SHRI RAVINDRA M. PATIL, MUMBAI V. DCIT CC-I, THANE, MUMBAI

ITSSA 143/MUM/2005

• Counselvise Citation: [2012] 121 COUNSELVISE.COM (IT) 8507 (ITAT-MUMBAI)
• Duration Of Justice: 7 year(s) 4 month(s) 29 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 29-08-2012
• Appeal Filed By: Assessee
• Bench Allotted: J
• Next Hearing Date: 26-07-2012
• Assessment Year: misc
• Appeal Filed On: 31-03-2005
• Court: TRIBUNAL
• Department Lawyers: SUBHACHAM RAM
• Keywords: Invalid notice; Search and seizure; Block assessment
• Section: 148; 132; 144; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH: MUMBAI BEFORE SHRI G.E. VEERABHADRAPPA, PRESIDENT AND SHRI VIJAY PAL RAO, JUDICIAL MEMBER ITSS 143/MUM/2005 ITSS 196/MUM/2005 BLOCK PERIOD 01.04.1990 TO 14.12.2000 SHRI RAVENDRA M. PATIL, SHRI NITIN M. PATIL, MITRA CHAYA, NEAR GAONDEVI TEMPLE, AAYARE ROAD, DOMBIVLI (E), MUMBAI ...... APPELLANT PAN: AAXPP 1918 P PAN: AAXPP 1921 C VS DY. COMMISSIONER OF INCOME-TAX, CEN. CIRCLE I, THANE / MUMBAI ..... RESPONDENT APPELLANT BY: SHRI H.N. MOTIWALLA SHRI PIYUSH CHHAJED RESPONDENT BY: SHRI SUBHACHAM RAM DATE OF HEARING: 26.07.2012 DATE OF PRONOUNCEMENT: 29.08.2012 O R D E R PER VIJAY PAL RAO, JM: THESE TWO APPEALS FILED BY THE TWO SEPARATE ASSESSE ES ARE DIRECTED AGAINST THE ORDERS OF THE CIT (A) ARISING FROM THE BLOCK ASSESSMENT IN RESPECT OF THE SEARCH AND SEIZURE ACTION FOR THE BL OCK PERIOD 01.04.1990 TO 14.12.2000. SINCE THE APPEALS ARE ARISING FROM THE SAME SEARCH AND SEIZURE ACTION AND THE ASSESSEES ARE RELATED PARTIES INVOLV ING COMMON ISSUES, THEREFORE, THESE TWO APPEALS ARE HEARD TOGETHER AND DISPOSED OFF FOR THE SAKE OF CONVENIENCE BY THIS COMPOSITE ORDER. 2. IN THE APPEAL ITSS 143 OF 2005 THE ASSESSEE HAS RAISED ONE OF THE GROUNDS REGARDING VALIDITY OF BLOCK ASSESSMENT AS G ROUND NO.2 AS UNDER: SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 2 2. THE BOCK ASSESSMENT MADE BY THE LEARNED ASSESSI NG OFFICER BE CANCELLED, AS THE NOTICE CALLING TO FILE THE RETURN WITHIN FIFTEEN DAYS FOR THE BLOCK PERIOD IS CONTRARY TO THE PROVIS IONS OF THE CT AND THEREFORE BAD IN LAW. 3. IN THE APPEAL IN ITSS NO.196 OF 2005 THE ASSESSE E HAS RAISED AN ADDITIONAL GROUND AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME APPEALS ERRED IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER U/S.158BA READ WITH SECTION 158BC OF THE INCOME TAX ACT, 1961 PARTICULARLY WHEN THE NOTICE U/S.158B C WERE ISSUED BY THE ASSESSING OFFICER TO THE RETURN OF INCOME FOR T HE BLOCK PERIOD FROM 01.04.1990 TO 14.12.2000 WAS WITHIN 15 DAYS INSTEAD OF NOT LESS THAN 15 DAYS AND THEREFORE THE BLOCK ASSESSMENT IS BAD I N LAW, ILLEGAL AND VOID AB INITIO. 