M/s The Himalaya Drug Company, Bangalore V. DCIT, Bangalore

ITA 1639/BANG/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6093 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-06-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 21-05-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 18-12-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAKESH BHASKAR DIT
• Assessee Lawyers: CHYTHANYA K K
• Keywords: Revision of order; Depreciation; Transfer pricing; Search and seizure; Document seized; Principle of natural justice; International transaction; Period of limitation; Retrospective amendment; Question of law; Competent authority; Block assessment; Revised return; Reason to believe; Documents seized
• Section: 92C; 143(3); 142(1); 92E; 153A; 139(5); 131; 148; 132; 144; 154; 139; 92

Judgement Text

ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 1 OF 78 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE CBENCH, BANGALORE BEFORE SHRI GEORGE GEORGE K. JUDICIAL MEMBER AND SHRI JASON P. BOAZ, ACCOUNTANT MEMBER ITA NOS. 1634 TO 1639/BANG/2012 (ASSESSMENT YEARS: 2003-04 TO 2008-09) THE HIMALAYA DRUG COMPANY, MAKALI BANGALORE 562 123 PAN: AADFT 3025 B VS. DCIT, CENTRAL CIRCLE 1(1) BANGALORE (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI CHYTHANYA K.K. ADVOCATE DEPARTMENT BY: SHRI RAKESH BHASKAR, DIT -(DR) DATE OF HEARING: 21/05/2014 DATE OF PRONOUNCEMENT: 13/06/2014 O R D E R PER BENCH: 1. THESE APPEALS OF THE ASSESSEE FIRM ARE DIRECTED AGAINST THE ORDER OF THE ASSESSING OFFICER PASSED U /S 153C R. W. S. 143(3) (SIC) 144C OF THE ACT DATED: 29.10.2012. THE RELEVANT ASSESSMENT YEARS ARE 2003-04 TO 2008-09. 2. THE ASSESSEE FIRM HAS, IN ITS CONCISE GROUNDS, RAISED A NUMBER OF GROUNDS IN AN ELABORATE AND NARRATIVE M ANNER BOTH ON JURISDICTIONAL ASPECTS AND ON MERITS. IN T HE COURSE OF HEARING OF APPEALS, BOTH THE PARTIES HAVE CONFINED THEIR ARGUMENTS PERTAINING TO CERTAIN JURISDICTIONAL ISSU ES FIRST AND THEN ON MERITS. THE CONCISE GROUNDS ON JURISDICTIO NAL ASPECTS ARGUED SERIALLY ARE LISTED BELOW: ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 2 OF 78 (1) [GR.III(1)] THAT THE DRP WAS NOT JUSTIFIED IN I SSUING ITS DIRECTIONS BEYOND THE TIME LIMIT SPECIFIED U/S 144C (12) OF THE ACT; (2) [GR.II(1)] THAT THE VALIDITY OF SEARCH PROCEEDI NGS AND ORDER U/S 153C OF THE ACT; (3) [GR.XVI] THAT THE VALIDITY OF REFERENCE TO TPO WHEN THE ASSESSMENT WAS NO MORE PENDING AS ON THE DATE O F SEARCH/REQUISITION AND NO INCRIMINATING MATERIAL WA S FOUND DURING THE SEARCH; (4) [GR.V (2)] THAT THE DRP HAD EXCEEDED ITS JURISD ICTION BY ISSUING DIRECTIONS IN RESPECT OF AMP EXPENDITURE; (5) [GR.V(1)] THAT THE JURISDICTION OF THE DRP IN C ONSIDERING NEW GROUNDS (6) [GR.III(2)&(3)]THE ORDER U/S 153C OF THE ACT WA S BARRED BY TIME AS PER S. 153B OF THE ACT. ON THE OTHER JURISDICTIONAL GROUNDS, THE LEARNED AR RELIED ON THE WRITTEN SUBMISSIONS FILED BY THE ASSESSEE. THE ISS UE ON MERITS WAS ARGUED BY BOTH THE LEARNED AR AND THE LEARNED D R ON 30.4.2014, 1.5.2014, 2.5.2014, 5.5.2014, 6.5.2014, 7.05.2014, 8.5.2014 AND 21.5.2014. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE AS UNDER: THE ASSESSEE FIRM IS ENGAGED IN THE B USINESS OF MANUFACTURE AND SALE OF HERBAL PHARMACEUTICAL PRODU CTS, PERSONAL CARE PRODUCTS, ANIMAL HEALTH CARE PRODUCTS ETC. FOR THE AY 2003-04, THE ASSESSEE FILED ITS RETURN OF INCOME ON 28.11.2003, DECLARING A TOTAL INCOME OF RS.11.89 CR ORES WHICH WAS PROCESSED INITIALLY U/S 143(1) OF THE ACT. SUB SEQUENTLY, DURING THE COURSE OF ASSESSMENT PROCEEDINGS U/S 143 (3) OF THE ACT, ACCORDING TO THE ASSESSEE, THE AO HAD NOT MADE ANY REFERENCE TO THE TRANSFER PRICING OFFICER [TPO] FOR COMPUTATION OF ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 3 OF 78 ARMS LENGTH PRICE [ALP] IN RELATION TO ITS INTERNA TIONAL TRANSACTIONS. THE AO HAD CONCLUDED THE ASSESSMENT U/S 143(3) OF THE ACT BY DISALLOWING CERTAIN EXPENSES AND ALSO MAKING A FEW ADDITIONS. WHEN THE ISSUE WENT BEFORE THE CIT (A), THE ASSESSEE GOT CERTAIN RELIEF. ON FURTHER APPEALS BY EITHER O F THE PARTY, THE EARLIER BENCH OF THIS TRIBUNAL HAD ALLOWED FURTHER RELIEF TO THE ASSESSEE. IN THE MEANWHILE, THE BANGALORE CITY POLI CE HAD SEIZED CASH OF RS.9.85 CRORES ON 5.8.2008 FROM THE RESIDEN CE OF SRI HISHAM SYED TAMIZ AND, THUS, THE ASSESSEE FIRM WAS SUBJECTED TO PROCEEDINGS UNDER S. 132A OF THE ACT. SUBSEQUEN TLY, A NOTICE U/S 153C OF THE ACT WAS SERVED ON THE ASSESSEE ON 1 1.5.2009, REQUIRING IT TO FURNISH ITS RETURNS OF INCOME FOR T HE AYS 2003.04 TO 2008-09. IN COMPLIANCE, THE ASSESSEE HAD FURNIS HED ITS RETURNS OF INCOME ON 1.6.2009. DURING THE COURSE O F PROCEEDINGS U/S 153C OF THE ACT, THE AO REFERRED TO THE COMPUTA TION OF ALP IN RELATION TO THE INTERNATIONAL TRANSACTIONS TO TH E TPO. CONSEQUENT TO THE ADJUSTMENT IN THE ALP, THE AO PAS SED DRAFT ASSESSMENT ORDERS WHICH WERE SERVED ON THE ASSESSEE ON 22.11.2011, INCORPORATING THE ADJUSTMENT TO THE ALP AS PROPOSED BY THE TPO. 4. AGGRIEVED BY THE DRAFT ASSESSMENT ORDER, THE ASSESSEE FILED ITS OBJECTIONS BEFORE THE DISPUTE RESOLUTION PANEL [DRP] ON 21.12.2011. AFTER HEARING THE ASSESSEE, THE DRP IS SUED DIRECTIONS U/S 144C (5) R. W. S. 144C (8) OF THE AC T VIDE ITS ORDER DATED 16.08.2012, DISMISSING THE ASSESSEES OBJECTI ONS. THE DRP DIRECTED THE AO TO MAKE ADDITIONAL TP ADJUSTMENT ON AMP EXPENSES. ACCORDINGLY, THE AO PASSED A FINAL ASSES SMENT ORDER U/S 153C R. W. S. 143(3) (SIC) 144C OF THE ACT DATED 29.10.2012. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 4 OF 78 5. AGGRIEVED, THE ASSESSEE HAS COME UP BEF ORE US WITH THE PRESENT APPEALS. AS POINTED OUT EARLIER IN PARAGRA PH-2 OF THIS ORDER, THE ASSESSEE HAS RAISED A NUMBER OF ISSUES. WE SHALL FIRST TAKE UP EACH OF JURISDICTIONAL GROUND ARGUED BY BOT H SIDE FOR CONSIDERATION. THE JURISDICTIONAL GROUNDS ARGUED B Y BOTH THE PARTIES ARE AS FOLLOWS: GROUND NO.III (1) : WHETHER THE DRP WAS JUSTIFIED IN ISSUING ITS DIRECT IONS BEYOND THE TIME LIMIT SPECIFIED U/S 144C (12) OF TH E ACT AND WHETHER THE FINAL ASSESSMENT ORDER PASSED BY TH E AO U/S 153C OF THE ACT BASED ON THE TIME BARRED DIRECT IONS OF THE DRP WAS TENABLE IN LAW ? 6. DURING THE COURSE OF HEARING BEFORE US, THE ELABORATE SUBMISSIONS MADE BY THE LEARNED AR ON THE ISSUE ARE SUMMARIZED AS UNDER: > THAT THE DRP DIRECTIONS HAVE BEEN ISSUED BEYOND THE TIME LIMIT SET OUT IN S 144C(12) THEREBY RENDERING THE S AID DIRECTIONS INVALID; SUB-SECTION (12) OF S. 144C STATES: NO DIRECTION UNDER SUB-SECTION (5) SHALL BE ISSUED AFTER NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWARDED TO THE ELIGIBLE ASSESSEE. SUB-SECTION (5) OF S. 144C STATES: THE DISPUTE RESOLUTION PANEL SHALL, IN A CASE WHER E ANY OBJECTION IS RECEIVED UNDER SUB-SECTION (2), IS SUE SUCH DIRECTIONS, AS IT THINKS FIT, FOR THE GUIDANCE OF THE ASSESSING OFFICER TO ENABLE HIM TO COMPLETE THE ASSESSMENT SUB-SECTION (2) OF S. 144C STATES: (2) ON RECEIPT OF THE DRAFT ORDER, THE ELIGIBLE AS SESSEE SHALL, WITHIN THIRTY DAYS OF THE RECEIPT BY HIM OF THE DRAFT ORDER,- ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 5 OF 78 (A) FILE HIS ACCEPTANCE OF THE VARIATIONS TO THE ASSESS ING OFFICER; OR (B) FILE HIS OBJECTIONS, IF ANY, TO SUCH VARIATION WITH ,- (I) THE DISPUTE RESOLUTION PANEL; AND (II) THE ASSESSING OFFICER. > THAT A COMBINED READING OF SUB-SECTIONS (2), (5) AN D (12) SHOWS THAT IN CASE ANY OBJECTIONS ARE FILED BY THE ASSESSEE WITH THE DRP, IN RESPECT OF VARIATIONS PROPOSED IN THE DRAFT ORDER, THE DRP SHALL ISSUE SUCH DIRECTIONS, AS IT T HINKS FIT, FOR THE GUIDANCE OF THE AO AND SUCH DIRECTIONS SHOU LD BE ISSUED WITHIN 9 MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER HAS BEEN FORWARDED BY THE AO TO THE ELIGIBLE ASSESSEE; > THAT IN THE PRESENT CASE, THE AO HAD FORWARDED T HE DRAFT ASSESSMENT ORDER TO THE ASSESSEE ON 22.11.2011 WHIC H HAS BEEN ACKNOWLEDGED BY THE DRP IN ITS DIRECTIONS. CONSEQUENTLY, THE TIME LIMIT FOR ISSUANCE OF DIRECT IONS U/S 144C(5) R.W.S 144C(12) WAS EXPIRED ON 31.8.2012; > THAT THE AO IN THE ASST. ORDER DATED 29.10.2012 [AT PARA 12 ON PAGE 5] STATED THAT: 12. THE HONBLE DISPUTE RESOLUTION PANEL GAVE DIRECTIONS AS PER THE PROVISIONS OF U/S 144 C (8) O F THE INCOME-TAX ACT, 1961 VIDE ITS ORDER DATED 16.8.2012 WHICH WAS RECEIVED IN THIS OFFICE ON 6 TH SEPTEMBER, 2012. > THAT BASED ON THE INFORMATION RECEIVED FROM THE DRP THROUGH RTI ACT THAT THE DATE OF ISSUE OF DIRECTION TO THE AO WAS 04.09.2012; THAT THE DIRECTIONS WERE ISSUED TO THE AO THROUGH THE INTER-DEPARTMENTAL PROCEDURE OF DESPATC HING THE TAPPAL THE TAPPAL REGISTER AND ALSO CONFIRMED TH AT THE DATE OF RECEIPT OF DIRECTIONS BY THE AO WAS 06-09-2012. IT HAS BEEN ACKNOWLEDGED BY THE DRP THAT THE SAID INFORMAT ION HAS BEEN EXTRACTED FROM THE TAPPAL REGISTERS MAINTAINED BY THE RESPECTIVE OFFICES. THE DRP IN ITS CORRIGENDUM DAT ED 5.12.2012 RECONFIRMED THAT THE DRP DIRECTIONS WERE FORWARDED TO THE ASSESSING OFFICER ON 4.9.2012 WHIC H WAS RECEIVED BY THE AO ON 6.9.2012 ; > THAT THE AO HAD ALSO CONFIRMED THROUGH RTI ACT THAT THE DIRECTIONS WERE RECEIVED FROM DRP ON 6.9.2012; ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 6 OF 78 > THAT BASED ON THE AOS CONFIRMATION THAT HE HAD R ECEIVED THE DRPS DIRECTIONS ONLY ON 6.9.2012, THE ASSESSEE FIL ED AN APPLICATION U/S 154 OF THE ACT SEEKING RECTIFICATIO N OF HIS ORDER DATED 29.10.2012 [THE FINAL ASST. ORDER] ON THE PRE MISE THAT AS THE DIRECTION U/S 144C (5) OF THE ACT WAS NOT ISSUE D TO THE AO ON OR BEFORE 31.8.2012 AND AS SUCH, THE IMPUGNED OR DER OF THE AO, ACTING UPON AN INVALID DIRECTION, WAS BAD IN LA W. HOWEVER, THE AO PASSED AN ORDER U/S 154 OF THE ACT, REJECTIN G THE ASSESSEES CONTENTIONS FOR THE REASONING THAT: (I) THERE WAS NO MISTAKE APPARENT FROM RECORD; (II) THE HONBLE DRP HAD ISSUED THE DIRECTIONS ON 1 6.8.2012 WHICH IS WELL WITHIN THE TIME-LIMIT OF 9 MONTHS FRO M THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWARDED TO THE ASSESSING OFFICER; & (III)THE ASSESSMENT ORDER HAS BEEN PASSED WITHIN TH E TIME- LIMIT PRESCRIBED U/S 144C(13); > THAT THE STATEMENT OF THE AO THAT THE DIRECTIONS HAD BEEN ISSUED BY THE DRP ON 16.8.2012 WAS FACTUALLY WRONG ON THE PREMISE THAT THE ASSESSEES AR APPEARED BEFORE THE DRP AND MADE FURTHER SUBMISSIONS DURING THE HEARING ON 16.8 .2012 AND THAT THE DRP HAD NOTED AT PARA 1.1 OF ITS DIREC TIONS ISSUED AS: AT THE FIRST HEARING ITSELF DIT (TP) AND THE TPO A ND AO WERE HEARD ALONG WITH THE ASSESSEE ON REQUEST TO TA KE ON RECORD THEIR SUBMISSIONS. ON 13.8.2012, THE TPO SUBMITTED HER REPORT, A COPY OF WHICH WAS GIVEN TO THE ASSESSEE. THE ASSESSEE FILED ITS REPLY BEFORE THE PANEL ON 16.8.2012 OBJECTING TO THE PROPOSED ENHANCEMENT. THUS, IT WAS NOT POSSIBLE TO ISSUE DIRECTIONS ON 16 .8.2012 ITSELF WITHOUT EXAMINING THE SUBMISSIONS OF THE ASSESSEE A ND THAT THE ASSESSEE HAD FILED ON 27.8.2012 AN AFFIDAVIT OF SRI MERAJ MINAL, CONFIRMING CERTAIN FACTS; > THAT THE DRP BE DIRECTED TO PRODUCE THE RECORD N OTE OF HEARING ON 16.8.2012 WHICH WOULD PROVE THAT NO DIRECTIONS HAD BEEN ISSUED BY THE DRP ON 16.8.2012; > THAT WHEN THE DRP HAD CONFIRMED IN ITS LETTER DAT ED 30.11.2012 AND CORRIGENDUM OF 5.12.2012 THAT IT HAD ISSUED ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 7 OF 78 DIRECTIONS TO THE AO ONLY ON 4.9.2012 AND EVEN THE AO IN HIS LETTER DT.27.11.2012 CONFIRMED THAT THE DIRECTIONS WERE RECEIVED BY HIM ONLY ON 6.9.2012, THE AO HAD, THUS, ERRED IN GIVING A FINDING THAT THE DIRECTIONS WERE ISSUED BY THE DRP ON 16.8.2012. THEREFORE, THE FINDING OF THE AO THAT THE DIRECTION S WERE ISSUED BY THE DRP ON 16.8.2012 IS LIABLE TO BE QUASHED; > THAT THE DRPS CORRIGENDUM DT. 5.12.2012 STATES T HAT IT PASSED THE DIRECTIONS ON 16.8.2012 AND DISPATCHED TO THE A SSESSEE ON 30.8.2012. HOWEVER, THE PROVISIONS OF S.144C(5) OF THE ACT IS MEANT FOR THE GUIDANCE OF THE AO TO ENABLE HIM TO C OMPLETE THE ASSESSMENT AND THAT ON RECEIPT OF DIRECTIONS, THE A O HAS TO NECESSARILY PASS THE ORDER IN CONFORMITY WITH THE D IRECTIONS OF DRP WHICH HAS BEEN EXPLICITLY SPELT OUT IN SUB-SECT ION (13) OF S. 144C ; > FURTHER THAT THE PURPOSE OF ISSUANCE OF DIRECTION S U/S 144C(5) IS TO PROVIDE GUIDANCE TO THE AO AND ONCE SUCH DIRE CTIONS ARE ISSUED BY THE DRP, THEN THE AO HAS TO PASS THE ASST . ORDER IN CONFORMITY TO THE DIRECTIONS. HOWEVER, SUB-SECTION (12) OF S. 144C STATES THAT NO DIRECTION UNDER SUB-SECTION (5) SHALL BE ISSUED AFTER NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWARDED TO THE ELIGIBLE ASSESSEE; > THAT A COMBINED READING OF SUB-SECTIONS (5) AND ( 12) OF S. 144C WOULD SHOW THAT NO DIRECTION FOR THE GUIDANCE OF TH E AO TO ENABLE HIM TO COMPLETE THE ASSESSMENT SHALL BE ISSU ED AFTER NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWARDED TO THE ELIGIBLE ASSESSEE. IN ORDER TO MA KE A HARMONIOUS READING OF SUB-SECTIONS (5) AND (12) OF S. 144C, THE WORDS TO THE AO SHOULD NECESSARILY BE READ INTO S UB-SECTION (12) OF S.144C; - THAT RULE 11 OF THE INCOME-TAX (DISPUTE RESOLUTI ON PANEL) RULES, 2009 SHOULD BE READ ALONG WITH RULE 10(3). RULE 10 STATES THAT THE PANEL SHALL ISSUE DIRECTIONS WITHI N THE SPECIFIED PERIOD. THE DIRECTION U/S 144C IS ISSUE D FOR THE GUIDANCE OF THE AO. HARMONISED READING OF RULE 10( 3) AND 11 SHOWS THAT THE DIRECTIONS ARE TO BE ISSUED TO TH E AO AND THE SAME SHOULD THEREAFTER BE COMMUNICATED TO THE ASSESSEE. THUS, THERE IS NO CONFLICT BETWEEN THE D RP RULES AND S. 144C AND EVEN IF THERE IS A CONFLICT, SECTIO N PREVAILS OVER THE RULE AND RULE CANNOT EXPAND THE SCOPE OF S ECTION; RELIES ON THE FOLLOWING CASE LAWS : ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 8 OF 78 (I) SMT VIJAY DHIR AND OTHERS V. DIT & ORS. (2011) 335 ITR 112 (ALL); (II) CIT V. TAJ MAHAL HOTEL (1971)82 ITR 44 (SC); (III) CIT V. M/S. CHEMPLAST SANMAR LTD (2009) 314 ITR 231 (MAD); (IV) CIT V. TULSYAN NEC LTD (2011) 330 ITR 226 (SC);& (V) ASSAM COMPANY LTD V. STATE OF ASSAM (2001) 248 ITR 567 (SC) > THAT THE TIME LIMIT PROVIDED U/S 114C(12) IS ABS OLUTE AND INFLEXIBLE. ONCE THE DRP FAILS TO MEET THE DEADLIN E, THE DRP CEASES TO HAVE JURISDICTION, NO MATTER WHAT IS THE LENGTH OF DELAY. WHEREVER THE LEGISLATURE INTENDED THAT THE T IME-LIMIT COULD BE RELAXED, EXPLICIT PROVISIONS HAVE BEEN MAD E LIKE THE FOLLOWING: (A) S. 131(3) OF THE ACT WHICH EMPOWERS IMPOUNDING OF BOOKS OF ACCOUNT/DOCUMENTS UNDER CERTAIN CIRCUMSTANCES. CLA USE (B) OF THE PROVISO TO S. 131 (3) STATES THAT AN AO OR A N ASST. DIRECTOR OR DEPUTY DIRECTOR SHALL NOT RETAIN IN HI S CUSTODY ANY SUCH BOOKS OR DOCUMENTS FOR A PERIOD EXCEEDING FIFTEEN DAYS (EXCLUSIVE OF HOLIDAYS) WITHOUT OBTAINING THE APPROVAL OF CCIT OR DG OR CIT OR DIRECTOR THEREFOR, AS THE CASE MAY BE. (B) S. 132(8) STATES THAT THE BOOKS OF ACCOUNT OR O THER DOCUMENTS SEIZED UNDER SUB-SECTION (1) OR SUB-SECTION (1A) SH ALL NOT BE RETAINED BY THE AUTHORIZED OFFICER FOR A PERIOD EXC EEDING THIRTY DAYS FROM THE DATE OF THE ORDER OF ASST. U/S 153A O R CLAUSE (C) OF S. 158BC UNLESS THE REASONS FOR RETAINING THE SA ME ARE RECORDED BY HIM IN WRITING AND THE APPROVAL OF THE CCIT, CIT, DG OR DIRECTOR FOR SUCH RETENTION IS OBTAINED. THE PROVISION OF S. 132(8) STATES THAT THE CHIEF COMMISSIONER, COMMISSIONER, DIRECTOR GENERAL OR DIRECTOR SHALL NOT AUTHORISE TH E RETENTION OF THE BOOKS OF ACCOUNT AND OTHER DOCUMENTS FOR A PERI OD EXCEEDING THIRTY DAYS AFTER ALL THE PROCEEDINGS UND ER THE INDIAN INCOME-TAX ACT 1922 (11 OF 1922), OR THIS ACT IN RE SPECT OF THE YEARS FOR WHICH THE BOOKS OF ACCOUNT OR OTHER DOCUM ENTS ARE RELEVANT ARE COMPLETED. (C) S. 142(2A) EMPOWERS AN AO, ON FULFILMENT OF CE RTAIN CONDITIONS, TO DIRECT AN ASSESSEE TO GET AN AUDIT D ONE U/S 142(2A) AND FURNISH THE REPORT TO THE AO. S 142(2C) STATES THAT EVERY REPORT UNDER SUB-SECTION (2A) SHALL BE FURNIS HED BY THE ASSESSEE TO THE ASSESSING OFFICER WITHIN SUCH P ERIOD AS MAY ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 9 OF 78 BE SPECIFIED BY THE ASSESSING OFFICER. THE PROVISO TO S. 142(2A) STATES THAT THE ASSESSING OFFICER MAY, SUO MOTO, OR ON AN APPLICATION MADE IN THIS BEHALF BY THE ASSESSEE AND FOR ANY GOOD AND SUFFICIENT REASON, EXTEND THE SAID PERIOD BY SUCH FURTHER PERIOD OR PERIODS AS HE THINKS FIT; SO, HOW EVER, THAT THE AGGREGATE OF THE PERIOD ORIGINALLY FIXED AND THE PE RIOD OR PERIODS SO EXTENDED SHALL NOT, IN ANY CASE, EXCEED ONE HUNDRED AND EIGHTY DAYS FROM THE DATE ON WHICH THE DIRECTIO N UNDER SUB-SECTION (2A) IS RECEIVED BY THE ASSESSEE. THIS MEANS THAT THE AO HAS THE DISCRETION TO EXTEND TIME FOR FURNIS HING THE AUDIT REPORT U/S 142(2A) OF THE ACT; (D) S. 250 DEALS WITH PROCEDURE IN APPEAL BEFORE C IT (A). S. 250(6A) STATES THAT IN EVERY APPEAL, THE CIT (A), WHERE IT IS POSSIBLE, MAY HEAR AND DECIDE SUCH APPEAL WITHIN A PERIOD OF ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHIC H SUCH APPEAL IS FILED BEFORE HIM UNDER SUB-SEC. (1) OF S. 246A. THE TIME LIMIT LAID DOWN IN S. 250(6A) IS DISCRETIONARY . THERE IS NO MANDATE FOR THE CIT (A) TO PASS THE ORDER WITHIN ON E YEAR FROM THE END OF THE FY IN WHICH THE APPEAL IS FILED. > THAT THE TIME LIMIT SPECIFIED U/S 144C(12) IS CA TEGORICAL AND ABSOLUTE AND THERE IS NO PROVISION TO RELAX THE TIM E-LIMIT AND, THEREFORE, THE TIME-LIMIT LAID DOWN IN S. 144C(12) FOR ISSUING THE DIRECTIONS IS MANDATORY. THUS, ONCE THE DIRECT IONS ARE NOT ISSUED WITHIN THE TIME LIMIT SPECIFIED IN S. 144C ( 12), THE DIRECTIONS BECOME TIME BARRED AND INVALID; RELIES ON THE FOLLOWING CASE LAWS : (I) CIT V. H.GOUTHAMCHAND (2012) 204 TAXMAN 86 (KAR)(MA G); (II) HARSINAGAR GUTKHA P LTD V. CIT (2011) 336 ITR 90 (A LL); (III) ACIT & ANR V. HOTEL BLUE MOON (2010) 321 ITR 362 (S C);& (IV) HOPE TEXTILES LTD V. UNION OF INDIA (1994) 205 ITR 508 (SC) > THAT ONCE THE DIRECTIONS HAVE NOT BEEN ISSUED WIT HIN THE TIME- LIMIT SPECIFIED U/S 144C(12), IT SHOULD FOLLOW THAT THE OBJECTIONS OF THE ASSESSEE AGAINST THE DRAFT ASSESS MENT ORDER ARE TO BE ACCEPTED. RELIES ON CIRCULAR NO.549 DT: 3 1.10.1989 OF CBDT (1990) 82 CTR (ST) 1; > THAT THE ASSESSEE RELIES ON THE FOLLOWING CASE L AWS FOR THE PROPOSITION THAT IF THE DIRECTIONS ARE NOT ISSUED W ITHIN THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 10 OF 78 TIME LIMIT SPECIFIED U/S 144C (12), THE OBJECTIONS RAISED BY THE ASSESSEE SHOULD BE DEEMED TO HAVE BEEN ACCEPTED: (I) VIPAN KHANNA V. CIT (2002) 255 ITR 220 (P &H); (II) KARNATAKA GOLF ASSOCIATION V. DIT (2004) 91 I TD 1 (BANG);& (III) BHAGWAD SWARUP SRI SRI DEVRAHA BABA MEMORIAL SHIR HARI PARMARTH DHAM TRUST V. CIT (2008) 299 ITR 161 (DEL) (SB) > THAT THE TIME LIMIT FOR ISSUING DIRECTIONS U/S 1 44C (12) IS MANDATORY. S 144C (12) STATES THAT NO DIRECTION UNDER SUB- SECTION (5) SHALL BE ISSUED AFTER NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWARDED TO THE ELIGIBLE ASSESSEE. THE EXPRESSION SHALL INDICATE THAT THE PROVISION IS MANDATORY; RELIES ON THE FOLLOWING CASE LAWS : (I) CIT V. ANJUM M.H. GHASWALA (2001) 252 ITR 1 (SC);& (II) CIT V. SMT P K NOORJAHAN (1999) 237ITR 570 (SC); > THAT THE PROVISO TO S. 10A(1A) PRESCRIBES THAT N O DEDUCTION U/S 10A SHALL BE ALLOWED TO AN ASSESSEE WHO DOES NO T FURNISH A RETURN OF HIS INCOME ON OR BEFORE THE DUE DATE SP ECIFIED UNDER SUB-SECTION (1) OF S. 139. RELIES ON THE FIN DING OF THE HONBLE SB OF TRIBUNAL