Shri Niraj Pankaj Shah, Surat V. The ACIT.,Circle-5, Surat

ITSSA 332/AHD/2010

• Counselvise Citation: [2012] 121 COUNSELVISE.COM (IT) 8334 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 28-09-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 02-08-2012
• Assessment Year: misc
• Appeal Filed On: 21-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y C SURTI
• Assessee Lawyers: S N DIVATIA
• Keywords: Document seized; Block assessment; Bogus loan; Documents seized
• Section: 132

Judgement Text

IT(SS) A NO 332/AHD/2010 A.YR.. 2005 -06 1 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AH MEDABAD (BEFORE D. K. TYAGI, JM & SHRI ANIL CHATURVEDI A.M .) I.T.(SS) A. N O.332/AHD/2010. (BLOCK PERIOD 1995-96 TO 2000-01 & 19-12-200 1) SHRI NIRAJ PANKAJ SHAH 1/A-7, APASARA APARTMENT, NEAR HINDU MILAN MANDIR, GOPIPURA, SURAT-395001 (APPELLANT) VS. ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE-5, AAYAKAR BHAVAN, NR.MAJURA GATE, SURAT. (RESPONDENT) PAN: AMBPS 4194 C APPELLANT BY : MR. S.N.DIVATIA RESPONDENT BY : MR. Y.C. SURTI ( )/ ORDER DATE OF HEARING : 2-8-2012 DATE OF PRONOUNCEMENT : 28-9-2012 PER: SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER. THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF LD. CIT (A)- IV, AHMEDABAD DATED 24-2-2010 FOR THE AFORESAID BLO CK PERIOD. 2. THE ASSESSEE IN ITS APPEAL HAS RAISED AS MANY AS SIX GROUNDS OF APPEAL. GROUND NO.1 AND 2 ARE INTER-CONNECTED AND THEREFORE, THEY ARE DISPOSED OF TOGETHER FOR THE SAKE OF CONVENIENCE. GROUND NOS.4,5 AND 6 ARE GENERAL IN NATURE AND THEREFORE THESE ARE NOT A DJUDICATED AND HENCE ARE DISMISSED FOR NON PROSECUTION. IT(SS) A NO 332/AHD/2010 A.YR.. 2005 -06 2 3. THERE WAS SEARCH OPERATION U/S. 132 OF THE ACT I N THE JAYRAJ GROUP OF CASES COVERING THE RESIDENTIAL AS WELL AS BUSINESS PREMISES OF THE ASSESSEE IN DECEMBER, 2001 AND JANUARY, 2002. THE B USINESS PREMISES OF M/S. PARIVAR TELEVISION PVT. LTD., WAS ALSO SEAR CHED U/S. 132(1) OF THE ACT ON 19-12-2001 IN CONNECTION WITH THE JAYRAJ GRO UP. 4. DURING THE COURSE OF SEARCH ACTION AT PARIVAR TE LEVISION PVT. LTD., MANY INCRIMINATING DOCUMENTS AND BOOKS OF ACCOUNTS WERE FOUND AND SEIZED. FROM THE SEIZED DOCUMENTS IT WAS SEEN THAT PARIVAR TELEVISION PVT. LTD., HAD SHOW RECEIPT OF UNACCOUNTED LOANS FROM VA RIOUS OUTSIDE PARTIES. THE BLOCK ASSESSMENT IN THE CASE OF PARIVAR TELEVIS ION PVT. LTD., WAS FINALIZED ON 31-12-2003 BY THE DCIT., BARODA AND HE INTIMATED THE A.O. OF THE ASSESSEE VIDE LETTER DATED 2-3-2005 THAT AS PER SEIZED MATERIAL THERE WERE CERTAIN TRANSACTIONS PERTAINING TO THE ASSESSE E WHICH MAY HAVE TO BE EXAMINED BY INITIATING THE PROCEEDINGS U/S. 158BD O F THE ACT. AFTER EXAMINATION OF THE RELEVANT SEIZED MATERIAL, NOTICE U/S. 158BD OF THE ACT WAS ISSUED ON 29-5-2007 AND THE ASSESSMENT WAS COMP LETED U/S. 158BD VIDE ORDER DATED 29-12-2008 AND THE INCOME WAS DETE RMINED AT RS. 3,26,000/-. AGGRIEVED BY THE ORDER OF A.O. ASSESSEE CARRIED THE MATTER BEFORE THE CIT (A). 