4. WE HAVE HEARD THE LD. AR AS WELL AS LD. DR AND C ONSIDERED THE RELEVANT RECORD RELATING ADMISSIBILITY OF THE ADDIT IONAL GROUND RAISED IN THE APPEAL IN ITSS 196 OF 2005. THE LD. AR OF THE ASSE SSEE HAS SUBMITTED THAT THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IS PUR ELY LEGAL AND NO NEW FACTS ARE REQUIRED TO BE EXAMINED OR INVESTIGATED AND, TH EREFORE, IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF NA TIONAL THERMAL POWER CO. LTD. VS. CIT 229 ITR 383 THE ADDITIONAL GROUND RAISED BY THE ASSESSEE MAY BE ADMITTED FOR ADJUDICATION. ON THE OTHER HAN D, THE LD. DR VEHEMENTLY OBJECTED THE ADMISSIBILITY OF THE ADDITI ONAL GROUND AT THIS STAGE WHEN THE ASSESSEE DID NOT RAISE THIS GROUND EITHER BEFORE THE AO OR BEFORE THE LD. CIT (A). 5. HAVING CONSIDERED THE RIVAL SUBMISSIONS AND CARE FUL PERUSAL OF THE RELEVANT RECORD WE FIND THAT THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IN ITSS 196 OF 2005 IS COMMON GROUND THAT RAISED BY TH E ASSESSEE IN ITSS 143 SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 3 OF 2005. THE FACTS RELATING TO THIS GROUND ARE IDE NTICAL IN BOTH THE APPEALS AND, THEREFORE, FOR ADJUDICATION OF THE ADDITIONAL GROUND NO NEW FACTS ARE REQUIRED TO BE EXAMINED OR VERIFIED. EVEN OTHERWIS E THIS MATTER IS ARISING FROM THE SAME SEARCH AND SEIZURE ACTION AND BOTH TH E APPEAL PERTAINS TO THE ASSESSEE WHO ARE FAMILY MEMBERS. THEREFORE, IN VIE W OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF NATIONAL THERM AL CO. LTD. (SUPRA) WE ADMIT THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IN ITSS 196 OF 2005 FOR ADJUDICATION. 6. THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE AO ISSUED NOTICE U/S.158BC ON 05.02.2002 DIRECTING THE ASSESSEE TO F ILE THE RETURN FOR BLOCK PERIOD WITHIN 15 DAYS WHEREAS THE REQUIREMENT U/S.1 58BC IS THE NOTICE REQUIRING THE ASSESSEE TO FURNISH THE BLOCK RETURN WITHIN SUCH TIME NOT BEING LESS THAN 15 DAYS BUT NOT MORE THAN 45 DAYS. THUS, THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT THE NOTICE ISSUED U/S.1 58BC IS INVALID AS THE AO HAS NOT GIVEN THE MINIMUM PERIOD OF TIME FOR FIL ING THE RETURN OF INCOME. CONSEQUENTLY, THE AO HAS NO JURISDICTION TO PROCEED WITH THE ASSESSMENT PROCEEDINGS U/S.158BC. IN SUPPORT OF HIS CONTENTIO N, HE HAS REFERRED THE CIRCULAR NO.717 DATED 14.08.1995 AND SUBMITTED THAT THE CBDT HAS MADE IT CLEAR THAT THE AO SHALL SERVE A NOTICE ON SUCH P ERSON REQUIRING HIM TO FURNISH A RETURN WITHIN SUCH PERIOD NOT LESS THAN 1 5 DAYS. THE LD. AR FURTHER CONTENDED THAT THE NOTICE U/S.158BC IS FOUN DATION FOR INITIATING THE PROCEEDINGS AND IF THE NOTICE IS INVALID THEN THE A SSESSMENT ITSELF IS BAD IN LAW. HE HAS RELIED UPON THE DECISION OF HONBLE SU PREME COURT IN THE