IN SAFFIRE GARMENTS V. ITO 2012 TIOL 735 ITAT RAJKOT-SB; > THAT THE DATE OF DIRECTION I.E., 16.8.2012 CANNO T BE TAKEN AS THE DATE OF ISSUE OF DIRECTION. MERE MENTION OF A DATE IN THE DIRECTION DOES NOT MAKE SUCH DATE THE DATE OF ISSUE . RELIES ON THE FOLLOWING CASE LAWS : (I) KANUBHAI M PATEL (HUF) V. HIREN BHATT OR HIS SUCCESSORS TO OFFICE (2011) 334 ITR 25 (GUJ); (II) CIT V. RAI BAHADUR KISHORE CHAND & SONS (2010) 1 DTLONLINE 165 (P & H)& (III) BANARSI DEVI V. ITO AIR 1964 SC 1742 > THAT THE DATE MENTIONED IN THE DIRECTION CANNOT BE TAKEN AS DATE OF ISSUE FOR TWO REASONS, NAMELY, (I) SUCH DAT E WRITTEN IN THE DIRECTION CANNOT BE TAKEN AS THE DATE OF ISS UE ON THE BASIS OF MEANING OF THE WORD ISSUE; AND (II) WHEN THE WORD ISSUE IS USED IN THE CONTEXT OF SETTING A POINT O F LIMITATION OF TIME, IT IS NECESSARY SUCH PERIOD OF LIMITATION IS NOT AMENABLE TO ALTERATION BY THE ISSUING AUTHORITY BY DECIDING ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 11 OF 78 THE DATE OF ISSUE. THIS WILL HAVE THE EFFECT OF FR USTRATING THE LIMITATION OF TIME SET OUT IN THE STATUTE; > THAT WITHOUT PREJUDICE TO THE MAIN CONTENTION TH AT NO DIRECTIONS HAD BEEN ISSUED BY THE DRP ON 16.8.2012 AND THAT THE DIRECTIONS TO THE AO HAD BEEN ISSUED ONLY ON 4.9.2012, THE FOLLOWING SUBMISSIONS ON LIMITATION A RE MADE: (A) SUB-SECTION (12) TO S. 144C STATES THAT NO DIRECTION UNDER SUB-SECTION (5) SHALL BE ISSUED AFTER NINE MONTHS F ROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWAR DED TO THE ELIGIBLE ASSESSEE. THE WORD ISSUED USED IN S. 144C (12) MEANS SERVED; RELIES ON THE FOLLOWING CASE LAWS : (I) BANARSI DEBI V. ITO (1964) 53 ITR 100 (SC); & (II) CWT V. KUNDAN LAL BEHARI LAL (1975) 99 ITR 581 (SC) > HOWEVER, IT WAS SUBMITTED THAT THE JUDGMENT OF T HE HONBLE SUPREME COURT IN THE CASE OF R.K. UPADHYAYA V. SHAN ABHAI P PATEL (1987) 166 ITR 163 (SC) IS DISTINGUISHABLE SI NCE THE DECISION WAS IN THE CONTEXT OF S. 147(B) OF THE ACT ; > THAT S. 144C WHICH DEALS WITH THE DRP PROVISIONS HAS USED THE EXPRESSIONS FORWARD, ISSUE AND RECEIPT, B UT, NOWHERE USED THE EXPRESSION SERVED. THUS, THERE IS NO NE ED TO DRAW A DISTINCTION BETWEEN ISSUE AND SERVED FOR THE PURPOSE OF INTERPRETING THE EXPRESSION ISSUED IN S. 144C (12). HENCE, THE RATIO OF DECISION RENDERED IN R.K. UPADHYAYAS CASE DOES NOT APPLY; > THAT THE DECISION IN R.K. UPADHYAYAS CASE WAS R ENDERED BY A DIVISION BENCH WHEREAS THE DECISION IN BANARSI DEBI S CASE HAD BEEN RENDERED BY THREE JUDGES BENCH. THE WELL SETTLED PROPOSITION OF LAW IS THAT IF THERE WERE CONFLICT O F OPINIONS BETWEEN THE TWO BENCHES OF THE SUPREME COURT ON A Q UESTION OF LAW, THE ONE DECLARED BY THE LARGER BENCH WOULD PREVAIL OVER THE ONE PRONOUNCED BY THE OTHER BENCH. THUS, THE DECISION IN BANARASI DEBIS CASE WHICH WAS RENDERED BY A THREE JUDGES BENCH SHOULD BE PREFERRED TO THE DECIS ION IN R.K. UPADHYAYAS CASE. AS STATED EARLIER, THE HON BLE S.C IN BANARASI DEBIS CASE HAS HELD THAT THE WORD ISSUED IS TO BE UNDERSTOOD AS SERVED. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 12 OF 78 > THAT THE WORD ISSUED IN S. 144C (12) SHOULD ME AN SERVED. THE DIRECTIONS U/S 144C (5) SHOULD BE SERVED ON THE ASSESSING OFFICER WITHIN 9 MONTHS FROM THE END OF THE MONTH I N WHICH THE DRAFT ORDER IS FORWARDED TO THE ELIGIBLE ASSESS EE. IN THE PRESENT CASE, THE DRAFT ASSESSMENT ORDER WAS FORWAR DED TO THE ASSESSEE ON 22.11.2011 AND THAT THE DIRECTIONS SHOU LD HAVE BEEN SERVED ON THE ASSESSING OFFICER ON OR BEFORE 3 1.8.2012. HOWEVER, THE DIRECTIONS WERE SERVED ON THE AO ONLY ON 6.9.2012. THIS FACT HAS NOT BEEN DISPUTED EITHER B Y THE DRP OR BY THE AO. THEREFORE, THE DIRECTIONS SERVED ON THE AO AFTER THE EXPIRY OF 9 MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ASSESSMENT ORDER WAS FORWARDED TO THE ELIGIBL E ASSESSEE WERE BARRED BY LIMITATION. RELIES ON THE FOLLOWING CASE LAWS : (A) CIT V. MICRO LABS LTD - (2012) 26 TAXMANN.COM 89 ( KAR); (B) CIT, MYSORE V. SRI D.S. SRINIVASA RAO & BROS - (201 4) 41 TAXMANN.COM 194 (KAR);& (C) WRIT PETITION (CIVIL) NO.5086/2013 IN THE CASE OF C IT II V. M/S MARUTI SUSUKI (INDIA) LTD DATED: 21.2.2014 DE LHI H.C. IN CONCLUSION, IT WAS PLEADED THAT THE ORDER PASSED U/S 153C W. R. S. 144C OF THE ACT IN CONFORMITY WITH SU CH TIME- BARRED DIRECTIONS WAS BAD IN LAW AND, HENCE, LIABLE TO BE QUASHED. 6.1. ON THE OTHER HAND, THE SUBMISSIONS MAD E BY THE LEARNED DR ARE SUMMARIZED AS UNDER: THAT THE PROVISIONS OF S 144C DEAL WITH REFERENCE T O THE DRP AT THE INSTANCE OF THE ASSESSEE, OBJECTING FOR THE DRAFT OF THE PROPOSED ASSESSMENT ORDER. S. 144(5) REFERS TO ISSUE OF DIRECTIONS FOR THE GUIDANCE OF THE AO TO ENABLE HIM TO COMPLETE THE ASSESSMENT, S. 144C(6) REFERS TO THE PROCEDURE FOR ISSUE OF DIRECTIONS AND SUB-SECTION 1 2 TO S 144C REFERS TO THE LIMITATION FOR ISSUANCE OF DIREC TIONS; THAT THOUGH THE DRP WAS TO ISSUE DIRECTIONS ON OR B EFORE 31/8/2012, DIRECTION WAS, HOWEVER, ISSUED ON 16.8.2 012 AND A COPY OF SUCH DIRECTION WAS DISPATCHED TO THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 13 OF 78 ASSESSEE AND THE TPO ON 30.8.2012. HOWEVER, THE CO PY MEANT FOR THE AO WAS DISPATCHED ON 4.9.2012; THAT FROM THE ABOVE SEQUENCES OF EVENTS, THE ASSESS EE CONTENDS THAT THE DIRECTIONS REFERRED IN SUB-SEC. 1 2 TO S. 144C IS ONLY TO THE AO AND IN VIEW OF THE DISPATCH OF THE DIRECTIONS OF THE DRP TO THE AO ONLY ON 4.9.2012, I T WAS BARRED BY LIMITATION. THE CONTENTION OF THE ASSESS EE CANNOT BE ACCEPTED FOR THE FOLLOWING REASONS, NAMELY: (I) SUB-SECTION 5 TO S. 144C REFERS TO THE ISSUANCE OF DIRECTIONS FOR GUIDANCE OF THE AO TO ENABLE HIM TO CONCLUDE THE ASSESSMENT. AS PER SUB-SECTION 5, THE DIRECTIONS SHOULD BE CONFINED TO ENABLING COMPLETION OF THE ASSESSMENT AND NOT OTHERWISE; (II) SUB-SECTION 12 TO S. 144C REFERS TO LIMITATION FOR COMPLETION OF PROCEEDINGS BY DRP. THE DIRECTION ISSUED BY THE DRP ON 16.8.2012 HAS LOST CONTROL OF THE OFFICE OF DRP ON 30.8.2012 IN VIEW OF DISPATCH OF THE ORDER TO THE ASSESSEE AND TPO. HENCE, THE DRP HAS ISSUED DIRECTIONS WITHIN THE TIME LIMIT; (III) AS CONTENDED BY THE ASSESSEE, THE WORD AO REFER TO IN SUB-SECTION 5 CANNOT BE READ INTO SUB-SECTION 12 TO S. 144C. IF THE INTENTION OF THE PARLIAMENT WAS SO, IT WOULD HAVE BEEN EXPRESSLY PROVIDED IN SUB- SECTION 12, CONTEMPLATING ISSUE OF DIRECTIONS TO AO. IN THE ABSENCE OF SUCH PERMISSIBLE INTERPRETATION, NO WORDS CAN BE READ INTO SUB- SECTION 12 OF S. 144C OF THE ACT; (IV) ALL SUB-SECTIONS IN S 144C PROVIDE FOR DIFFERENT OB JECTS AND INTEND. THE INTENTION OF ONE SUB-SECTION CANNOT BE READ INTO ANOTHER SUB-SECTION WHICH WOULD AMOUNT TO VIOLENCE TO THAT SUB-SECTION WHICH IS NOT PERMISSIBLE; (V) THAT IT IS SETTLED POSITION OF LAW THAT EACH SECTIO N AND SUB-SECTION HAS TO BE READ KEEPING IN MIND THE PURPOSE AND INTENT BEHIND THE ENACTMENT; & (VI) WITHOUT PREJUDICE TO THE ABOVE CONTENTIONS, THAT IN VIEW OF EXPLANATION TO S. 92CA OF THE ACT, THE TPO IS ALSO AO AND SERVICE ON TPO IS SUFFICIENT COMPLIANCE U/S 144C(12) OF THE ACT. RELIES ON THE FOLLOWING CASE LAWS : (I) CIT V. SODRA DEVI (1957) 32 ITR 615 (SC); ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 14 OF 78 (II) SMT TARULATA SHYAM AND ORS. V. CIT (1977) 108 ITR 345 (SC); (III) K.P.VARGHESE V. ITO & ANR (1981) 131 ITR 597 (SC); (IV) R.K. UPADHYAYA V. SHANABHAI P PATEL (1987) 166 ITR 163 (SC); (V) CIT V. SHEO KUMARI DEVI (1986) 157 ITR 13; (VI) CWT V. SMT HASHMATUNNISA BEGUM (1989) 176 ITR 98 (SC); (VII) KESHAVJI RAVJI & CO., ETC., V. CIT (1990) 183 ITR 1 (SC); (VIII) GOODYEAR INDIA LTD & ANR. V. STATE OF HARYANA & STATE OF MAHARASHTRA & ANR. (1991) 188 ITR 402 (SC) ; (IX) S.VASUDEVA V. STATE OF KARNATAKA (1993) VOL 3 SCC 467; (X) DR. SATTURS SUSHRUSHALYA NURSING HOME & AN R V. STATE OF KARNATAKA & ANR (1992) 198 ITR 480 (KAR); (XI) DELHI DEVELOPMENT AUTHORITY V. H.C. KHURANA (1993) 204 ITR 412 (SC); (XII) CIT V. N.C. BUDHARAJA & CO ANR. ETC., ETC., (1993) 204 ITR 412 (SC); (XIII) JAGDISH SINGH V. LT. GOVERNOR OF DELHI AND ORS (199 7) VOL 4 (SCC)435; (XIV) ORISSA STATE WAREHOUSING CORPN V. CIT (1999) 237 ITR 5890 (SC); COMMISSIONER OF AGRL INCOME-TAX V. PLANTATION CORPORATION OF KERALA LTD (2001) 247 ITR 155 (SC); (XV) PRAKASH NATH KHANNA & ANR V. CIT (2004)266 ITR 1 (SC); (XVI) AJMERA HOUSING CORPN & ETC., V. CIT (2010 326 ITR 642; & (XVII) KANUBHAI M PATEL (HUF) V. HIREN BHATT OR HIS SUCCESSORS TO OFFICE AND ORS (2011) 334 ITR 25 6.2. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS, PERUSED THE RELEVANT MATERIALS ON RECORDS, THE DOCU MENTARY EVIDENCES PRODUCED BY EITHER OF THE PARTY IN THE FO RM OF VOLUMINOUS PAPER BOOKS AND ALSO VARIOUS CASE LAWS O N WHICH THE RESPECTIVE PARTIES HAVE PLACED THEIR RELIANCE. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 15 OF 78 6.2.1. THE MAIN CONTENTION OF THE ASSESSEE IS CENTRED ON THE DIRECTIONS ISSUED BY THE DRP U/S 144(5) R.W.S. 144C (8) OF THE ACT TO THE AO WAS BARRED BY LIMITATION AND, THUS, T HE FINAL ASSESSMENT ORDER PASSED BY THE AO U/S 153C R. W. S. 143 (3) (SIC) 144C OF THE ACT DATED 29.10.2012 BASED ON TIM E BARRED DIRECTIONS OF THE DRP BAD IN LAW AND LIABLE TO BE Q UASHED. 6.2.2. WE SHALL NOW PROCEED TO ANALYSE, CHRONOL OGICALLY, THE SEQUENCE OF EVENTS WHICH TOOK PLACE IN THE ASSESSEE S CASE, AS UNDER: 6.2.3. A DRAFT ASSESSMENT ORDER FOR THE AY UND ER DISPUTE, INCORPORATING THE TRANSFER PRICING ADJUSTMENT U/S 9 2CA OF THE ACT IN RESPECT OF INTERNATIONAL TRANSACTIONS MADE B Y THE ASSESSEE, WAS SERVED ON THE ASSESSEE ON 22.11.2011. AGGRIEVED, THE ASSESSEE FILED ITS OBJECTIONS BEFORE THE DRP ON 21.12.2011. AFTER HAVING CONSIDERED THE CONTENTIONS OF THE ASSE SSEES OBJECTIONS TO THE DRAFT ASSESSMENT ORDER, THE REMAN D REPORT OF THE TPO AND ALSO FURTHER SUBMISSIONS MADE BY THE AS SESSEES REPRESENTATIVE ON 16.8.2012, THE DRP, IN ITS DIRECT IONS U/S 144(5) R.W.S. 144(8) OF THE ACT, SPECIFIED THAT THE OBJECTIONS OF THE ASSESSEE AGAINST THE DRAFT ASSESSMENT ORDER STAND R EJECTED. BASED ON THE DIRECTIONS OF THE DRP, THE AO HAD CONC LUDED THE FINAL ASSESSMENT ORDER U/S 153C R.W.S. 143(3) (SIC) 144C OF THE ACT ON 29.10.2012. IT WAS THE STAND OF THE ASSESSE E THAT THE DIRECTIONS OF THE DRP HAVING BEEN ISSUED BEYOND THE TIME LIMIT AS SET OUT IN SECTION 144C (12) OF THE ACT RENDERED ITS DIRECTIONS NULL AND VOID. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 16 OF 78 6.2.4. SUB-SECTION (12) OF S. 144C OF TH E ACT SAYS THAT NO DIRECTION UNDER SUB-SECTION (5) SHALL BE ISSUED AFT ER NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWARDED TO THE ELIGIBLE ASSESSEE WHEREAS SUB-SECTION (5) OF 144C STATES THAT THE DISPUTE RESOLUTION PANEL SHALL, IN A CASE WHERE ANY OBJECTION IS RECEIVED UNDER SUB-SECT ION (2), ISSUE SUCH DIRECTIONS, AS IT THINKS FIT, FOR THE GU IDANCE OF THE ASSESSING OFFICER TO ENABLE HIM TO COMPLETE THE ASSESSMENT. IN SUBSTANCE, IN CASE OF ANY OBJECTIONS ARE FILED BY THE ASSESSEE WITH THE DRP IN RESPECT OF VARIATIO NS PROPOSED IN THE DRAFT ASSESSMENT ORDER, THE DRP SHALL ISSUE SUC H DIRECTIONS, AS IT DEEMS FIT, FOR THE GUIDANCE OF THE AO AND SUC H DIRECTIONS SHALL BE ISSUED WITHIN NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ASSESSMENT ORDER IS FORWARDED TO TH E ELIGIBLE ASSESSEE. IN THE INSTANT CASE, NO DOUBT, THE DRAFT ASSESSMENT ORDER U/S 144C (1) OF THE ACT WAS SERVED ON THE ASS ESSEE ON 22.11.2011 [SOURCE: PARA 11 OF ASST. ORDER DT: 29.1 0.2012]. CONSEQUENTLY, THE TIME LIMIT FOR ISSUANCE OF DIRECT IONS U/S 144C (5) R. W. S 144C (12) WAS EXPIRED ON 31.8.2012. 6.2.5. IN THE MEANWHILE, THE ASSESSEE HAD GAT HERED INFORMATION THROUGH RTI ACT, THE FOLLOWING INFORMAT ION, FROM THE ITO-CUM-SECRETARY, DRP, VIDE HER LETTER DATED 30.11 .2012, NAMELY: (I) THE DATE OF ISSUE OF DIRECTION TO THE ASSESSING OFF ICER WAS 4.9.2012; THAT THE DIRECTIONS WERE ISSUED TO THE AO THROUGH THE INTER-DEPARTMENTAL PROCEDURE OF DISPATCHING THE TAPPAL THROUGH THE TAPPAL REGISTER; (II) AFFIRMED THAT THE DATE OF RECEIPT OF DIRECTIONS BY THE ASSESSING OFFICER WAS 6.9.2012; & (III) THAT THE AFORESAID INFORMATION HAS BEEN EXTRA CTED FROM THE TAPPAL REGISTERS MAINTAINED BY THE RESPECTIVE OFFICES. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 17 OF 78 [REFER: PAGE 324 OF PB AR] 6.2.6. SUBSEQUENTLY, THE DRP HAD ISSUED A CORRIGENDUM DATED 5.12.2012 TO ITS EARLIER LETTER DATED 30.11.2 012 WHICH READS AS UNDER: 1. DATE OF ISSUE OF DIRECTION TO THE ASSESSING OFF ICER: THE DRP DIRECTIONS IN THE CASE OF THE HIMALAYA DRUG COMPANY, BANGALORE, WERE PASSED ON 16.08.2012 GIVING DUE OPPORTUNITY TO THE ASSESSEE, DULY SIGNED BY THE DISPUTE RESOLUTION PANEL MEMBERS, BANGALORE, AND, T HE SAME WAS DISPATCHED TO THE ASSESSEE ON 30.08.2012 I.E., WITHIN THE TIME LIMIT FROM THIS OFFICE BY SPE ED POST BEARING NO.EK09206981 5 IN (COPY ENCLOSED FOR REFERENCE). A COPY OF THE DRP DIRECTIONS WERE (WAS ) SENT TO THE ASSESSING OFFICER THROUGH THE INTER-DEPARTME NTAL PROCEDURE OF FORWARDING THE TAPPAL THRO TAPPALS REGISTER ON 04.09.2012 FROM THIS OFFICE. 6.2.7. IT WAS THE CONTENTION OF THE LEARNED AR THAT THE ASSESSEES AUTHORISED REPRESENTATIVE DID APPEAR BEF ORE THE DRP ON 16.8.2012 AND MADE FURTHER WRITTEN SUBMISSIONS, DURING THE COURSE OF HEARING, WHICH WAS ENDORSED BY THE DRP I N ITS DIRECTIONS, THAT 1.1.. ON 13.8.2012, THE TPO SUBMITTED HER REPORT, A COPY OF WHICH WAS GIVEN TO THE ASSESS EE. THE ASSESSEE FILED ITS REPLY BEFORE THE PANEL ON 16.8.2 012 OBJECTING TO THE PROPOSED ENHANCEMENT. IT WAS, THEREFORE, QUESTIONED BY THE LEARNED AR: HOW IT COULD HAVE BEEN FEASIBLE FO R THE DRP TO ISSUE DIRECTIONS ON 16.8.2012 ITSELF, BY ANALYSING THE SUBMISSIONS MADE BY THE ASSESSEE ON THE SAME DAY? HOWEVER, AS A MATTER OF FACT, THE HEARING OF THE ASSESSEES CASE WAS A CONTINUOUS PROCESS RIGHT FROM 2.3.2012, 20.3.12, 14 .4.12, 20.4.12, 25.6.12 AND FINALLY ON 16.8.2012 [SOURCE: DIRECTIONS OF THE DRP DT.16.8.12] AND, THUS, IT WAS QUITE REASONA BLE FOR THE DRP TO ISSUE ITS DIRECTIONS ON 16.8.2012, AFTER DUE EXAMINATION OF THE SUBMISSION OF THE ASSESSEE. WE WOULD HAVE A CCEPTED THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 18 OF 78 ASSESSEES ARGUMENT THAT IT WAS NOT POSSIBLE FOR TH E DRP TO ISSUE ITS DIRECTION ON THE DAY ON WHICH THE ASSESSEE MADE ITS SUBMISSIONS PROVIDED ONLY ONE HEARING WAS HELD IN T HE CASE OF THE ASSESSEE ON 16.8.2012. HOWEVER, IN THE INSTANT CASE, HEARING WAS HELD ON VARIOUS DATES AS MENTIONED [SUP RA] AND THE PANEL MUST HAVE BEEN THE KNOWING OF THE ISSUE(S) AG ITATED AND, THEREFORE, THE ASSESSEES OBJECTION ON THIS POINT D OESNT CARRY ANY CONVICTION. IT IS, THEREFORE, REJECTED. FURTHER, W E WOULD LIKE TO REFER TO THE DRPS CORRIGENDUM DATED 5.12.2012 WHER EIN IT HAS BEEN EMPHATICALLY STATED THAT [AT THE COST OF REPET ITION] 1. DATE OF ISSUE OF DIRECTION TO THE ASSESSING OFFICER: THE DRP DIRECTIONS IN THE CASE OF THE HIMALAYA DRUG COMPANY , BANGALORE, WERE PASSED ON 16.08.2012 GIVING DUE OPPORTUNITY TO THE ASSESSEE, DULY SIGNED BY THE DIS PUTE RESOLUTION PANEL MEMBERS, BANGALORE, AND, THE SAME WAS DISPATCHED TO THE ASSESSEE ON 30.08.2012 I.E., WITHIN THE TIME LIMIT FROM THIS OFFICE BY SPEED POST BEARING NO.EK09206981 5 IN 6.2.8. HOWEVER, THE MAIN CONTENTION OF THE ASSESSEE WAS THAT THE DIRECTIONS PASSED ON 16.8.2012 AND DISPATC HED TO THE ASSESSEE ON 30.8.2012 WAS IRRELEVANT AND THE ONLY S IGNIFICANT HERE WAS WHEN THE DIRECTION U/S 144C (5) R.W.S. 144 C (8) MEANT FOR THE GUIDANCE OF THE AO TO ENABLE HIM TO COMPLET E THE ASSESSMENT ISSUED. SUB-SECTION (5) TO S. 144C OF T HE ACT SAYS: THE DISPUTE RESOLUTION PANEL SHALL, IN A CASE WHER E ANY OBJECTION IS RECEIVED UNDER SUB-SECTION (2), ISSUE SUCH DIREC TIONS, AS IT THINKS FIT, FOR THE GUIDANCE OF THE ASSESSING OFFICER TO E NABLE HIM TO COMPLETE THE ASSESSMENT AND SUB-SECTION (12) TO S. 144C MAKES IT UNAMBIGUOUSLY CLEAR THAT ( 12) NO DIRECTION UNDER SUB- ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 19 OF 78 SECTION (5) SHALL BE ISSUED AFTER NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER IS FORWARDED TO THE ELIGIBLE ASSESSEE. THUS, IN THE PRESENT CASE, THE DIRECTIONS OF THE DRP HAVE SINCE BEEN ISSUED WITHIN NINE MONTHS F ROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER WAS FORWARDED TO THE ELIGIBLE ASSESSEE I.E., THE DRAFT ASSESSMENT ORDER WAS SERVED ON THE ASSESSEE ON 22.11.2011 AND THAT THE DIRECTIONS U/S 144C (5) R.W.S. 144C (8) OF THE ACT WAS ISSUED WELL BEFORE [ CUT-OFF DATE] 31.8.2012 AND, SIGNIFICANTLY, THE DIRECTION WAS ISSUED TO THE ASSESSEE ON 30.8.2012 THROUGH SPEED POST. 6.2.9. THE CONTENTION OF THE ASSESSEE TH AT THE ISSUANCE OF DIRECTION TO THE ASSESSEE DOES NOT GIVE RISE TO ANY CAUSE OF ACTION TO THE ASSESSEE AND, THE DIRECTIONS SHOULD HAVE BEE N ISSUED TO THE AO WITHIN NINE MONTHS AS SUBSCRIBED IN SUB-SECT ION (12) TO S. 144C OF THE ACT, IN OUR VIEW, DOESNT CARRY ANY MERIT. AS A MATTER OF FACT, THE ISSUANCE OF DIRECTIONS OF THE D RP CAME INTO FORE ONLY ON THE BASIS OF THE OBJECTIONS FILED BY T HE ASSESSEE BEFORE THE DRP. SUCH BEING THE SITUATION, THE LEAR NED ARS ARGUMENT THAT COPY OF DIRECTIONS IS FORWARDED TO THE ASSESSEE ONLY ON PRINCIPLES OF NATURAL JUSTICE; AND THE ISSU ANCE OF THE DIRECTIONS TO THE ASSESSEE DOES NOT GIVE RISE TO AN Y CAUSE OF ACTION TO THE ASSESSEE [REFER: PARA 20 ON PAGE 61 OF A.RS SUBMISSION] CANNOT BE ACCEPTABLE. WHEN THE DIRECTI ONS OF THE DRP U/S 144C(5) R.W.S. 144C(8) OF THE ACT HAS BEEN ISSUED TO ONE OF THE PARTIES INVOLVED I.E., TO THE ASSESSEE WITHI N THE TIME SPECIFIED IN SUB-SECTION (12) TO S. 144C OF THE ACT , IT CANNOT BE SAID THAT SECTION 144C DOES NOT REQUIRE ISSUE OF DIRECTION T O THE ASSESSEE. THEREFORE, IF THE DRP CHOOSES TO SERVE A COPY OF THE ASSESSEE, THE DATE OF ISSUE OF THE COPY OR THE SERV ICE THEREOF IS ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 20 OF 78 IRRELEVANT FOR THE PURPOSE OF SECTION 144C [SOURCE: PARA 23 ON PAGE 62 OF A.RS SUBMISSION]. 6.2.10. DURING THE COURSE OF HEARING, T HE LEARNED DR ARGUED, AMONG OTHERS, THAT THE SUB-SECTION (12) TO S. 144C REFERS TO LIMITATION FOR COMPLETION OF PROCEEDINGS BY DRP AND THAT THE DIRECTION ISSUED BY THE DRP ON 16.8.2012 HAD LOST C ONTROL OF OFFICE OF DRP ON 30.8.2012 IN VIEW OF DISPATCH OF T HE ORDER TO THE ASSESSEE AND TPO AND, HENCE, THE DRP HAS ISSUED DIR ECTIONS WITHIN THE TIME LIMIT. IN THIS CONTEXT, THE LEARNE D DR HAD PLACED RELIANCE ON THE JUDGMENT OF THE HONBLE GUJARAT HIG H COURT IN THE CASE OF KANUBHAI M PATEL (HUF) V. HIREN BHATT O R HIS SUCCESSORS TO OFFICE REPORTED IN (2011) 334 ITR 25 (GUJ). 