROM WHERE DOCUMENTS FOUND AND SEIZED: OFFI CE/ RESIDENCE OF SH. S.S. JINDAL, MR. BHAVESH JINDAL; ADDRESS 12A, GREEN AVEN UE, SECTOR- D, POCKET- 3, VASANT KUNJ, NEW DELHI PARTY NO.R1. A-7 21 BALLOT PAPER FOR EQUITY SHAREHOLDERS. I HAVE EXAMINED THE ABOVE DOCUMENTS AND THE CONTENT S NOTED/WRITTEN THEREIN. AFTER EXAMINATION OF THESE DOCUMENTS, I A M SATISFIED THAT THIS AFORESAID DOCUMENT BELONG TO M/S CANTON TRADERS PVT. LTD. IN VIEW OF THE SAME, I AM FURTHER SATISFIED THAT IT IS FIT CASE FOR INITIATIN G PROCEEDINGS U/S 153C RWS 153A OF THE INCOME TAX ACT, 1961. ACCORDINGLY, NOTICES U/S 153C RWS 153A ARE REQUIRED TO BE ISSUED AS PER PROVISIONS OF THE INCOME TAX ACT, 1961. 3. THE ASSESSING OFFICER ACCORDINGLY ISSUED NOTICE U/S 153C R.W.S. 153A ON 13.12.2013. THE ASSESSEE IN RESPONSE TO THE SAI D NOTICE, FILED ITS RETURN OF INCOME ON 20.12.2013 DECLARING TOTAL INCOME OF R S.41,377/-. THE ASSESSING OFFICER IN THE ASSESSMENT ORDER HAS MENTI ONED THAT THE ASSESSEE HAS NO OBJECTION FOR COMPLETING THE ASSESSMENT U/S 153C OF THE I.T. ACT WHICH IS IMPLIED. HE FURTHER MENTIONED IN THE ASSE SSMENT ORDER THAT THE ORIGINAL RETURN WAS FILED ON 31.10.2006 U/S 139(1) DECLARING TOTAL INCOME OF RS.41,377/-. IT MAY BE PERTINENT TO MENTION HERE T HAT THE ORIGINAL ASSESSMENT WAS COMPLETED U/S 143(3) VIDE ORDER DATE D 31.03.2008 WHEREIN THE ASSESSING OFFICER HAS DISALLOWED THE PRELIMINAR Y EXPENSES INCURRED FOR INCREASE IN SHARE CAPITAL. 4. THE ASSESSING OFFICER ISSUED STATUTORY NOTICE U/ S 143(2) AND 142(1) ALONG WITH A QUESTIONNAIRE DATED 03.01.2014 ASKING THE ASSESSEE TO JUSTIFY 4 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 THE SHARE CAPITAL OF RS.22.01 CRORES RAISED DURING THE YEAR WHICH INCLUDES SHARE APPLICATION MONEY OF RS.0.89 CRORE AND SHARE PREMIUM OF RS.21.12 CRORES. REJECTING THE VARIOUS EXPLANATION GIVEN BY THE ASSESSEE AND OBSERVING THAT THE ASSESSEE FAILED TO FULFILL THE C RITERIA LAID DOWN IN THE PROVISIONS OF SECTION 68 OF THE I.T. ACT AND FURTHE R OBSERVING THAT THE COMPANIES WHO HAVE INVESTED IN THE SHARES OF THE AS SESSEE COMPANY ARE ONLY PAPER COMPANIES WHICH ARE NOT DOING ANY BUSINE SS, THE ASSESSING OFFICER MADE ADDITION OF RS.22,01,00,000/- TO THE T OTAL INCOME OF THE ASSESSEE. 5. BEFORE THE LD. CIT(A), THE ASSESSEE APART FROM C HALLENGING THE ADDITION ON MERIT CHALLENGED THE VALIDITY OF ASSUMP TION OF JURISDICTION U/S 153C OF THE I.T. ACT. IT WAS ARGUED THAT INITIATIO N AND COMPLETION OF THE ASSESSMENT PROCEEDINGS U/S 153C AND 153A HAS BEEN D ONE BEYOND THE PRESCRIBED LIMITATION PERIOD OF SIX YEARS FROM THE DATE OF HANDING OVER OF MATERIAL OR RECORDING OF SATISFACTION U/S 153C AS P ER PROVISO OF SECTION 153C(1) OF THE I.T. ACT. IT WAS ARGUED THAT DOCUME NTS PERTAINING TO THE ASSESSEE WERE HANDED OVER ON 03.12.2013 AND, THEREF ORE, THE ASSESSING OFFICER CAN TAKE ACTION U/S 153C IN SIX PRECEDING F INANCIAL YEARS I.E. FOR ASSESSMENT YEARS 2008-09 TO 2013-14 ONLY. HOWEVER, THE ASSESSING OFFICER HAS WRONGLY ISSUED NOTICE U/S 153C FOR ASSESSMENT Y EARS 2006-07 AND 2007- 