CASE OF ACIT VS. HOTEL BLUE MOON 321 ITR 362 AND SUBMITT ED THAT THE HONBLE SUPREME COURT HAS DEALT WITH AN IDENTICAL ISSUE AND HELD THAT THE NOTICE U/S.158BC IS MANDATORY AND MAKES VERY FOUNDATION FO R JURISDICTION. THE TIME LIMIT PRESCRIBED UNDER THIS SECTION IS OF 15 D AYS FOR COMPLIANCE AND IN CASE OF SEARCH AFTER FIRST JANUARY, 1997 THE TIME L IMIT MAY BE GIVEN UPTO 45 DAYS FOR COMPLIANCE. FOLLOWING THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF HOTEL BLUE MOON, THE HONBLE HIGH COURT OF KARNATAKA IN CASE OF CIT VS. MICRO LABS LTD. IN ITA NO.2748/2005 C/W ITA NOS.3060/2005, 2303/2005, 749/2006, 3148/2005 HAS HELD THAT THE AO SHALL SERVE A NOTICE SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 4 U/S.158BC REQUIRING THE ASSESSEE TO SUBMIT THE RETU RN WITHIN SUCH TIME NOT BEING LESS THAN 15 DAYS BUT NOT MORE THAN 45 DAYS. THEREFORE, THE MANDATORY PERIOD OF TIME AS STIPULATED U/S.158BC IS NOT COMPLIED WITH IF THE NOTICE U/S.158BC CALLS UPON THE ASSESSEE TO SUB MIT THE RETURN OF INCOME WITHIN A PERIOD OF 15 DAYS. THE LD. AR OF T HE ASSESSEE HAS ALSO RELIED UPON THE DECISION OF HONBLE SUPREME COURT I N THE CASE OF CIT VS. BRATHWATE AND CO. 201 ITR 343 AND SUBMITTED THAT TH E TERM NOT LESS THAN 7 YEARS HAS BEEN CONSTRUED BY THE HONBLE SUPREME COU RT AS THE PERIOD SHOULD GO BEYOND 7 YEARS. THE LD. AR HAS ALSO POIN TED OUT THAT THE DECISION IN THE CASE OF CIT VS. MICRO LABS LTD. HAS BEEN FOL LOWED BY THE KARNATAKA HIGH COURT IN THE SUBSEQUENT DECISION IN THE CASE O F CIT VS. GHEWARCHAND SURANA IN ITA NO.3053 OF 2005 DATED 14TH SEPTEMBER, 2011 AND HELD THAT THE TIME STIPULATED IN THE NOTICE U/S.158BC IS WITH IN 15 DAYS TIME IT IS VOID AB INITIO . CONSEQUENTLY, THE AUTHORITY HAD NO JURISDICTION TO INITIATE THE PROCEEDINGS AND ORDER PASSED IN A PROCEEDINGS WHICH IS ALSO VOID. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED THAT THE ASSES SEE HAS NOT FILED THE RETURN IN RESPONSE TO NOTICE U/S.158BC WITHIN THE T IME PERIOD AS PRESCRIBED UNDER THE PROVISIONS AS WELL AS UNDER THE NOTICE BU T THE RETURN WAS FILED AFTER 9 MONTHS. WHEN THE AO HAS PROCESSED THE BELA TED RETURN FILED BY THE ASSESSEE WHICH, AMOUNTS EXTENSION OF TIME BY THE AO AND, THEREFORE, THE ASSESSMENT WAS COMPLETED IN THE MANNER AS PRESCRIBE D UNDER THE PROVISION OF SEC.158BC. WHEN THE AO HAS COMPLIED WITH ALL TH E PROCEDURAL REQUIREMENTS WHILE COMPLETING THE ASSESSMENT THEN N O INJURY HAS BEEN CAUSED TO THE ASSESSEE WITH RESPECT TO THE NOTICE I N QUESTION AND CONSEQUENTLY THERE IS NO DEFECT IN THE PROCEEDINGS INITIATED ON THE BASIS OF THE SAID NOTICE. HE FURTHER SUBMITTED THAT EVEN IF THERE IS A DEFECT IN THE NOTICE THE SAME IS CURABLE DEFECT WHICH HAS BEEN CU RED WHEN