Smt. Kusum B. Patel, New Delhi V. DCIT, New Delhi

ITSSA 32/DEL/2010

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8417 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 18 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 20-05-2011
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 02-08-2017
• Assessment Year: misc
• Appeal Filed On: 02-07-2010
• Court: TRIBUNAL
• Department Lawyers: H L DIHANA
• Keywords: Principle of natural justice; Reasonable cause; Block assessment
• Section: 132; 11; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D : NEW DELHI DELHI BENCH D : NEW DELHI DELHI BENCH D : NEW DELHI DELHI BENCH D : NEW DELHI BEFORE SHRI R.P.TOLANI, JM AND SHRI B.K.HALDAR, AM BEFORE SHRI R.P.TOLANI, JM AND SHRI B.K.HALDAR, AM BEFORE SHRI R.P.TOLANI, JM AND SHRI B.K.HALDAR, AM BEFORE SHRI R.P.TOLANI, JM AND SHRI B.K.HALDAR, AM IT(SS) A.NO.30/DEL/2010 IT(SS) A.NO.30/DEL/2010 IT(SS) A.NO.30/DEL/2010 IT(SS) A.NO.30/DEL/2010 BLOCK ASSESSMENT YEARS : 1997 BLOCK ASSESSMENT YEARS : 1997 BLOCK ASSESSMENT YEARS : 1997 BLOCK ASSESSMENT YEARS : 1997- -- -98 TO 2003 98 TO 2003 98 TO 2003 98 TO 2003- -- -04 UPTO 11.02.2003 04 UPTO 11.02.2003 04 UPTO 11.02.2003 04 UPTO 11.02.2003 ASSTT.COMMISSIONER OF ASSTT.COMMISSIONER OF ASSTT.COMMISSIONER OF ASSTT.COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -22(1), 22(1), 22(1), 22(1), N NN NEW DELHI. EW DELHI. EW DELHI. EW DELHI. VS. VS. VS. VS. MRS.KUSUM B.PATEL, MRS.KUSUM B.PATEL, MRS.KUSUM B.PATEL, MRS.KUSUM B.PATEL, 1 11 1 ST STST ST FLOOR, B FLOOR, B FLOOR, B FLOOR, B- -- -419, 419, 419, 419, NEW FRIENDS COLONY, NEW FRIENDS COLONY, NEW FRIENDS COLONY, NEW FRIENDS COLONY, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 065. 110 065. 110 065. 110 065. PAN NO.AECPB8567P. PAN NO.AECPB8567P. PAN NO.AECPB8567P. PAN NO.AECPB8567P. (APPELLANT) (RESPONDENT) IT(SS) A.NO.32/DEL/2010 IT(SS) A.NO.32/DEL/2010 IT(SS) A.NO.32/DEL/2010 IT(SS) A.NO.32/DEL/2010 BLOCK ASSESSMENT YEARS : 1997 BLOCK ASSESSMENT YEARS : 1997 BLOCK ASSESSMENT YEARS : 1997 BLOCK ASSESSMENT YEARS : 1997- -- -98 TO 2003 98 TO 2003 98 TO 2003 98 TO 2003- -- -04 UPTO 11.02.2003 04 UPTO 11.02.2003 04 UPTO 11.02.2003 04 UPTO 11.02.2003 MRS.KUSUM B.PA MRS.KUSUM B.PA MRS.KUSUM B.PA MRS.KUSUM B.PATEL, TEL, TEL, TEL, B BB B- -- -417, 417, 417, 417, NEW FRIENDS COLONY, NEW FRIENDS COLONY, NEW FRIENDS COLONY, NEW FRIENDS COLONY, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. PAN NO.AECPB8567P. PAN NO.AECPB8567P. PAN NO.AECPB8567P. PAN NO.AECPB8567P. VS. VS. VS. VS. DY.COMMISSIONER OF DY.COMMISSIONER OF DY.COMMISSIONER OF