6.2.11. WE HAVE, WITH RESPECTS, PERUSED THE RULIN G OF THE HONBLE HIGH COURT WHEREIN, IT HAS BEEN HELD AS UND ER: 14. IN THE BACKGROUND OF THE AFORESAID FACTS AND CONTENTIONS, THE CORE ISSUE THAT ARISES FOR CONSIDE RATION IS AS TO WHEN CAN THE NOTICE UNDER SECTION 148 OF T HE ACT BE SAID TO HAVE BEEN ISSUED. IN THIS CONTEXT, IT WOULD BE NECESSARY TO EXAMINE THE TRUE IMPORT OF TH E EXPRESSION SHALL BE ISSUED AS EMPLOYED IN SECTION 149 OF THE ACT. 15. THE EXPRESSION ISSUE HAS BEEN DEFINED IN BLAC KS LAW DICTIONARY TO MEAN TO SEND FORTH; TO EMIT; TO PROMULGATE; AS, AN OFFICER ISSUES ORDERS, PROCESS I SSUES FROM COURT. TO PUT INTO CIRCULATION; AS, THE TREAS URY ISSUES NOTES. TO SEND OUT, TO SEND OUT OFFICIALLY; TO DELIVER, FOR USE, OR AUTHORITATIVELY; TO GO FORTH A S AUTHORITATIVE OR BINDING. WHEN USED WITH REFERENCE TO WRITS, PROCESS, AND THE LIKE, THE TERM IS ORDINARIL Y CONSTRUED AS IMPORTING DELIVERY TO THE PROPER PERSO N, OR TO THE PROPER OFFICER FOR SERVICE ETC. 15.1. IN P RAMANATHAN AIYERS LAW LEXICON THE WORD ISSUE HAS BEEN DEFINED AS FOLLOWS: ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 21 OF 78 ISSUE. AS A NOUN, THE ACT OF SENDING OR CAUSING TO GO FORTH; A MOVING OUT OF ANY ENCLOSED PLACE; EGRESS; THE ACT OF PASSING OUT; EXIT; EGRESS OR PASSAGE OUT [WORCESTER DICT.]; THE ULTIMATE RESULT OR END. AS A VERB, TO ISSUE MEANS TO SEND OUT, TO SEND OU T OFFICIALLY; TO SEND FORTH; TO PUT FORTH; TO DELIVER , FOR USE, OR UN-AUTHORITATIVELY; TO PUT INTO CIRCULATION; TO EMI T; TO GO OUT (BURRILL); TO GO FORTH AS A AUTHORITATIVE OR BINDIN G, TO PROCEED OR ARISE FROM; TO PROCEED AS FROM A SOURCE (CENTURY DICT.) ISSUE OF PROCESS, GOING OUT OF THE HANDS OF THE CLE RK, EXPRESSED OR IMPLIED, TO BE DELIVERED TO THE SHERIF F FOR SERVICE. A WRIT OR NOTICE IS ISSUED WHEN IT IS PUT IN PROPER FORM AND PLACED IN AN OFFICERS HANDS FOR SERVICE, AT THE TIME IT BECOMES A PERFECTED PROCESS. ANY PROCESS MAY BE CONSIDERED ISSUED IF MADE OUT AND PLACED IN THE HANDS OF A PERSON AUTHORISED TO SERVE IT, AND WITH A BONA FIDE INTENT TO HAVE IT SERVED. 16. THUS, THE EXPRESSION TO ISSUE IN THE CONTEXT OF ISSUANCE OF NOTICES, WRITS AND PROCESS, HAS BEEN ATTRIBUTED THE MEANING, TO SEND OUT; TO PLACE IN THE HANDS OF THE PROPER OFFICER FOR SERVICE. THE EXPRESSION SHALL BE ISSU ED AS USED IN SECTION 149 WOULD THEREFORE HAVE TO BE READ IN T HE AFORESAID CONTEXT 6.2.12. FROM THE PRECEDENT ON THE SUBJECT, IT IS EVIDENT THAT THE EXPRESSION TO ISSUE MEANS TO SEND OUT SO THAT THE OFFICER CONCERNED HAS LOST CONTROL OVER THE ORDER S O THAT HE IS NOT IN A POSITION TO TAMPER/ALTER THE SAME. IN THE INST ANT CASE, THE DRP DIRECTIONS, ADMITTEDLY, WAS ISSUED TO THE ASSES SEE CONCERNED ON 30.8.2012 [I.E., WITHIN THE TIME LIMIT ] BY SPEED POST BEARING NO.EK09206981 5 IN. THE ARGUMENT OF THE AS SESSEE IS THAT THE SERVICE OF THE DRP DIRECTIONS TO THE ASSES SEE IS IMMATERIAL AND WHAT IS CONTEMPLATED U/S 144C IS THE ISSUE OF DRPS DIRECTIONS TO THE AO ONLY. HOWEVER , WE ARE OF THE VIEW THAT THIS ARGUMENT OF THE ASSESSEE IS TOO TECHNICAL AND NOT ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 22 OF 78 BASED ON THE SOUND LEGAL FOOTING. AS MENTIONED EARLIER, THE LEGAL PRECEDENT EXPLAINS THAT THE EXPRESSION TO ISSUE IS IN THE CONTEXT OF THE OFFICER CONCERNED HAVING LOST CONTROL/AUTHORITY OVER HIS/HER ORDER AND THAT HE/SH E WILL NOT BE IN A POSITION TO ALTER/TAMPER WITH THE SAME . IN THE PRESENT CASE, THE DRP HAD LOST CONTROL OVER OF ITS DIRECTIONS [DATED 16.8.2012] WHEN THE SAME WAS ISSUED/DISPATCH ED TO THE ASSESSEE CONCERNED. MOREOVER, THE ASSESSEE DOESNT HAVE A CASE THAT THE DIRECTIONS OF THE DRP DATED 16.8.2012 RECE IVED BY IT IS MATERIALLY DIFFERENT FROM THE DIRECTIONS OF DRP ISS UED TO THE AO.FURTHER, THE INCOME-TAX (DISPUTE RESOLUTION PANE L) RULES, 2009 ALSO PRESCRIBE THE COMMUNICATION OF THE DIRECT ION OF THE DRP AS UNDER: DIRECTIONS TO BE COMMUNICATED TO PARTIES: 11. THE PANEL SHALL, AFTER THE DIRECTIONS ARE ISSUE D, COMMUNICATE THE SAME TO THE ELIGIBLE ASSESSEE AND T O THE ASSESSING OFFICER. THE ABOVE RULE CONTEMPLATES THAT THE FIRST DIRECTIO N MUST BE ISSUED BY THE DRP AND LATER ON COMMUNICATES THE SAM E TO THE ELIGIBLE ASSESSEE AND THE AO. SUB-SECTION (5) TO S . 144C ENVISAGES THE DIRECTIONS OF THE DRP FOR THE GUIDANC E OF THE AO TO ENABLE HIM TO COMPLETE THE ASSESSMENT. IN THIS CAS E, THE DIRECTION OF THE DRP HAS BEEN, ADMITTEDLY, ISSUED T O THE ASSESSEE ON 30.8.2012 ITSELF AND, THUS, THE DRP HAD LOST CON TROL OVER ITS ORDER DATED 16.8.2012.THEREFORE, THE DIRECTION OF T HE DRP U/S 144C (5) R.W.S 144C(8) OF THE ACT IN THE CASE OF TH E HIMALAYA DRUG COMPANY WHICH HAD RAISED OBJECTIONS TO THE DRA FT ASSESSMENT ORDER [ONE OF THE PARTIES TO THE ISSUE] HAS BEEN ISSUED IN CONFORMITY WITH THE PROVISIONS OF SUB-SEC TION (12) TO S. 144C OF THE ACT. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 23 OF 78 6.2.13. WE HAVE, WITH DUE REGARDS, PERUSED THE VARI OUS CASE LAWS ON WHICH THE LEARNED AR HAD PLACED STRONG RELIANCE, AS UNDER: (I) CIT V. H.GAUTHAMCHAND (2012) 204 TAXMAN 86 (KAR)(MA G): THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH CO URT WAS WITH REGARD TO NON-ISSUANCE OF A NOTICE U/S 143(2) OF THE ACT. OSTENSIBLY, THE HONBLE COURT RULED THAT EVEN IF AN ASSESSMENT ORDER MADE U/S 144 OF THE ACT WAS VOID AB INITIO AS BEING CONTRARY TO THE STATUTORY REQUIREMENT OF ISSUANCE O F A NOTICE U/S 143(2) OF THE ACT. AT THE OUT-SET, WE WOULD LIKE TO POINT OUT THAT THE CASE LAW RELIED ON BY THE ASSESSEE HAS NO RELEVANCE WHATSOEV ER TO THE ISSUE UNDER DISPUTE FOR A SIMPLE REASON THAT THE DI RECTIONS OF THE DRP WAS ISSUED WITHIN THE TIME LIMIT PRESCRIBED UND ER- SUBSECTION (12) TO S. 144C OF THE ACT. (II) LIKEWISE, THE JUDGMENT OF THE HONBLE ALLAHABA D HIGH COURT IN THE CASE OF HARISINAGAR GUTKHA P. LTD V. CIT (2011) 336 ITR 90 (ALL), AS RELIED ON BY THE ASSESSEE, IS NOT DIRECTLY APPLICABLE TO THE FACTS OF THE ISSUE UNDER CONSIDER ATION, IN A SENSE THAT THE ISSUE BEFORE THE HONBLE COURT WAS T HE SERVICE OF A NOTICE U/S 143(2) OF THE ACT WITHIN THE PERIOD PROV IDED UNDER THE PROVISO IS MANDATORY. HOWEVER, IN THE PRESENT CASE , THE DIRECTION OF THE DRP WAS ISSUED WELL BEFORE (CUT-OF F DATE) 31.8.2012 AND, SIGNIFICANTLY, THE DIRECTION WAS ISSUED TO THE ASSESSEE ON 30.08.2012 THROUGH SPEED POST [REFER: PARA 7.5. OF THIS ORDER]. THEREFORE, THE CASE LAW RELIED ON BY THE ASSESSEE IS NOT APPLICABLE TO THE PRESENT CASE. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 24 OF 78 (III) THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF ACIT & ANR V. HOTEL BLUE MOON (2010) 321 IT R 362 (SC) WAS WITH REGARD TO THE PROVISO TO S. 143(2) WHICH P UTS AN EMBARGO ON THE AO TO EXERCISE JURISDICTION AFTER TH E EXPIRY OF 12 MONTHS FROM THE END OF THE MONTH IN WHICH THE RETUR N WAS FILED BY THE ASSESSEE ETC. HOWEVER, AS ALREADY DELIBERAT ED (SUPRA), THE DIRECTION OF THE DRP HAD SINCE BEEN ISSUED WITHIN NINE MONTHS FROM THE END OF THE MONTH IN WHICH THE DRAFT ORDER WAS FORWARDED TO THE ELIGIBLE ASSESSEE [WHICH HAD CONTESTED THE DRAFT ASSESSMENT ORDER BEFORE THE DRP FOR WHICH THE DIRECTION CAME TO BE ISSUED ] AND, THUS, THE SUB-SECTION (12) TO S. 144C OF THE ACT HAS NO ROLE TO PLAY IN THE PRESE NT CASE AS ATTRIBUTED BY THE ASSESSEE. WE ARE, THEREFORE, OF THE VIEW THAT THE CASE LAW RELIED ON BY THE ASSESSEE IS NOT APPLI CABLE TO THE PRESENT ISSUE. (IV) THE ASSESSEE IS ALSO TRYING TO TAKE REFUGE IN THE BOARDS CIRCULAR NO.549 DATED 31.10.1989 [(1990) 82 CTR (ST .) 1]. OSTENSIBLY, THE CIRCULAR WAS ISSUED IN THE CONTEXT OF S. 143(2) OF THE ACT. IN THIS CONNECTION, WE WOULD LIKE TO POINT OUT THAT THE ABOVE CIRCULAR HAS NO RELEVANCE TO THE ISSUE ON HAN D SINCE IT SEEMINGLY SPEAKS ABOUT THE ISSUANCE OF A NOTICE U/S 143(2) OF THE ACT WITHIN A SPECIFIED TIME LIMIT ETC., AS MADE IT EXPLICIT ALREADY, THE DIRECTION OF THE DRP HAD BEEN ISSUED UNDER SUB- SECTION (5) TO S. 144C OF THE ACT WITHIN THE TIME S PECIFIED UNDER SUB-SECTION (12) TO S. 144C OF THE ACT. 6.2.14. IN AN OVERALL CONSIDERATION OF THE FACTS AN D CIRCUMSTANCES OF THE ISSUE AS DISCUSSED THREAD-BARE IN THE FORE- GOING PARAGRAPHS AND ALSO IN CONFORMITY WITH JUDICI AL VIEW ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 25 OF 78 (SUPRA) ON THE ISSUE, WE ARE OF THE VIEW THAT THE F INAL ASSESSMENT ORDER PASSED U/S 153C R.W.S. 143 (3) (SIC) 144C OF THE ACT DATED 29.12.2012 BASED ON THE DIRECTIONS OF THE DRP ISSU ED U/S 144C(5) R.W.S. 144C(8) OF THE ACT WAS WITHIN THE PA RAMETERS PRESCRIBED IN THE RELEVANT PROVISIONS OF THE ACT. IN SUBSTANCE, THE FINAL ASSESSMENT ORDER PASSED BY THE AO U/S 153 C OF THE ACT BASED ON THE DIRECTIONS OF THE DRP WAS TENABLE IN L AW. IT IS ORDERED ACCORDINGLY. [GR.II(1)] VALIDITY OF SEARCH PROCEEDINGS AND ORDER U/S153C OF THE ACT: 7. IT WAS THE STAND OF THE LEARNED AR THAT TH E ORDER PASSED U/S 153C OF THE ACT WAS NOT LEGALLY TENABLE AS THE REQUISITE CONDITIONS FOR INVOKING THE POWERS UNDER THE SAID S ECTION SUCH AS (I) SATISFACTION NOTES; (II) ISSUANCE OF VALID N OTICE U/S 153C OF THE ACT ETC., WERE ABSENT IN THE CASE UNDER CONSIDE RATION. THE SUBMISSIONS MADE BY THE LEARNED AR ON THE ISSUE ARE SUMMARIZED AS UNDER: > THAT IN THE PRESENT CASE, THE ADIT (INV) HAD REQ UISITIONED THE POLICE TO HANDOVER THE CASH SEIZED FROM MR HISH AM; THAT THE JURISDICTION ON HISHAM WAS SINCE SHIFTED F ROM THE ADIT (INV) TO THE DCIT, CENTRAL CIRCLE; AND THAT IN ORDER TO MAKE AN ORDER U/S 153C ON THE ASSESSEE, IT WAS NECE SSARY THAT THE AO WAS SATISFIED THAT THE SEIZED CASH BELO NGED TO THE ASSESSEE; > THAT AS PER S. 153C(1), THE AO OF THE OTHER PERS ON CAN ASSUME JURISDICTION ONLY WHEN THE REQUISITIONED ASS ETS WERE HANDED OVER BY THE AO OF THE REQUISITIONED PER SON. IN THE PRESENT CASE, THE CASH SEIZED WAS DEPOSITED IN PD ACCOUNT IN THE NAME OF HISHAM AND THAT THE SAME HAS NOT BEEN TRANSFERRED TO THE PD ACCOUNT OF THE ASSESSEE. THUS, THE ASSUMPTION OF JURISDICTION U/S 153C WAS BAD IN LAW; > THAT IT WAS ESSENTIAL THAT THE AO [DCIT, CENTRA L CIRCLE 1(1)] SHOULD HAVE SATISFIED THAT THE MONEY, BULLION, JEWE LLERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCOUNT OR ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 26 OF 78 DOCUMENTS REQUISITIONED BELONGS OR BELONG TO THE OT HER PERSON. IT WAS EMPHASIZED THAT THE SATISFACTION RE GARDING BOOKS OF ACCOUNT, DOCUMENTS, ETC., BELONGING TO THE OTHER PERSON SHOULD BE FORMED BY THE AO OF THE SEARCHED PERSON, I.E., DCIT, CC 1(1) AND NOT OF ANY OTHER OFFICER I NCLUDING THE AUTHORIZED OFFICER/REQUISITIONING OFFICER; > THAT MERE RELIANCE BY THE AO ON THE APPRAISAL REP ORT OF THE AUTHORIZED OFFICER/REQUISITIONING OFFICER WAS NOT S UFFICIENT TO COMPLY WITH THIS CONDITION. THE AO OF THE SEARC HED PERSON WILL HAVE TO FORM AN INDEPENDENT OPINION. I N THE PRESENT CASE, THERE WAS NOTHING ON RECORD WHICH WOU LD PROVE THAT THE AO ARRIVED AT THE SATISFACTION BASED ON AN INDEPENDENT THOUGHT PROCESS THAT THE SEIZED CASH BE LONGED TO THE ASSESSEE; RELIES ON THE FOLLOWING CASE LAWS: (I) MANISH MAHESHWARI V. ACIT (2007) 289 ITR 341 (SC); (II) ISPAT INDUSTRIES LTD V. COMMISSIONER OF CUSTOMS 2006(12)SC 379; (III) KHANDUBHAI VASANJI DESAI V. DCIT (1999) 236 ITR 731 (GUJ) THE JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CAS E OF CIT V. PUSHPA RANI (2005) 193 CTR (DEL) 256 RELIED ON BY T HE LEARNED DR IS DISTINGUISHABLE; > THAT SECTIONS 158BD AND 153C ARE PARI MATERIA. HENCE, THE RATIO OF THE ABOVE DECISIONS SQUARELY APPLY TO S. 1 53C > THAT RELIES ON THE FOLLOWING DECISIONS ON THE PROPOSITION THAT RECORDING OF SATISFACTION BY THE ASSESSING OFFICER OF THE SEARCHED PERSON U/S 153C IS MANDATOR Y: (I) INGRAM MICRO (INDIA) EXPORTS PVT LTD V. DDIT (I TAT, MUMBAI); (II)CIT V. SSK TULAJABHAVANI KALYAN 2012-TIOL-933-H C-KAR; > THAT THOUGH S. 153C(1) STATES THAT WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY MONEY.REQUISITIONED BELON GS OR BELONG TO A PERSON OTHER THAN THE PERSON REFERRED T O IN SECTION 153A IT IS NOT ENOUGH IF THE AO RECORDS HIS SATISFACTIO N THAT THE ASSETS BELONG TO THE OTHER PERSON. THE AO SHO ULD ALSO ARRIVE AT THE SATISFACTION THAT THE ASSETS THAT WER E HANDED OVER ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 27 OF 78 REPRESENT UNDISCLOSED INCOME OF THE OTHER PERSON. THIS IS INHERENT IN THE SCHEME OF SEARCH AND SEIZURE. THE ASSESSEE HAD ESTABLISHED, WHILE MAKING SUBMISSIONS TO OTHER GROUNDS RAISED, THAT THE MONEY, BULLION, JEWELLERY, VALUABL E ARTICLES OR THINGS OR ASSETS REFERRED TO IN SECTIONS 132, 132A, 153A AND 153C SHOULD REPRESENT UNDISCLOSED INCOME. IF IT RE PRESENTS UNDISCLOSED INCOME OF THE SEARCHED PERSON, S. 153A WILL BE INVOKED. IF IT REPRESENTS UNDISCLOSED INCOME OF O THER PERSON, S. 153C WILL BE INVOKED. THEREFORE, THE BASIC REQU IREMENT THAT THE ASSETS REPRESENT UNDISCLOSED INCOME SHOULD BE S ATISFIED. WHEN THE AO OF THE SEARCHED PERSON IS REQUIRED TO B E SATISFIED THAT THE ASSETS BELONG TO OTHER PERSON, IT IS TRI TE TO SAY THAT HE SHOULD ALSO BE SATISFIED THAT THE ASSETS REPRESE NT UNDISCLOSED INCOME OF THE OTHER PERSON; > THAT THOUGH S. 153C DOES NOT EXPLICITLY STATE TH AT THE AO OF THE SEARCHED PERSON HAS TO ARRIVE AT SATISFACTION T HAT THE ASSETS SEIZED/REQUISITIONED REPRESENT UNDISCLOSED I NCOME OF THE OTHER PERSON, CONSIDERING THE ENTIRE SCHEME O F SEARCH AND SEIZURE PROVISIONS CONTAINED IN SECTIONS 153A TO 15 3C, ARRIVING AT SUCH SATISFACTION IS AN INHERENT REQUIR EMENT. IF IT IS NOT SO, THEN IT LEADS TO ABSURD RESULTS. IN CAS E OF A PERSON WHO IS SEARCHED, BEFORE REQUIRING THE AUTHORIZED OF FICER TO MAKE REQUISITION, THE DIRECTOR OR CCIT ETC., SHOULD HAVE REASON TO BELIEVE CONSEQUENT TO INFORMATION IN HIS POSSESSION THAT THE PERSON FROM WHOSE CUSTODY THE ASSET HAS BE EN TAKEN BY ANY AUTHORITY FOR THE TIME BEING IN FORCE HAS NO T OR WOULD NOT DISCLOSE IT. [ C RAMAIAH REDDY V. ACIT (2011) 339 ITR 210 (KAR)]; > THAT WHEN IT COMES TO PERSON OTHER THAN THE SEAR CHED PERSON, IN ORDER TO ASSUME JURISDICTION U/S 153C, THE AO OF THE SEARCHED PERSON SHOULD ARRIVE AT THE SATISFACTION N OT ONLY WHETHER THE REQUISITIONED ASSETS BELONG TO THE OTH ER PERSON, BUT ALSO THE SAME REPRESENT UNDISCLOSED INCOME OF T HE OTHER PERSON. ANY UNDERSTANDING TO THE CONTRARY MAY RESU LT IN ABSURDITY; > THAT IT IS NECESSARY TO READ THAT THE SATISFACTI ON SHALL EXTEND TO BELIEVING THAT THE REQUISITIONED ASSET REPRESENTS U NDISCLOSED INCOME OF THE OTHER PERSON. IT IS NECESSARY TO SO READ SO AS TO INTRODUCE OBJECTIVITY INTO AND REMOVE SUBJECTIVITY FROM THE SCHEME OF SUCH ASSESSMENT. IT IS ALSO NECESSARY TO SO READ TO PREVENT ABUSE. [RELIES ON THE CASE LAW IN CIT V. K ELVINATOR OF INDIA LIMITED (2010) 320 ITR 561 (SC)]; ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 28 OF 78 > THAT SEARCH AND SEIZURE OPERATION RESULTS IN A S ERIOUS INVASION INTO THE PRIVACY OF THE CITIZEN. RELIES ON THE FOLLOWING CASE LAWS : (I) P.R. METRANI V. CIT (2006) 287 ITR 209; (II) ITO V. SETH BROTHERS (1969) 74 ITR 836 (SC); (III) C. RAMAIAH REDDY V. ACIT 339 ITR 210 (KER) > THAT A COMBINED READING OF SECTIONS 132(1), 132A , 153A(1) AND 153C(1) SHOWS THAT IF THERE IS ANY MONEY, BULLI ON, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING OR BOOKS OF ACCO UNT OR DOCUMENTS OR ASSETS WHICH REPRESENT EITHER WHOLLY O R PARTLY INCOME OR PROPERTY WHICH HAS NOT BEEN OR WOULD NOT BE DISCLOSED AND SUCH MONEY, BULLION ETC., HAS BEEN SE IZED OR REQUISITIONED U/S 132(1)/132A: (A) ASSESSMENT U/S 153A SHALL BE MADE ON THE SEARCH ED PERSON IF THEN REQUISITIONED ASSETS BELONG TO HIM OR ELSE; (B) ASSESSMENT SHALL BE MADE U/S 153C ON THE OTHER PERSON, IF THE ASSETS BELONG TO SUCH OTHER PERSON. > THAT S. 153C HAS TO BE READ WITH SECTION 132/132A . IT CANNOT BE READ INDEPENDENT OF S. 132A. JURISDICTION U/S 1 53C CAN BE ASSUMED ONLY WHEN THE AO OF THE SEARCHED PERSON HAN DS OVER THE ASSETS REQUISITIONED U/S 132A TO THE JURISDICTI ONAL AO OF THE ASSESSEE [OTHER THAN THE SEARCHED PERSON]. THE ASSETS CAN BE REQUISITIONED U/S 132A ONLY WHEN THE DIRECTOR GE NERAL ETC., WHO AUTHORISES REQUISITION, HAS REASON TO BELIEVE B ASED ON INFORMATION IN POSSESSION, THAT THE SAID ASSETS REP RESENT UNDISCLOSED INCOME OR PROPERTY. IN OTHER WORDS, TH E ASSETS WHICH REPRESENT UNDISCLOSED INCOME OR PROPERTY ARE REQUISITIONED U/S 132A. IF THE ASSETS SO REQUISITI ONED BELONG TO THE SEARCHED PERSON, ASSESSMENT IS MADE U/S 153A. IF THE ASSETS SO REQUISITIONED BELONG TO OTHER PERSON, A SSESSMENT IS MADE ON SUCH OTHER PERSON U/S 153C. THEREFORE, W HETHER IT IS AN ASSESSMENT U/S 153A OR 153C, THE SINE QUA NON IS THAT THE REQUISITIONED ASSETS SHOULD REPRESENT EITHER WHOLLY OR PARTLY INCOME OR PROPERTY WHICH HAS NOT BEEN OR WOULD NOT BE DISCLOSED. IF THIS CONDITION IS NOT FULFILLED, THE N THE ENTIRE ASSESSMENT U/S 153C IS VOID AB INITIO. > THAT IN ORDER TO INVOKE S. 153C, RECORDING OF SA TISFACTION, IN WRITING, BY THE AO OF THE SEARCHED PERSON THAT TH E SEIZED ASSETS BELONG TO THE OTHER PERSON AND THAT THEY R EPRESENT ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 29 OF 78 UNDISCLOSED INCOME OF THE OTHER PERSON IS A PREREQU ISITE. IF THE SATISFACTION IN THE MANNER AS AFORESAID IS NOT RECO RDED, THEN PROCEEDINGS U/S 153C CANNOT BE INITIATED. THAT THE RE IS NOTHING ON RECORD TO PROVE THAT THE AO OF HISHAM HA S RECORDED HIS SATISFACTION THAT THE SEIZED CASH BELONGED TO T HE ASSESSEE AND THE SAME REPRESENTED UNDISCLOSED INCOME OF THE ASSESSEE. THE REVENUE IS REQUIRED TO PRODUCE THE RECORD OF SA TISFACTION; > THAT SINCE ALL THE SEARCH CASES HAD BEEN CENTRALI ZED TO DCIT, CC 1(1), THE AO OF HISHAM AND THE ASSESSEE ARE THE SAME. EVEN IF THE AO OF THE SEARCHED PERSON AND THE OTHER PERSON ARE SAME, STILL IT IS ESSENTIAL THAT THE SATISFACTION U /S 153C SHOULD BE ARRIVED AT AND DULY RECORDED. RELIES ON THE FOLLOWING CASE LAWS : (I) KRISHNA SUGAR CORPORATION V. DCIT (2011) 16 TAXMANN .COM 237 (LUCK. TRIB.); (II) CIT V. JAMUNA PRASAD KANHAIYA LAL UNNAO (2012) 210 TAXMAN 103(ALL) > THAT THE AO OF THE PERSON SEARCHED MERELY RELIED ON THE STATEMENT RECORDED U/S 131 TO COME TO THE CONCLUSIO N THAT THE SEIZED CASH BELONGED TO THE ASSESSEE; AND THAT THE PROVISIONS U/S 153C CANNOT BE INVOKED MERELY ON THE BASIS OF STATEMENT RECORDED U/S 131. THE AO OF THE PERSON S EARCHED IS REQUIRE TO OBTAIN OTHER DOCUMENTARY EVIDENCE TO CORROBORATE THE ASSERTIONS MADE IN THE STATEMENT RECORDED U/S 1 31. THE ONUS CAST ON HIM IS HIGH. S. 153C STATES THAT THE AO OF THE PERSON SEARCHED SHOULD BE SATISFIED THAT THE SEIZED BOOKS OF ACCOUNT, MONEY, ETC., BELONG TO OTHER PERSON. WITH REGARD TO ISSUE OF NOTICE U/S 153C WITHOUT PRO PER APPLICATION OF MIND: > THAT IN ORDER TO INITIATE PROCEEDINGS U/S 153C, A VALID NOTICE IN THE MANNER PROVIDED IN S. 153C IS TO BE ISSUED. IF THE NOTICE ISSUED REFLECTS NON-APPLICATION OF MIND, THEN THE E NTIRE PROCEEDINGS ARE VOID AB INITIO AND THE ORDER BASED ON SUCH VOID PROCEEDINGS IS LIABLE TO BE QUASHED. A READIN G OF THE NOTICE SHOWS THAT THE AO HAD ISSUED THE NOTICE IN A MECHANICAL MANNER WHICH READS AS UNDER: ACTION U/S 132 OF THE INCOME-TAX ACT, 1961 WAS INITIATED IN YOUR CASE ON 5.08.2008 WHEREIN CERTAIN ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 30 OF 78 BOOKS OF ACCOUNT AND DOCUMENTS HAVE BEEN SEIZED. O N THE BASIS OF THE SEIZED MATERIAL, I HAVE REASON TO BELIEVE THAT YOU HAVE NOT DISCLOSED THE INCOME CHARGEABLE T O TAX. > THAT THIS IS FACTUALLY INCORRECT. NO SEARCH U/S 132 WAS CARRIED EITHER IN RESPECT OF THE ASSESSEE OR IN RESPECT OF HISHAM SYED TAMIZ. IT WAS RATHER A CASE OF REQUISITION, RELATI NG TO HISHAM U/S 132A. THERE WAS NO SEIZURE OF ANY MATERIAL FRO M THE ASSESSEE. AS SUCH, THE CONTENTS OF THE SAID NOTICE WERE ENTIRELY INCORRECT. AS THE NOTICE ISSUED U/S 153C REFERS TO NON-EXISTING SEARCH AND, AS THE NOTICE REFERS TO SE IZED MATERIAL WITHOUT THERE BEING ACTUAL SEIZURE, THE SAID NOTICE WAS NOT VALID. IN THE SAID NOTICE, THERE WAS NO REFERENCE TO THE REQUISITION ISSUED U/S 132A AND SATISFACTION ARRIVE D AT AS REQUIRED U/S 153C. THEREFORE, THE AFORESAID NOTICE WAS ISSUED WITH NO APPLICATION OF MIND. RELIES ON THE FOLLOWING CASE LAWS : (I) MANISH MAHESHWARI V. ACIT 289 ITR 341 (SC); (II) DILIP N. SHROFF V. JCIT (2007) 219 ITR 519 (SC); (III) UNION OF INDIAS V. DHARMENDRA TEXTILE PROCESSORS (2008) 306 ITR 277 (SC); & (IV) CIT V. RELIANCE PETRO PRODUCTS (P) LTD (2010) 322 I TR 158 (SC); & (V) M/S. VEERABHADRAPPA SANGAPPA & CO V. ACIT ITA NO.1359/BANG/2008 [THE FINDINGS OF THE TRIBUNAL WAS CONFIRMED BY THE HONBLE KARNATAKA H.C IN ITA NO.5209/2009. > THAT AS THE NOTICE U/S 153C WAS NOT ISSUED IN TH E MANNER STIPULATED UNDER THE SAID SECTION, THE SAID NOTICE WAS INVALID AND THE ENTIRE PROCEEDINGS WERE THUS VOID. HENCE, THE ORDER U/S 153C IS LIABLE TO BE QUASHED. 