THE RETURN OF INCOME FILED BY THE ASSESSEE BEYOND THE PERIOD OF L IMITATION WAS PROCESSED BY THE AO. THE LD. AR RELIED UPON THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SHIRISH MADHUKAR DALVI VS . ACIT 287 ITR 242 AND SUBMITTED THAT THE HONBLE JURISDICTIONAL HIGH COUR T HAS HELD THAT THE AO DID NOT GIVE 15 DAYS CLEAR NOTICE, HOWEVER, IT DID NOT CAUSE ANY PREJUDICE TO THE ASSESSEE AS THE ASSESSEE WAS SERVED WITH ANOTHE R NOTICE. THE LD. AR SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 5 HAS FURTHER SUBMITTED THAT WHEN THE ASSESSEE HAS NO T RAISED ANY OBJECTION AGAINST THE ALLEGED DEFECTIVE NOTICE BEFORE THE AO AND DULY PARTICIPATED IN THE ASSESSMENT PROCEEDINGS THEN AS PER THE PROVISIO NS OF SEC.292B THE ASSESSEE IS NOT PERMITTED TO RAISE SUCH OBJECTION S UBSEQUENTLY. HE HAS FURTHER SUBMITTED THAT THE TIME PERIOD MENTIONED WI THIN 15 DAYS MEANS AND INCLUDES 15 TH DAY. HE HAS ALSO RELIED UPON THE DECISION OF SPEC IAL BENCH OF THIS TRIBUNAL IN CASE OF CIT VS. NIRANJAN LAL VERMA 180 TAXMAN 74. IN REBUTTAL, THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SHIRISH MA DHUKAR DALVI (SUPRA) IS NOT APPLICABLE IN THE FACTS OF THE PRESENT CASE AS THERE WAS A SECOND NOTICE IN THE SAID CASE AND FURTHER THIS DECISION WAS PRIO R TO HONBLE SUPREME COURT IN THE CASE OF HOTEL BLUE MOON. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THERE IS NO DISPUTE THAT NOTIC E ISSUED BY THE AO U/S.158BC REQUIRING THE ASSESSEE TO FURNISH THE RET URN IN THE PRESCRIBED FORM NO.2B WITHIN 15 DAYS FROM THE SERVICE OF NOTIC E. WE REPRODUCE RELEVANT PART OF THE NOTICE DATED 05.02.2002 ISSUED U/S.158BC AS UNDER: THE RETURN SHOULD BE IN THE PRESCRIBED FORM 2B AND BE DELIVERED IN THIS OFFICE WITHIN 15 DAYS FROM THE SERVICE OF THIS NOTICE, DULY VERIFIED AND SIGNED IN ACCORDANCE WITH THE PROVISIONS OF SEC TION 140 OF THE INCOME-TAX ACT, 1961. 8. THE LD. DR HAS ALSO NOT DISPUTED THIS FACT THAT THE TIME PERIOD MENTIONED IN THE SAID NOTICE IS WITHIN 15 DAYS. SU B-CLAUSE (II) OF CLAUSE (A) OF SEC.158BC STIPULATES SERVICE OF A NOTICE TO SUCH PERSON REQUIRING HIM TO FURNISH RETURN IN THE PRESCRIBED FORM WITHIN SUCH T IME NOT BEING LESS THAN 15 DAYS BUT NOT MORE THAN 45 DAYS. THE RELEVANT PA RT OF SEC.158BC READS AS UNDER: SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 6 WHERE ANY SEARCH HAS BEEN CONDUCTED UNDER SECTION 132 OR BOOKS OF ACCOUNT, OTHER DOCUMENTS OR ASSETS ARE REQUISITIONE D UNDER SECTION 132A, IN THE CASE OF ANY PERSON, THEN, (A) THE ASSESSING OFFICER SHALL (I) IN RESPECT OF SEARCH INITIATED OR BOOKS OF ACC OUNT OR OTHER DOCUMENTS OR ANY ASSETS REQUISITIONED AFTER THE 30TH DAY OF J UNE, 1995, BUT BEFORE THE 1ST DAY OF JANUARY, 1997, SERVE A NOTICE TO SUCH PERSON REQUIRING HIM TO FURNISH WITHIN SUCH TIME NOT BEING LESS THAN FIFTEEN DAYS; (II) IN RESPECT OF SEARCH INITIATED OR BOOKS OF AC COUNT OR OTHER DOCUMENTS OR ANY ASSETS REQUISITIONED ON OR AFTER THE 1ST DAY OF JANUARY, 1997, SERVE A NOTICE TO SUCH PERSON REQUIRING HIM T O FURNISH WITHIN SUCH TIME NOT BEING LESS THAN FIFTEEN DAYS BUT NOT MORE THAN FORTY- FIVE DAYS, AS MAY BE SPECIFIED IN THE NOTICE A RETU RN IN THE PRESCRIBED FORM AND VERIFIED IN THE SAME MANNER AS A RETURN UNDER CLAUSE (I) OF SUB-SECTION (1) OF SECTION 142, SETTI NG FORTH HIS TOTAL INCOME INCLUDING THE UNDISCLOSED INCOME FOR THE BLO CK PERIOD. 9. THUS, IT IS CLEAR THAT THE TIME PERIOD TO BE ALL OWED FOR FURNISHING THE RETURN OF INCOME IS NOT LESS THAN 15 DAYS WHICH MEA NS THE TIME PERIOD MUST BE MORE THAN 15 DAYS BUT NOT MORE THAN 45 DAYS. TH E WORDS USED IN THE PROVISION IS NOT BEING LESS THAN 15 DAYS AND NOT WITHIN 15 DAYS. THEREFORE, THERE IS A CLEAR DIFFERENCE BETWEEN THE TIME PERIOD ALLOWED FOR FURNISHING THE RETURN WITHIN 15 DAYS AND NOT LESS T HAN 15 DAYS, WHICH MEANS MORE THAN 15 DAYS WITH A RIDER OF 45 DAYS. T HE TERM NOT LESS THAN 15 DAYS HAS BEEN CLARIFIED BY THE CBDT IN CIRCULAR NO.717 IN PARA 39.3(E) AS UNDER: (E) PROCEDURE FOR MAKING BLOCK ASSESSMENT: THE ASS ESSING OFFICER SHALL SERVE A NOTICE ON SUCH PERSON REQUIRING HIM T O FURNISH WITHIN SUCH TIME, NOT BEING LESS THAN 15 DAYS, AS MAY BE SPECIFIED IN THE NOTICE , SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 7 A RETURN IN THE PRESCRIBED FORM AND VERIFIED IN THE SAME MANNER AS A RETURN UNDER CLAUSE (I) OF SUB-SECTION (1) OF SECTI ON 142 SETTING FORTH HIS TOTAL INCOME INCLUDING UNDISCLOSED INCOME FOR THE B LOCK PERIOD. THE OFFICER SHALL PROCEED TO DETERMINE THE UNDISCLOSED INCOME OF THE BLOCK PERIOD AND PROVISIONS OF SECTION 142, SUB-SECTIONS (2) AND (3) OF SECTION 143 AND SECTION 144 SHALL APPLY ACCORDINGLY. THE A SSESSING OFFICER SHALL NOT BE REQUIRED TO ISSUE ANY NOTICE UNDER SECTION 148 FOR THE PURPOSE OF PROCEEDINGS UNDER THIS CHAPTER. THOUGH THE BLOCK PERIOD CAN BE EXTENDED UPTO 10 YEARS IN THE CASE WHERE THE ASS ESSEE HAS NOT DISCLOSED UNDISCLOSED INCOME IN ANYONE OR MORE OF T HE PREVIOUS YEARS IN THE BLOCK PERIODS AND THE ASSESSING OFFICER ALSO DOES NOT FIND ANY MATERIAL INDICATING UNDISCLOSED INCOME IN ANY ONE O R MORE OF THE PREVIOUS YEARS COMPRISED IN THE BLOCK PERIOD, IT WI LL NOT BE NECESSARY TO DO THE EXERCISE OF COMPUTING THE UNDISCLOSED INCOME FOR THE RELEVANT YEARS AND THE EXERCISE MAY BE LIMITED TO THE YEARS IN RESPECT OF WHICH THE UNDISCLOSED INCOME HAS BEEN FOUND. ON DETERMIN ATION OF THE UNDISCLOSED INCOME OF THE BLOCK PERIOD, THE ASSESSI NG OFFICE SHALL ISSUE AN ORDER