08 WITHOUT HAVING ANY JURISDICTION. RELYING ON VAR IOUS DECISIONS INCLUDING 5 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. M/S RRJ SECURITIES LTD. REPORTED IN 380 ITR 612, IT WAS ARGUED THAT THE DATE OF HANDING OVER OF MATERIAL BELONGING TO THE ASSESSEE HAS TO BE CONSTRUED AS REFERENCE DATE FOR INITIATION OF ACTION U/S 153C AS AGAINST THE DATE OF INITIATION OF SEARCH THAT HAS TO BE CONSTRUED AS RE FERENCE DATE FOR INITIATION OF ACTION U/S 153A OF THE I.T. ACT. 6. BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE AND FOLLOWING THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CAS E OF RRJ SECURITIES LTD. (SUPRA), LD. CIT(A) HELD THAT THE ASSESSMENT COMPLE TED U/S 153C/153A WAS VOID AB-INITIO SINCE THE NOTICE U/S 153C WAS ISSUED BEYOND THE LIMITATION PERIOD OF SIX YEARS FROM THE REFERENCE DATE. HE, H OWEVER, REJECTED THE CLAIM OF THE ASSESSEE THAT INITIATION OF PROCEEDINGS U/S 153C WAS NOT VALID SINCE NO BOOKS OF ACCOUNT BELONGING TO THE ASSESSEE AS ENVIS AGED IN THAT SECTION WERE FOUND AND SEIZED DURING THE COURSE OF SEARCH ON THE PERSON REFERRED IN SECTION 153A OF THE I.T. ACT. THE RELEVANT OBSERVA TION OF THE LD. CIT(A) READS AS UNDER :- 5.4 I HAVE CAREFULLY CONSIDERED ASSESSMENT ORDER, WRITTEN SUBMISSIONS, CASE LAWS RELIED UPON AND ORAL ARGUMENTS OF LD. AR. THE OBJECTIONS/ARGUMENTS OF THE APPELLANT ARE DISCUSSED AS UNDER:- (I) IN THIS CASE B.C. JINDAL GROUP OF CASES, SEARCH AND SEIZURE ACTION U/S 132 OF THE ACT, WAS INITIATED ON 14.11.2011. CASE OF TH E ASSESSEE WAS CENTRALIZED WITH ACIT, CENTRAL CIRC1E-22, NEW DELHI, VIDE JURISDICTI ON ORDER DATED 27.12.2012 FROM KOLKATA AND SUBSEQUENTLY, CENTRALIZED WITH ACI T, CENTRAL CIRC1E-14, NEW DELHI, VIDE ORDER OF CIT-III, NEW DELHI DATED 16.9. 2013. (II) SUBSEQUENTLY, IN THE CASE OF APPELLANT, SATISF ACTION NOTE FOR INITIATING ACTION U/S 153C, WAS RECORDED, AFTER RECEIVING THE DOCUMENTS ON 03.12.2013 PERTAINING TO THE ASSESSEE. SINCE, A.O. OF BOTH THE PERSONS, WAS SAME AND 6 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 THEREFORE, PHYSICAL HANDING OVER OF THE DOCUMENTS W AS ASSUMED BY THE A.O. ON 03.12.2013. ACCORDINGLY, A.O. ISSUED NOTICE U/S 153 C, ON 03.12.2013. (III) IN THE APPELLATE PROCEEDINGS, THE APPELLANT HAS SUBMITTED THAT THE DOCUMENTS PERTAINING TO APPELLANT, WERE HANDED OVER ON 03.12.2013 AND THEREFORE, A.O. CAN TAKE ACTION U/S 153C IN 6 PRECE DING F.YS. I.E. FOR A.Y. 2008- 09 TO A.Y. 2013-14 ONLY. HOWEVER, THE A.O. HAS WRON GLY ISSUED NOTICES U/S 153C FOR A.Y. 2006-07 AND A.Y. 2007-08, WITHOUT JURISDIC TION. FOR THE ABOVE SUBMISSION, THE APPELLANT HAS ALSO RE LIED UPON THE DECISION OF JURISDICTIONAL HIGH COURT OF DELHI IN THE CASE O F CIT -7 VS. M/S RRJ SECURITIES LTD., [2016] 380 ITR 612 (DELHI), WHERE IT HAS BEEN HELD THAT THE DATE OF HANDING OVER OF MATERIAL, WILL BE CONSTRUED AS THE REFERENC E DATE FOR INITIATION OF ACTION U/S 153C, AS AGAINST DATE OF INITIATION OF SEARCH C ONSTRUED THE REFERENCE DATE FOR INITIATION OF ACTION U/S 153A. THE RELEVANT PORTION OF DECISION HAS ALSO BEEN