Smt Everlin Fernandes, Bhopal V. The ACIT, Bhopal

ITA 251/IND/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9569 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 9 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-03-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 02-03-2011
• Assessment Year: 2000-2001
• Appeal Filed On: 19-05-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P K MITRA
• Keywords: Invalid notice; Search and seizure; Set aside
• Section: 143(3); 153A; 147; 148; 132; 139

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.251/IND/2009 A.Y.2000-01 SMT. EVERLYN FERNANDES BHOPAL PAN AACPF-3486H APPELLANT VS ASSTT. COMMISSIONER OF INCOME TAX 1(1), BHOPAL RESPONDENT APPELLANT BY : SHRI H.P. VERMA ALONG WITH SHRI ASHISH GOYAL RESPONDENT BY : SHRI P.K.MITRA O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(A) DATED 6.3.2009. THE CRUX OF THE GROUNDS OF THE APPEAL IS THAT THE 2 LEARNED COMMISSIONER OF INCOME TAX (APPEALS) WAS NO T JUSTIFIED IN UPHOLDING THE ACTION OF THE ASSESSING OFFICER U/S 1 47/148 OF THE ACT. 2. DURING HEARING, THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT A SEARCH AND SEIZED OPERATION U/S 132(1) WAS C ARRIED OUT AT THE PREMISES OF GEI HAMON GROUP AT BHOPAL ON 15.11.2006 WHEREIN CERTAIN UNEXPLAINED ASSETS, BOOKS OF ACCOUNTS AND INCRIMINA TING DOCUMENTS WERE SEIZED. THE ASSESSEE IS THE FULL TIME DIRECTOR OF GEI HAMON INDUSTRIES LIMITED. THE ASSESSEE FILED RETURN ON 31 .8.2002 DECLARING INCOME OF RS.3,44,622/-. IT WAS PLEADED THAT NO NO TICE U/S 148 OF THE ACT IS TO BE ISSUED BY THE OFFICER BELOW THE RANK O F JCIT AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE RELEVANT ASSESSME NT YEAR AND SINCE THE NOTICE WAS ISSUED BY THE ACIT, THEREFORE, IT IS AN INVALID NOTICE. THE LD. COUNSEL FOR THE ASSESSEE RELIED UPON CERTAIN JUDICI AL PRONOUNCEMENTS WHICH ARE AVAILABLE AT PAGE 2 OF THE SYNOPSIS FILED BY THE ASSESSEE. ON THE OTHER HAND, THE LEARNED SENIOR DEPARTMENTAL REPRESENTATIVE STRONGLY DEFENDED THE IMPUGNED ORDER AND THE CASE LAWS DISCUSSED THEREIN. A PLEA WAS ALSO RAISED THAT IN THE PRESENT CASE THE ASSESSMENT YEAR WAS OUTSIDE THE BLOCK PERIOD BUT WI THIN THE STIPULATED TIME AS PROVIDED U/S 148 OF THE ACT. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATERIAL AVAILABLE ON RE CORD. THE MAIN QUESTION BEFORE US IS WHETHER THE ASSESSING OFFICER CAN LEGALLY MAKE AN 3 ASSESSMENT U/S 147 READ WITH 143(3) FOR THE ASSESSM ENT YEAR 2002-01 BY ISSUING A NOTICE U/S 148 OF THE ACT DATED 9.3.20 07 I.E. AFTER THE INITIATION AND CONCLUSION OF ACTION U/S 132 AND THA T TOO ON THE BASIS OF INFORMATION/MATERIAL SEIZED DURING SEARCH AND SEIZU RE OPERATION. THE STAND OF THE ASSESSEE IS THAT WHERE SEARCH IS INITI ATED U/S 132/132A OF THE ACT, THE ASSESSING OFFICER CEASES TO INVOKE THE POWER VESTED IN HIM TO MAKE ASSESSMENT BY GENERAL PROVISIONS AS THE AS SESSMENT IN CASE OF SURCHARGE REQUISITION IS REGULATED BY THE SPECIF IC PROVISION CONTAINED IN SECTION 153A TO 153C. BEFORE COMING TO ANY CON CLUSION, WE ARE REPRODUCING HEREUNDER SECTION 153A OF THE ACT :- 86 [ ASSESSMENT IN CASE OF SEARCH OR REQUISITION. 