OF ASSESSMENT AND DETERMINE THE DEMAND PAY ABLE BY HIM ON THE BASIS OF SUCH ASSESSMENT. THE ASSETS SEIZED IN THE COURSE OF SEARCH OR TAKEN POSSESSION OF AS A RESULT OF REQUIS ITION UNDER SECTION 132A SHALL BE RETAINED TO THE EXTENT NECESSARY AND SHALL BE DEALT WITH IN THE MANNER LAID DOWN UNDER SECTION 132B. 10. FURTHER, THE HONBLE KARNATAKA HIGH COURT AFTER THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF HOTEL BLUE MOO N (SUPRA) HAS CONSIDERED AND DECIDED AN IDENTICAL ISSUE IN CASE O F CIT VS. MICRO LABS LTD. (SUPRA) IN PARA 13 & 14 AS UNDER: 13. RELIANCE WAS ALSO PLACED BY THE ASSESSEE ON TH E JUDGMENT IN THE CASE OF ASSISTANT COMMISSIONER OF INCOME TAX AND AN OTHER VS. HOTEL BLUE MOON REPORTED IN [2010] 321 ITR 362 (SC) TO CO NTEND THAT THE NOTICE UNDER SECTION 158BC DEALING WITH THE BLOCK A SSESSMENT MAKES SUCH A NOTICE IS REQUIRED TO BE SERVED ON THE PERSO N WHO IS FOUND TO SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 8 HAVE UNDISCLOSED INCOME. RELIANCE WAS ALSO PLACED ON THE UNREPORTED JUDGMENT OF THIS COURT IN ITA NO.21/2003 C/W ITA NO .22/2003 DISPOSED OFF ON 03.04.2008, WHEREIN IT WAS HELD THA T WHEN ONE THE NOTICE IS HELD TO BE INVALID, THE ENTIRE PROCEEDING S WOULD BECOME VOID FOR WANT OF JURISDICTION. FURTHER RELIANCE WAS ALS O PLACED ON THE UNREPORTED JUDGMENT OF THIS COURT IN THE CASE OF M/ S. WINTER CARE PRIVATE LTD., VS. DEPUTY COMMISSIONER OF INCOME-TAX DISPOSED OFF ON 15.02.1993 PASSED IN W.P. NO.33832/1992, WHEREIN IT WAS HELD THAT WHEN THE NOTICE DID NOT CONFORM WITH THE REQUIREMEN TS OF PROVISIONS OF THE ACT, THE PROCEEDING REQUIRES TO BE QUASHED. 14. THE PROCEEDINGS UNDER CHAPTER XIV-B AND THE PRO VISIONS OF SECTION 139 ARE DIFFERENT. A RETURN FILED UNDER SE CTION 139 IS A VOLUNTARY RETURN. A RETURN UNDER CHAPTER XIV-B CAN NOT BE FILED VOLUNTARILY. IT IS ONLY WHEN A NOTICE UNDER SECTION 158BC WOULD BE ISSUED BY THE REVENUE. HOWEVER, AS AND WHEN VALIDI TY ISSUED, IT IS ONLY THEN THAT A RETURN COULD BE FILED. WHEN ANY S EARCH HAS BEEN CONDUCTED UNDER SECTION 132 OR BOOKS OF ACCOUNT, OT HER DOCUMENT OR ASSETS ARE REQUISITIONED UNDER SECTION 132A, IT IS ONLY THEN, THE ASSESSING OFFICER SHALL PROCEED TO ASSESS THE UNDIS CLOSED INCOME. THEREFORE, SECTION 158 BA PROVIDES FOR JURISDICTION TO THE ASSESSING OFFICER TO ASSESS THE UNDISCLOSED INCOME IN ACCORDA NCE WITH CHAPTER XIV-B. SECTION 158 BA(2) IS A CHARGING SECTION, 15 8BB PROVIDES FOR COMPUTATION OF UNDISCLOSED INCOME FOR THE BLOCK PER IOD AND 158 BC PROVIDES FOR PROCEDURE FOR BLOCK ASSESSMENT. THERE FORE, A NOTICE UNDER SECTION 158 BC PROVIDES FOR A PROCEDURE TO BE ADOPT ED FOR BLOCK ASSESSMENT. UNDER THIS PROCEDURE ENVISAGED, THE AS SESSING OFFICER SHALL