7.1. ON THE OTHER HAND, THE SUBMISSIONS MADE ON BE HALF OF THE REVENUE ARE SUMMARIZED AS UNDER: THAT REQUISITION U/S 132A OF THE ACT WAS ISSUED IN THE CASE OF SRI HISHASM SYED TAMIZ ON 5.8.2008 AND BASED ON THE ADMISSION OF SRI TAMIZ IN HIS STATEMENT ON OATH; TH E STATEMENTS OF THE DIRECTOR OF THE ASSESSEE AS WELL AS SMT JAYASHREE ULLAL WERE RECORDED. BOTH OF THEM HAVE A DMITTED ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 31 OF 78 THAT THE CASH REQUISITIONED IN THE HANDS OF TAMIZ W AS BELONGED TO THE ASSESSEE AND THAT THE SAID AMOUNT R EQUIRED TO BE ADJUSTED AGAINST THE DISCHARGE OF LIABILITIES OF THE ASSESSEE AND THAT THERE WAS NO DISPUTE REGARDING TH E AMOUNT BELONGED TO THE ASSESSEE. A SATISFACTION NOT E WAS RECORDED TO THE EFFECT THAT THE AMOUNT FOUND IN POS SESSION OF SRI TAMIZ BELONGED TO THE ASSESSEE AND, HENCE, T HE SATISFACTION NOTE WAS IN ACCORDANCE WITH THE PROVIS IONS OF THE ACT. IT WAS SETTLED POSITION OF LAW THAT WHILE THE COURTS EXAMINES THE SATISFACTION RECORDED BY THE AO, THE SUFFICIENCY CANNOT BE LOOKED INTO; THAT SRI TAMIZ AND THE ASSESSEE WERE BEING ASSESSED BY THE SAME AO. THOUGH THE PROVISIONS OF S.153C CONTEMPLATES THE HANDING OVER OF SEIZED MATERIAL/CA SH TO THE AO HAVING JURISDICTION OVER SUCH OTHER PERSON, IN THE PRESENT CASE, AS THE AO IN RESPECT OF SUCH OTHER PE RSON BEING SAME AS THAT OF THE REQUISITIONED PERSON, THE QUESTION OF HANDING OVER OF CASH DOES NOT ARISE. T HUS, THE HANDING OVER OF SEIZED MATERIAL IS NOT A REQUIREMEN T IF THE AO IS THE SAME IN RESPECT OF SEARCHED/REQUISITIONED PERSON AND SUCH OTHER PERSON. HENCE, INVOKING OF S. 153C WAS JUST AND PROPER; THAT NOTICE U/S 153C WAS ISSUED AFTER RECORDING SATISFACTION. THE ACT PROVIDES FOR ISSUANCE OF A N OTICE TO SUCH OTHER PERSON ON RECORDING OF SATISFACTION REGA RDING SEIZED MATERIAL BELONGING TO SUCH OTHER PERSON. PR OCEDURE PRESCRIBED FOR CALLING UPON SUCH OTHER PERSON TO FI LE A RETURN IS U/S 153A AND THAT THE NOTICE U/S 153A IS A PROCEDURAL, ANY DEFECT IN THE SAID NOTICE IS COVERE D U/S 292B OF THE ACT. THE MATERIAL AVAILABLE WITH THE A O TO ISSUE A NOTICE U/S 153C NEED NOT BE REPRODUCED IN THE SAID NOTICE. WHEN INVOKING OF JURISDICTION U/S 153 C IS DISPUTED, THEN ONLY THE COURT CAN LOOK INTO THE MAT ERIAL AVAILABLE WITH THE AO FOR INVOKING S.153C. IT IS A LSO SETTLED IN LAW THAT SATISFACTION/REASONS RECORDED FOR ISSUA NCE OF A NOTICE IS NOT REQUIRED TO BE FURNISHED TO THE ASSES SEE TILL A RETURN IS SUBMITTED IN COMPLIANCE TO THE SAID NOTIC E. THE ADMISSIONS OF THE DIRECTOR OF THE ASSESSEE AND SMT JAYASHREE ULLAL CONFIRM THE JURISDICTION U/S 153C O F THE ACT; ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 32 OF 78 THAT WHILE LOOKING INTO THE VALIDITY OF THE NOTICE, THE JUDICIARY HAS TO LOOK INTO THE OBJECT AND REQUIREME NTS OF ISSUANCE OF SUCH NOTICE AND ON SATISFACTION THAT TH E SAID NOTICE IS IN CONFORMITY WITH THE OBJECT, THE CURABI LITY OR OTHERWISE OF THE DEFECT IN THE NOTICE, IF ANY, HAS TO BE LOOKED IN TO. IN THE PRESENT CASE, THE SEQUENCE OF EVENTS, I.E., REQUISITION OF CASH U/S 132A FROM SRI TAMIZ , HIS STATEMENT THAT THE CASH BELONGS TO THE ASSESSEE, ACCEPTANCE AND CONFIRMATION OF THE SAME BY THE M.D AND CFO OF THE ASSESSEE AND SATISFACTION NOTE OF THE AO CLEARLY INDICATE THAT A NOTICE U/S 153C WAS ISSUED IN ORDER TO BRING THE SEIZED CASH WHICH BELONGED TO THE ASSESSE E TO TAX U/S 153A OF THE ACT. WITH THIS BACKGROUND IF THE N OTICE ISSUED U/S 153C IS LOOKED INTO, IT IS CLEAR THAT NO TICE WAS ISSUED IN SUBSTANCE AND EFFECT IN CONFORMITY WITH O R ACCORDING TO THE INTENT AND PURPOSE OF THIS ACT. H ENCE, THE DEFECT, IF ANY, IN THE NOTICE ISSUED U/S 153C IS CU RED U/S 292B OF THE ACT. RELIES THE FOLLOWING CASE LAWS: (I) S.NARAYANAPP AND ORS V. CIT (1966) 62 ITR (SH.N.9)(SC); (II) RAYMOND WOOLLEN MILLS LTD V. ITO & ORS (1999) 236 ITR 34(SC); & (III) ACIT V. RAJESH JHAVERI STOCK BROKERS P LTD (2007) 291 ITR 500 (SC); 7.2. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBM ISSIONS, RELEVANT MATERIALS ON RECORDS AND ALSO THE CASE LAW S ON WHICH EITHER OF THE PARTY HAVE PLACED THEIR RELIANCE. THE REQUISITION U/S 132A OF THE ACT WAS ISSUED IN THE CASE OF SRI HISHA M SYED TAMIZ AND HIS STATEMENT WAS RECORDED U/S 131 OF THE ACT O N THE SAME DAY I.E., 5.8.2008. IN HIS SUBSEQUENT STATEMENT U/ S 131 OF THE ACT ON 7.10.2008, HE HAD REITERATED WHAT HAS BEEN A DMITTED EARLIER U/S 131 OF THE ACT DT.5.8.2008. TO QUESTIO N NO.7, HE HAD DEPOSED AS UNDER: I AGREE THAT OUT OF THE AMOUNT OF RS.9,84,85,000/- FOUND IN MY POSSESSION ON 05/08/2008, A SUM OF RS.9,70,00,00 0 ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 33 OF 78 BELONGS TO M/S HIMALAYA DRUG COMPANY. IN THE STATE MENT RECORDED FROM ME ON 05/08/2008 I HAD WRONGLY STATED THAT THE ENTIRE AMOUNT OF RS.9,84,85,000/- FOUND IN MY P OSSESSION BELONGED TO SRI MERAJ MANAL. THE BALANCE AMOUNT OF RS.14,85,000 BELONGS TO ME WHICH IS EARNED OUT OF M Y CAR BUSINESS. I HAD IN MY POSSESSION TWO CARS REMAININ G UNSOLD AS ON 31.03.2008 AND THE SAME WAS SOLD TO M/S CITIZ EN CARS IN THE MONTH OF JULY, 2008. THESE TWO CARS HAVE AL SO BEEN SHOWN AS CLOSING STOCK IN THE P & L ACCOUNT SUBMITT ED TO YOU.. 7.2.1. IN HER STATEMENTS RECORDED ON OATH U/S 1 31 OF THE ACT ON 5.8.2008 AND AGAIN ON 29.9.2008, SMT. JAYASHREE ULLAL, CFO OF THE ASSESSEE COMPANY HAD EXPLICITLY ACKNOWLEDGED , WHILE ANSWERING TO QUESTION NO.3 (ON 29.9.2008) AS UNDER: WE HAVE RECEIVED TOTAL CASH OF RS.9,73,21,710.00 REGARDING THE TOTAL CASH OF RS.9,84,85,000.00 FOUND , WE SUBMIT THAT OUR CASH IS ONLY RS.9,70,00,000.00. WE THOUGHT THAT THE BALANCE CASH COULD BE OUT OF COUNTING ERRO R AS MR SHABIR SHERIFF HAD NOT COUNTED THE CASH WHEN THE SA ME IS HANDED OVER TO HIM. HOWEVER, OUR PURCHASER HAS CO NFIRMED THAT HE HAD COUNTED THE CASH AND, THEREFORE, THERE CANNOT BE ANY ERROR. IN VIEW THEREOF, WE ARE CONVINCED THAT THIS DIFFERENCE IN THE AMOUNT MUST BE CASH BELONGING TO MR HISHAM AND IT DOES NOT BELONG TO US. WE HEREBY CON FIRM THAT OUR AMOUNT WHICH WAS IN HIS POSSESSION WAS ONLY RS.9,70,00,000/- AND BALANCE CASH DOES NOT BELONG T O US. 7.2.2. THUS, IT IS ABUNDANTLY CLEAR AND ESTABLI SHED THAT THE AMOUNT BELONGED TO THE ASSESSEE. ACCORDINGLY, A SA TISFACTION NOTE WAS RECORDED TO THE EFFECT THAT THE AMOUNT FOU ND IN POSSESSION OF SRI TAMIZ DID BELONG TO THE ASSESSEE. ADMITTEDLY, SRI TAMIZ AND THE ASSESSEE WERE ASSESSED BY THE SAM E ASSESSING OFFICER. AS RIGHTLY POINTED OUT BY THE REVENUE, TH E PROVISIONS OF S. 153C CONTEMPLATE HANDING OVER OF THE SEIZED MATE RIAL/CASH TO THE AO HAVING JURISDICTION OVER SUCH OTHER PERSON. AS PER THE PROVISIONS OF S. 153C. WHERE THE ASSESSING OFFICER IS SATISFIED ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 34 OF 78 THAT ANY MONEY.SEIZED OR REQUISITIONED BELONGS O R BELONG TO A PERSON OTHER THAN THE PERSON REFERRED TO IN SECTI ON 153A, THEN THE BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED SHALL BE HANDED OVER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON AND THAT ASSESS ING OFFICER SHALL PROCEED AGAINST EACH SUCH OTHER PERSON AND ISSUE SU CH OTHER PERSON NOTICE AND ASSESS OR REASSESS INCOME OF SUCH OTHER PERSON IN ACCORDANCE WITH THE PROVISIONS OF SECTION 153A. . INCIDENTALLY, IN THE PRESENT CASE, AS THE AO IN RESPECT OF SUCH O THER PERSON WAS SAME AS THAT OF THE REQUISITIONED PERSON AND, T HUS, THE QUESTION OF HANDING OVER OF CASH DID NOT ARISE. IN THIS CONNECTION, WE WOULD LIKE TO REFER TO THE FINDINGS OF THE HONBLE ITAT, AHMEDABAD BENCH B IN THE CASE OF BHARAT GIN NING & PRESSING FACTORY V. ITO REPORTED IN (2013) 32 TAXMA NN.COM 322 (AHMEDABAD TRIB). AFTER EXTENSIVELY ANALYSING TH E RIVAL SUBMISSIONS, THE HONBLE BENCH HAS RECORDED ITS FIN DINGS AS UNDER: 5THE SEARCH OPERATION WAS CARRIED OUT AT TH E RESIDENCE AS WELL AS BUSINESS PREMISES OF SHRI YAKU B A COLDDRINK WHERE FROM THE BOOKS OF ACCOUNT OF THE FI RM AS PER ANNEXURE A/11 & A/12 AND LOOSE PAPER AS PER ANNEXUR E 3 WERE FOUND AND SEIZED. AS PER SECTION 153C, THE BO OKS OF ACCOUNT BELONGING TO THE OTHER PERSON IS REQUIRED T O BE FOUND AND SEIZED AT THE PREMISES OF THE SEARCH TOOK PLACE WHERE ASSESSMENT U/S 153A HAS BEEN MADE I.E., SEARCHED PA RTY. FOR INITIATING PROCEEDING U/S 153C, IT IS NOT NECES SARY THAT THESE BOOKS OF ACCOUNT SHOULD BE INCRIMINATING. WH EN BOOKS OF ACCOUNT OF THE APPELLANT FOUND AND SEIZED FROM T HE SEARCH PLACE OF THE PARTNER OF THE FIRM, THE AO IS FULLY E MPOWERED TO INITIATE PROCEEDING U/S 153C OF THE IT ACT AGAINST THE FIRM I.E., OTHER PERSON. THE AO OF BOTH PARTNERS AS WELL AS F IRM WAS SAME. THEREFORE, NO SEPARATE SATISFACTION IS REQUI RED TO BE RECORDED AS HELD IN THE CASE OF CIT V. PANCHAJANYAM MANAGEMENT AGENCIES & SERVICES [2011] 333 ITR 281/[ 2012] 20 TAXMANN.COM 584 (KER) WHEREIN IT WAS HELD THAT S EARCH IN PREMISES OF THE MANAGING PARTNER SAME AO HAVING ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 35 OF 78 JURISDICTION OVER MANAGING PARTNER AND FIRM NOTIC E TO FIRM U/S 158BD R.W.S. 158BC, THE AO NEED NOT TO RECORD R EASONS BLOCK ASSESSMENT OF FIRM IS VALID. THE CASE LAWS C ITED BY THE APPELLANT ARE SQUARELY NOT APPLICABLE AS IN CASE OF AL. CARGO GLOBAL LOGISTIC LTD (SUPRA) IS TOTALLY ON DIFFERENT FOOTING WHICH WAS ON APPORTIONMENT OF THE DISCLOSURE BETWEEN 80IA UNIT OR NON 80IA UNIT. IN ASSESSEES CASE, IN ALL THE YEAR S, NO SCRUTINY ASSESSMENT HAS BEEN MADE BY THE AO. THE RE TURN OF THE APPELLANT HAD BEEN PROCESSED U/S 143(1)(A)AND I T WAS HELD BY THE HONBLE APEX COURT IN THE CASE OF ASSTT . CIT V. RAJESH JHAVERI STOCK BROKERS (P) LTD (2007) 291 ITR 500/161 TAXMAN 316 (SC), INTIMATION U/S 143(1)(A) CANNOT BE TREATED TO BE AN ORDER OF ASSESSMENT AND THERE BEING NO ASS ESSMENT U/S 143(1)(A). THE SECTION 153D HAS BEEN AMENDED W . E. F. 1.6.2007 WHEREAS THE LD. AO HAS PASSED ORDERS U/S 1 53C IN ALL THE YEARS ON 24.3.2006. THUS, NO APPROVAL OF J CIT/ACIT IS REQUIRED. KEEPING IN VIEW OF THE FACTS AND LEGA L POSITION ON THIS ISSUE, WE HAVE CONSIDERED VIEW THAT CIT (A) WA S RIGHT IN CONFIRMING THE ACTION OF THE AO U/S 153 OF THE IT A CT. . 7.2.3. IN CONFORMITY WITH THE FINDINGS OF THE HONBLE ITAT, AHMEDABAD (SUPRA), WE ARE OF THE VIEW THAT NO SEPARATE SATISFACTION WAS REQUIRED TO BE RECORDED BY THE AO AS THE AO WAS SAME IN RESPECT OF SEARCHED/REQUIRED PERSON [SR I TAMIZ] AND SUCH OTHER PERSON [THE ASSESSEE]. WITH REGARD T O THE ISSUANCE OF NOTICE U/S 153C OF THE ACT WITHOUT PROP ER APPLICATION OF MIND AS ALLEGED BY THE LEARNED AR, W E WOULD LIKE TO POINT OUT THAT THE AO HAD CLEARLY MENTIONED IN T HE SAID NOTICE THAT (AT THE COST OF REPETITION) ACTION U/S 132 OF THE INCOME-TAX ACT, 1961 WAS INITIATED IN YOUR CASE ON 5.08.2008 WHEREIN CERTAIN BOOKS OF ACCOUNT AND DOCUMENTS HAVE BEEN SEIZED. ON THE BASIS OF THE SEIZED MATERIAL, I HAV E REASON TO BELIEVE THAT YOU HAVE NOT DISCLOSED THE INCOME CHAR GEABLE TO TAX. THE SAME CANNOT BE TERMED THAT THE NOTICE WAS ISSUED IN A MECHANICAL MANNER AS MENTIONED BY THE L EARNED AR. IN LOOKING INTO THE SCENARIO WHICH TOOK PLACE IN THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 36 OF 78 ASSESSEES CASE AS RIGHTLY POINTED OUT BY THE REVEN UE, I.E., REQUISITION OF CASE U/S 132A OF THE ACT FROM SRI TA MIZ, HIS STATEMENT ON OATH THAT THE CASH BELONGED TO THE ASS SESSEE, ACKNOWLEDGING AND CONFIRMING THE STATEMENT OF SRI TAMIZ NOT ONLY BY THE MANAGING DIRECTOR BUT ALSO BY THE CFO OF THE ASSESSEE ON OATH AND THE SATISFACTION NOTE OF THE A O CLEARLY INDICATE THAT A NOTICE U/S 153C WAS ISSUED IN ORDER TO BRING THE SEIZED CASH WHICH ADMITTEDLY BELONGED TO THE AS SESSEE TO TAX U/S 153A OF THE ACT. 7.2.4. WE HAVE, WITH DUE RESPECTS, PERUSED THE CASE LAWS ON WHICH THE LEARNED AR PLACED RELIANCE AND OF THE VIEW THAT THEY ARE NOT DIRECTLY APPLICABLE TO THE FACTS OF TH E ISSUE ON HAND. 7.2.5. IN VIEW OF THE SEQUENCE OF THE EVE NTS NARRATED ABOVE, WE ARE OF THE VIEW THAT THE ISSUANCE OF A NO TICE U/S 153C OF THE ACT WAS IN FACT, IN ACCORDANCE WITH AND ACCORDING TO INTENT AND PURPOSE OF THE I.T. ACT. IF THERE W ERE TO BE ANY LACUNAE IN THE ISSUANCE OF SUCH NOTICE U/S 153C OF THE ACT, THE PROVISIONS OF S. 292B OF THE ACT WILL TAKE CARE OF THE SAME. IN SUBSTANCE, THERE WAS NO ANY INFIRMITY IN THE SEA RCH PROCEEDINGS AND ORDER MADE U/S 153C OF THE ACT. AC CORDINGLY, THIS GROUND IS DECIDED AGAINST THE ASSESSEE. IT IS ORDERED ACCORDINGLY. GROUND NO. XVI : VALIDITY OF REFERENCE TO TPO WHEN THE ASSESSMENT WA S NO MORE PENDING AS ON THE DATE OF SEARCH/REQUISITION A ND NO INCRIMINATING MATERIAL WAS FOUND DURING THE SEARCH : ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 37 OF 78 8. IN THIS GROUND THE ASSESSEE CONTENDS THAT SINCE NO INCRIMINATING MATERIALS WERE FOUND IN THE COURSE OF SEARCH/REQUISITION, THE ASSESSING OFFICER IS NOT JU STIFIED IN MAKING A REFERENCE TO THE TPO AND THE TRANSFER PRIC ING ADJUSTMENTS MADE FOR THE ASSESSMENT YEARS 2003-04 T O 2008-09 ARE INVALID. ADMITTEDLY, IN THE INSTANT CASE, ONLY ADDITION FOR THE ASSESSMENT YEARS CONCERNED ARE TRANSFER PRICING ADJ USTMENTS AND THERE IS NO INCRIMINATING MATERIAL FOUND IN THE COURSE OF REQUISITION RELATABLE TO THE TRANSFER PRICING ADJUS TMENTS. THEREFORE, ACCORDING TO THE LEARNED AR, THE ASSESSM ENT COMPLETED PERTAINING TO THE TRANSFER PRICING ADJUST MENTS IS INVALID. FOR THE ABOVE PROPOSITION, THE LEARNED AR S RELIANCE WAS ON THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. CHAITANDAS LACHMAN DAS (2012) 211 TAXMANN 6 1 (DEL). ALTERNATIVELY, IT WAS ARGUED THAT THE ASSESSMENTS F OR ASSESSMENT YEARS 2003-04 TO 2006-07 WERE FINALISED/CONCLUDED A ND HAS NOT ABATED AS ON THE DATE OF HANDING OVER OF THE SEIZED CASH TO THE JURISDICTIONAL ASSESSING OFFICER (10.08.2008) AND, HENCE, THE ASSESSMENT U/S 153C CAN BE BASED ONLY ON THE SEIZED MATERIAL. FOR THE ABOVE PROPOSITION, THE LEARNED AR PLACES RE LIANCE ON (I) THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF ABHINAV KUMAR MITTAL REPORTED IN 351 ITR 20(DELHI) AND (II) THE ORDER OF THE SPECIAL BENCH OF THE TRIBUNAL IN THE C ASE OF ALL CARGO GLOBAL LOGISTIC LTD VS. DCIT (2012) 23 TAXMAN N.COM 103 (MUMBAI) (S.B). 8.1. CONTRADICTING THE CONTENTION OF THE ASSESSEE THAT NO DOCUMENT WAS FOUND AS A CONSEQUENCE OF REQUISITION U/S 132A OF THE ACT IN THE CASE OF SRI TAMIZ AND, HENCE, A R EFERENCE TO THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 38 OF 78 TPO WAS INCORRECT ETC., IT WAS ARGUED ON BEHALF OF THE REVENUE THAT- S.153 HAS BEEN BROUGHT INTO STATUTE BY THE FINANCE ACT, 2003 W.E.F. 1.6.2003 FOR ASSESSMENTS IN RESPECT OF SEARCH U/S 132 OR REQUISITION U/S 132A AFTER 31.5.2003. PR IOR TO 1.6.2003, SEARCH AND REQUISITION, ASSESSMENTS WERE DEALT UNDER CHAPTER XIV-B OF THE ACT. THE PROVISIONS OF C H.XIV-B WERE DEALING WITH BLOCK ASSESSMENT IN RESPECT OF TH E UNDISCLOSED INCOME FOUND DURING THE COURSE OF SEARCH/REQUISITION. THE ASSESSMENT UNDER CH. XIV-B WAS IN ADDITION TO THE REGULAR ASSESSMENT I.E. DUAL ASSESSMENTS, ONE UNDER CH.XIV-B AND ANOTHER UNDER CH.XIV OF THE ACT. BY INTRODUCTION OF SECTION 153A, 153B, 153C AND 153 D, THE PARLIAMENT HAS BROUGHT IN SINGLE ASSESSMENT CON CEPT IN PLACE OF DUAL ASSESSMENTS, NAMELY UNDER CH. XIV AND XIV- B OF THE ACT. THE ASSESSMENT UNDER CH.XIV-B WAS CON FINED TO THE UNDISCLOSED INCOME FOUND DURING THE COURSE O F SEARCH AND ANY ADDITION TO BE MADE UNDER CH.XIV-B B E UNDISCLOSED INCOME AND AS A RESULT OF EVIDENCE FOUN D IN THE SEARCH/ REQUISITION; S.153 PROVIDES FOR ASSESSMENT/RE-ASSESSMENT NOT WITHSTANDING ANYTHING CONTAINED IN SECTIONS 139, 14 7, 148, 149 AND 153 WHEN SEARCH U/S 132 OR REQUISITION U/S 132A OF THE ACT INITIATED AFTER 31.5.2003 AND ADMITTEDLY , IN THE PRESENT CASE, REQUISITION U/S 132A WAS AFTER 31.5.2 003; IF SEARCH U/S 132 OR REQUISITION U/S 132A IS INITIA TED OR ANY SATISFACTION U/S 153C IS RECORDED REGARDING BELONGI NG OF MONEY ETC., OR BOOKS OF ACCOUNTS OR DOCUMENT SEIZED OR REQUISITION TO A PERSON OTHER THAN REFERRED TO IN S . 153A, THE INITIATION OF PROCEEDINGS EITHER FOR ASSESSMENT OR RE- ASSESSMENT IS MANDATORY. IN VIEW OF THE LANGUAGE EM PLOYED IN S.153A, THE ASSESSING OFFICER HAS NO OPTION BUT TO INITIATE PROCEEDINGS U/S 153A OF THE ACT AND ASSESS EE/RE- ASSESS IN RESPECT OF SIX AYS IMMEDIATELY PRECEDING THE AY RELEVANT TO THE PREVIOUS YEAR IN WHICH SEARCH WAS CONDUCTED/REQUISITION WAS MADE; LIKE BLOCK ASSESSMENT IN CH.XIV-B, THE ASSESSMENTS U/S 153A IS NOT CONFINED TO MATERIAL FOUND AS A RESULT OF ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 39 OF 78 SEARCH/REQUISITION AND THE ASSESSING OFFICER IS EMP OWERED TO PROCEED U/S 153A IRRESPECTIVE OF ANYTHING FOUND AND SEIZED IN THE COURSE OF SEARCH/REQUISITION. IN THE SCHEME OF S.153A, THE ASSESSMENTS PENDING WO ULD ABATE AND THE ASSESSMENTS COMPLETED STANDS RE-OPENE D NOTWITHSTANDING THE PRE-CONDITIONS/RESTRICTIONS IMP OSED U/S 139, 147, 148, 149, 151 AND 153 OF THE ACT. THE ASSESSING OFFICER CAN PROCEED TO ASSESS OR RE-ASSES S THE INCOME OF THE ASSESSEE EVEN IN THE ABSENCE OF ANY M ATERIAL BEING FOUND AND SEIZED IN THE COURSE OF SEARCH/REQU ISITION. IT IS AN ASSESSMENT/RE-ASSESSMENT OF ESCAPED INCOME ; FOR PROCEEDING WITH ASSESSMENTS U/S 153A, PRE-CONDI TION IS SEARCH/REQUISITION. DETECTION OF ANY UNDISCLOSED INCOME OR MATERIAL FOUND IN THE COURSE OF SEARCH AND REQUI SITION IS NOT A PRECONDITION FOR PROCEEDING WITH ASSESSMENT/R E- ASSESSMENT U/S 153A IN VIEW OF CLEAR LANGUAGE EMPLO YED THEREIN AND, THUS, SEIZURE OF MATERIAL IS IMMATERIA L. ALL THE DECISIONS RELIED ON BY THE ASSESSEE IN SUPP ORT OF THE PROPOSITION THAT NO ASSESSMENT OR RE-ASSESSMENT CAN BE MADE WITHOUT ANYTHING BEING FOUND IN SEARCH/REQUISI TION IS CONTRARY TO THE SCHEME OF ASSESSMENTS U/S 153A. THE JUDGMENTS HAVE MIXED UP THE CONCEPT OF ASSESSMENT U NDER CH.XIV-A AND XIV OF THE ACT; AND THAT NONE OF THE JUDGMENTS RELIED ON BY THE ASSESSEE DO LAID DOWN TH E CORRECT LAW AND THE SAME ARE DISTINGUISHABLE ON THE FACTS OF THE ISSUE; WITHOUT ADMITTING, IF ASSESSMENTS ARE INITIATED U/S 153A AND IF ANY INCOME ESCAPED ASSESSMENT IS FOUND IN TH E COURSE OF ASSESSMENT AND IF THE AO HAS NOT FOUND AN Y MATERIAL AND IN THE COURSE OF SEARCH/REQUISITION, I F THE JUDGMENTS RELIED ON ARE APPLIED, THERE IS NO REMEDY PROVIDED TO BRING SUCH ESCAPED INCOME TO TAX AND TH AT THE ENTIRE CONCEPT OF ASSESSMENT/RE-ASSESSMENT U/S 153A OF THE ACT PURSUANT TO SEARCH OR REQUISITION WOULD BE DEFEATED; IN VIEW OF THE ASSESSMENT U/S 153A BEING ASSESSMENT /RE- ASSESSMENT, UTMOST RESTRICTION ON THE ASSESSING OFF ICER IS NOT TO RELOOK INTO THE ISSUES ALREADY BEING CONSIDE RED IN A COMPLETED ASSESSMENT ON APPLICATION OF MIND AND ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 40 OF 78 RECORDING COGENT REASONS. ADMITTEDLY IN THE PRESENT CASE, THERE WAS NO REFERENCE TO THE TPO BY THE ASSESSING OFFICER AND FURTHER, 3CEB REPORT DOES NOT REPORT THE EXPEND ITURE INCURRED BY THE ASSESSEE ON AMP. THUS, IT WAS A CAS E OF ASSESSMENT AND NO MATERIAL WAS REQUIRED TO BE FOUND IN THE COURSE OF REQUISITION. FURTHER, IN AS REOPENED ASSESSMENT EACH AND EVERY ISSUE WAS OPEN BEFORE THE ASSESSING OFFICER EXCEPT CONCLUDED ON APPLICATION O F MIND. UTMOST, THE ASSESSING OFFICER MAY NOT DISTURB THE F INDING IN A CONCLUDED ASSESSMENT UNLESS OTHERWISE SOMETHIN G FOUND IN THE COURSE OF REQUISITION CONTRARY TO THE MATERIAL CONSIDERED FOR RECORDING HIS FINDING IN A CONCLUDED ASSESSMENT. IN SUCH A POSITION, DETECTION OF MATERI AL IN THE COURSE OF SEARCH/REQUISITION MAY BE REQUIRED; IN THE INSTANT CASE, PROCEEDINGS HAVE BEEN INITIATE D U/S 132A OF THE ACT IN THE CASE OF SRI TAMIZ. THE SCOPE OF S.132 AND 132A IS DIFFERENT. IN THE PRESENT CASE, REQUIS ITION U/S 132A WAS ISSUED AS THE CASH FOUND IN THE POSSESSION OF SRI TAMIZ WAS NOT RECORDED IN THE BOOKS OF ACCOUNTS AND HE WOULD NOT HAVE DISCLOSED THE SAME FOR THE PURPOSES OF THE ACT; WITHOUT ADMITTING THE SCOPE OF S.132 AS ANALYZED BY THE ITAT (SB) IN THE CASE OF ALL CARGO GLOBAL LOGISTIC LIMITED IS DIFFERENT FROM THE SCOPE OF SECTION. 