DY.COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CIRCLE CIRCLE CIRCLE CIRCLE- -- -22(1), 22(1), 22(1), 22(1), NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI H.L.DIHANA, CIT-DR. ASSESSEE BY : SHRI S.R.MEHRA, CA. (ONLY FOR HEARING ASSESSEES ADDITIONAL GROUNDS APPLICATION DATED 17.1.2011). ORDER ORDER ORDER ORDER PER R.P.TOLANI, JM : PER R.P.TOLANI, JM : PER R.P.TOLANI, JM : PER R.P.TOLANI, JM : THESE ARE CROSS-APPEALS FILED BY THE ASSESSEE AND THE REVENUE. 2. ASSESSEES APPEAL RAISES GROUNDS PERTAINING TO V ALIDITY OF SEARCH PROCEEDINGS AND CONSEQUENT ASSESSMENT U/S 158BC AS WELL AS MERITS. SIMILARLY, THE REVENUES APPEAL RAISES GROUNDS PERT AINING TO MERITS. IT(SS)-30 & 32/DEL/2010 2 3. LEARNED COUNSEL FOR THE ASSESSEE, AT THE OUTSET, FILED A REQUEST FOR ADMISSION OF ADDITIONAL GROUNDS OF APPEAL WHICH ARE AS UNDER:- 1. (A) THAT THE AO HAS ERRED BOTH IN LAW AS WELL A S IN THE FACTS OF THE CASE IN PASSING THE IMPUGNED BLOCK ASSESSMENT ORDER UNDER S. 158BC OF THE ACT WITHOUT SERVING ON THE ASSESSEE ANY NOTICE UNDER S. 158BC(A )(II) OF THE ACT. (B) THAT THE BLOCK ASSESSMENT SO MADE WITHOUT SERVI NG ANY NOTICE UNDER S. 158BC(A)(II) OF THE ACT IS WITH OUT JURISDICTION AND DESERVES TO BE QUASHED. (C) THAT THE AO HAS ERRED BOTH IN LAW AS WELL AS IN THE FACTS OF THE CASE IN PASSING THE IMPUGNED BLOCK ASSESSMENT ORDER UNDER S. 158BC OF THE ACT WITHOUT SERVING ON THE ASSESSEE ANY NOTICE UNDER S. 143(2) OF THE ACT. (D) THAT THE BLOCK ASSESSMENT SO MADE WITHOUT SERVI NG ANY NOTICE UNDER S. 143(2) OF THE ACT IS WITHOUT JU RISDICTION AND DESERVES TO BE QUASHED. (E) THAT THE COMPLETION OF THE BLOCK ASSESSMENT UND ER S. 158BC OF THE ACT WITHOUT ALLOWING ANY OPPORTUNITY U NDER S. 143(2) OF THE ACT IS IN VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE AND IS THEREFORE NULL AND VOID AB INITIO. (F) THAT THE FRAMING OF THE BLOCK ASSESSMENT U/S 15 8BC OF THE ACT IN THE INDIVIDUAL NAME OF THE ASSESSEE O N THE BASIS OF A SEARCH WARRANT U/S 132 IN THE COLLECTIVE NAMES OF BHAGUBHAI M PATEL KUSUM B.PATEL, REME (P) LTD., SOL E STRAP (P) LTD., HAMCO STEEL AND ALLOYS LTD., M.P. D RAVYA MINERAL AND SMELTING LTD., K.B. ASSOCIATES, RELIABL E ENGINEERING WORKS, B.M.PATEL, IS ILLEGAL AND BAD IN LAW. IN VIEW OF THE DECISION OF THE SUPREME COURT IN THE CASE OF NATIONAL THERMAL POWER CO.LTD. VS. CIT : 229 ITR 38 3 AND ALSO THE DECISION IN THE CASE OF THE JUTE CORPORATI ON OF INDIA VS. CIT 187 ITR 688 AND THE DISCRETION VESTED IN YOUR HONOURS UNDER RULE 11 OF THE INCOME TAX APPELLATE R ULES, 1963, THE ADDITIONAL GROUND OF APPEAL CALLS FOR BEI NG ADMITTED AND ADJUDICATED ON MERITS. IT(SS)-30 & 32/DEL/2010 