REPRODUCED IN THE WRITTEN SUBMISSIONS (SUPRA). FROM THE ABOVE, FOLLOWING FACTS EMERGED: THE DOCUMENTS WERE HANDED OVER TO THE A.O. ON 03.12 .2013 AND ACTION 153C WAS ALSO INITIATED ON 03.12.2013 ITSELF, AFTER RECORDING SATISFACTION, AS PER PROVISO TO SECTION 153C (1) OF THE ACT, THE REFERENCE DATE FOR TAKING ACTION U/S 153C, WILL BE AS 03.12.2013 IN THE CASE OF APPELLANT, INSTEAD OF DATE OF SEARCH ON 14.11.2011, WHICH IS REQUIRED FOR TAKING ACTION 153A, AND THE 6 PRECEDING A.Y.S , WILL BE FROM A.Y. 2008-09 T O A.Y. 2013-14 ONLY. FROM THE ABOVE, IT IS CLEAR THAT A.O. HAS WRONGLY I SSUED NOTICES U/S 153C FOR A.Y. 2006-07 AND A.Y. 2007-08, SINCE THE DOCUME NTS WERE HANDED OVER ON 03.12.2013. THEREFORE, THE NOTICE ISSUED BY THE A .O., IS BEYOND THE LIMITATION PERIOD OF 6 YEARS FROM THE REFERENCE DATE, PRESCRIB ED IN THE FIRST PROVISO TO SECTION 153C(1) AND 153A(1) OF ACT. IN VIEW OF THE ABOVE, I AM OF THE CONSIDERED OPINIO N THAT THE ASSESSMENT COMPLETED U/S 153C/ 153A OF THE ACT, IS VOID AB-INI TIO, AS THE A.O. HAS NO JURISDICTION MAKING THE ASSESSMENT FOR A.Y. 2006-07 , BEING BEYOND PERIOD OF 6 YEARS. AS SUCH, FACTS OF THE APPELLANT ARE SQUARELY COVERED BY THE RATIO LAID DOWN BY HON'BLE JURISDICTIONAL HIGH COURT OF DELHI, IN T HE CASE OF CIT-7 VS. M/S RRJ SECURITIES LTD., [2016] 380 ITR 612 (DELHI) (SUPRA) . IN VIEW OF THE ABOVE, I AGREE WITH THE ARGUMENTS OF THE APPELLANT AND THEREFORE, I HOLD THAT THE ASSESSMENT COMPLETED U/S 153C/153A, IS VOID AB INITIO, SINCE NOTICE U/S 153C WAS ISSUED BEYOND LIMITATION PERIOD OF 6 YEARS FROM THE REFERENCE DATE. 7. AGGRIEVED WITH SUCH ORDER OF THE LD. CIT(A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL BY RAISING THE FOLLOWING GROUND S :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE ASSES SMENT COMPLETED U/S 153C/153A OF THE I.T. ACT, 1961 IS VOID AB-INITIO, AS THE A.O. HAS NO JURISDICTION FOR MAKING THE ASSESSMENT FOR A.Y. 2006-07, BEING B EYOND PERIOD OF SIX YEARS 7 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 RELYING ON THE JUDGEMENT OF HON'BLE HIGH COURT OF D ELHI, IN THE CASE OF CIT-7 VS. M/S RRJ SECURITIES LTD. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE REFER ENCE DATE FOR TAKING ACTION U/S 153C IS 03.12.2013, DATE OF INITIATING ACTION U/S 1 53C, INSTEAD OF DATE OF SEARCH ON 14.11.2011. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) HAS ERRED IN LAW IN HOLDING THAT THE FIRST PROVISO TO S ECTION 153C OF THE INCOME TAX ACT, 1961 ENVISAGES THE SIX ASSESSMENT YEARS FOR TH E PURPOSE OF ASSESSMENT U/S 153C BE DETERMINED FROM THE DATE ON WHICH SEIZED DO CUMENTS ARE CONSIDERED TO BE HANDED OVER IGNORING THE FACT THAT FIRST PROVISO TO SECTION 153C IS TO BE READ ONLY IN THE CONTEXT OF SECOND PROVISO TO SUB-SECTIO N 1 OF SECTION 153A, WHICH DEALS WITH ABATEMENT OF PENDING ASSESSMENT/ REASSES SMENT PROCEEDINGS ON THE DATE OF INITIATION OF SEARCH? 