132A OF THE AC T. AS HELD BY THE TRIBUNAL, WARRANT U/S 132 CAN BE ISSUED ONLY ON SATISFACTION OF ANY OF THE CONDITION ENUMERATED IN S.132 OF THE ACT, WHEREAS FOR ISSUANCE OF REQUISITION U/S 13 2A, THE CONDITION TO BE SATISFIED ARE DIFFERENT. IN THE INS TANT CASE, REQUISITION WAS ISSUED ON BEING SATISFIED THE CASH IN THE POSSESSION OF SRI TAMIZ WAS NOT ACCOUNTED AND WOULD NOT HAVE BEEN DISCLOSED THE SAME FOR THE PURPOSE OF THE ACT. RELIES ON THE JUDGMENT OF THE HON'BLE DELHI HIGH CO URT IN THE CASE OF SSP AVIATION LTD. DISTINGUISHING THE FINDINGS OF THE SPECIAL BENCH OF THE MUMBAI ITAT (ALL CARGO GLOBAL LOGISTIC LTD V. DCIT (2012) 23 TAXMANN.COM 103(MUM.)(SB). IT WAS ARGUED THAT TH E REFERENCE MADE BY THE SPECIAL BENCH TO SEARCH AND S EIZURE WAS THE POWER CONFERRED ON THE AUTHORIZED OFFICER B Y VIRTUE OF THE WARRANT ISSUED U/S 132 OF THE ACT. THE SEIZU RE OF THE MATERIAL WAS NOT A PRE-CONDITION FOR INITIATION OF PROCEEDINGS U/S 153A. THE PRE-CONDITION WAS CONDUCT OF ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 41 OF 78 SEARCH U/S 132 OR REQUISITION U/S 132A OF THE ACT. THE SPECIAL BENCH DEALT WITH THE FACTUAL POSITION WHERE IN THE CASE WAS A SEARCH U/S 132 OF THE ACT AND THERE WAS NO DISPUTE REGARDING NON-DISCLOSURE OF THE CASH SEIZED FROM THE POSSESSION OF SRI TAMIZ. HENCE THE FINDINGS OF THE SPECIAL BENCH HAVE NO RELEVANCE TO THE FACTS OF THE ISSUE UNDER DISPUTE. 8.2. WE HAVE CAREFULLY EXAMINED THE RIVAL CONTENTIO NS AND ALSO PERUSED THE RELEVANT MATERIALS ON RECORD. THE MAIN CONTENTION OF THE ASSESSEE IS THAT SINCE NO INCRIMINATING MATERIA LS WERE FOUND IN THE COURSE OF SEARCH/REQUISITION, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING A REFERENCE TO THE TPO AND THE TRANSFER PRICING ADJUSTMENT MADE FOR ASSESSMENT YEARS 2003-0 4 TO 2008- 09 ARE INVALID. THIS CONTENTION OF THE ASSESSEE, AC CORDING TO US, IS TOO FAR-FETCHED. WITH THE INTRODUCTION OF SECTIO NS 153A, 153B, 153C AND 153D, THE LEGISLATURE HAS BROUGHT ABOUT SI NGLE ASSESSMENT CONCEPT IN PLACE OF DUAL ASSESSMENT CONT EMPLATED UNDER CHAPTER XIV-B. AS A RESULT, IN VIEW OF 2 ND PROVISO TO SECTION 153A, NORMAL ASSESSMENT PENDING DURING THE PROCEEDINGS U/S 153A OR 153C WILL ABATE AND ONLY SI NGLE ASSESSMENT IS TO BE MADE BOTH FOR DISCLOSED AND UND ISCLOSED INCOME. IF THE CONTENTION OF THE ASSESSEE IS ACCEPT ED, IT WILL LEAD TO ABSURD SITUATION WHEREBY EVEN REPORTED INCOME IN A RETURN OF INCOME COULD NOT BE TAXED WHEN THE SAME ABATE ON AC COUNT OF INITIATION OF PROCEEDINGS U/S 153A OR 153C. SUCH A SITUATION CAN NEVER BE IN THE CONTEMPLATION OF LEGISLATURE AND WE , OUT RIGHTLY REJECT THE MAIN CONTENTION OF THE ASSESSEE. 8.2.1. WE SHALL NOW PROCEED TO ANALYSE THE A LTERNATIVE CONTENTIONS PUT FORTH ON BEHALF OF THE ASSESSEE AS UNDER: ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 42 OF 78 WE ARE OF THE VIEW THAT THE ASSESSMENTS U/S 153C PERTAINING TO ASSESSMENT YEARS 2003-04 TO 2006-07 A RE TO BE RESTRICTED TO THE INCRIMINATING MATERIAL FOUND DURI NG THE COURSE OF SEARCH/REQUISITION IN VIEW OF THE FACT THAT THE ASSESSMENT PROCEEDINGS FOR THESE YEARS HAD ATTAINED FINALITY P RIOR TO THE INITIATION OF SEARCH. IN THIS CONTEXT, IT WOULD BE FRUITFUL TO PLACE THE FOLLOWING FACTS WITH REGARD TO THE ASSESSMENT P ROCEEDINGS WHICH TOOK PLACE PRIOR TO THE INITIATION OF REQUISI TION PROCEEDINGS U/S 132A OF THE ACT: THE ASSESSEE HAD FILED THE RETURN OF INCOME ALONG W ITH FORM 3CEB, AUDIT REPORT U/S 44AB AND OTHER DOCUMENT S REQUIRED TO BE ENCLOSED TO THE RETURNS FOR THE ASSE SSMENT YEARS 2003-04 AND 2004-05. THE RETURNS OF INCOME WE RE PROCESSED U/S 143(1) OF THE I.T. ACT, 1961 ACCEPTIN G THE RETURNED INCOME; THE ACIT SELECTED THE ASSESSEES RETURNS FOR SCRUTI NY BY ISSUING NOTICES U/S 143(2) AND 142(1) OF THE ACT FO R THE AFORESAID ASSESSMENT YEARS; THE ACIT DID NOT MAKE ANY REFERENCE TO THE TPO FOR COMPUTATION OF ARMS LENGTH PRICE (ALP) IN RELATION TO THE INTERNATIONAL TRANSACTIONS. THE ACIT PASSED SEPARAT E ORDERS DATED 15.02.2006 U/S 143(3) OF THE ACT (PAGE NOS.438 TO 463 OF THE PAPER BOOK), DISALLOWING CERT AIN EXPENSES AND MAKING CERTAIN ADDITIONS FOR EACH OF T HE AFORESAID ASSESSMENT YEARS. THE ACIT DID NOT MAKE A NY ADJUSTMENT U/S 92C(3) OF THE ACT. AGGRIEVED BY THE AFORESAID ORDER TO THE EXTENT IT W AS PREJUDICIAL TO THE INTEREST OF THE ASSESSEE, THE AS SESSEE PREFERRED AN APPEAL BEFORE THE CIT (A) WHO ALLOWED THE APPEAL IN PART; BOTH THE DEPARTMENT AND ASSESSEE FILED APPEALS/CROS S OBJECTION AGAINST THE SAID ORDER BEFORE THE TRIBUNA L. THE ITAT VIDE ITS ORDER DATED 28.03.2008 ALLOWED THE AS SESSEES APPEAL PARTLY, DISMISSED THE REVENUES APPEAL AND A LLOWED THE CROSS OBJECTIONS; ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 43 OF 78 SUBSEQUENTLY THE BANGALORE CITY POLICE HAD SEIZED C ASH OF RS.9.85 CRORES FROM THE RESIDENCE OF MR.HISHAM SYED TAMIZ. A WARRANT OF AUTHORIZATION U/S 132A WAS EXEC UTED BY THE ADIT TO REQUISITE THE SEIZED CASH FROM INSPE CTOR OF POLICE, JC NAGAR POLICE STATION ON 05.08.2008 AND L ATER CASH WAS HANDED OVER TO THE ADIT; IN THE STATEMENT RECORDED U/S 132(1A) ON 05.08.2008 MR. HISHAM SYED TAMIZ STATED THAT THE ENTIRE CASH BELON GED TO MR.MERAJ MANAL, CHAIRMAN OF THE HIMALAYA GROUP OF COMPANIES; ENQUIRY U/S 132(1A) AND STATEMENT OF MR.MERAJ MANAL , MR. SHABIR SHARIF, PARTNER OF THE ASSESSEE AND MRS. JAY ASHREE ULLAL, CFO OF THE ASSESSEE WERE RECORDED; THE SEIZED CASH WAS HANDED OVER BY THE ASSTT. DIREC TOR OF INCOME TAX (INVESTIGATION) TO THE DCIT CENTRAL CIRC LE-1(1) (ASSESSING OFFICER). NOTICE U/S 153C WAS ISSUED TO THE ASSESSEE; ON 10.08.2008 BEING THE DATE ON WHICH THE SEIZED AS SET WAS HANDED OVER TO THE JURISDICTIONAL ASSESSING OFF ICER, NO ASSESSMENT OR RE-ASSESSMENT RELATING TO THE ASSESSM ENT YEARS 2003-04 AND 2004-05 WERE PENDING. EVEN THE AP PEAL FILED BEFORE THE TRIBUNAL WAS DISPOSED OFF ON 28.03 .2008 ITSELF; IN SO FAR AS ASSESSMENT YEAR 2005-06 IS CONCERNED, THE ASSESSMENT U/S 143(3) HAD BEEN COMPLETED PRIOR TO INITIATION OF PROCEEDINGS U/S 153C AND AN ORDER HAS BEEN PASSED ON 15.12.2008. THE ASSESSEE HAS FILED AN APP EAL BEFORE THE LEARNED CIT(A) AGAINST THE SAID ORDER DA TED 15.12.2008 WHICH WAS PENDING FOR DISPOSAL. 8.2.2. SECTION 153C (1) R.W. SECOND PROVISO TO SECTION 153A(1) STATES THAT ANY ASSESSMENT OR RE-ASSESSMENT PENDING ON THE DATE ON WHICH SEIZED ASSETS ARE HANDED OVER TO THE JURISDICTIONAL ASSESSING OFFICER SHALL ABATE. THE HON'BLE ALLAHABA D HIGH COURT ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 44 OF 78 IN THE CASE OF CIT (CENTRAL) KANPUR V. SMT. SHAILA AGARWAL, 204 TAXMAN 276 HELD AS UNDER: THE WORD ABATEMENT IS REFERABLE TO SOMETHING, WH ICH IS PENDING ALIVE, OR IS SUBJECT TO DEDUCTION. THE ABAT EMENT REFERS TO SUSPENSION OR TERMINATION OF THE PROCEEDINGS EIT HER OF THE MAIN ACTION, OR THE PROCEEDINGS ANCILLARY OR COLLAT ERAL TO IT. THE WORD IS COMMONLY USED IN THE LEGISLATIONS, WHICH PR OVIDE FOR ABATEMENT OF ACTION/SUIT, ABATEMENT OF LEGACIES, AB ATEMENT OF NUISANCE; AND ALL ACTIONS FOR SUCH NATURE, WHICH HA VE THE PENDENCY OR CONTINUANCE. THE PROCEEDINGS, WHICH HAV E ALREADY TERMINATED ARE NOT LIABLE FOR ABATEMENT UNL ESS STATUTE EXPRESSLY PROVIDES FOR SUCH CONSEQUENCE THEREOF (PA RA 13). THE WORD PENDING OCCURRING IN THE SECOND PROVISO TO SECTION 153A OF THE ACT IS ALSO SIGNIFICANT. IT IS QUALIFIE D BY THE WORDS ON THE DATE OF INITIATION OF THE SEARCH, AND MAKE S IT ABUNDANTLY CLEAR THAT ONLY SUCH ASSESSMENT OR RE-AS SESSMENT PROCEEDINGS ARE LIABLE TO ABATE (PARA 14). THE PENDENCY OF AN APPEAL IN THE TRIBUNAL AGAINST T HE ORDER OF THE ASSESSMENT AGAINST WHICH AN APPEAL HAS BEEN DECIDED BY COMMISSIONER (APPEALS) IS NOT A CONTINUATION OF THE PROCEEDINGS OF ASSESSMENT. AN APPEAL UNDER THE INCO ME TAX ACT LIES TO THE APPELLATE TRIBUNAL ON A QUESTION OF LAW. EVEN IF IT IS PENDING ON THE DATE OF SEARCH, NO SUCH INTENT ION HAS INDICATED BY THE TRIBUNAL ARISES OUT OF THE PROVISI ONS OF SECOND PROVISO TO SECTION 153A TO ABATE THE PROCEED INGS WHICH HAVE BEEN COMPLETED OR CONCLUDED AND TO RESTO RE ASSESSMENT TO THE FILE OF THE ASSESSING OFFICER (PA RA-15). THIS IS NO FORCE IN THE SUBMISSION THAT WHERE A NOT ICE U/S 153A HAS BEEN GIVEN AFTER THE SEARCH OPERATIONS U/S 132 FOR FILING ASSESSMENT FOR THE BLOCK PERIOD OF 6 YEARS, AND IF SUCH PERIOD INCLUDES ANY OF THE ASSESSMENT YEAR, THE ABA TEMENT OF ASSESSMENT AND RE-ASSESSMENT PROCEEDINGS, TO GIVE W AY TO RE-ASSESSMENT CONSIDERING THE ADDITIONAL IN THE ASS ESSMENT U/S 153A, WILL ALSO INCLUDE THE ASSESSMENT OR RE-AS SESSMENT WHICH HAS BEEN COMPLETED. IF AS A RESULT OF SEARCH, SOME UNDISCLOSED INCOME IS FOUND TO HAVE ESCAPED ASSESSM ENT, THE ASSESSING OFFICER MAY INITIATE STEPS FOR RE-ASSESSM ENT AFTER SANCTION OF COMPETENT AUTHORITY, WITHIN THE PRESCRI BED PERIOD OF LIMITATION. (PARA-16). THE SECOND PROVISO TO SECTION 153A OF THE ACT REFER S TO ABATEMENT OF THE PENDING ASSESSMENT OR RE-ASSESSMEN T ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 45 OF 78 PROCEEDINGS. THE WORD PENDING DOES NOT OPERATE AN Y SUCH INTERPRETATION, THAT WHEREVER THE APPEAL AGAINST SU CH ASSESSMENT OR RE-ASSESSMENT IS PENDING, THE SAME AL ONG WITH ASSESSMENT OR RE-ASSESSMENT PROCEEDINGS IS LIABLE T O BE ABATED. THE PRINCIPLES OF INTERPRETATION OF TAXING STATUTES DO NOT PERMIT THE COURT TO INTERPRET THE SECOND PROVIS O TO SECTION 153A IN A MANNER THAT WHERE THE ASSESSMENT OR RE- ASSESSMENT PROCEEDINGS ARE COMPLETE, AND THE MATTER IS PENDING IN APPEAL IN THE TRIBUNAL, THE ENTIRE PROCE EDINGS WILL ABATE (PARA 19). 8.2.3. IN THE ASSESSEES CASE, EVEN THE APPEAL WHIC H HAD BEEN FILED BEFORE THE ITAT GOT DISPOSED OFF IN RESP ECT OF ASSESSMENT YEARS 2003-04 AND 2004-05. SO FAR AS ASS ESSMENT YEAR 2005-06 WAS CONCERNED, THE ASSESSMENT U/S 143( 3) HAD BEEN COMPLETED PRIOR TO INITIATION OF PROCEEDINGS U /S 153C. THE ASSESSEE HAS FILED APPEAL BEFORE THE CIT (A) AND TH E SAME WAS PENDING DISPOSAL AS ON DATE. HENCE, ASSESSMENTS WER E NOT PENDING ON THE DATE OF HANDING OVER OF THE SEIZED C ASH FOR THE ABOVE THREE YEARS. 8.2.4. IN SO FAR AS ASSESSMENT YEAR 2006-07 WAS CON CERNED, THE TIME LIMIT FOR ISSUING NOTICES U/S 143(2) EXPIR ED. HENCE, NO ACTION COULD BE TAKEN U/S 143. THE CIRCULAR NO.549 DATED 31 ST OCTOBER, 1989 (1990) 82 CTR (ST) 1) ISSUED BY THE C BDT IN THE CONTEXT OF SECTION 143(2). IT WAS CLARIFIED THEREIN AS UNDER: 5.13 A PROVISO TO SUB-S (2) PROVIDES THAT A NOTI CE UNDER THE SUB-SECTION CAN BE SERVED ON THE ASSESSEE ONLY DURI NG THE FINANCIAL YEAR IN WHICH THE RETURN IS FURNISHED OR WITHIN SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE RETUR N IS FURNISHED, WHICHEVER IS LATER. THIS MEANS THAT THE DEPARTMENT MUST SERVE THE SAID NOTICE ON THE ASSESSEE WITHIN T HIS PERIOD, IF A CASE IS PICKED UP FOR SCRUTINY. IT FOLLOWS THA T IF AN ASSESSEE AFTER FURNISHING THE RETURN OF INCOME DOES NOT RECEIVE A NOTICE U/S 143(2) FROM THE DEPARTMENT WIT HIN THE AFORESAID PERIOD, HE CAN TAKE IT THAT THE RETURN FI LED BY HIM ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 46 OF 78 HAS BECOME FINAL AND NO SCRUTINY PROCEEDINGS ARE TO BE STARTED IN RESPECT OF THAT RETURN. 8.2.5. IN THE BACKGROUND OF ABOVE MENTIONED FACTS A ND THE CASE LAW REFERRED (SUPRA), LET US EXAMINE THE ISSUE S, IN DEPTH, FURTHER, AS UNDER: THE DRP AT PARA 3.20 OF THE DIRECTIONS HAS OBSERVED AS UNDER: DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER MADE A REFERENCE TO THE TPO CERTA IN INTERNATIONAL TRANSACTIONS ARISING OUT OF THE ASSES SEES BUSINESS AND THE FINDINGS IN THE SEARCH AND WITH TH E PRIOR APPROVAL OF THE CIT (CENTRAL), BANGALORE. 8.2.6. AT PARA 3.7 OF THE DIRECTIONS, THE DRP FURTH ER OBSERVED AS UNDER: DURING THE COURSE OF SEARCH PROCEEDINGS, THE ASSES SEE ALSO FILED A TRANSFER PRICING DOCUMENT DATED 31.03. 2005. 8.2.7. THE FINDINGS OF DRP WERE NOT CORRECT AS NO DOCUMENTS WERE SEIZED DURING THE SEARCH CONDUCTED B Y THE POLICE AT THE PREMISES OF MR HISHAM. ONLY CASH WAS SEIZED. WHEN AN ASSESSMENT U/S 143(3) HAS ALREADY BEEN MADE PRIOR TO THE SEARCH PROCEEDINGS, THEN SUCH COMPLETED PROCEED INGS ARE FINAL AND THEY DO NOT ABATE. NO ADDITION CAN BE MAD E IN AN ASSESSMENT U/S 153C IN THE ABSENCE OF ANY INCRIMINA TING MATERIAL. IN THIS CONTEXT, WE REFER TO THE DECISION OF THE ITAT, MUMBAI SPECIAL BENCH, IN ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT (2012) 23 TAXMANN.COM 103 (MUM.) (SB). THE SPE CIAL BENCH HELD THEREIN AS UNDER: 58. THE QUESTION NO.1 BEFORE US IS ANSWERED AS UND ER: ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 47 OF 78 (A) IN ASSESSMENTS THAT ARE ABATED, THE AO RETAINS THE ORIGINAL JURISDICTION AS WELL AS JURISDICTION CONFERRED ON HIM U/S 153A FOR WHICH ASSESSMENTS SHALL BE MADE FOR EACH OF THE SIX ASSESSMENT YEARS SEPARATELY; (B) IN OTHER CASES, IN ADDITION TO THE INCOME THAT HAS ALREADY BEEN ASSESSED, THE ASSESSMENT U/S 153A WILL BE MADE ON THE BASIS OF INCRIMINATING MATERIAL, WHICH IN THE CONTEXT OF RELEVANT PROVISIONS MEANS (I) BOOKS OF ACCOUNTS, OTHER DOCUMENTS, FOUND IN THE COURSE OF SEARCH BUT NOT PRODUCED IN THE COURSE OF ORIGINAL ASSESSMENT, AND (II) UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH. 8.2.8. THE HON'BLE DELHI HIGH COURT IN CIT VS. ABHI NAV KUMAR MITTAL (2013) 351 ITR 20 (DELHI) HELD AS UNDE R: WE HAVE NO REASON TO DIFFER FROM THE VIEW TAKEN BY THE TRIBUNAL, PARTICULARLY, AS NO MATERIAL WAS FOUND IN THE SEARCH AND SEIZURE OPERATIONS, WHICH WOULD JUSTIFY THE ASSESSING OFFICERS ACTION IN REFERRING THE MATTER TO THE DVO FOR HIS OPINION ON VALUATION OF THE SAID PROPERTIES . IF THAT BE THE CASE, THEN THE VALUATION ARRIVED AT BY THE DVO WOULD BE OF NO CONSEQUENCE. 8.2.9. AFTER REPRODUCING THE RELEVANT PORTION OF TH E OBSERVATIONS AT PARA 58 OF THE FINDINGS OF THE HON 'BLE SPECIAL BENCH OF ITAT, MUMBAI BENCH (SUPRA), THE DRP IN IT S DIRECTIONS AT PARA 11.2 ON PAGE 29, HAS STATED AS UNDER: IN THIS CASE THE ORIGINAL ASSESSMENTS HAD BEEN MAD E U/S 143(3) AND HAD ABATED. ACCORDINGLY THE AO WOULD RET AIN THE ORIGINAL JURISDICTION HENCE ADDITIONS MADE UNDER TH IS PRESENT JURISDICTION ARE VALID AS PER LAW. IT IS FURTHER SU BMITTED THAT THE PROCEEDINGS OF TRANSFER PRICING FOR EACH YEAR I S AN INDEPENDENT PROCEEDING NOT GOVERNED BY THE FINDINGS IN ANY OTHER TP AUDIT FOR ANY YEAR. THIS BEING A SEARCH CA SE, ALL ASSESSMENTS, PROCEEDINGS TILL THE DATE OF SEARCH GE TS ABATED AND A FRESH ASSESSMENT OR AUDIT IS TO BE DONE AFRES H ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 48 OF 78 CONSEQUENT TO SEARCH PROCEEDINGS AS PER SECTION 153 A/153C OF THE I.T. ACT. CONSEQUENT TO A SEARCH ACTION, ALL PROCEEDINGS PENDING SO FAR GETS ABATED AND IT IS AS THOUGH ALL PROCEEDINGS ARE BEFORE THE AO FOR THE FIRST TIME. HENCE, A FRES H REFERENCE RECEIVED FROM THE AO IS TREATED AS A FRESH TP AUDIT PROCEEDINGS BEFORE THE TPO AND IT IS AS IF NO PROCE EDINGS HAVE TAKEN PLACE IN THIS CASE FOR THE YEARS COVERED UNDE R THE BLOCK PERIOD, PRIOR TO THIS REFERENCE. 8.2.10. THE OBSERVATION OF THE DRP IS NOT A CORRECT READING OF THE JUDGMENT OF THE HON'BLE SPECIAL BENCH. IMPORT O F THE JUDGMENT OF THE SPECIAL BENCH IS THAT ASSESSMENTS T HAT ARE PENDING ON THE DATE OF INITIATION OF SEARCH ALONE W ILL ABATE. IT NOWHERE STATES THAT THE COMPLETED ASSESSMENTS WOULD ABATE. THE QUESTIONS BEFORE THE SPECIAL BENCH WERE AS UNDE R: 1. WHETHER, ON THE FACTS AND IN LAW, THE SCOPE OF ASSESSMENT U/S 153A ENCOMPASSES ADDITIONS, NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF S EARCH? 2. WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE LEARNED CIT (APPEALS) WAS JUSTIFIED IN UPHOLDIN G THE DISALLOWANCE OF DEDUCTION U/S 80IA(4) OF THE ACT, O N MERITS? 8.2.11. THE CONCLUSIONS MADE BY THE SPECIAL BENCH A T PARA 58 OF THE JUDGMENT ARE TO BE INTERPRETED IN THE LIG HT OF WHAT HAS BEEN STATED BY THE BENCH AT PARA 52 AND 53 OF THE J UDGMENT WHICH ARE REPRODUCED BELOW: THE PENDING PROCEEDINGS SHALL ABATE. THIS MEANS TH AT OUT OF SIX YEARS, IF ANY ASSESSMENT OR RE-ASSESSMENT IS PE NDING ON THE DATE OF INITIATION OF THE SEARCH, IT SHALL ABAT E. IN OTHER WORDS PENDING PROCEEDINGS WILL NOT BE PROCEEDED WIT H THEREAFTER. THE ASSESSMENT HAS NOW TO BE MADE U/S 1 53A (1)(B) AND THE FIRST PROVISO. IT ALSO MEANS THAT ON LY ONE ASSESSMENT WILL BE MADE UNDER THE AFORESAID PROVISI ONS AS THE TWO PROCEEDINGS I.E. ASSESSMENT OR RE-ASSESSMEN T PROCEEDINGS AND PROCEEDINGS UNDER THIS PROVISION ME RGE INTO ONE. IF ASSESSMENT MADE UNDER SUB-SECTION (1) IS AN NULLED IN APPEAL OR OTHER LEGAL PROCEEDINGS, THEN THE ABATED ASSESSMENT OR RE-ASSESSMENT SHALL REVIVE. THIS MEAN S THAT ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 49 OF 78 THE ASSESSMENT OR RE-ASSESSMENT, WHICH HAD ABATED, SHALL BE MADE, FOR WHICH EXTENSION OF TIME HAS BEEN PROVIDED U/S 153B. 53. THE QUESTION NOW IS WHAT IS THE SCOPE OF ASSESS MENT OR RE-ASSESSMENT OF TOTAL INCOME U/S 153A (1) (B) AND THE FIRST PROVISO?. WE ARE OF THE VIEW THAT FOR ANSWERING THI S QUESTION, GUIDANCE WILL HAVE TO BE SOUGHT FROM SECTION 132(1) . IF ANY BOOKS OF ACCOUNTS OR OTHER DOCUMENTS RELEVANT TO TH E ASSESSMENT HAD NOT BEEN PRODUCED IN THE COURSE OF O RIGINAL ASSESSMENT AND FOUND IN THE COURSE OF SEARCH IN OUR HUMBLE OPINION SUCH BOOKS OF ACCOUNTS OR OTHER DOCUMENTS H AVE TO BE TAKEN INTO ACCOUNT WHILE MAKING ASSESSMENT OR RE- ASSESSMENT OF TOTAL INCOME UNDER THE AFORESAID PROV ISION. SIMILAR POSITION WILL OBTAIN IN A CASE WHERE UNDISC LOSED INCOME OR UNDISCLOSED PROPERTY HAS BEEN FOUND AS A CONSEQUENCE OF SEARCH. IN OTHER WORDS, HARMONIOUS INTERPRETATION WILL PRODUCE THE FOLLOWING RESULTS:- (A) IN SO FAR AS PENDING ASSESSMENTS ARE CONCERNE D, THE JURISDICTION TO MAKE ORIGINAL ASSESSMENT AND ASSESS MENT U/S 153A MERGE INTO ONE AND ONLY ONE ASSESSMENT FOR EAC H ASSESSMENT YEAR SHALL BE MADE SEPARATELY ON THE BAS IS OF THE FINDINGS OF THE SEARCH AND ANY OTHER MATERIAL EXIST ING OR BROUGHT ON THE RECORD OF THE AO (B) IN RESPECT OF N ON-ABATED ASSESSMENTS, THE ASSESSMENT WILL BE MADE ON THE BAS IS OF BOOKS OF ACCOUNTS OR OTHER DOCUMENTS NOT PRODUCED I N THE COURSE OF ORIGINAL ASSESSMENT BUT FOUND IN THE COUR SE OF SEARCH AND UNDISCLOSED INCOME OR UNDISCLOSED PROPER TY DISCOVERED IN THE COURSE OF SEARCH. 