3 4. LEARNED COUNSEL FOR THE ASSESSEE CONTENDS THAT T HE ADDITIONAL GROUNDS ARE LEGAL GROUNDS AND WERE TAKEN BEFORE THE LOWER AUTHORITIES. RELYING ON THE HON'BLE SUPREME COURT JUDGMENT IN TH E CASE OF N.T.P.C., IT IS REQUESTED THAT THE SAME MAY BE ADMI TTED. BOTH THE PARTIES AGREED THAT THE ISSUE ABOUT ADMISSIBILITY O F ADDITIONAL GROUNDS MAY BE DECIDED FIRST. THEREFORE, THESE APPEALS ARE HEARD ONLY ON THE LIMITED POINT ABOUT VALIDITY OF PROCEEDINGS U/S 158 BC AND RELATED PROVISIONS OF BLOCK ASSESSMENT. 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH THE MATERIAL ON RECORD. WE OBSERVE THAT THE ASSESSEE HAS RAISED GROUNDS ABOUT VALIDITY OF PROCEEDINGS U/S 158BC WHICH HAVE BEEN D ECIDED BY THE CIT(A). THE ADDITIONAL GROUNDS BEING HEARD CANNOT BE ADMITTED INASMUCH AS THE ASSESSEE CANNOT BE ALLOWED TO GO ON FINDING NEW WAYS OF CHALLENGING THE VALIDITY OF SEARCH PROCEEDI NGS AND CONSEQUENT ASSESSMENT. THE ONLY REASON GIVEN BY THE ASSESSEE IS TO THE EFFECT THAT GROUNDS ARE BEING TAKEN AT THE ADVISE OF THE C OUNSEL. NO REASON HAS BEEN ADDUCED AS TO WHY THE ASSESSEE WAS PREVENT ED BY REASONABLE CAUSE IN RAISING IT BEFORE THE CIT(A) AN D IN REGULAR MEMORANDUM OF APPEAL, MORE SO WHEN VARIOUS OTHER AS PECTS ABOUT VALIDITY OF BLOCK ASSESSMENT PROCEEDINGS HAVE BEEN CHALLENGED. IN OUR VIEW, THE ASSESSEE IS ON A SPREE OF RAISING ADDITIO NAL GROUNDS ON BECOMING WISER WHICH CANNOT BE PERMITTED. BESIDES, THE VARIOUS ADDITIONAL GROUNDS REQUIRED ADJUDICATION OF FACTS A ND VERIFICATION OF RECORDS WHICH IS NOT PERMISSIBLE UNDER RULE 11. SI NCE THE ASSESSEE HAS FAILED TO GIVE ADEQUATE REASONS FOR RAISING THE ADDITIONAL GROUNDS AND VARIOUS ASPECTS OF VALIDITY HAVING BEEN ALREADY CHALLENGED BY THE ASSESSEE, IT CANNOT BE SAID THAT HE WAS NOT DILIGEN T ABOUT THE ISSUES PERTAINING TO THE VALIDITY OF SEARCH PROCEEDINGS. BESIDES, THE GROUNDS BEING RAISED REQUIRE THE VERIFICATION OF FACTS. IN VIEW THEREOF, THE IT(SS)-30 & 32/DEL/2010 4 APPLICATION DATED 17.1.2011 UNDER RULE 11 BY THE AS SESSEE IS DISMISSED. 6. SINCE WE HAVE DISMISSED THE ASSESSEES APPLICATI ON FOR ADDITIONAL GROUNDS, WE DIRECT THE REGISTRY TO POST THE APPEALS OF ASSESSEE AND REVENUE IN REGULAR COURSE FOR HEARING BY THE BENCH. 7. THE ASSESSEES APPLICATION FOR ADMISSION OF ADDI TIONAL GROUNDS IS DISMISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 20 TH MAY, 2011. SD/- SD/- (B.K.HALDAR) (B.K.HALDAR) (B.K.HALDAR) (B.K.HALDAR) (R.P.TOL (R.P.TOL (R.P.TOL (R.P.TOLANI) ANI) ANI) ANI) ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER DATED : 20.05.2011. VK. COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR