Shri Shivanand N. Hattiholi, Belgaum V. Dy.Comm. Of Income Tax, Circle-2, Belgaum

ITSSA 105/PAN/2013

• Counselvise Citation: [2015] 122 COUNSELVISE.COM (IT) 1190 (ITAT-PANAJI)
• Duration Of Justice: 2 year(s) 5 month(s) 27 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 18-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 18-11-2015
• Assessment Year: misc
• Appeal Filed On: 22-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRASHANT GADEKAR LD
• Assessee Lawyers: P DINESH
• Section: 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI NARENDRA S. SAINI , HONBLE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN , HONBLE JUDICIAL MEMBER ITA NO. 105/PNJ/2013 : ( BLOCK PERIOD 0 1.4.86 TO 10.7.96 ) SHRI SHIVANAND N HATTIHOLI, PLOT NO. 8, ASHOK VILLA, SHREE RAM COLONY, 2 ND STAGE, RANI CHANNAMMA NAGAR, BELGAUM. PAN : A AJPH6636C ( APPELLANT) VS. THE DEPUTY COMMISSIONER OF INCOME - TAX , CIRCLE - 2 , BELGAUM. (RESPONDENT) ASSESSEE BY : SHRI P. DINESH, ADV. REVENUE BY : SHRI PRASHANT GADEKAR , LD . DR . DATE OF HEARING : 18 /11 /2015 DATE OF ORDER : 18 /11 /2015 O R D E R PER GEORGE MATHAN : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ASSESSMENT ORDER PASSED BY THE ASST. COMMISSI ONER OF INCOME TAX, CIRCLE - 2, BE LGAUM U/S 158BC R.W.S 158BD AND 254 OF THE ACT DATED 25.03.2013 FOR THE BLOCK PERIOD 01.4.1986 TO 10. 7.1996 . 2. SHRI P. DINESH, ADVOCATE REPRESENTED ON BEHALF OF THE ASSESSE AND SHRI PRASHANT GADEKAR, LD. D.R REPRESENTED ON BEHALF OF T HE REVENUE. 3. IT WAS SUBMITTED BY THE LD. A.R THAT THE APPEAL IS AGAINST THE 158BD ORDER. THERE WAS SEARCH ACTION U/S 13 2 ON AN ADVOCATE NAMELY SHRI I. M. SHEDSHAL AS ALSO ON SHRI V.G. SAMBARGI ON 10.7.1996. IT WAS SUBMISSION THAT 2 ITA NO . 105/PNJ/2013 ( BLOCK PERIOD : 1.4.86 TO 10.7.96 ) CONSEQUENT SEARCH ASS ESSMENT IN THE CASE OF SHRI I.M. SHEDSHAL AND SHRI V.G. SAMBARG I WAS COMPLETED ON 31.7.1997. H E DREW OUR ATTENTION TO PAGE NO. 9 AND 3 3 OF THE PAPER BOOK WHICH WERE COPIES OF THE ASSESSMENT ORDER IN THE CASE OF SHRI V.G. SAMBARGI AND SHRI I.M. SHEDSHAL R ESPECTIVELY. IT WAS SUBMISSION THAT THE SATISFACTION HAS BEEN RECORDED IN THE ASSESSEES CASE ON 04.06.1998 , MUCH AFTER THE COMPLETION OF THE SEARCH ASSESSMENT IN THE CASE OF SHRI I.M. SHEDSHAL AND SHRI V.G. SAMB ARGI. H E DREW OUR ATTENTION TO PAGE NO.2 OF THE PAPER BOOK, DR PRODUCED THE COPY OF THE SATISFACTION NOTE WHICH CONFIRMED THE DETAILS FILED IN THE PAPER BOOK. 4. IT WAS SUBMISSION OF THE LD. A.R THAT IN VIEW OF THE DECISION OF SUPREME COURT