8.2.12. THE QUESTION BEFORE THE SPECIAL BE NCH WAS WHETHER THE ASSESSMENT U/S 153A WARRANTS ADDITION I N THE ABSENCE OF ANY INCRIMINATING MATERIAL? IN THIS CONT EXT THE SPECIAL BENCH HELD THAT ONCE SEARCH TAKES PLACE, AS SESSMENT IS TO BE MADE FOR A PERIOD OF SIX ASSESSMENT YEARS IMM EDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVI OUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED. IF THE ASSESSMENTS OF ANY OF THE ASSESSMENT YEARS ARE PENDING ON THE DATE OF INITIAT ION OF SEARCH, THOSE ASSESSMENTS WOULD ABATE. IF ASSESSMENT FOR AN Y OF THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 50 OF 78 OTHER ASSESSMENTS YEARS IS ALREADY COMPLETED BEFORE THE SEARCH PROCEEDINGS, THEN SUCH ASSESSMENTS WOULD NOT ABATE. AS ASSESSMENT IS TO BE DONE FOR ALL THE SIX YEARS, IN CASE OF NON- ABATED ASSESSMENTS, THE ADDITIONS WILL HAVE TO BE M ADE ONLY ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING TH E COURSE. 8.2.13. IN FACT AT PARA 65.5 OF THE CIRCULAR N O.7 DATED 05.09.2003, IT HAS BEEN CLARIFIED AS UNDER: THE ASSESSING OFFICER SHALL ASSESS AND REASSESS TH E TOTAL INCOME OF EACH OF THESE SIX ASSESSMENT YEARS. ASSES SMENT OR RE-ASSESSMENT, IF ANY, RELATING TO ANY ASSESSMEN T YEAR FALLING WITHIN THE PERIOD OF SIX ASSESSMENT YEARS P ENDING ON THE DATE OF INITIATION OF THE SEARCH U/S 132 OR REQ UISITION U/S 132A, AS THE CASE MAY BE, SHALL ABATE. 8.2.14. THE TRIBUNAL IN ACIT V. PRATIBHA INDUSTRIES LTD (2012) 28 TAXMANN.COM 246 (MUMBAI TRIB.) HELD AS UN DER: 39. SECTION 153A WAS INTRODUCED IN THE STATUTE W.E .F 01.06.2005, WHEREIN THE SECTION STARTS WITH THE NON OBSTANTE PHRASE NOTWITHSTANDING, THEREFORE, AS SOON AS TH E SEARCH IS CONCLUDED THE AO HAVING JURISDICTION OVER THE AS SESSEE, A JURISDICTION IS CAST UPON THE AO TO ISSUE NOTICES U /S 153A (1) FOR THE PRECEDING SIX YEARS, CALLING UPON THAT PERS ON TO FILE ITS RETURNS. AS SOON AS THE NOTICES ARE REQUIRED, DUE PROCESS OF LAW SHALL BEGIN AND AO AND THE ASSESSEE ARE REQUIRE D TO FOLLOW THE SAME, WHICH SHALL CULMINATE WITH THE AO TO ASSESS OR REASSESS THE TOTAL INCOME OF THE SEARCHED PERSON IN ALL THE SIX YEARS IN QUESTION. WHILE CASTING THIS JURISDICT ION OVER THE AO, THE LEGISLATURE, TO REMOVE ALL THE DIFFICULTIES WITH REGARD TO THE MULTIPLICITY OF PROCEEDINGS PENDING ON THE DATE OF INITIATION OF SEARCH, THROUGH 2 ND PROVISO, EXPUNGED ALL THOSE PROCEEDINGS, SO THAT THE ASSESSEE AND THE AO SHALL DEAL WITH ONLY ONE TYPE OF PROCEEDINGS, WHEREIN THE AO SHALL, AS PER CLAUSE (II), ASSESS OR REASSESS THE TOTAL INCOME OF THE SEARCHED PERSON. THIS BARRIER HAS BEEN SET UP BY THE LEGISLA TURE ONLY WITH REGARD TO PROCEEDINGS THAT WERE FOUND PENDING BEFORE THE ASSESSING OFFICER ON THE DATE OF SEARCH. THEREF ORE, A PROCEEDING WHICH IS PENDING, ONLY THOSE PROCEEDINGS SHALL GET ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 51 OF 78 ABATED. IN OTHER WORDS, ANY PROCEEDING THAT HAS REA CHED ITS FINALITY SHALL NOT BE DISTURBED, AS PER THE CLARIFI CATION ISSUED BY THE CBDT, THROUGH CIRCULAR NO.7 DATED 05.09.2003 (SUPRA), UNLESS THERE ARE MATERIALS FOUND, INDICATING EXISTE NCE OF INCOME EMBEDDED IN THOSE INCRIMINATING DOCUMENT(S) . 8.2.15. THE DRP RELIED ON THE DECISION OF THE TRIB UNAL IN INTELLINET TECHNOLOGIES INDIA PVT LTD V. ITO 2010-T IOL-167-ITAT. AT PARA 11.2, PAGE 30 OF THE DIRECTIONS, THE DRP OB SERVED AS UNDER: FURTHER, IN THE CASE OF INTELLINET TECHNOLOGIES IN DIA PVT LTD VS ITO CITED IN 2010-TIOL-167-ITAT, THE HON'BLE COURT HAD OCCASION TO OBSERVE THAT WHEN THE TPO HAS NOT MADE ANY ADDITION THE FIRST TIME, THERE IS NO HEROISM IN REP EATING THE SAME MISTAKE WHEN THE PROCEEDINGS COME BEFORE HIM O NCE AGAIN. ACCORDINGLY THE REFERENCE TO THE TPO MADE BY THE AO IS VALID. HENCE, THE OBJECTION OF THE TAXPAYER-FIRM IS NOT ACCEPTABLE. 8.2.16. THE ISSUE IN INTELLINETS CASE WAS NOT WITH REFERENCE TO ANY TP MATTER. THE DRPS OBSERVATION THAT THE HON'BLE COURT HAD OCCASION TO OBSERVE THAT WHEN THE TPO HAS NOT MADE ANY ADDITION THE FIRST TIME.. IS ABSURD. THE DRP HAS MADE REFERENCE TO MERELY REPRODUCING THE OBSERVATION OF THE TPO AT PA GE 11, PARA 7 OF HER REMAND REPORT DATED 13.08.2012. THE DRP HAS NOT INDEPENDENTLY ANALYSED THE DECISION. 8.2.17. THE CORRECT OBSERVATIONS AND THE CONTEXT I N WHICH THE TRIBUNAL IN INTELLINETS CASE MADE THOSE OBSERVATIO NS ARE DISCUSSED BELOW: - THE FACTS IN THAT CASE ARE AS UNDER: THE ASSESSEE HAS CLAIMED A DEDUCTION U/S 10A AMOUNT ING TO RS.59,00,110/- IN ITS RETURN FILED FOR THE IMPUG NED ASSESSMENT YEAR 2004-05. THE TOTAL INCOME DETERMINE D BY THE ASSESSING OFFICER AFTER THE ABOVE CLAIM WAS RS. 92,110. WHILE MAKING THE CLAIM OF DEDUCTION U/S 10A, THE AS SESSEE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 52 OF 78 HAS NOT SET OFF THE BROUGHT FORWARD LOS AMOUNTING T O RS.,45,80,166/-. THE ASSESSING OFFICER ALLOWED THE CLAIM OF DEDUCTION MADE BY THE ASSESSEE U/S 10A AFTER MAKING CERTAIN ADJUSTMENTS IN THE MATTER OF EXPORT TURNOVE R ETC. THE ASSESSING OFFICER HAS GIVEN THE DEDUCTION U/S 1 0A WITHOUT SETTING OFF OF THE BROUGHT FORWARD LOSS AS COMPUTED BY THE ASSESSEE. THE CIT, ON PERUSAL OF THE RECORDS OF THE CASE FOUN D THAT THE DEDUCTION U/S 10A WAS GIVEN BY THE ASSESSING AUTHORITY WITHOUT PROPER APPLICATION OF MIND AND AG AINST THE PROVISIONS OF THE I.T. ACT, 1961. THE CIT HELD THAT THE DEDUCTION U/S 10A OUGHT TO HAVE BEEN ALLOWED AFTER SETTING OFF THE BROUGHT FORWARD BUSINESS LOSS AND UNABSORBE D DEPRECIATION RELATING TO THE EARLIER ASSESSMENT YEA RS. AFTER HEARING THE ASSESSEE IN DETAIL AND EXAMINING THE MA TERIALS AVAILABLE ON RECORD, THE CIT CAME TO THE CONCLUSION THAT THE ASSESSMENT ORDER PASSED BY THE ASSESSING AUTHORITY WAS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE R EVENUE. HE ACCORDINGLY, SET ASIDE THE COMPUTATION OF DEDUCT ION U/S 10A AND DIRECTED THE ASSESSING OFFICER TO REVISE TH E DEDUCTION AFTER SETTING OFF THE BUSINESS LOSS/UNABS ORBED DEPRECIATION RELATING TO THE EARLIER ASSESSMENT YEA RS. THE ASSESSEE HAD FILED AN APPEAL AGAINST THE ORDER U/S 263. DURING THE HEARING THE AR OF THE ASSESSEE HIGHLIGHT ED THAT TWO VIEWS WERE AVAILABLE REGARDING COMPUTATION OF DEDUCTION U/S 10A AT THE RELEVANT POINT OF TIME WHE N THE ASSESSMENT ORDER WAS PASSED BY THE ASSESSING AUTHOR ITY. THE DECISIONS WERE AVAILABLE IN SUPPORT OF THE CONT ENTION OF THE ASSESSEE THAT THE PROFIT OF THE CURRENT YEAR SH OULD NOT BE DILUTED AND THE DECISIONS ARE ALSO AVAILABLE IN SUPPORT OF THE CONTENTION THAT CURRENT YEARS PROFIT SHOULD BE ADJUSTED FOR BROUGHT FORWARD LOSSES AND UNABSORBED DEPRECIAT ION. SO WHAT HE MAKES OUT IS THAT WHERE THE ASSESSING AU THORITY HAS ADOPTED ONE OF THE POSSIBLE VIEWS ON A SUBJECT, THEN THE VIEW TAKEN BY THE ASSESSING AUTHORITY CANNOT BE HELD TO BE ERRONEOUS. WHILE DISPOSING OF THE ABOVE ARGUMENT, THE ITAT HEL D AS UNDER: 24. IT IS NOT OUT OF CONTEXT HERE, TO REFER TO THE DECISION OF THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH REND ERED IN THE CASE OF KPIT CUMMINS INFOSYSTEMS (BANGALORE) (P ) LTD V. ASSTT. CIT (2008) 26 SOT 529. IN THE SAID DECISION, THE TRIBUNAL HAS HELD IN FAVOUR OF THE ASSESSEE, ACCEPT ING THE ARGUMENT THAT BROUGHT FORWARD LOSS/UNABSORBED DEPRE CIATION ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 53 OF 78 NEED NOT BE SET OFF AGAINST PROFITS ELIGIBLE FOR DE DUCTION U/S 10A. IN FACT, ONE OF US WAS A PARTY TO THAT ORDER. BUT IN THE COURSE OF ARGUMENTS, WE FOUND THAT THE SAID ORDER M IGHT NOT BE REFLECTING THE CORRECT POSITION OF LAW. WE HAVE NO HESITATION TO STATE SO, AS WE DO NOT BELIEVE THAT PERPETUATING A MISTAKE IS HEROISM. THEREFORE, THE ISSUE BEFORE THE ITAT WAS ALTOGETHER DIFFERENT AND THE CONTEXT IN WHICH IT MADE THE STATEMENT RELI ED UPON BY THE TPO IS COMPLETELY DIFFERENT. IN THAT CASE, T HE TRIBUNAL WAS DEALING WITH THE ISSUE OF WHETHER IT I S RIGHT TO FOLLOW A JUDGMENT WHICH IN THE OPINION OF THE ITAT WAS NOT CORRECT IN LAW. BUT THE ISSUE IN THE PRESENT CASE I S SCOPE OF ASSESSMENT U/S 153C. IT IS SUBMITTED THAT THE RATIO OF THE ABOVE JUDGMENT CANNOT BE APPLIED TO ASCERTAINING TH E SCOPE OF ASSESSMENT U/S 153C. THE SCOPE OF ASSESSMENT U/S 153C HAS BEEN DECIDED BY THE HON'BLE SPECIAL BENCH IN ALL CARGOS CASE (SUPRA). THE RATIO OF THE SPECIAL BENC H DECISION SQUARELY APPLIES TO THE PRESENT CASE. IN ANY CASE, THE DECISION RELIED ON BY THE TPO HAS BEEN SET ASIDE BY THE HON'BLE KARNATAKA HIGH COURT IN M/S. INTELLINET TECHNOLOGIES INDIA PVT LTD VS. CIT (ITA NO.254/2010). THE FACTS NOTED BY THE DRP TO UPHOLD THE VALIDITY OF REFERENCE TO TPO ARE TOTALLY INCORRECT. THE ANALYSIS OF THE DRP WITH REGARD TO THE JUDGMENT OF THE SPECIAL BENCH IS NOT CORRECT. THE RELIANCE PLACED B Y THE DRP ON INTELLINETS CASE IS ALSO INCORRECT. 8.2.18. BEFORE CONCLUDING THIS ISSUE, WE WOULD LIK E TO DEAL WITH THE ARGUMENTS OF THE LEARNED STANDING COU NSEL IN DEPTH. SUMMARY OF THE CONTENTIONS RAISED BY THE REV ENUE ARE AS UNDER: (I) ASSESSMENT U/S 153C, THE ASSESSING OFFICER CAN PROC EED TO ASSESS OR RE-ASSESS EVEN IN THE ABSENCE OF ANY MATERIAL FOUND AND SEIZED IN THE COURSE OF SEARCH O R REQUISITION; (II) THOSE CASES WHERE ASSESSMENT IS COMPLETED PRIOR TO INITIATION OF PROCEEDINGS U/S 153C, IF ANY ISSUE IS CONCLUDED WITH A FINDING, ONLY THOSE ISSUES CANNOT BE DISTURBED U/S 153C ASSESSMENT UNLESS SOME MATERIAL IS ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 54 OF 78 FOUND WHICH WOULD DISTURB THE FINDING IN RESPECT OF SUCH ISSUE. SO FAR AS OTHER ISSUES ARE CONCERNED, EVEN I N RESPECT OF ABATED ASSESSMENTS, ASSESSING OFFICER WI LL HAVE JURISDICTION TO RE-OPEN THE ENTIRE ASSESSMENT AND MAKE ADDITIONS EVEN IF NO INCRIMINATING MATERIAL IS FOUND; (III) THE RATIO OF THE DECISION OF THE HON'BLE SPECIAL BE NCH OF TRIBUNAL IN ALL CARGOS CASE IS NOT APPLICABLE T O THE PRESENT CASE AS THE HON'BLE SPECIAL BENCH DEALT WIT H A CASE OF SEARCH U/S 132 WHEREAS IN THE PRESENT CASE IT IS REQUISITION U/S 132A. 8.2.19. THE CONTENTIONS OF THE REVENUE, WE ARE O F THE VIEW, ARE NOT LEGALLY TENABLE. IF THE CONTENTION OF THE R EVENUE THAT ONCE THE PROCEEDINGS U/S 153C IS INITIATED, ASSESSING OF FICER HAS POWER TO REOPEN THE ENTIRE ASSESSMENT EVEN IN RESPE CT OF THOSE ASSESSMENTS WHICH DO NOT ABATE IS HELD TO BE LEGALL Y TENABLE, THE WHOLE REQUIREMENT OF PROVIDING FOR ABATEMENT OF ONL Y PENDING PROCEEDINGS AS ON THE DATE OF HANDING OVER OF ASSET S [PROVISO TO SECTION 153C (1) R.W SECOND PROVISO TO SECTION 153A (1)] WOULD BE RENDERED OTIOSE. IT WOULD AMOUNT TO ABATEMENT OF AL L ASSESSMENT PROCEEDINGS WHETHER COMPLETED OR PENDING AS ON THE DATE OF HANDING OVER OF ASSETS. WHERE AN ASSESSMENT IS COMP LETED PRIOR TO INITIATION OF PROCEEDINGS U/S 153C AND AN ORDER U/S 143(3) IS PASSED, THE ASSESSEE PREFERS AN APPEAL AGAINST SUCH ORDER U/S 143(3) AND THE APPEAL IS PENDING. MEANWHILE THE PRO CEEDINGS U/S 153C IS INITIATED. GOING BY THE INTERPRETATION PLACED BY THE REVENUE ON THE PROVISO TO SECTION 153C(1), EVEN THE ASSESSMENT ORDER WHICH IS SUBJECT MATTER OF APPEAL WOULD ALSO ABATE. THIS INTERPRETATION IS NOT CORRECT. 8.2.20. DURING THE COURSE OF HEARING THE LEARNED ST ANDING COUNSEL RELIED ON THE DECISION OF THE HON'BLE RAJAS THAN HIGH ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 55 OF 78 COURT IN JAI STEEL (INDIA) JODHPUR VS. ACIT (2013) 36 TAXMANN.COM 523 (RAJASTHAN) TO SUPPORT HIS CONTENTI ON. THE INTERPRETATION PLACED BY THE LEARNED STANDING COUNS EL ON THE DECISION OF THE HON'BLE RAJASTHAN HIGH COURT IS INC ORRECT. IN THAT CASE, THE ASSESSEE HAD TAKEN A CONTENTION THAT ONCE NOTICE U/S 153A OF THE ACT IS ISSUED, THE ASSESSMENTS FOR SIX YEARS ARE AT LARGE BOTH FOR THE ASSESSING OFFICER AND THE ASS ESSEE AND HENCE, IT IS PERMISSIBLE TO MAKE FRESH CLAIM DURING SECTION 153A PROCEEDINGS. THE HON'BLE HIGH COURT REJECTED THE CO NTENTION OF THE ASSESSEE. THE LEARNED STANDING COUNSEL RELIED O N CLAUSE (B) IN PARA 22 OF THE DECISION OF THE HON'BLE HIGH COUR T OF RAJASTHAN TO SUPPORT HIS CONTENTION THAT INCRIMINATING MATERI AL IS NECESSARY ONLY TO DISTURB A FINDING ON AN ISSUE ALR EADY CONSIDERED IN THE ASSESSMENTS THAT HAVE NOT ABATED. THE LEARNED STANDING COUNSEL LITERALLY INTERPRETED THE WORDS US ED IN CLAUSE (B) OF PARA 22 OF THE DECISION. THE OBSERVATION OF THE HON'BLE HIGH COURT NEEDS TO BE READ IN THE CONTEXT OF THE ENTIRE JUDGMENT. THE HON'BLE HIGH COURT HAS CATEGORICALLY HELD THAT IN C ASE OF ASSESSMENTS WHICH DO NOT ABATE, THE SAME CAN BE TIN KERED ONLY BASED ON THE INCRIMINATING MATERIAL FOUND DURING TH E COURSE OF SEARCH OR ASSESSMENT. THE ARGUMENT THAT ASSESSING O FFICER IS FREE TO DISTURB INCOME, EXPENDITURE OR DEDUCTION DE HORS THE INCRIMINATING MATERIAL WHILE MAKING ASSESSMENT U/S 153A OF THE ACT IS ALSO NOT BORNE OUT FROM THE SCHEME OF THE SA ID PROVISION WHICH AS NOTICED ABOVE IS ESSENTIALLY IN CONTEXT OF SEARCH/REQUISITION. THE PROVISIONS OF SECTIONS 153A TO 153C CANNOT BE INTERPRETED TO BE A FURTHER INNINGS FOR T HE ASSESSING OFFICER AND/OR ASSESSEE BEYOND PROVISIONS OF SECTIO N 139 (RETURN OF INCOME), 139(5) (REVISED RETURN OF INCOME), 147 (INCOME ESCAPING ASSESSMENT) AND 263)REVISION OF ORDERS OF THE ACT. IN ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 56 OF 78 THIS CONTEXT, THEFINDING OF THE HON'BLE RAJASTHAN H IGH COURT [AT PARA 25]IS RELEVANT AND SAME IS REPRODUCED BELOW: 25. THE ARGUMENT OF THE LEARNED COUNSEL THAT THE A SSESSING OFFICER IS ALSO FREE TO DISTURB INCOME, EXPENDITURE OR DEDUCTION DE HORS THE INCRIMINATING MATERIAL, WHILE MAKING AS SESSMENT ORDER U/S 153A OF THE ACT IS ALSO NOT BORNE OUT FRO M THE SCHEME OF THE SAID PROVISION WHICH AS NOTICED ABOVE IS ESSENTIALLY IN CONTEXT OF SEARCH AND/OR REQUISITION . THE PROVISIONS OF SECTION 153A TO 153C CANNOT BE INTERP RETED TO BE A FURTHER INNINGS FOR THE ASSESSING OFFICER AND/OR ASSESSEE BEYOND PROVISION OF SECTION 139 (RETURN OF INCOME), 139(5) (REVISED RETURN OF INCOME), 147 (INCOME ESCAPING AS SESSMENT) AND 263 (REVISION OF ORDERS) OF THE ACT. 8.2.21. THE LEARNED STANDING COUNSEL RELIED ON THE DECISION OF THE HON'BLE ITAT IN SCOPE (P) LTD VS. D CIT (2013) 142 ITD 515. THE DECISION DOES NOT HELP THE REVENUE. IN FACT, THE TRIBUNAL IN PARA 13 IS HELD AS UNDER: 13. BEFORE PARTING WITH THE ISSUE, WE MAKE IT CLEA R THAT HAVING HELD THAT INITIATION OF PROCEEDINGS U/S 153A IS VALID, THE ASSESSING OFFICER, CANNOT RESORT TO A ROVING AN D FISHING ENQUIRY TO FIND OUT WHETHER ANY INCOME HAS ESCAPED ASSESSMENT DURING THE RE-ASSESSMENT PROCEEDINGS WHE N THERE IS NO INCRIMINATING MATERIAL FOUND OR SEIZED DURING THE COURSE OF SEARCH ACTION U/S 132. 8.2.22. FURTHER, IT WAS SUBMITTED BY THE LEAR NED STANDING COUNSEL THAT WHERE A PROCEEDING U/S 153A/153C ARE I NITIATED AND THE PROPOSITION THAT IT IS NOT OPEN TO THE ASSE SSING OFFICER TO MAKE ADDITION IN THE ABSENCE OF INCRIMINATING DOCUM ENTS FOUND WOULD LEAD TO AN ABSURD SITUATION WHERE THE REVENUE WOULD BE LEFT WITH NO REMEDY TO ASSESS THE INCOME WHICH, DUR ING THE COURSE OF THE PROCEEDINGS U/S 153A,WAS FOUND TO HAV E ESCAPED ASSESSMENT. THIS APPREHENSION OF THE LEARNED STANDI NG COUNSEL WAS WITHOUT ANY MERIT SINCE SECTION 153A/153C ONLY MENTIONS ABOUT THE ABATEMENT OF PENDING PROCEEDINGS. IT DOE S NOT ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 57 OF 78 PRECLUDE THE REVENUE FROM INITIATING PROCEEDINGS, B Y ISSUANCE OF NOTICE U/S 148 OF THE ACT, PROVIDED THE OTHER MANDA TORY CONDITIONS FOR SUCH ISSUANCE OF NOTICE ARE SATISFIE D. THE NON OBSTANTE CLAUSE IN SECTION 153A/153C IS WITHOUT FOL LOWING THE PROCEDURAL NORMS THAT ARE REQUIRED TO BE FOLLOWED I N THE CASE OF AN ASSESSMENT IN PURSUANT TO A SEARCH/REQUISITION. THEREFORE, RE-OPENING OF AN ASSESSMENT DURING THE COURSE OF PR OCEEDING U/S 153A/153C BY ISSUANCE OF NOTICE U/S 148 IS NOT DEBA RRED, NO DOUBT, PROVIDED THE OTHER CONDITIONS ARE SATISFIED FOR ISSUANCE OF SUCH NOTICE. IN THIS CONTEXT, WE REFER TO THE JUDGM ENT OF THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF M/S GUD WILL HOUSING LTD V. ITO 2014-TIOL-479 HC-KAR-IT WHEREIN THE HON'BLE COURT HAS HELD AS UNDER: 5. IT IS TRUE THAT SECTION 158BD STATES THAT WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON, OTHER THAN THE PERSON WITH R ESPECT TO WHOM SEARCH WAS MADE U/S 132, THEN THE BOOKS OF ACC OUNTS, OTHER DOCUMENTS OR ASSETS SEIZED SHALL BE HANDED OV ER TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTH ER PERSON AND THAT THE ASSESSING OFFICER SHALL PROCEED U/S 15 8BC AGAINST SUCH OTHER PERSON AND THE PROVISIONS OF THE SE CHAPTER SHALL APPLY ACCORDINGLY. THIS PROVISION BY ITSELF, IN OUR OPINION, IS NOT SUFFICIENT TO HOLD THAT THE ASSESSI NG OFFICER, ON THE FACTS AND IN THE CIRCUMSTANCES, AS OCCURRED IN THE PRESENT CASE, COULD NOT HAVE PROCEEDED AGAINST THE ASSESSEE U/S 147 BY ISSUING NOTICE U/S 148 OF THE ACT. THIS PROVISIO N FELL FOR CONSIDERATION OF THE DELHI HIGH COURT AND THE ALLAH ABAD HIGH COURT. THE ALLAHABAD HIGH COURT IN CIT VS. ABHYUDAY A BUILDERS (P) LTD (2012) 340 ITR 0310 WAS CONSIDERIN G NOT ONLY THESE PROVISIONS BUT WAS EXAMINING THE SAME IN THE LIGHT OF SIMILAR FACTS, AS FALL FOR OUR CONSIDERATION IN THE PRESENT CASE. WHILE DOING SO, THE ALLAHABAD HIGH COURT PLACED REL IANCE UPON THE JUDGMENT OF THE DELHI HIGH COURT IN JANKI EXPORTS INTERNATIONAL VS. UNION OF INDIA (2005) 278 ITR 029 6) TO HOLD THAT THE PROVISIONS CONTAINED IN SECTION 158BD OF T HE ACT ARE ANALOGOUS TO THE PROVISIONS CONTAINED IN SECTION 14 7 OF THE ACT, IN SO FAR AS THE PROCEDURE THAT IS REQUIRED TO BE FOLLOWED. SECTION 147 CONTEMPLATES THAT IF THE ASSESSING OFFI CER HAS ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 58 OF 78 REASONS TO BELIEVE THAT THERE IS ESCAPEMENT OF INCO ME, THEN NOTICE CAN BE ISSUED U/S 148 OF THE ACT. SECTION 15 8BD OF THE ACT PROVIDES THAT IF THE ASSESSING OFFICER IS SATIS FIED THAT ANY UNDISCLOSED INCOME BELONGS TO ANY PERSON OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH WAS MADE U/S 132 OF THE ACT, UPON SUCH SATISFACTION, IS REQUIRED TO FORWARD THE RELEVANT DOCUMENTS, PAPERS ETC. TO THE ASSESSING OFFICER HAV ING JURISDICTION OVER SUCH OTHER PERSON IN RESPECT OF W HOM THE UNDISCLOSED INCOME HAS BEEN DISCLOSED FOR BLOCK ASS ESSMENT. THUS, IT IS OPEN TO THE ASSESSING OFFICER TO PROCEE D AGAINST THE ASSESSEE, IF HE HAS REASON TO BELIEVE THAT HIS INCO ME HAS EITHER ESCAPED THE ASSESSMENT OR WHOSE UNDISCLOSED INCOME IS UNEARTHED DURING THE SEARCH CONDUCTED U/S 132 OF THE ACT OF THE PREMISES OF SOME OTHER PERSON. FROM PLAIN RE ADING OF THESE PROVISIONS, WE DO NOT FIND ANY IMPEDIMENT IN PROCEEDING AGAINST SUCH PERSON BY ISSUING NOTICE U/ S 148 OF THE ACT. IN OTHER WORDS, CHAPTER XIV-B DO NOT PRECL UDE THE ASSESSING OFFICER TO PROCEED AGAINST SUCH ASSESSEE BY ISSUING NOTICE U/S 148 OF THE ACT. THE REMEDIES AVA ILABLE TO THE ASSESSING OFFICER, UNDER THESE PROVISIONS ARE I NDEPENDENT OF EACH OTHER, AND THE PROVISIONS BEING ANALOGOUS, IF IS FOR THE ASSESSING OFFICER TO OPT FOR EITHER OF THEM IN A SI TUATION, SUCH AS IN THE PRESENT CASE. THE LEGISLATURE, IN OUR OPI NION, HAS GIVEN CHOICE TO THE ASSESSING OFFICER TO EITHER PRO CEED UNDER CHAPTER XIV-B OR U/S 148 OF THE ACT AGAINST THE ASS ESSEE, SUCH AS THE ONE IN THE PRESENT CASE. 8.2.23. IN VIEW OF THE ABOVE, THE APPREHENSIO N OF THE REVENUE IS NOT WELL FOUNDED. MOREOVER, THE CONTENTION THAT THE DECISION OF THE HON'BLE SPECIAL BENCH WAS RENDERED IN THE CONTE XT OF SECTION 132 AND NOT SECTION 132A AND, HENCE, IT DOESNT APP LY TO THE FACTS OF THE PRESENT CASE IS NOT TENABLE. SECTION 1 32A (3) CLEARLY STATES THAT THE PROVISIONS OF SUB-SECTIONS (4A) TO (14) OF SECTION 132 AND SECTION 132B APPLY MUTATIS MUTANDIS IN CASE OF REQUISITION. THEREFORE, THE RATIO OF THE DECISION O F THE HON'BLE SPECIAL BENCH ALSO APPLIES TO THE FACTS OF THE PRES ENT CASE. THEREFORE, THE FACTUAL FINDINGS AS WELL AS THE LEGA L REASONING OF THE DRP FOR UPHOLDING THE VALIDITY OF REFERENCE TO TPO IS WITHOUT ANY LEGAL SANCTITY FOR THE AYS 2003-04 TO 2006-07 S INCE THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 59 OF 78 ASSESSMENT PROCEEDINGS FOR THOSE YEARS HAD ALREADY ATTAINED FINALITY AND NO INCRIMINATING MATERIAL PERTAINING T O TP ADJUSTMENT WAS DISCOVERED IN SEARCH/REQUISITION. T HEREFORE, THE ASSESSMENTS MADE U/S 153C FOR THE ASSESSMENT YEARS 2003-04 TO 2006-07 WERE INVALID AS THE SAME WERE NOT PENDIN G ON THE DATE OF HANDING OVER OF CASH AND, THUS, THE ASSESSM ENTS MADE WERE EXTRANEOUS TO SEIZED CASH. THIS PROPOSITION IS BASED ON THE DECISION OF THE SPECIAL BENCH IN ALL CARGO (SUPRA) AND THE JUDGMENT OF THE DELHI HIGH COURT IN CHETAN DAS (SUP RA). GROUND V (2 ): DRP HAD EXCEEDED ITS JURISDICTION BY ISSUING DIRECT IONS IN RESPECT OF AMP EXPENDITURE ; 9. THE SUBMISSIONS OF THE LEARNED AR ARE AS FOLLO WS: - THAT THE DRP DOES NOT HAVE THE POWERS TO ISSUE ANY DIRECTION IN RESPECT OF AMP EXPENDITURE WHICH DID N OT FORM PART OF THE TPOS ORDER THEREBY EXCEEDING ITS JURIS DICTION; - THAT THE MEMORANDUM EXPLAINING THE INTENTION BEHIND INTRODUCTION OF EXPLANATION BELOW S. 144C(8) READS AS UNDER: POWER OF THE DRP TO ENHANCE VARIATIONS: DISPUTE RESOLUTION PANEL (DRP) HAD BEEN CONSTITUTED WITH A VIEW TO EXPEDITIOUSLY RESOLVE THE CASES INVOLVING T RANSFER PRICING ISSUES IN THE CASE OF ANY PERSON HAVING INT ERNATIONAL TRANSACTIONS OR IN CASE OF A FOREIGN COMPANY. IT HA S BEEN PROVIDED UNDER SUB-SECTION (8) OF SECTION 144C THAT DRP MAY CONFIRM, REDUCE OR ENHANCE THE VARIATIONS PROPOSED IN THE DRAFT ORDER OF THE AO. IN A RECENT JUDGMENT, IT WAS HELD THAT THE POWER OF DRP IS RESTRICTED ONLY TO THE ISSUES RAISED IN THE DRAFT A SSESSMENT ORDER AND, THEREFORE, IT CANNOT ENHANCE THE VARIATI ON PROPOSED IN THE ORDER AS A RESULT OF ANY NEW ISSUE WHICH COMES TO THE NOTICE OF THE PANEL DURING THE COURSE OF PROCEEDINGS BEFORE IT. THIS IS NOT IN ACCORDANCE WITH THE LEGISLATIVE INTE NT. IT IS ACCORDINGLY PROPOSED TO INSERT AN EXPLANATION IN THE PROVISIONS OF SECTION 144C TO CLARIFY THAT THE POWE RS OF THE DRP TO ENHANCE THE VARIATION SHALL INCLUDE AND SHAL L ALWAYS ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 60 OF 78 BE DEEMED TO HAVE INCLUDED THE POWER TO CONSIDER AN Y MATTER ARISING OUT OF THE ASSESSMENT PROCEEDINGS RE LATING TO THE DRAFT ASSESSMENT ORDER. THIS POWER TO CONSIDER ANY ISSUE WOULD BE IRRESPECTIVE OF THE FACT WHETHER SUC H MATTER WAS RAISED BY THE ELIGIBLE ASSESSEE OR NOT. THIS AMENDMENT WILL BE EFFECTIVE RETROSPECTIVELY FR OM THE 1 ST DAY OF APRIL, 2009 AND WILL ACCORDINGLY APPLY TO AS SESSMENT YEAR 2009-10 AND SUBSEQUENT ASSESSMENT YEARS. - THAT IT WOULD SHOW THAT THE EXPLANATION BELOW S. 14 4C(8) IS APPLICABLE FOR AY 2009-10 AND NOT APPLICABLE FOR THE AYS 2003-04 TO 2008-09 AND, THAT, THE DRP WAS NOT JUSTI FIED IN ISSUING DIRECTIONS IN RESPECT OF A NEW VARIATION; - THAT THE MEMORANDUM EXPLAINING THE AMENDMENTS PROPOSED BY THE FINANCE BILL 2012 IN RESPECT OF INS ERTION OF EXPLANATION TO S. 144C(8) CLEARLY STATES THAT THE S AID EXPLANATION IS EFFECTIVE ONLY FROM THE AY 2009-10 A ND SUBSEQUENT YEARS AND DOESNT APPLY TO THE PENDING PROCEEDINGS. - THAT AS PER THE JUDGMENT OF THE HONBLE JURISDICTIO NAL HIGH COURT IN THE CASE OF GE INDIA TECHNOLOGY CENTRE (P) LTD V. DRP [2011] 338 ITR 416 (KAR) [ PAGE 120 OF WS], THE DRP HAD NO POWERS TO CONSIDER A NEW VARIATION; - WITHOUT PREJUDICE TO THE CONTENTION THAT EXPLANATIO N BELOW S. 144C (8) IS PROSPECTIVE AND EXPLANATION BELOW S. 144C (8) CONFERS POWER ON THE DRP TO CONSIDER ANY MATTER ARISING OUT OF THE ASSESSMENT PROCEEDINGS RELATING TO DRAFT ORDER. HOWEVER, THE POWER DOES NOT EXTEND TO VARIATION IN RESPECT OF ALP OF THOSE INTERNATIONAL TRANSACTIONS WHICH DO NOT FORM PART OF ADJUSTMENT U/S 92CA; - THAT THE ASSESSMENT PROCEEDINGS RELATING TO DRAFT ORDER DO NOT INCLUDE THE PROCEEDINGS BEFORE THE TPO U/S 92CA AS THE DRAFT ORDER PROCEEDINGS PERTAIN TO THE PROCEEDI NGS BEFORE THE AO; - THAT THE TPO HAD NO POWER TO CONSIDER AN INTERNATIO NAL TRANSACTION WHICH HAD NOT BEEN REPORTED IN FORM 3CE B; AND THAT THE AMENDED S. 92CA, WHICH RECEIVED THE PRESIDENTIAL ASSENT ON 28.5.2012, ONLY ENABLES THE TPO TO CONSIDER AN INTERNATIONAL TRANSACTION WHICH WAS NOT ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 61 OF 78 REPORTED IN FORM 3CEB. IN THE INSTANT CASE, THE OR DER U/S 92CA WAS PASSED BY THE TPO ON 31.10.2011 AND, HENC E, THE DRP CANNOT ISSUE DIRECTIONS TO TPO TO CONSIDER INTERNATIONAL TRANSACTION NOT REPORTED IN FORM 3CEB ; RELY ON THE FOLLOWING CASE LAWS : (I) MRS TREETY K SAHNI V. ITO (1998) 65 ITD 466 (MUM); (II) HUKAM CHAND SHYAM LAL V. UNION OF INDIA & ORS. 1976 AIR 789; (III) RAMACHANDRA KESHAV ADKE & ORS V. GOVIND JOTI CHAVARE & ORS. 1975 AIR 915; (IV) CIT V. ANJUM M.H. GHASWALA (2001) 252 ITR 1 (SC) - THAT ELABORATING THE RATIO BEHIND THE INTRODUCTION OF EXPLANATION BELOW S. 144C(8) AND EXTENSIVELY QUOTIN G THE JUDGMENT OF THE HONBLE JURISDICTIONAL HIGH COURT I N THE CASE OF GE INDIA TECHNOLOGY CENTRE (P) LTD V. DRP R EPORTED IN (2011) 338 ITR 416 (KAR) , IT WAS CONTENDED THAT THE INTRODUCTION OF EXPLANATION BELOW S. 144C(8) WA S MADE TO ENABLE THE DRP TO ISSUE DIRECTIONS IN RESPECT OF NEW VARIATIONS WHICH ARE NOT RELATED TO TP MATTERS AND, THUS, DRP DOES NOT POSSESS POWERS TO DISCOVER NEW INTERNA TIONAL TRANSACTION NOT EARLIER CONSIDERED BY THE TPO. 9.1. REBUTTING THE ASSESSEES CONTENTION THAT EXPLA NATION TO S. 144C (8) OF THE ACT HAS BEEN GIVEN EFFECT FROM 1.4. 2009 BY FINANCE ACT 2012 AND BY WAY OF CIRCULAR THE EFFECT OF AMENDMENT HAS BEEN GIVEN FOR THE AY 2009-10 ON WARD S AND THE ASSESSMENTS INVOLVED IN THE PRESENT APPEALS ARE PRI OR TO THE AY 2009-10 AND, THUS, THE AMENDMENT HAS NO APPLICATION ETC., THE REVENUES SUBMISSIONS ARE AS UNDER: THAT THE MEMORANDUM EXPLAINING THE FINANCE BILL 201 2 EXPRESSED THE COMMENCEMENT OF EXPLANATION WAS FROM THE AY 2009-10 ONWARDS. HOWEVER, SINCE THE SAID OBSERV ATION WAS A MISTAKE CREPT IN IN THE MEMORANDUM WHICH HAS BEEN SUBSEQUENTLY RECTIFIED BY ISSUANCE OF A CIRCUL AR NO.3/2012 DATED 12.6.2012 EXPLAINING THE AMENDMENTS MOVED IN FINANCE BILL 2012. THE CLARIFICATION ISSU ED BY THE ABOVE CIRCULAR READS AS UNDER: ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 62 OF 78 1. A CLARIFICATORY AMENDMENT WAS PROPOSED IN THE F INANCE BILL 2012 [CLAUSE 63] BY INSERTING THE FOLLOWING EX PLANATION AFTER SUB-SECTION (8J) OF SECTION 144C, WHICH SHALL BE DEEMED TO HAVE BEEN INSERTED W. E. F. 1 ST APRIL,2009, NAMELY: EXPLANATION- FOR THE REMOVAL OF DOUBTS, IT IS HERE BY DECLARED THAT THE POWER OF THE DISPUTE RESOLUTION P ANEL TO ENHANCE THE VARIATION SHALL INCLUDE AND SHALL BE DE EMED ALWAYS TO HAVE INCLUDED THE POWER TO CONSIDER ANY M ATTER ARISING OUT OF THE ASSESSMENT PROCEEDINGS RELATING TO THE DRAFT ORDER, NOTWITHSTANDING THAT SUCH MATTER WAS R AISED OR NOT BY THE ELIGIBLE ASSESSEE. THE DATE OF EFFECTIVITY OF THE PROVISION MENTIONED IN CLAUSE 63 OF THE FINANCE BILL, 2012 AND THE NOTES ON CLAUS ES (CLAUSE 60) THEREOF IS 1 ST APRIL, 2009, I.E., THE PROVISION WOULD APPLY TO ALL CASES FILED BEFORE DRP ON OR AFTER 1 ST APRIL, 2009, IRRESPECTIVE OF THE ASSESSMENT YEAR. IN THE EXPLAN ATORY MEMORANDUM ISSUED WITH THE FINANCE BILL [ G. RATIONALIZATION OF TRANSFER PRICING PROVISIONS (SUB -HEADING) POWER OF THE DRP TO ENHANCE VARIATIONS), THE EFFE CTIVITY HAS BEEN INCORRECTLY MENTIONED AS APPLYING TO ASSES SMENT YEAR 2009-10 AND, SUBSEQUENT YEARS. THIS BEING A PROCEDURAL PROVISION, THE CORRECT POSITION IS AS ST ATED IN THE NOTES ON CLAUSES, I.E., IT WOULD APPLY TO ANY PROCE EDING BEFORE THE DRP AS ON 1 ST APRIL, 2009 AND MAY BE READ ACCORDINGLY. [CLAUSE 63] THAT FROM THE ABOVE CLARIFICATION IT IS CLEAR THAT EXPLANATION TO S. 144(8) IS APPLICABLE TO ALL CASES FILED BEFOR E THE DRP ON OR AFTER 1.4.2009 IRRESPECTIVE OF THE ASSESSMENT YE AR. THUS, THE DRP WAS WITHIN ITS DOMAIN IN EXERCISING POWERS CONFERRED UNDER EXPLANATION TO S. 144 C(8) OF THE A CT. 9.2. WE HAVE CAREFULLY CONSIDERED THE R IVAL SUBMISSIONS ON THE ISSUE AND ALSO PERUSED THE RELEVANT MATERIAL S AS WELL AS THE CIRCULAR NO.3 OF 2012 DATED 12 TH JUNE, 2012. 9.2.1. AT THE OUTSET, WE WOULD LIKE TO CLARIFY THAT AS PER THE CIRCULAR NO.3 OF 2012 DATED 12.6.2012 WHICH WAS THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 63 OF 78 SUPPLEMENTARY MEMORANDUM EXPLAINING THE OFFICIAL AMENDMENTS MOVED IN THE FINANCE BILL, 2012 AS REFLE CTED IN THE FINANCE ACT, 2012, IT HAS BEEN MADE EXPLICIT THAT THE DATE OF EFFECTIVITY OF THE PROVISION MENTIONED IN CLAUSE 63 OF THE FINANCE BILL, 2012 AND THE NOTES ON CLAUSES (CLAUSE 60) THE REOF IS 1 ST APRIL, 2009, I.E., THE PROVISION WOULD APPLY TO ALL CASES FILED BEFORE THE DRP ON OR AFTER 1 ST APRIL, 2009, IRRESPECTIVE OF THE ASSESSMENT YEAR. IN VIEW OF THE ABOVE CLARIFICATION, WE ARE OF THE VIEW THAT THE DRP WAS WITHIN ITS DOMAIN AND ALSO JUSTIFIED IN EXERCISING THE POWERS CONFERRED UNDER EXPLANATIO N TO S. 144C (8) OF THE ACT. MOREOVER, IT WAS THE CONTENTION OF THE ASSESSEE THAT THE DRP HAS POWER ONLY TO ENHANCE OR REDUCE TH E ADJUSTMENT THAT HAS ALREADY BEEN CARRIED OUT U/S 92 CA. IN OTHER WORDS, IT WAS THE LEARNED ARS SUBMISSION THA T THE DRP HAS NO POWER TO TREAT TRANSACTIONS IN RESPECT OF WH ICH EITHER NO ADJUSTMENT WAS PROPOSED BY THE LEARNED TPO OR SUCH TRANSACTION DOES NOT FORM PART OF THE REPORT U/S 92 E. THIS SUBMISSION OF THE LEARNED AR IS DEVOID ANY MERITS, IN VIEW OF THE MEMORANDUM EXPLAINING THE INTENTION BEHIND INTRODUC TION OF EXPLANATION BELOW S. 144C (8) WHICH READ AS UNDER: POWER OF THE DRP TO ENHANCE VARIATIONS DISPUTE RESOLUTION PANEL [DRP] HAD BEEN CONSTITUTED WITH A VIEW TO EXPEDITIOUSLY RESOLVE THE CASES INVOLVING T RANSFER PRICING ISSUES IN THE CASE OF ANY PERSON HAVING INT ERNATIONAL TRANSACTIONS OR IN CASE OF A FOREIGN COMPANY. IT H AS BEEN PROVIDED UNDER SUB-SECTION (8) OF SECTION 144C THAT DRP MAY CONFIRM, REDUCE OR ENHANCE THE VARIATIONS PROPOSED IN THE DRAFT ORDER OF THE ASSESSING OFFICER. IN A RECENT JUDGMENT, IT WAS HELD THAT THE POWER OF DRP IS RESTRICTED ONLY TO THE ISSUES RAISED IN THE DRAFT A SSESSMENT ORDER AND THEREFORE IT CANNOT ENHANCE THE VARIATION PROPOSED IN THE ORDER AS A RESULT OF ANY NEW ISSUE WHICH COM ES TO THE NOTICE OF THE PANEL DURING THE COURSE OF PROCEEDING S BEFORE IT. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 64 OF 78 THIS IS NOT IN ACCORDANCE WITH THE LEGISLATIVE INTE NT. IT IS ACCORDINGLY PROPOSED TO INSERT AN EXPLANATION IN THE PROVISIONS OF SECTION 144C TO CLARIFY THAT THE POWE R OF THE DRP TO ENHANCE THE VARIATION SHALL INCLUDE AND SHALL AL WAYS BE DEEMED TO HAVE INCLUDED THE POWER TO CONSIDER ANY M ATTER ARISING OUT OF THE ASSESSMENT PROCEEDINGS RELATING TO THE DRAFT ASSESSMENT ORDER. THIS POWER TO CONSIDER ANY ISSUE WOULD BE IRRESPECTIVE OF THE FACT WHETHER SUCH MATTER WAS RAISED BY THE ELIGIBLE ASSESSEE OR NOT. THIS AMENDMENT WILL BE EFFECTIVE RETROSPECTIVELY FR OM THE 1 ST DAY OF APRIL, 2009 AND WILL ACCORDINGLY APPLY TO AS SESSMENT YEAR 2009-10 AND SUBSEQUENT ASSESSMENT YEARS. 9.2.2. IN VIEW OF EXPLANATION TO S. 144C(8), I T IS CLEAR THAT DRP IS EMPOWERED TO TAKE COGNIZANCE OF ANY NEW ISSU E WHICH COMES TO THE NOTICE OF THE PANEL DURING THE COURSE OF PROCEEDINGS BEFORE IT. THEREFORE, IN THE LIGHT OF THE AFORESAI D REASONING, THE ISSUE RAISED BY THE ASSESSEE IS DECIDED IN FAVOUR O F THE REVENUE. IT IS ORDERED ACCORDINGLY. GROUND V(1 ): JURISDICTION OF THE DRP IN CONSIDERING THE NEW GROU NDS: 10. IT WAS THE CASE OF THE ASSESSEE THAT THE DRP W AS NOT JUSTIFIED IN REMANDING THE ISSUE OF AMP EXPENDITURE TO THE TPO IN THE GARB OF ENQUIRY ON A SPECIFIC REQUEST OF TPO AS IT WOULD AMOUNT TO CONFERRING OF POWER TO REVIEW HER OWN ORD ER THOUGH NEITHER S.92CA NOR ANY OTHER PROVISION OF IT ACT CO NFERS SUCH POWER OR REVIEW ON TPO AND IT WOULD AMOUNT TO CIRCU MVENTING THE PROVISIONS OF S. 92CA (2B). IN THIS CONNECTION , IT WAS SUBMITTED BY THE LEARNED AR - THAT NEITHER S. 92 CA NOR ANY OTHER PROVISIONS IN T HE ACT CONFERS THE POWER OF REVIEW ON THE TPO. POWER TO ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 65 OF 78 REVIEW IS NOT AN INHERENT POWER AND THAT IT SHOULD BE CONFERRED BY THE STATUTE; RELIES ON THE FOLLOWING CASE LAWS: (I) CIT V. KELVINATOR OF INDIA LTD (2010) 320 ITR 561 ( SC); (II) PATEL NARSHI THAKERSHI AND ORS V. SRI PRADYUMANSINGHJI (1971) 3 SCC 844 [SC]; (III) LILY THOMAS ETC V. UNION OF INDIA & ORS. 2000 (1)AL T CRI 363 (SC); (IV) CIT V. MANAV VIKAS AVAM SEWA SANSTHAN (2011) 336 ITR 250 (ALL); - THAT BY SPECIFICALLY REQUESTING THE DRP TO PERMIT T HE TPO TO EXAMINE THE ALLEGED INTERNATIONAL TRANSACTIONS N OT FORMING PART OF THE ORIGINAL ORDER, THE TPO WAS SEE KING TO REVIEWS HER ORDER IN AN INDIRECT MANNER WHICH CANNO T BE DIRECTLY DONE. RELIES ON THE FOLLOWING CASE LAWS: (I) CIT V. ANJUM M.H. GHASWALA (2001) 252 ITR 1 (SC); & (II) RAMACHANDRA KESHAV ADKE & ORS V. GOVIND JOTI CHAVARE & ORS 1975 AIR 915 10.1. ON THE OTHER HAND, THE REVENUE ARGUED THAT T HE ASSESSEES CONTENTION OF THE REMANDING THE ISSUE FO R DETERMINING THE ALP IN RESPECT OF EXPENDITURE TOWARDS TO AMP TO THE TPO WAS WITHOUT JURISDICTION ETC., CANNOT BE ACCEPTED FOR T HE FOLLOWING REASONS: (A) THAT THE DRP WAS BROUGHT INTO THE STATUTE AS AN ALTERNATIVE METHOD OF RESOLVING DISPUTES IN RESPECT OF INTERNATIONAL TRANSACTIONS AS AN ALTERNATIVE TO THE APPEAL REMEDY BEFORE THE CIT (A); AND THAT IT IS SE TTLED POSITION OF LAW THAT THE POWERS OF THE CIT (A) COTERMINOUS WITH THAT OF THE AO AND THAT THE PROCEEDINGS BEFORE THE CIT (A) ARE CONTINUATION OF ASSESSMENT PROCEEDINGS; (B) IF THE PROVISIONS OF S. 144C ARE READ WITH THE PROVISIONS RELATING TO THE POWERS OF CIT (A), IT IS CLEAR THAT S. 144C IS PARIMATERIA WITH S. 251 OF THE ACT. THE DRP IS EMPOWERED U/S 144C TO GO INTO THE ISSUES WHICH WERE NOT CONSIDERED BY THE AO IN THE DRAFT ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 66 OF 78 ASSESSMENT ORDER IRRESPECTIVE OF WHETHER THE ASSESS EE RAISED THE ISSUE OR NOT; (C) THAT IN THE INSTANT CASE, THE ASSESSEE RAISED CERTA IN CONTENTIONS BEFORE THE AO AFTER THE DETERMINATION O F ALP WITH REGARD TO EXPENDITURE ON AMP. IN VIEW OF THE ISSUE BEING RAISED SUBSEQUENTLY, THE TPO WAS DIRECTED TO LOOK IN TO THE ISSUE. IT WAS CLEAR FRO M THE REQUEST OF THE TPO THAT THE EXPENDITURE ON AMP WAS NOT PART OF 3CEB REPORT FILED BY THE ASSESSEE. WH EN THE ISSUE CAME TO THE NOTICE OF DRP, THE TPO WAS REQUIRED TO SUBMIT A REPORT AND, ACCORDINGLY, THE T PO HAD DETERMINED THE ALP ON AMP EXPENDITURE; (D) THAT AS THE EXPENDITURE ON AMP WAS NOT PART OF 3CEB REPORT AND THE SAME WAS NOT CONSIDERED WHILE DETERMINING THE ALP, THE VIEW OF THE TPO ON REMAND WOULD NOT AMOUNT TO REVIEW. AS NO VIEW WAS EXPRESSED EARLIER BY THE TPO, THE QUESTION OF REVIE W DOESNT ARISE; (E) THAT THE AMENDMENT TO S. 92CA (2B) OF THE ACT IS CLEAR REGARDING THE POWERS OF TPO TO CONSIDER THE INTERNATIONAL TRANSACTIONS OTHER THAT REFERRED U/S (1); AND THAT IN VIEW OF AMENDMENT AND NON-DECLARATION OF AMP EXPENDITURE IN 3CEB REPORT AND SUBSEQUENT DISPUTE BY THE ASSESSEE BEFORE THE AO/DRP, THE DETERMINATION OF ALP ON AMP EXPENDITURE ON REMAND FROM THE DRP BY THE TPO WAS WITHIN THE AMBIT OF S. 92CA OF THE ACT; (F) THAT THE AMENDMENT TO S. 92CA OF THE ACT BROUGHT INTO STATUTE W.E.F. 1.6.2002 IS A PROCEDURAL SECTIO N AND APPLICABLE TO ALL PENDING MATTERS AND, THUS, TH E ORDER IS WITHIN THE PURVIEW OF S. 92CA (2B) OF THE ACT. S. 92CA ALSO PROVIDES PROTECTION TO THE ASSESSEE FR OM RETROSPECTIVE AMENDMENT TO S. 92CA (2B) OF THE ACT. THE CASE OF THE ASSESSEE DOES NOT FIT INTO THE PROTECTION PROVIDED U/S 92CA (2C) OF THE ACT. IN CONCLUSION, IT WAS PLEADED THAT IN VIEW OF THE A BOVE FACTUAL POSITION READ WITH S. 144C (8), THE ORDER O F THE REMAND ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 67 OF 78 PASSED BY THE DRP WAS JUST AND PROPER WHICH REQUIRE S TO BE UPHELD. 10.2. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS AND ALSO PERUSED THE RELEVANT MATERIALS ON RECORD. AS BROUGHT ON RECORD BY THE REVENUE, THE EXPENDITURE ON AMP WAS N OT PART OF REPORT BY THE ASSESSEE IN ITS 3CEB REPORT. WHEN TH E ISSUE OF EXPENDITURE ON AMP BROUGHT TO THE NOTICE OF DRP, IN ITS FAIRNESS, THE DRP DIRECTED THE TPO TO LOOK INTO THE ISSUE AND SUBMIT A REPORT, ON THE BASIS OF WHICH, THE TPO HAD DETERMIN ED THE ALP ON AMP EXPENDITURE TOO. SUCH BEING THE SITUATION, THE ASSESSEE CANNOT TAKE A STAND THAT THE VIEW EXPRESSED BY THE TPO ON A SPECIFIC DIRECTION BY THE DRP, WOULD AMOUNT TO REVI EW. WE HAVE ALSO CAREFULLY ANALYSED THE AMENDMENT TO S. 92CA (2 B) OF THE ACT, THE RELEVANT PORTION OF WHICH, IS REPRODUCED A S UNDER [FOR READY REFERENCE]: SECTION 92 CA OF THE ACT PROVIDES THAT THE ASSESSI NG OFFICER, IF HE CONSIDERS IT NECESSARY OR EXPEDIENT TO DO SO, MAY WITH THE PREVIOUS APPROVAL OF THE COMMISSIONER OF I NCOME-TAX, REFER THE MATTER OF DETERMINATION OF ARMS LENGTH P RICE IN RESPECT OF AN INTERNATIONAL TRANSACTION TO THE TRAN SFER PRICING OFFICER (TPO). ONCE REFERENCE IS MADE TO THE TPO, TPO IS COMPETENT TO EXERCISE ALL POWERS THAT ARE AVAILABLE TO THE AO UNDER SUB-SECTION (3) OF S. 92C FOR DETERMINATION O F ALP AND CONSEQUENT ADJUSTMENT. FURTHER U/S 92E OF THE ACT, THERE IS REPORTING REQUIREMENT ON THE TAXPAYER AND THE TAXPA YER IS UNDER OBLIGATION TO FILE AN AUDIT REPORT IN THE PRE SCRIBED FROM BEFORE THE AO CONTAINING DETAILS OF ALL INTERNATION AL TRANSACTIONS UNDERTAKEN BY THE TAXPAYER DURING THE YEAR. THIS AUDIT REPORT IS THE PRIMARY DOCUMENT WITH THE AO WHICH CONTAINS THE DETAILS OF INTERNATIONAL TRANSACTIONS UNDERTAKEN BY THE TAXPAYER. IF THE ASSESSEE DOES NOT REPORT SU CH A TRANSACTION IN THE REPORT FURNISHED UNDER S. 92E, T HEN THE AO WOULD NORMALLY NOT BE AWARE OF SUCH AN INTERNATIONA L TRANSACTION SO AS TO MAKE A REFERENCE TO THE TPO. THE TPO MAY NOTICE SUCH A TRANSACTION SUBSEQUENTLY DURING T HE COURSE OF PROCEEDING BEFORE HIM. IN ABSENCE OF SPECIFIC P OWER, THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 68 OF 78 DETERMINATION OF ARMS LENGTH PRICE BY THE TPO WOUL D BE OPEN TO CHALLENGE EVEN THOUGH THE BASIS OF SUCH AN ACTIO N IS NON- REPORTING OF TRANSACTION BY THE TAXPAYER AT FIRST I NSTANCE. IT IS PROPOSED TO AMEND THE S. 92CA OF THE ACT RETR OSPECTIVELY TO EMPOWER TPO TO DETERMINE ARMS LENGTH PRICE OF A N INTERNATIONAL TRANSACTION NOTICED BY HIM IN THE COU RSE OF PROCEEDING BEFORE HIM, EVEN IF THE SAID TRANSACTION WAS NOT REFERRED TO HIM BY THE AO, PROVIDED THAT SUCH INTER NATIONAL TRANSACTION WAS NOT REPORTED BY THE TAX PAPER AS PE R THE REQUIREMENT CAST UPON HIM U/S 92E OF THE ACT. [SOURCE: 342 ITR (ST) 274) 10.2.1. THUS, THE NON-DECLARATION OF AMP E XPENDITURE IN 3CEB REPORT OF THE ASSESSEE AND SUBSEQUENT DIFFERENCE/GRIEVANCE WITH THE AO/DRP, THE DETERMINA TION OF ALP ON AMP EXPENDITURE ON REMAND FROM THE DRP BY THE TP O, IN OUR VIEW, WAS WITHIN THE SPHERE OF S. 92CA OF THE ACT. THEREFORE, GROUND NO.V (1) IS DECIDED AGAINST THE ASSESSEE. GROUND III(2)&(3) : ORDER U/S 153C OF THE ACT WAS BARRED BY TIME AS PER S. 153B OF THE ACT : 11.IT WAS THE SUBMISSION OF THE LEARNED AR THAT S. 153B LAYS DOWN THE TIME LIMIT FOR MAKING AN ASSESSMENT ORDER U/S 153C OF THE ACT. SEARCH WAS CONDUCTED AT THE PREMISES OF TAMIZ ON 4.8.2008 AND THE LAST OF THE AUTHORIZATION FOR REQUISITION WAS EXECU TED DURING AUGUST, 2008. IT WAS UNDISPUTED THAT THE ON LY ASSET SEIZED WAS CASH OF RS.9.7 CRORE. DURING THE C OURSE OF ASSESSMENT PROCEEDINGS U/S 153C, A REFERENCE U/S 92 CA(1) WAS MADE AND AN ORDER U/S 92CA WAS PASSED ON 31.10.2011. BASED ON THESE FACTS, THE APPLICABLE P ROVISION WHICH DEALS WITH THE TIME LIMIT MAKING AN ASSESSMEN T ORDER U/S 153C WAS THE FIFTH PROVISO TO S. 153B(1) PRIOR TO ITS AMENDMENT BY THE FINANCE ACT, 2012; AS PER FIFTH PROVISO TO S. 153B(1) [PRIOR TO ITS AM ENDMENT], THE PERIOD OF LIMITATION FOR MAKING ASSESSMENT OR R E- ASSESSMENT U/S 153C IS: ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 69 OF 78 - THIRTY-THREE MONTHS FROM THE END OF THE FINANCIAL Y EAR IN WHICH LAST OF THE AUTHORIZATIONS FOR SEARCH U/S 132 OR FOR REQUISITION U/S 132A IS EXECUTED OR - TWENTY ONE MONTHS FROM THE END OF THE FY IN WHICH T HE ASSETS SEIZED OR REQUISITIONED ARE HANDED OVER U/S 153C TO THE JURISDICTIONAL AO OF THE OTHER PERSON WHICHEVER IS LATER; AS PER S. 153B(2)(B), THE LAST OF THE AUTHORIZATION SHALL BE DEEMED TO HAVE BEEN EXECUTED IN THE CASE OF REQUISI TION U/S 132A ON THE ACTUAL RECEIPT OF THE BOOKS OF ACCO UNT OR OTHER DOCUMENTS OR ASSETS BY THE AUTHORIZED OFFICER . THE DATE OF SUCH HANDING OVER BY THE POLICE TO AUTHORIZ ED OFFICER CAN BE TAKEN NOT LATER THAN 31.3.2009. THUS, THE L AST OF THE AUTHORIZATION FOR REQUISITION U/S 132A WAS DEEM ED TO HAVE BEEN EXECUTED IN THE FY 2008-09 AND THAT THE P ERIOD OF THIRTY-THREE MONTHS REFERRED ABOVE ENDED ON 31.1 2.2011; WITHOUT PREJUDICE TO THE SUBMISSION THAT THERE WAS NO PROPER HANDING OVER OF CASH SO AS TO CONFER JURISDI CTION U/S 153C FOR THIS ALTERNATIVE GROUND ON LIMITATION, ONE MAY ASSUME THAT THE CASH SEIZED WAS HANDED OVER U/S 153 C TO THE JURISDICTIONAL AO ON OR BEFORE 11.5.2009 [WHICH WAS THE DATE OF NOTICE U/S 153C]. THUS, THE PERIOD OF TWEN TY MONTHS REFERRED ABOVE ENDED ON 31.12.2011. SINCE TH E ORDER U/S 153C WAS PASSED ONLY ON 29.10.2012, THE S AME WAS BARRED BY LIMITATION AND, HENCE, LIABLE TO BE Q UASHED; S. 144C (13) AS IT STOOD PRIOR TO AMENDMENT BY F. A CT 2012 PROVIDES THE AO SHALL PASS THE FINAL ASST. ORDER, NOTWITHSTANDING THE TIME-LIMIT SPECIFIED U/S 153 OF THE ACT, IN CONFORMITY WITH THE DIRECTIONS ISSUED BY THE DRP ; AND THAT S. 144C(13) HAS BEEN AMENDED BY F ACT 2012 TO PROVIDE THAT THE NOTWITHSTANDING EFFECT SHALL EXTEN D TO S 153B; THAT THE EXTENDED PERIOD OF LIMITATION WAS APPLICAB LE ONLY TO THOSE CASES WHERE THE NORMAL PERIOD OF LIMITATIO N U/S 153B TO MAKE ASSESSMENT U/S 153C WAS NOT EXPIRED ON THE DATE ON WHICH THE FINANCE ACT 2012 RECEIVED THE ASSET OF THE PRESIDENT ON 28.5.2012. THUS, THE PERIOD OF LIMITATION TO PASS AN ORDER U/S 153C WAS EXPIRED ON 31.12.2011 WHICH WAS MUCH EARLIER TO THE DATE ON WH ICH THE FA 2012 RECEIVED THE PRESIDENTS ASSENT. RELIES ON THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 70 OF 78 JUDGMENT IN THE CASE OF S.S. GADGIL V. LAL & CO. (1 964) 53 ITR 231 (SC); THAT S. 144C(13) AS AMENDED BY F A 2012 WAS TO APPL Y TO AY 2010-11 ONWARDS AND THAT AS PER THE MEMORANDUM EXPLAINING THE AMENDMENTS MADE BY F A 2012 , THE AMENDMENT TOOK EFFECT FROM 1.10.2009 AND THAT THE AMENDMENT BEING SUBSTANTIVE APPLIES TO AY 2010-11 ONWARDS AND NOT FOR EARLIER AYS; AND HENCE, THE AMENDMENT MADE TO S. 144C (13) WHICH WAS SAID TO BE EFFECTIVE FROM 1.10.2009 WAS ALSO APPLICABLE FOR AY 2010-11 AND NOT TO A PRIOR AY. RELIES ON THE FOLLOWING CASE LAWS : (I) M/S. IPOLICY NETWORK PVT. LTD V. ITO, SECRETARIAT, DRP II (2012) 146 TTJ (DEL) 464; (II) CIT V. AMADEUS INDIA (P) LTD (2013) 351 ITR 92 (DEL ); (III) KUBER TOBACCO PRODUCTS (P) LTD V. DCIT (2009) 28 SOT 292 (DEL) (SB); 11.1. REFUTING THE ASSESSEES CONTENTIONS THAT T HE ASSESSMENT ORDER PASSED PURSUANT TO DIRECTIONS ISSUED BY DRP W AS BEYOND THE LIMITATION PROVIDED U/S 153B OF THE ACT ETC., T HE LEARNED DR SUBMITTED THE FOLLOWING ARGUMENTS, NAMELY: S 144C (13) PROVIDES FOR PASSING ASSESSMENT WITHIN ONE MONTH FROM THE END OF THE MONTH IN WHICH DIRECTION IS RECEIVED FROM DRP NOTWITHSTANDING S. 153B OF THE AC T. THE ORDER OF ASSESSMENT PASSED WAS WITHIN THE TIME FRAM E PROVIDED U/S 144C(13) OF THE ACT AND HENCE THE ORDE R WAS WITHIN TIME; THE PROVISIONS OF S. 144C (13) HAS PROVIDED FOR EXT ENSION OF TIME FOR THE ASSESSMENTS GOVERNED BY LIMITATION U/S 153B OF THE ACT. NO DOUBT, S. 153B WAS BROUGHT INTO SEC TION 144C BY F A 2012 W.E.F 1.10.2009. THE EXTENDED LIM ITATION WAS APPLICABLE TO ALL APPLICATIONS/OBJECTIONS FILED AFTER 1.10.2009. IN THE PRESENT CASE, THE OBJECTION WAS FILED AFTER 1.10.2009 AND THE AMENDMENT AND EXTENSION PROVIDED U/S 144C (13) WAS APPLICABLE. THE ASSESSM ENT ORDER PASSED U/S 153C R.W.S 144C OF THE ACT WAS WIT HIN THE TIME LIMIT PRESCRIBED U/S 144C (13) OF THE ACT. THE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 71 OF 78 ABOVE INTENTION WAS CLEAR AND EXPLICIT FROM THE MEMORANDUM EXPLAINING THE AMENDMENT. AS THERE WAS NO AMBIGUITY IN THE LANGUAGE OF S. 144C, NO JUDGMENTS ARE REQUIRED FOR INTERPRETATION. THE ORDER OF DRP WAS SUBSEQUENT TO THE AMENDMENT AND, HENCE, THE AO WAS ENTITLED TO EXTENSION OF TIME PROVIDED U/S 144C (13 ) OF THE ACT. 11.2. IN A REJOINDER TO THE REVENUES ARGUMENT, T HE SUBMISSIONS MADE BY THE LEARNED AR ARE SUMMARIZED AS UNDER: AS IS EVIDENT FROM THE SUBMISSIONS OF THE REVENUE, RELIANCE IS PLACED SOLELY ON THE MEMORANDUM WHICH STATES THA T UNDER THE PROVISIONS OF S. 144C OF THE ACT WHERE AN ELIGIBLE ASSESSEE FILES AN OBJECTION AGAINST THE DRAFT ASSES SMENT ORDER BEFORE THE DRP, THEN, THE TIME LIMIT FOR COMP LETION OF ASSESSMENTS ARE AS PROVIDED IN S. 144C NOTWITHSTAND ING ANYTHING IN S. 153. A SIMILAR PROVISION IS PROPOSE D TO BE MADE WHERE ASSESSMENTS ARE FRAMED AS A RESULT OF SE ARCH AND SEIZURE TO PROVIDE THAT FOR SUCH ASSESSMENTS, T IME LIMIT SPECIFIED IN S. 144C WILL APPLY, NOTWITHSTANDING AN YTHING IN S. 153B. A PERUSAL OF THE MEMORANDUM SHOWS THAT IT IS SUBSTANTIVE PROVISION AND NOT PROCEDURAL. IT ALSO DOES NOT STATE THAT IT IS INTENDED TO MAKE THE AMENDMENT TO REMOVE ANY LACUNA IN THE STATUTE. IT IS NOT CLARIFICATORY OR PROCEDURAL IN NATURE. THERE IS NOTHING IN THE MEMORANDUM TO SHOW THAT IT APPLIES TO APPLICATIONS/ OBJECTIONS FILED ON OR AFTER 1.10.2009. THE APPELL ANT REITERATES ITS SUBMISSIONS THAT THE AMENDMENT IS SUBSTANTIAL IN NATURE AND HENCE, CANNOT BE INVOKED TO EXTEND THE TIME LIMIT TO PASS THE ORDERS U/S 153C W HERE THE TIME LIMIT STIPULATED U/S 153B HAS ALREADY APPL IED; THE TIME LIMIT TO PASS THE ORDER U/S 153C R.W.S. 15 3B EXPIRED ON 31.12.2011. THE FINANCE ACT, 2012 RECEIV ED PRESIDENTIAL ASSENT ON 28.5.2012 AND HENCE THE EXTE NDED PERIOD OF LIMITATION WAS NOT APPLICABLE TO THOSE CA SES WHERE THE NORMAL PERIOD OF LIMITATION U/S 153B TO MAKE ASSESSMENT U/S 153C HAS NOT EXPIRED ON THE DATE ON WHICH THE FINANCE ACT 2012 RECEIVED THE PRESIDENTIAL ASSE NT; ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 72 OF 78 THE REVENUE HAD NEITHER RAISED OBJECTIONS WITH REGA RD TO THE OTHER CONTENTIONS OF THE ASSESSEE NOR DISTINGUI SHED THE CASE LAWS RELIED ON BY THE ASSESSEE. 11.3. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBM ISSIONS AND ALSO PERUSED THE RELEVANT MATERIALS ON RECORD. 11.3.1. SECTION 153B LAYS DOWN THE TIME-LIMIT FOR M AKING AN ASSESSMENT ORDER U/S 153C OF THE ACT. THE SEARCH WA S CONDUCTED AT THE PREMISES OF TAMIZ ON 5.8.2008. TH E LAST OF THE AUTHORIZATION FOR REQUISITION WAS EXECUTED DURING A UGUST 2008. IT IS UNDISPUTED THAT THE ONLY ASSET THAT HAS BEEN SEIZED WAS CASH OF RS.9.7 CRORES. DURING THE COURSE OF ASSESS MENT PROCEEDINGS U/S 153C, A REFERENCE U/S 92CA (1) WAS MADE. AN ORDER U/S 92CA WAS PASSED ON 31.10.2011. BASED ON THOSE FACTS, THE APPLICABLE PROVISION WHICH DEALS WITH TH E TIME-LIMIT FOR MAKING AN ASSESSMENT ORDER U/S 153C WAS THE FIFTH P ROVISO TO S. 153B(1) PRIOR TO ITS AMENDMENT BY FINANCE ACT, 2012 . THE FIFTH PROVISO TO S. 153B(1) PRIOR TO ITS AMENDMENT BY THE FINANCE ACT, 2012 IS EXTRACTED AS UNDER: PROVIDED ALSO THAT IN CASE WHERE THE LAST OF THE AUTHORISATIONS FOR SEARCH UNDER SECTION 132 OR FOR REQUISITION UNDER SECTION 132A EXECUTED DURING THE FINANCIAL YE AR COMMENCING ON THE 1 ST DAY OF APRIL, 2005 OR ANY SUBSEQUENT FINANCIAL YEAR AND DURING THE COURSE OF THE PROCEED INGS FOR THE ASSESSMENT OR RE-ASSESSMENT OF TOTAL INCOME IN CASE OF OTHER PERSON REFERRED TO IN SECTION 153C, A REFERENCE UND ER SUB- SECTION (1) OF SECTION 92CA- (I) WAS MADE BEFORE THE 1 ST DAY OF JUNE, 2007 BUT AN ORDER UNDER SUB-SECTION (3) OF SECTION 92CA HAS NOT BEEN MADE BEFORE SUCH DATE; OR (II) IS MADE ON OR AFTER THE 1 ST DAY OF JUNE, 2007, THE PERIOD OF LIMITATION FOR MAKING THE ASSESSMENT OR R E- ASSESSMENT IN CASE OF SUCH OTHER PERSON SHALL, ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 73 OF 78 NOTWITHSTANDING ANYTHING CONTAINED IN CLAUSE (II) O F THE SECOND PROVISO, BE THE PERIOD OF THIRTY-THREE MONTHS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE LAST OF THE AUTHORISATIONS FOR SEARCH UNDER SECTION 132 OR FOR REQUISITION UNDER SECTION 132A WAS EXECUTED OR TWENTY-ONE MONTHS FROM THE END OF THE FINANCIAL YEAR IN WHICH BOOKS OF ACCOUNT OR DOCUMENTS OR ASSETS SEIZED OR REQUISITIONED ARE HANDED OVER UNDER SECTION 153C TO THE ASSESSING OFFICER HAVING JURISDICTION OVER SUCH OTHER PERSON, WHICHEVER IS LATER. 11.3.2. AS PER THE FIFTH PROVISO TO SECTION 153B(1 ) OF THE ACT, THE PERIOD OF LIMITATION FOR MAKING ASSESSMENT OR RE-AS SESSMENT U/S 153C IS: (I) THIRTY-THREE MONTHS FROM THE END OF THE FINA NCIAL YEAR IN WHICH LAST OF THE AUTHORIZATIONS FOR SEARCH UNDER S ECTION 132 OR FOR REQUISITION U/S 132A IS EXECUTED; OR (II) TWENTY-ONE MONTHS FROM THE END OF THE FINANC IAL YEAR IN WHICH THE ASSETS SEIZED O REQUISITIONED ARE HANDED OVER UNDER SECTION 153C TO THE JURISDICTIONAL ASSESSING OFFICER OF THE OTHER PERSON WHICHEVER IS LA TER. 11.3.3. AS PER SECTION 153B (2)(B), THE LAST OF THE AUTHORIZATION SHALL BE DEEMED TO HAVE BEEN EXECUTED IN THE CASE OF REQUISITION UNDER SECTION 132A, ON THE ACTUAL RE CEIPT OF THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ASSETS BY TH E AUTHORIZED OFFICER. THE DATE OF SUCH HANDING OVER BY THE POLI CE TO AUTHORIZED OFFICER CAN BE TAKEN NOT LATER THAN 31.3.2009. THE REFORE, THE LAST OF THE AUTHORIZATION FOR REQUISITION U/S 132A IS DE EMED TO HAVE BEEN EXECUTED IN THE FINANCIAL YEAR 2008-09. THE P ERIOD OF THIRTY-THREE MONTHS REFERRED TO IN (I) ABOVE ENDED ON 31.12.2011. THE ORDER U/S 153C PASSED ON 29.10.2012 WAS BARRED BY LIMITATION. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 74 OF 78 11.3.4. S. 144C (13) AS IT STOOD PRIOR TO AMENDMENT BY THE FINANCE ACT, 2012 READS AS UNDER: (13) UPON RECEIPT OF THE DIRECTIONS ISSUED UNDER S UB- SECTION (5), THE ASSESSING OFFICER SHALL, IN CONFOR MITY WITH THE DIRECTIONS, COMPLETE, NOTWITHSTANDING ANYT HING TO THE CONTRARY CONTAINED IN SECTION 153, THE ASSESSMENT WITHOUT PROVIDING ANY FURTHER OPPORTUNIT Y OF BEING HEARD TO THE ASSESSEE, WITHIN ONE MONTH FR OM THE END OF THE MONTH IN WHICH SUCH DIRECTION IS REC EIVED. 11.3.5. SECTION 144C(13) AS IT STOOD PRIOR TO AMEND MENT BY THE FINANCE ACT, 2012 PROVIDES THE ASSESSING OFFICE R SHALL PASS THE FINAL ASSESSMENT ORDER, NOTWITHSTANDING THE TIM E-LIMIT SPECIFIED U/S 153 OF THE ACT, IN CONFORMITY WITH TH E DIRECTIONS ISSUED BY THE DRP. SECTION 144C (13) HAS BEEN AMEN DED BY FINANCE ACT, 2012 TO PROVIDE THAT THE NOTWITHSTANDI NG EFFECT SHALL EXTEND TO S. 153B. THE EXTENDED PERIOD OF LI MITATION IS APPLICABLE ONLY TO THOSE CASES WHERE THE NORMAL PER IOD OF LIMITATION U/S 153B TO MAKE ASSESSMENT U/S 153C HAS NOT EXPIRED ON THE DATE ON WHICH THE FINANCE ACT, 2012 RECEIVED THE PRESIDENTS ASSENT. THE FINANCE ACT, 2012 RECEIVED THE PRESIDENTS ASSENT ON 28.5.2012. AS MENTIONED EARL IER, THE PERIOD OF LIMITATION TO PASS AN ORDER U/S 153C HAD ALREADY EXPIRED ON 31.12.2011 WHICH WAS MUCH EARLIER TO THE DATE ON WHICH THE FINANCE ACT, 2012 RECEIVED THE PRESIDENT S ASSENT AND, HENCE, THE RE-ASSESSMENT ORDERS U/S 153C WERE BARRE D BY LIMITATION. 11.3.6. IN THIS CONNECTION, WE RELY ON THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF S.S. GADGIL V. LAL & CO REPORTED IN (1964) 53 ITR 231 (SC). THE BRIEF FACT S IN THE SAID ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 75 OF 78 CASE ARE THAT A NOTICE WAS ISSUED AGAINST THE ASSES SEE AS AN AGENT OF A NON-RESIDENT ON 27 TH MARCH, 1957 AND THAT NOTICE RELATED TO THE ASSESSMENT YEAR 1954-55. UNDER CLAU SE (III) OF THE PROVISO TO S. 34(1) AS IT STOOD PRIOR TO ITS AMENDM ENT BY THE FINANCE ACT, 1956, A NOTICE OF ASSESSMENT OR RE-ASS ESSMENT COULD NOT BE ISSUED AGAINST A PERSON DEEMED TO BE A N AGENT OF A NON-RESIDENT AFTER THE EXPIRY OF ONE YEAR FROM THE END OF THE YEAR OF ASSESSMENT. THE RIGHT TO COMMENCE A PROCEEDING FOR ASSESSMENT AGAINST THE ASSESSEE AS AGENT OF A NON-R ESIDENT FOR THE AY 1954-55, THEREFORE, ENDED ON 31 ST MARCH 1956 UNDER THE NEW ACT BEFORE ITS AMENDMENT IN 1956. THIS PROVISI ON WAS, HOWEVER, AMENDED BY THE FINANCE ACT, 1956, AND UNDE R THE AMENDED PROVISION THE PERIOD OF LIMITATION WAS EXTE NDED TO TWO YEARS FROM THE END OF THE ASSESSMENT YEAR. THE AME NDMENT WAS MADE ON 8 TH SEPTEMBER, 1958, BUT WAS GIVEN EFFECT TO FROM 1 ST APRIL, 1956. SINCE THE TIME WITHIN WHICH NOTICE CO ULD BE ISSUED AGAINST A PERSON DEEMED TO BE AN AGENT OF A NON-RES IDENT WAS EXTENDED TO TWO YEARS FROM THE END OF THE ASSESSMEN T YEAR, IT WAS CONTENDED ON BEHALF OF THE ITO THAT THE NOTICE ISSUED BY HIM WAS WITHIN THE TERMS OF THE AMENDED PROVISION AND W AS, THEREFORE, A VALID NOTICE. NOW THE NOTICE ISSUED O N 27 TH MARCH, 1957 WAS CLEARLY WITHIN A PERIOD OF TWO YEARS FROM THE END OF THE ASSESSMENT YEAR 1954-55 AND IF THE AMENDED PROVISIO N APPLIED, THE NOTICE WOULD BE A VALID NOTICE. IT WAS, HOWEVE R, HELD BY THE HONBLE SUPREME COURT THAT THE NOTICE WAS NOT A VAL ID NOTICE INASMUCH AS THE RIGHT OF THE ITO TO RE-OPEN THE ASS ESSMENT OF THE ASSESSEE UNDER THE UN-AMENDED PROVISION BECAME BARRED ON 31 ST MARCH, 1956, AND THE AMENDED PROVISION DID NOT OPE RATE AGAINST HIM SO AS TO AUTHORISE THE ITO TO COMMENCE PROCEEDINGS FOR RE-OPENING THE ASSESSMENT OF THE ASSESSEE IN A CASE WHERE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 76 OF 78 BEFORE THE AMENDED PROVISION CAME INTO FORCE, THE P ROCEEDINGS HAD BECOME BARRED UNDER THE AMENDED PROVISION. 11.3.7. BASED ON THE ABOVE FACTS, THE HONBLE SU PREME COURT HAD HELD AS UNDER: AS WE HAVE ALREADY POINTED OUT, THE RIGHT TO COMME NCE A PROCEEDING FOR ASSESSMENT AGAINST THE ASSESSEE AS A N AGENT OF A NON-RESIDENT PARTY UNDER THE INCOME-TAX ACT BEFORE IT WAS AMENDED, ENDED ON MARCH, 31, 1956. I T IS TRUE THAT UNDER THE AMENDING ACT, BY SECTION 18 OF THE FINANCE ACT, 1956, AUTHORITY WAS CONFERRED UPON THE INCOME-TAX OFFICER TO ASSESS A PERSON AS AN AGENT O F A FOREIGN PARTY UNDER SECTION 43 WITHIN TWO YEARS FRO M THE END OF THE YEAR OF ASSESSMENT. BUT THE AUTHORITY O F THE INCOME-TAX OFFICER UNDER THE ACT BEFORE IT WAS AMEN DED BY THE FINANCE ACT OF 1956, HAVING ALREADY COME TO AN END, THE AMENDING PROVISION WILL NOT ASSIST HIM TO COMME NCE A PROCEEDING EVEN THOUGH AT THE DATE WHEN HE ISSUED T HE NOTICE IT IS WITHIN THE PERIOD PROVIDED BY THAT AME NDING ACT. THIS WILL BE SO, NOTWITHSTANDING THE FACT THERE HAS BEEN NO DETERMINABLE POINT OF TIME BETWEEN THE EXPIRY OF TH E TIME PROVIDED UNDER THE OLD ACT AND THE COMMENCEMENT OF THE AMENDING ACT. THE LEGISLATURE HAS GIVEN TO SECTION 18 OF THE FINANCE ACT 1956, ONLY A LIMITED RETROSPECTIVE OPERATION, I.E., UP-TO APRIL, 1, 1956 ONLY. THAT P ROVISION MUST BE READ SUBJECT TO THE RULE THAT IN THE ABSENC E OF AN EXPRESS PROVISION OR CLEAR IMPLICATION, THE LEGISLA TURE DOES NOT INTEND TO ATTRIBUTE TO THE AMENDING PROVISION A GREATER RETROSPECTIVITY THAN IS EXPRESSLY MENTIONED, NOR TO AUTHORIZE THE INCOME-TAX OFFICER TO COMMENCE PROCEE DING WHICH BEFORE THE NEW ACT CAME INTO FORCE HAD BY THE EXPIRY OF THE PERIOD PROVIDED BECOME BARRED. 11.3.8. WE HAVE DULY PERUSED THE ARGUMENTS PUT-FORT H BY THE LEARNED COUNSEL FOR THE REVENUE AS WELL AS THE REJO INDER TO THE REVENUES SUBMISSION MADE BY THE LEARNED AR. AS HI GHLIGHTED BY THE ASSESSEE IN ITS REJOINDER TO THE REVENUES ARGU MENT, THE REVENUE HAS PLACED ITS STRONG RELIANCE ON THE MEMOR ANDUM. ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 77 OF 78 HOWEVER, ON A PERUSAL OF THE SAID MEMORANDUM, IT IS EVIDENT THAT IT WAS INTENDED TO MAKE THE AMENDMENT TO REMOV E ANY OMISSION OR FLAWS IN THE STATUTE AND AS SUCH, IT WA S NEITHER CLARIFICATORY NOR PROCEDURAL IN NATURE. MOREOVER, THERE WAS NO TRACE OF ANY MENTION IN THE MEMORANDUM TO ILLUSTRAT E THAT IT APPLIES TO OBJECTION/APPLICATION FILED ON OR AFTER 1.10.2009. IN THE PRESENT CASE, THE TIME-LIMIT TO PASS THE ORDERS U/S 153C R.W.S. 153B OF THE ACT HAS EXPIRED ON 31.12.2011 IT SELF AND THAT THE FINANCE ACT, 2012 RECEIVED THE PRESIDENTS NOD (ASSENT) ONLY ON 28.5.2012. 11.3.9. TAKING ALL THE ABOVE ASPECTS INTO CONSIDERA TION, WE ARE OF THE VIEW THAT THE RE-ASSESSMENTS ORDERS PASS ED U/S 153C OF THE ACT ON 29.10.2012 WERE BARRED BY LIMITATION AND, HENCE, THE RE-ASSESSMENT ORDERS FOR ALL THE ASSESSMENT YEA RS UNDER DISPUTE DESERVE TO BE QUASHED. IT IS ORDERED ACCOR DINGLY. 12. THEREFORE, THE JURISDICTIONAL GROUNDS ARGUED S ERIALLY BY BOTH SIDES ARE DECIDED IN THE FOLLOWING MANNER: (I) GROUND NO. III (1) IS D ISMISSED; (II) GROUND NO. II (1) IS DI SMISSED; (III) GROUND NO. XVI IS PARTL Y ALLOWED; (IV) GROUND NO. V (2) IS DISM ISSED; (V) GROUND NO. V (1) IS DISM ISSED; & (VI) GROUND NO. III (2) & (3) IS ALLOWED. 12.1 IN VIEW OF PARTLY ALLOWING GROUND NO. XVI AND ALLOWING GROUND NO. III (2) & (3) FULLY, THE ASSESSMENTS MAD E FOR THE ASSESSMENT YEARS 2003-04 TO 2008-09 ARE QUASHED. C ERTAIN JURISDICTIONAL ASPECTS HAVE BEEN DECIDED IN FAVOUR OF THE ASSESSEE ITA NOS.1634 TO 1639 OF 2012 THE HIMALAYA DRUG COMP ANY BANGALORE PAGE 78 OF 78 AND THE ASSESSMENT ORDERS FOR THE AY'S 2003-04 TO 2 008-09 BEING QUASHED, WE REFRAIN FROM ADJUDICATING THE ISS UES RAISED ON MERITS. IT IS ORDERED ACCORDINGLY. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH JUNE, 2014. SD/- SD/- (JASON P. BOAZ) (GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE DATED 13 TH JUNE, 2014. VNODAN/SPS COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, ITAT, BANGALORE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCHES, BANGALORE