153A. 87 [(1)] NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139 , SECTION 147 , SECTION 148 , SECTION 149 , SECTION 151 AND SECTION 153 , IN THE CASE OF A PERSON WHERE A SEARCH IS INITIATED UNDER SECTION 132 OR BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ANY ASSETS ARE REQUISIT IONED UNDER SECTION 132A AFTER THE 31ST DAY OF MAY, 2003, THE ASSESSING OFF ICER SHALL (A) ISSUE NOTICE TO SUCH PERSON REQUIRING HIM TO F URNISH WITHIN SUCH PERIOD, AS MAY BE SPECIFIED IN THE NOTICE, THE RETURN OF INCOM E IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN SIX ASSESSMENT YEARS REFERRED TO IN CLAUSE (B), IN THE PRESCRIBED FORM AND VERIFIED IN THE PRE SCRIBED MANNER AND SETTING FORTH SUCH OTHER PARTICULARS AS MAY BE PRES CRIBED AND THE PROVISIONS OF THIS ACT SHALL, SO FAR AS MAY BE, APP LY ACCORDINGLY AS IF SUCH RETURN WERE A RETURN REQUIRED TO BE FURNISHED UNDER SECTION 139 ; (B) ASSESS OR REASSESS THE TOTAL INCOME OF SIX ASS ESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVI OUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED OR REQUISITION IS MADE : PROVIDED THAT THE ASSESSING OFFICER SHALL ASSESS OR REASSESS THE TOTAL INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING W ITHIN SUCH SIX ASSESSMENT YEARS: PROVIDED FURTHER THAT ASSESSMENT OR REASSESSMENT, IF ANY, RELATING T O ANY ASSESSMENT YEAR FALLING WITHIN THE PERIOD OF SIX AS SESSMENT YEARS REFERRED TO IN THIS 88 [SUB-SECTION] PENDING ON THE DATE OF INITIATION OF THE SEARCH UNDER SECTION 132 OR MAKING OF REQUISITION UNDER SECTION 132A , AS THE CASE MAY BE, SHALL ABATE. 4 89 [(2) IF ANY PROCEEDING INITIATED OR ANY ORDER OF AS SESSMENT OR REASSESSMENT MADE UNDER SUB-SECTION (1) HAS BEEN AN NULLED IN APPEAL OR ANY OTHER LEGAL PROCEEDING, THEN, NOTWITHSTANDING A NYTHING CONTAINED IN SUB-SECTION (1) OR SECTION 153 , THE ASSESSMENT OR REASSESSMENT RELATING TO ANY ASSESSMENT YEAR WHICH HAS ABATED UNDER THE SECO ND PROVISO TO SUB- SECTION (1), SHALL STAND REVIVED WITH EFFECT FROM T HE DATE OF RECEIPT OF THE ORDER OF SUCH ANNULMENT BY THE COMMISSIONER: PROVIDED THAT SUCH REVIVAL SHALL CEASE TO HAVE EFFECT, IF S UCH ORDER OF ANNULMENT IS SET ASIDE.] EXPLANATION.FOR THE REMOVAL OF DOUBTS, IT IS HEREB Y DECLARED THAT, (I) SAVE AS OTHERWISE PROVIDED IN THIS SECTION, SECTION 153B AND SECTION 153C , ALL OTHER PROVISIONS OF THIS ACT SHALL APPLY TO THE ASSESSMENT MADE UNDER THIS SECTION; (II) IN AN ASSESSMENT OR REASSESSMENT MADE IN RESP ECT OF AN ASSESSMENT YEAR UNDER THIS SECTION, THE TAX SHALL BE CHARGEABLE