IN THE CASE OF CIT - II I VS. M/S CALCUTTA KNITWEARS REPORTED IN (2014) TAXCORP (DT) 57035 (SC). WHEREIN, IT HAS BEEN HELD THAT AS FOLLOWS: - 4 4. IN THE RESULT, WE HOLD THAT FOR THE PURPOSE OF SECTION 158BD OF THE ACT A SATISFACTION NOTE IS SINE QUA NON AND MUST BE PREPARED BY THE ASSESSING OFFICER BEFORE HE TRANSMITS THE RECORDS TO THE OTHER ASSESSING OFFICER WHO HAS JURISDICTION OVER SUCH OTHER PERSON. THE SATISFACTION NOTE COULD BE PREPARED AT EITHER OF THE FOLLOWING STAGES: (A) AT THE TIME OF OR ALONG WITH THE INTIMATION OF PROCEEDINGS AGAINST THE SEARCHED PERSON UNDER SECTION 158BC OF THE ACT; (B) ALONG WITH THE ASSESSMENT PROCEEDINGS UNDER SECTION 158BC OF THE ACT; AND (C) IMMEDIATELY AFTER THE ASSESSMENT PROCEEDINGS ARE COMPLETED UNDER SECTION 158BC OF THE ACT OF THE S EARCHED PERSON. 5. SATISFACTION NOTE HAS NOT BEEN PREPARED AT THE TIME OF THE IN ITI ATION OF THE PROCEEDINGS OF SEARCH U/S 158BC NOR ALONG WITH THE ASSESSMENT PROCEEDINGS U/S 158BC NOR IMMEDIATELY AFTER THE ASSESSMENT PROCEEDINGS WE RE COMPLETED U/S 158BC OF THE ACT ON THE SEARCHED PERSON. CONSEQUENTLY, AS THE SATISFACTION NOTE HAS BEEN RECORDED MUCH BEYOND THE REASONABLE TIME THE CONSEQUENTIAL ASSESSMENT ORDER WAS LIABLE TO BE ANNULLED. IN REPLY THE LD.D.R VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 3 ITA NO . 105/PNJ/2013 ( BLOCK PERIOD : 1.4.86 TO 10.7.96 ) 6. WE HAVE CONSID ERED THE RIVAL SUBMISSIONS. AS HAS BEEN RIGHTLY POINTED OUT BY THE LD. A.R, THE ASSESSMENT ORDER IN THE CASE OF THE SEARCHED PERSON HAS BEEN C OMPLE TED ON 31.7.1997 ITSELF AND THE SATISFACTION IN THE CASE OF THE ASSESSE HAS BEEN RECORDED ONLY ON 04.06.1998 , LONG AFTER THE COMPLETION OF THE ASSESSMENT IN THE CASE OF SEARCHE D PERSON. CONSEQUENTLY, IN THE VIEW OF THE PRINCIPLES LAID OUT BY THE HONBLE SUPREME COURT THAT IN THE CASE OF CIT - III VS. M/S CALCUTTA KNITWEARS , AS THE S ATISFACTION NOTE IN THE CASE OF THE ASSESSEE HAS NOT BEEN PREPARED W ITHIN THE PRESCRIBED PE RIOD NOR ANY REASONABLE PERIOD, C ONSEQUENTIAL NOTICE ISSUED U/S 158BD AND THE CONSEQUENTIAL ASSESSMENT IS BAD IN LAW AND STANDS ANNULLED. 7 . IN THE RESULT, APPE AL OF THE ASSESSEE I S ALLOW ED. 8 . ORDER PR ONOUNCED IN THE OPEN COURT ON 18 .11 .2015. SD/ - ( NARENDRA S. SAINI ) ACCOUNTANT MEMBER SD/ - ( GEORGE MATHAN) JUDICIAL MEMBER PLACE : PANAJI - GOA DATED : 18 /11 /2015 *A* COPY TO : ( 1 ) APPELLANT ( 2 ) RESPONDENT ( 3 ) CIT CONCERNED ( 4 ) CIT(A) CONCERNED ( 5 ) D.R ( 6 ) GUARD FILE TRUE COPY, BY ORDER ASSISTANT REGISTRAR ITAT, PANAJI BENCH, PANAJI