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) HAS ERRED IN LAW IN HOLDING THAT THE SIX ASSESSMENT YEA RS FOR THE PURPOSE OF ASSESSMENT U/S 153C OF THE INCOME TAX ACT, 1961 BE DETERMINED FROM THE DATE ON WHICH SEIZED DOCUMENTS ARE CONSIDERED TO BE HANDED OVER TO THE JURISDICTIONAL AO IGNORING THE FACT THAT AS PER SECTION 153C(1) OF THE INCOME TAX ACT 1961, THE AO HAS TO ASSESS OR REASSESS INCOME OF SUCH OTHER P ERSON IN ACCORDANCE WITH PROVISION OF THE SECTION 153A OF THE INCOME TAX ACT , 1961, ITSELF, THAT THE SECTION 153A(1) HAS UNAMBIGUOUSLY DEFINED THAT THE AO SHALL ASSESS OR REASSESS THE TOTAL INCOME OF SIX ASSESSMENT YEARS IMMEDIATELY PRECEDIN G THE ASSESSMENT YEAR RELEVANT TO THE YEAR IN WHICH SUCH SEARCH IS CONDUC TED OR REQUISITION IS MADE? 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE SIX P RECEDING A.YS. WILL BE FROM A.Y. 2008-09 TO A.Y. 2013-14 ONLY INSTEAD OF A.Y. 2006-0 7 TO A.Y. 2011-12. 6. THAT THE ORDER OF THE CIT(A) IS PERVERSE, ERRONE OUS AND IS NOT TENABLE ON FACTS AND IN LAW. 7. THAT THE GROUNDS OF APPEAL ARE WITHOUT PREJUDICE TO EACH OTHER. 8. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND, A LTER OR FORGO ANY GROUND(S) OF APPEAL EITHER BEFORE OR AT THE TIME O F HEARING OF THE APPEAL. 8. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS AN ADMITTED FACT THAT THE SEARCH IN THE CASE OF JINDAL GROUP OF CASES TOOK PL ACE ON 14.11.2011 DURING WHICH CERTAIN DOCUMENTS/BILLS BELONGING TO THE ASSE SSEE WERE FOUND AND SEIZED FROM THE PREMISES OF THE SEARCHED PARTIES. IT IS ALSO AN ADMITTED FACT THAT THE SATISFACTION NOTE WAS PREPARED ON 03.12.20 13 AND THE DOCUMENTS 8 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 WERE HANDED OVER ON 03.12.2013. THE NOTICE U/S 153 C WAS ALSO ISSUED TO THE ASSESSEE ON 03.12.2013. 9. IT IS THE SUBMISSION OF LD. COUNSEL FOR THE ASSE SSEE THAT AS PER THE PROVISO TO SECTION 153C(1) OF THE I.T. ACT, THE REF ERENCE DATE FOR TAKING ACTION U/S 153C WILL BE 03.12.2013 IN THE CASE OF T HE ASSESSEE AND THEREFORE, THE IMPUGNED ASSESSMENT YEAR FALLS OUTSIDE THE PURV IEW OF THE PERIOD OF SIX YEARS. 10. WE FIND THE PROVISIONS OF SECTION 153C READ AS UNDER :- ASSESSMENT OF INCOME OF ANY OTHER PERSON. 153C. (1) NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139, SECTION 147, SECTION 148, SECTION 149, SECTION 151 AND SECT ION 153, WHERE THE ASSESSING OFFICER IS SATISFIED THAT, (A) ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABL E ARTICLE OR THING, SEIZED OR REQUISITIONED, BELONGS TO; OR (B) ANY BOOKS OF ACCOUNT OR DOCUMENTS, SEIZED OR R EQUISITIONED, PERTAINS OR PERTAIN TO, OR ANY INFORMATION CONTAINED THEREIN, R ELATES TO, A PERSON OTHER THAN THE PERSON REFERRED TO IN SECTI ON 153A, THEN, THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS, SEIZED OR REQUISITI ONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AND THAT ASSESSING OFFICER SHALL PROCEED AGAINST EACH SUCH O THER PERSON AND ISSUE NOTICE AND ASSESS OR REASSESS THE INCOME OF THE OTHER PERS ON IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A, IF, THAT ASSESSING OFFI CER IS SATISFIED THAT THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIO NED HAVE A BEARING ON THE DETERMINATION OF THE TOTAL INCOME OF SUCH OTHER PER SON 17 [FOR SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SEARCH IS CONDUCTED OR REQUISITION IS MADE AND] FOR THE RELEVANT ASSESSMENT YEAR OR YEARS REFERRED TO IN SUB-SECTION (1) OF SECTION 153A : PROVIDED THAT IN CASE OF SUCH OTHER PERSON, THE REF ERENCE TO THE DATE OF INITIATION OF THE SEARCH UNDER SECTION 132 OR MAKIN G OF REQUISITION UNDER SECTION 132A IN THE SECOND PROVISO TO SUB-SEC TION (1) OF SECTION 153A SHALL BE CONSTRUED AS REFERENCE TO THE DATE OF RECEIVING THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIO NED BY THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON : PROVIDED FURTHER THAT THE CENTRAL GOVERNMENT MAY BY RULES 18 MADE BY IT AND PUBLISHED IN THE OFFICIAL GAZETTE, SPECIFY THE CLAS S OR CLASSES OF CASES IN RESPECT OF SUCH OTHER PERSON, IN WHICH THE ASSESSING OFFICE R SHALL NOT BE REQUIRED TO ISSUE NOTICE FOR ASSESSING OR REASSESSING THE TOTAL INCOM E FOR SIX ASSESSMENT YEARS 9 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SEARCH IS CONDUCTED OR REQUISITION IS MADE 19 [AND FOR THE RELEVANT ASSESSMENT YEAR OR YEARS AS REFERRED TO IN SUB-SECTION (1) OF SECTION 153A] EXCEPT IN CASES WHERE ANY ASSESSMENT OR REASSESSMENT HAS ABATED. (2) XXXXX 11. WE FIND THE HONBLE DELHI HIGH COURT IN THE CAS E OF RRJ SECURITIES LTD. (SUPRA) HAS HELD THAT THE PROVISO TO SECTION 1 53C(1) EXPRESSLY INDICATE THAT REFERENCE TO THE DATE OF INITIATION OF SEARCH FOR THE PURPOSE OF SECOND PROVISO TO SECTION 153A, SHALL BE CONSTRUED AS A RE FERENCE TO THE DATE ON WHICH VALUABLE ASSETS OR DOCUMENTS ARE RECEIVED BY THE ASSESSING OFFICER OF AN ASSESSEE (OTHER THAN THE SEARCH PERSON). WE FIN D THE HONBLE DELHI HIGH COURT IN THE CASE OF PR.CIT VS. SARWAR AGENCY (P.) LTD. REPORTED IN 397 ITR 400 AFTER CONSIDERING THE DECISION OF THE HONBLE D ELHI HIGH COURT IN THE CASE OF RRJ SECURITIES LTD. (SUPRA) HAS OBSERVED AS UNDER :- 6. THE CASE OF THE REVENUE IS THAT THE FIRST PROVI SO TO SECTION 153 C REFERS ONLY TO THE SECOND PROVISO TO SECTION 153 A(1) OF T HE ACT, WHICH ONLY INDICATES THAT ANY ASSESSMENT RELATING TO ANY AY FALLING WITH IN THE PERIOD OF SIX AYS WHICH IS PENDING AS OF THE INITIATION OF SEARCH SHALL ABA TE. THEREFORE, THE SECOND PROVISO TO SECTION 153 C IS ALSO CONCERNED ONLY WITH THE AS PECT OF ABATEMENT OF PENDING ASSESSMENTS. ACCORDING TO THE REVENUE, THIS MAKES N O DIFFERENCE TO THE COMPUTATION OF THE BLOCK OF SIX YEARS PRECEDING THE AY RELEVANT TO THE PREVIOUS YEAR /IN WHICH THE SEARCH WAS CONDUCTED. IN OTHER W ORDS, ACCORDING TO THE REVENUE, THE BLOCK PERIOD FOR BOTH THE SEARCHED PER SON AND THE 'OTHER PERSON' WOULD REMAIN THE SAME NOTWITHSTANDING THAT THERE MA Y BE SOME DELAY IN TRANSMITTING THE DOCUMENTS RECOVERED DURING THE SEA RCH WHICH BELONG OR PERTAIN TO THE 'OTHER PERSON' TO THE AO OF SUCH OTHER PERSO N. 7. THE CASE OF THE ASSESSEE, ON THE OTHER HAND, IS THAT SINCE IN THE CASE OF THE 'OTHER PERSON' THE AO ISSUES NOTICE ONLY SUBSEQUENT TO THE NOTICES ISSUED UNDER SECTION 153 A TO THE SEARCHED PERSON, THE STARTING POINT FOR COMPUTATION OF THE BLOCK PERIOD WOULD BE THE DATE ON WHICH, BASED ON T HE SEIZED DOCUMENTS, NOTICE IS ISSUED TO THE 'OTHER PERSON' UNDER SECTION 153 C OF THE ACT. THUS IN THE PRESENT CASE, THE SIX YEAR PERIOD PRIOR TO AY 2012-13 I.E. AY 2007-08 TO AY 2012-13. 