SERVE A NOTICE REQUIRING THE ASSESSEE TO FURN ISH HIS RETURN WITHIN SUCH TIME NOT BEING LESS THAN 15 DAYS BUT NOT MORE THAN 45 DAYS AS SPECIFIED IN THE NOTICE. THEREFORE, THE TIME TO BE GRANTED TO THE ASSESSEE IN TERMS OF SECTION 158 BC IS A MINIMUM OF 15 DAYS AND A MAXIMUM OF 45 DAYS. IF THE SAID PERIOD OF TIME IS NOT GRANTED , THE NOTICE IS INVALID RENDERING THE ENTIRE PROCEEDINGS AS WITHOUT JURISDI CTION. ADMITTEDLY IN SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 9 THIS CASE, THE NOTICE UNDER SECTION 158BC CALLS UPO N THE ASSESSEE TO SUBMIT ITS RETURN OF INCOME WITHIN A PERIOD OF 15 DAYS. WITHIN A PERIOD OF 15 DAYS IS LESS THAN 15 DAYS. THEREFORE, THE MANDATORY PERIOD OF TIME AS STIPULATED UNDER SECTION 158 BC H AS NOT BEEN COMPLIED WITH. THE NOTICE THEREFORE IS INVALID. A N INVALID NOTICE CANNOT CONFER ANY JURISDICTION ON THE AUTHORITY. HENCE, T HE ENTIRE PROCEEDINGS ARE BAD IN LAW. THE NOTICE IS AB-INITIO VOID. 11. THE DECISION OF HONBLE JURISDICTIONAL HIGH COU RT IN THE CASE OF SHIRISH MADHUKAR DALVI IS ON THE POINT WHERE THE VALIDITY O F A NOTICE WAS TO BE EXAMINED WHEN A SUBSEQUENT NOTICE WAS ISSUED BY THE AO. THE HONBLE HIGH COURT HAS OBSERVED IN PARA 46 TO 48 AS UNDER: 46. HAVING EXAMINED FACTUAL MATRIX, STATUTORY PROV ISION, LAW LAID DOWN BY VARIOUS COURTS PRESENTLY HOLDING THE FIELD, IF ONE TURNS TO THE FACTS OF THE CASE AT HAND, IT IS NOT IN DISPUTE THAT NOTICE DT. 6 TH JULY, 1998 DID NOT MENTION CORRECT PROVISIONS OF TH E ACT; IT DID NOT MENTION CORRECT BLOCK PERIOD FOR WHICH THE RETURN W AS REQUIRED TO BE FILED; IT DID NOT GIVE 15 DAYS CLEAR NOTICE. TH OUGH THE SAID NOTICE WAS DEFECTIVE, IT DID NOT CAUSE ANY PREJUDIC E TO THE APPELLANT. UNDISPUTED FACTUAL MATRIX REVEALS THAT APPELLANT WAS SERVED WITH ANOTHER NOTICE DT. 17 TH SEPT., 1998 MENTIONING BLOCK PERIOD FOR WHICH THE RETURN WAS REQUIRED TO BE FILE D INCORPORATING CORRECT REFERENCE TO THE SECTIONS APPLICABLE TO THE CASE IN QUESTION AND IT MENTIONED THAT THE PERIOD OF 45 DAYS FOR FIL ING RETURN WAS AVAILABLE TO THE APPELLANT WHICH THE RETURN WAS REQ UIRED TO BE FILED INCORPORATING CORRECT REFERENCE TO THE SECTIO NS APPLICABLE TO THE CASE IN QUESTION AND IT MENTIONED THAT THE PERI OD OF 45 DAYS FOR FILING RETURN WAS AVAILABLE TO THE APPELLANT WH ICH THE APPELLANT DID NOT AVAIL. HE WAS DIRECTED TO FILE R ETURN. 47. PURSUANT TO THE ABOVE NOTICE DT. 17 TH SEPT., 1998, THE APPELLANT APPROACHED THE DY. CIT VIDE HIS LETTER DT. 28 TH SEPT., 1998 AND SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 10 SOUGHT FURTHER EXTENSION OF 45 DAYS FOR FILING BLOC K PERIOD RETURN. HE HAS, ACCORDINGLY, FILED HIS RETURN ON 2 ND NOV., 1998, DECLARING TOTAL INCOME OF ` 1,01,33,700. THE SAME WAS ACCORDINGLY ASSESSED VIDE ASSESSMENT ORDER DT. 30 TH JUNE, 2000. 48. IT IS NOT IN DISPUTE THAT NOTICE DT. 6 TH JULY, 1998 DID NOT CAUSE ANY PREJUDICE TO THE APPELLANT. DURING THE COURSE OF H EARING, WE SPECIFICALLY ASKED MR. SATHE AS TO WHAT PREJUDICE W AS SUFFERED BY THE APPELLANT ON ACCOUNT OF ALLEGED DEFECTIVE NO TICE DT. 6 TH JULY, 1998. HE MADE A POSITIVE STATEMENT NO SPEC IFIC PREJUDICE WAS SUFFERED BY THE APPELLANT. AT ANY RATE, THE NO TICE DT. 6 TH JULY, 1998 SUFFERED FROM ONLY TECHNICAL DEFECTS, IF ANY, AND, IN OUR OPINION, IT WAS PROTECTED UNDER THE UMBRELLA OF S. 292B OF THE ACT. 12. IT IS CLEAR FROM THE FACTS OF THE SAID CASE THA T WHEN THE SUBSEQUENT NOTICE WAS ISSUED THEN THE ALLEGED DEFECTIVE NOTICE DID NOT CAUSE ANY PREJUDICE TO THE ASSESSEE. THEREFORE, THE SAID DEC ISION IS NOT APPLICABLE IN THE FACTS OF THE PRESENT CASE WHERE THE ONLY NOTICE ISSUED U/S.158BC WAS CONTRARY TO THE PROVISIONS OF SEC.158BC. 13. AS REGARDS THE SPECIAL BENCH DECISION IN CASE O F NAVIN VERMA VS. ACIT 100 ITD 73, THE SAID DECISION HAS BEEN CONSIDERED B Y THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF NIRANJAN LAL VERM A (SUPRA) WHEREIN THE COUNSEL FOR THE ASSESSEE GAVE UP THE OBJECTION RAIS ED BEFORE THE TRIBUNAL REGARDING INVALIDITY OF THE NOTICE ISSUED U/S.158BD . THEREFORE, NO FINDING HAS BEEN GIVEN BY HONBLE PUNJAB & HARYANA HIGH COU RT ON THE ISSUE OF VALIDITY OF NOTICE. 14. IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE C ASE, WE HOLD THAT THE PERIOD OF TIME STIPULATED U/S.158BC IS NOT LESS THA N 15 DAYS AND, THEREFORE, THE NOTICE ALLOWED THE ASSESSEE TO FILE THE RETURN WITHIN 15 DAYS IS CONTRARY TO THE MANDATORY CONDITION AS PROVIDED U/S.158BC. ACCORDINGLY, THE SAID SHRI RAVENDRA M. PATIL SHRI NITIN M. PATIL ITSS 143/MUM/2005 ITSS 196/MUM/2005 11 NOTICE IS INVALID IN VIEW OF THE DECISIONS OF HONB LE SUPREME COURT IN THE CASE OF HOTEL BLUE MOON AS WELL AS DECISION OF KARN ATAKA HIGH COURT IN THE CASE OF MICRO LABS LTD. CONSEQUENTLY, THE ASSESSME NT FRAMED BY THE AO BASED ON THE INVALID NOTICE IS VOID AND LIABLE TO B E SET ASIDE. 15. SINCE IN BOTH THE CASES THE ASSESSMENT ITSELF I S VOID AND SAME ARE SET ASIDE. WE, THEREFORE, PROPOSE NOT TO GO INTO THE M ERITS OF THE CASE. 16. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE S ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 2 9TH AUGUST, 2012 SD/- ( G.E. VEERABHADRAPPA ) PRESIDENT SD/- ( VIJAY PAL RAO ) ACCOUNTANT MEMBER MUMBAI, DATE: 29TH AUGUST, 2012 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A)-IV, MUMBAI. 4) THE CIT-4, MUMBAI. 5) THE D.R. J BENCH, MUMBAI. 6) COPY TO GUARD FILE. BY ORDER / / TRUE COPY / / ASSTT. REGISTRAR I.T.A.T., MUMBAI *CHAVAN