AT THE RATE OR RATES AS APPLICABLE TO SUCH ASSE SSMENT YEAR. 4. IF THE LANGUAGE USED IN THE AFORESAID SECTION IS AN ALYSED, THERE IS AN OBLIGATION ON THE ASSESSING OFFICER TO ISSUE NOT ICE TO SUCH PERSON REQUIRING HIM TO FURNISH WITHIN SUCH PERIOD AS MAY BE SPECIFIED IN THE NOTICE, THE RETURN OF INCOME IN RESPECT OF EACH AS SESSMENT YEAR, FALLING WITHIN SIX ASSESSMENT YEARS REFERRED TO IN CLAUSE ( B) ..AS REQUIRED TO BE FURNISHED U/S 139 AND FURTHER IS TO ASSESS OR RE ASSESS THE TOTAL INCOME OF SIX ASSESSMENT YEARS IMMEDIATELY PRECEDIN G THE ASSESSMENT RELEVANT TO THE PREVIOUS YEAR IN WHICH SEARCH WAS C ONDUCTED OR REQUISITION WAS MADE. FURTHER EXPLANATION HAS BEEN APPENDED TO THE PROVISO REMOVING THE DOUBTS. U/S 153B(1)(A) AND (B ) A TIME LIMIT FOR COMPLETION OF ASSESSMENT U/S 153A HAS BEEN DEFINED SUBJECT TO PROVISO CONTAINED THEREIN. UNDER SECTION 153C ASSESSMENT O F INCOME OF ANY OTHER PERSON AND ISSUANCE OF NOTICE, SUBJECT TO PRO VISO HAVE BEEN 5 PROVIDED. SECTION 153D PROVIDES FOR PRIOR APPROVAL NECESSARY FOR ASSESSMENT IN CASES OF SEARCH OR REQUISITION. IN T HE PRESENT APPEAL A SEARCH AND SEIZURE OPERATION TOOK PLACE IN THE CASE OF THE ASSESSEE. ADMITTEDLY, THE PROVISIONS OF SECTION 153A OPEN WIT H NON-OBSTANTE CLAUSE WHICH ONLY MEANS THAT AS A SEQUEL TO THE SEA RCH ACTION THE ASSESSMENT WILL BE MADE UNDER THE PROVISIONS OF SEC TION 153A, 153B AND 153C OF THE ACT. IT DOES NOT EVEN REMOTELY SUG GEST THAT EVEN AFTER SEARCH AND SEIZURE ACTION HAS TAKEN PLACE IN THE CA SE OF AN ASSESSEE, THERE IS NO REMEDY AVAILABLE UNDER THE ACT. IT IS ONLY IN RESPECT OF ASSESSMENT OF BLOCK PERIOD THAT WHILE CONSIDERING T HE DOCUMENTS AND SEIZED MATERIALS, A SEARCH ACTION INITIATED U/S 139 , 147, 148 NEED NOT TO BE ISSUED AND THE LIMITATIONS PROVIDED UNDER OTHER SECTIONS WILL NOT APPLY. THIS INSERTION WAS MADE IN FAVOUR OF THE AS SESSING OFFICER TO SAVE HIS PRECIOUS TIME TO CARRY OUT INVESTIGATION M ORE EFFECTIVELY. THE NON-OBSTANTE CLAUSE REFERRED TO THEREIN IS NOT INTE NDED TO CONFER ANY KIND OF IMMUNITY ON THE ASSESSEE ESPECIALLY TO THE FACTS OF THE PRESENT APPEAL. ADMITTEDLY, IN THE PRESENT APPEAL THE ASSE SSMENT YEAR FALLS OUTSIDE THE BLOCK PERIOD BUT WITHIN THE AMBIT OF PR OVISIONS OF SECTION 148 TO TAX THE RIGHTFUL AMOUNT WHICH OTHERWISE WOULD HA VE ESCAPED ASSESSMENT. THEREFORE, WE FIND NO INFIRMITY IN THE STAND OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IN AFFIRMING T HE ACTION OF THE 6 ASSESSING OFFICER U/S 148 TO BRING TO TAX THE ESCAP ED INCOME. THEREFORE, THIS APPEAL OF THE ASSESSEE IS DISMISSED. FINALLY, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH THE SIDES AT THE CONCLUSION OF THE HEARING ON 2 ND MARCH, 2011. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 2 ND MARCH, 2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, G UARD FILE DN/- 7