10 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 THUS NO NOTICE COULD BE ISSUED UNDER SECTION 153 C OF THE ACT TO REOPEN THE ASSESSEE'S ASSESSMENT FOR AY 2006-07. RELIANCE IS P LACED ON THE DECISION OF THIS COURT IN COMMISSIONER OF INCOME-TAX-7 V. RRJ SECURI TIES LTD. [2016] 380 ITR 612 (DEL) WHERE THIS VERY QUESTION WAS EXAMINED AND ANSWERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. 8. IN RRJ SECURITIES (SUPRA), THE COURT AFTER NOTIC ING THE DECISION IN SSP AVIATION LTD. V. DEPUTY CIT[2012] 346 ITR 177 (DEL) , HELD AS FOLLOWS: '21. AS DISCUSSED HEREINBEFORE, ONCE THE AO OF THE SEARCHED PERSON IS SATISFIED THAT THE SEIZED ASSETS/DOCUMENTS BELONG T O ANOTHER PERSON AND THE SAID ASSETS/DOCUMENTS HAVE BEEN TRANSFERRED TO THE AO OF SUCH OTHER PERSON, THE PROCEEDINGS FOR ASSESSMENT/REASSESSMENT OF INCOME OF THE OTHER PERSON HAS TO PROCEED IN ACCORDANCE WITH PROV ISIONS OF SECTION 153A OF THE ACT. SECTION 153A REQUIRES THAT WHERE A SEARCH HAS BEEN INITIATED UNDER SECTION 132 OF THE ACT, THE AO IS R EQUIRED TO ISSUE NOTICE REQUIRING THE NOTICEE TO FURNISH RETURNS OF INCOME IN RESPECT OF SIX ASSESSMENT YEARS RELEVANT TO THE SIX PREVIOUS YEARS PRECEDING THE PREVIOUS YEAR IN WHICH THE SEARCH IS CONDUCTED. AS DISCUSSED HEREINBEFORE, BY VIRTUE OF SECOND PROVISO TO SECTION 153A, THE ASSES SMENT/REASSESSMENT PENDING ON THE DATE OF INITIATION OF SEARCH ABATE. IN THE CONTEXT OF PROCEEDINGS UNDER SECTION 153C OF THE ACT, THE REFE RENCE TO THE DATE OF INITIATION OF THE SEARCH IN THE SECOND PROVISO TO S ECTION 153A HAS TO BE CONSTRUED AS THE DATE ON WHICH THE AO RECEIVES THE DOCUMENTS OR ASSETS FROM THE AO OF THE SEARCHED PERSON. THUS, BY VIRTUE OF SECOND PROVISO TO SECTION 153A OF THE ACT AS IT APPLIES TO PROCEEDING S UNDER SECTION 153C OF THE ACT, THE ASSESSMENT/REASSESSMENT PENDING ON THE DATE ON WHICH THE ASSETS/DOCUMENTS ARE RECEIVED BY THE AO WOULD ABATE . IN RESPECT OF SUCH ASSESSMENTS WHICH HAVE ABATED, THE AO WOULD HAVE TH E JURISDICTION TO PROCEED AND MAKE AN ASSESSMENT. HOWEVER, IN RESPECT OF CONCLUDED ASSESSMENTS, THE AO WOULD ASSUME JURISDICTION TO RE ASSESS PROVIDED THAT THE ASSETS/DOCUMENTS RECEIVED BY THE AO REPRESENT O R INDICATE ANY UNDISCLOSED INCOME OR POSSIBILITY OF ANY INCOME THA T MAY HAVE REMAINED UNDISCLOSED IN THE RELEVANT ASSESSMENT YEARS..... 24. AS DISCUSSED HEREINBEFORE, IN TERMS OF PROVISO TO SECTION 153C OF THE ACT, A REFERENCE TO THE DATE OF THE SEARCH UNDE R THE SECOND PROVISO TO SECTION 153A OF THE ACT HAS TO BE CONSTRUED AS THE DATE OF HANDING OVER OF ASSETS/DOCUMENTS BELONGING TO THE ASSESSEE (BEING T HE PERSON OTHER THAN THE ONE SEARCHED) TO THE AO HAVING JURISDICTION TO ASSESS THE SAID ASSESSEE. FURTHER PROCEEDINGS, BY VIRTUE OF SECTION 153C(1) OF THE ACT, WOULD HAVE TO BE IN ACCORDANCE WITH SECTION 153A OF THE ACT AND THE REFERENCE TO THE DATE OF SEARCH WOULD HAVE TO BE CO NSTRUED AS THE REFERENCE TO THE DATE OF RECORDING OF SATISFACTION. IT WOULD FOLLOW THAT THE SIX ASSESSMENT YEARS FOR WHICH ASSESSMENTS/REASSESS MENTS COULD BE MADE UNDER SECTION 153C OF THE ACT WOULD ALSO HAVE TO BE CONSTRUED WITH REFERENCE TO THE DATE OF HANDING OVER OF ASSETS/DOC UMENTS TO THE AO OF THE ASSESSEE.' 11 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 9. THE SAID DECISION IN RRJ SECURITIES (SUPRA) HAS BEEN FOLLOWED BY THIS COURT SUBSEQUENTLY IN ARN INFRASTRUCTURE INDIA LTD. V. ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCULE-28, NEW DELHI[2017] 394 ITR 569 (DEL.). 10. MR. SALIL AGGARWAL, LEARNED COUNSEL FOR THE ASS ESSEE, HAS DRAWN THE ATTENTION OF THE COURT TO THE RECENT AMENDMENT MADE IN SECTION 153 C OF THE ACT BY THE FINANCE ACT, 2017 WITH EFFECT FROM 1ST APRIL 2017. THIS AMENDMENT IN EFFECT STATES THAT THE BLOCK PERIOD FOR THE SEARCHE D PERSON AS WELL AS THE 'OTHER PERSON' WOULD BE THE SAME SIX AYS IMMEDIATELY PRECE DING THE YEAR OF SEARCH. THIS AMENDMENT IS PROSPECTIVE. 11. MR. ASHOK MANCHANDA, LEARNED SENIOR STANDING CO UNSEL FOR THE APPELLANT, SOUGHT TO PURSUE THIS COURT TO RECONSIDE R ITS VIEW IN RRJ SECURITIES (SUPRA). THE COURT DECLINES TO DO SO FOR MORE THAN ONE REASON. FIRST, FOR REASONS BEST KNOWN TO IT, THE REVENUE HAS NOT CHALLENGED TH E DECISION OF THIS COURT IN RRJ SECURITIES (SUPRA) IN THE SUPREME COURT. THE SAID D ECISION HAS BEEN CONSISTENTLY FOLLOWED BY THE AUTHORITIES UNDER THIS COURT AS WEL L AS BY THIS COURT. THIRDLY, THE RECENT AMENDMENT TO SECTION 153 C(1) OF THE ACT STA TES FOR THE FIRST TIME THAT FOR BOTH THE SEARCHED PERSON AND THE OTHER PERSON THE P ERIOD OF REASSESSMENT WOULD BE SIX AYS PRECEDING THE YEAR OF SEARCH. THE SAID A MENDMENT IS PROSPECTIVE. 12. CONSEQUENTLY, NO SUBSTANTIAL QUESTION OF LAW AR ISES FROM THE IMPUGNED ORDER OF THE ITAT. THE APPEAL IS, ACCORDINGLY, DISM ISSED. 12. WE FIND THE HONBLE DELHI HIGH COURT IN THE CAS E OF PR.CIT VS. R.L. ALLIED VIDE ITA NO.370/2015 AND BATCH OF OTHER APPE ALS ORDER DATED 28.01.2016 FOLLOWING THE DECISION IN THE CASE OF RR J SECURITIES LTD. (SUPRA) HAS OBSERVED AS UNDER :- 7. THIS COURT REITERATES THE VIEW ALREADY EXPRESSE D BY IT IN RRJ SECURITIES (SUPRA) WHEN IT COMES TO REOPENING OF ASSESSMENTS O F A PERSON OTHER THAN THE SEARCHED PERSON, IN TERMS OF THE FIRST PROVISO TO S ECTION 153C(1). IN SUCH EVENT THE DATE OF SEARCH WOULD GET POSTPONED TO THE DATE OF RECEIPT OF THE BOOKS OF ACCOUNTS OR DOCUMENTS SEIZED BY THE AO HAVING JURIS DICTION OVER SUCH OTHER PERSON AND THE SIX EARLIER AYS WOULD HAVE TO BE RE CKONED WITH REFERENCE TO SUCH POSTPONED DATE OF SEARCH. THE FIRST PROVISO TO SECT ION 153 B (1) DOES NOT SUPPORT THE CASE SOUGHT TO BE CANVASSED BY THE REVENUE. IT REFERS TO AND ACKNOWLEDGES THAT THE DATE OF SEARCH QUA THE 'OTHER PERSON', IN TERMS OF THE FIRST PROVISO TO SECTION 153 C (1), GETS POSTPONED TO THE DATE ON WH ICH DOCUMENTS ARE HANDED OVER TO THE AO OF THE 'OTHER PERSON'. CONSEQUENTLY, THE QUESTION OF REFERRING THE CASE TO A LARGER BENCH DOES NOT ARISE. 12 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 8. IN THE PRESENT CASE, THERE IS NO DOUBT THAT IT W AS ONLY ON 24TH MARCH 2009 THAT THE AO OF THE ASSESSEE RECEIVED THE DOCUMENTS SEIZED AND IT WAS ON THAT DATE A NOTICE UNDER SECTION 153C (1) WAS ISSUED AND SERV ED UPON THE ASSESSEE. CONSEQUENTLY, THIS COURT FINDS NO LEGAL ERROR IN TH E CONCLUSION OF THE ITAT THAT NOTICE UNDER SECTION 153C (1) COULD NOT HAVE BEEN I SSUED FOR AYS 2001-02 AND 2002-03. 9. NO SUBSTANTIAL QUESTION OF LAW ARISES FOR CONSID ERATION. THE APPEALS ARE DISMISSED. 13. SINCE IN THE INSTANT CASE ALSO THE DOCUMENTS WE RE HANDED OVER TO THE ASSESSING OFFICER ON 03.12.2013 AND ACTION U/S 153C WAS ALSO INITIATED ON 03.12.2013 A FINDING GIVEN BY THE LD. CIT(A) AND NO T CONTROVERTED BY THE LD. DR, THEREFORE, THE SIX PRECEDING ASSESSMENT YEARS W ILL BE FROM A.Y. 2008- 09 TO 2013-14. SINCE IN THE INSTANT CASE, THE ASSE SSING OFFICER HAS ISSUED NOTICE U/S 153C TO THE ASSESSEE FOR ASSESSMENT YEAR 2006-07, THEREFORE, THE SAME BEING BEYOND THE PERIOD OF SIX PRECEDING ASSES SMENT YEARS FROM THE REFERENCE DATE IS VOID AB-INITIO. THEREFORE, THE A SSESSMENT COMPLETED U/S 153C/153A FOR THE IMPUGNED ASSESSMENT YEAR IS VOID AB-INITIO SINCE THE ASSESSING OFFICER HAS NO JURISDICTION FOR MAKING TH E ASSESSMENT FOR ASSESSMENT YEAR 2006-07 BEING BEYOND THE PERIOD OF SIX YEARS. SINCE THE ORDER OF THE LD. CIT(A) IS IN ACCORDANCE WITH LAW L AID DOWN BY THE HONBLE JURISDICTIONAL HIGH COURT, THEREFORE, IN ABSENCE OF ANY CONTRARY MATERIAL BROUGHT TO OUR NOTICE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) HOLDING THE ASSESSMENT AS VOID AB-INITIO. A CCORDINGLY, THE ORDER OF LD. CIT(A) IS UPHELD AND THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 13 ITA NO.5673/DEL/2016 C.O. NO.24/DEL/2018 C.O. NO.39/DEL/2017 (ASSESSEE) : 14. THE ASSESSEE IN THE CROSS OBJECTION HAS RAISED THE FOLLOWING CROSS-GROUND :- 1. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN NO T APPRECIATING THAT THE INITIATION OF PROCEEDINGS UNDER SECTION 153C WAS NO T VALID INASMUCH AS NO BOOKS OF ACCOUNTS OR DOCUMENTS BELONGING TO THE APPELLA NT AS ENVISAGED UNDER THAT SECTION WERE FOUND AND SEIZED DURING THE COURSE OF SEARCH ON THE PERSON REFERRED TO IN SECTION 153A OF THE ACT. 15. SINCE THE APPEAL FILED BY THE REVENUE HAS BEEN DISMISSED, THE CROSS OBJECTION FILED BY THE ASSESSEE BECOMES INFRUCTOUS. WE, THEREFORE, DISMISS THE GROUND RAISED BY THE ASSESSEE IN THE CROSS OBJE CTION BEING ACADEMIC IN NATURE. 16. IN THE RESULT, THE APPEAL FILED BY THE REVENUE AS WELL AS CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF MAY, 2018. SD/- SD/- (SUDHANSHU SRIVASTAVA) (R . K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 28-05-2018. SUJEET COPY OF ORDER TO: - 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT 4) THE CIT(A) 5) THE DR, I.T.A.T., NEW DELHI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, NEW DELHI