5. BEFORE CIT (A) AMONG THE OTHER GROUNDS, THE ASSE SSEE ALSO CHALLENGED THE LEGAL VALIDITY OF THE ASSESSMENT ON THE GROUND THAT THE ASSESSMENT ORDER WAS PASSED WITHOUT JURISDICTION AN D NOTICE ISSUED U/S. 158BD WAS ILLEGAL. CIT (A) DID NOT ACCEPT THE CONTE NTIONS OF THE ASSESSEE AND HELD THAT A.O. HAD PROPER JURISDICTION OF ISSUI NG VALID NOTICE U/S. IT(SS) A NO 332/AHD/2010 A.YR.. 2005 -06 3 158BD, ACCORDINGLY HE DISMISSED THE GROUND. CIT (A) ALSO DISMISSED OTHER GROUNDS AND THEREFORE, NOW THE ASSESSEE IS IN APPEA L BEFORE US. 6. BEFORE US THE LD. A.R. SUBMITTED THAT THE NOTICE U/S. 158BD WAS ISSUED AFTER THE GAP OF 66 MONTHS I.E. 5 & HALF YEA RS AND THEREFORE NOTICE U/S./ 158BD WAS BARRED BY LIMITATION IS ILLEGAL AND AGAINST THE PROVISIONS OF SEC. 158BD,. HE THUS, SUBMITTED THAT ADDITION MADE BY A.O. AND CONFIRMED BY CIT (A) NEEDS TO BE DELETED AND BLOCK ASSESSMENT TO BE ANNULLED. 7. THE LD. A.R. ALSO PLACED BEFORE US A COPY OF DEC ISION OF THE CO- ORDINATE BENCH IN THE CASE OF SHRI RASIKLAL NAGINDA S SHAH IN IT(SS) A NO.47/AHD/2008 DATED 21-5-2010, WHEREIN ONE OF THE GROUND TAKEN BY THE ASSESSEE WAS WHETHER THE PROCEEDINGS INITIATED UNDE R 158BD LONG AFTER ORDER U/S.158BC WAS PASSED, WAS VOID ABINITIO. HE S UBMITTED THAT THE HONBLE TRIBUNAL RELYING ON THE DECISION OF ACIT VS . KISORILAL BALBANT RAI (2007) 17 SOT 380 (CHANDIGARH), BHARAT BHUSHAN JAIN VS. ACIT (2009) 17 DTR 498(DEL.) AND VARIOUS OTHER DECISIONS ALLOWED T HE APPEAL OF THE ASSESSEE. HE THEREFORE URGED THAT FOLLOWING THE DE CISION IN THE CASE OF RASIKLAL NAGINDAS SHAH (SUPRA) SIMILAR VIEW BE TAKE N IN THE PRESENT CASE. 8. THE LD. D.R. ON THE OTHER HAND PLACED RELIANCE O N THE ORDER OF A.O. AS WELL AS CIT (A). 9. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD. THE FACTUAL MATRIX OF THE CASE IS THAT SEARCH OPERA TION U/S. 132 WAS UNDERTAKEN IN JAYRAJ GROUP OF CASES IN DECEMBER, 20 01 AND JANUARY, 2002. BUSINESS PREMISES OF PARIVAR TELEVISION PVT. LTD., WAS ALSO SEARCHED ON IT(SS) A NO 332/AHD/2010 A.YR.. 2005 -06 4 18-12-2001 AND THE BLOCK ASSESSMENT WAS FINALIZED O N 31-3-2003 FROM THE MATERIAL ON RECORD. IT IS SEEN THAT NOTICE U/S.158B D WAS ISSUED TO THE ASSESSEE ON 29-5-2007. IN THE CASE OF BHARAT BHUSHA N JAIN VS. ACIT (SUPRA) CO-ORDINATE BENCH OF TRIBUNAL HAS HELD THAT WHEN PROCEEDINGS U/S.158BC WERE INITIATED AFTER 19 MONTHS OF COMPLET ION OF THE 158BC, THE ASSESSMENT CANNOT BE SUSTAINED. IN THE CASE OF VIS HNUBHAI R. BAROT VS. ACIT IN IT(SS) A. NO.104/AHD/2009 THE CO-ORDINATE B ENCH OF TRIBUNAL, FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF MANISH MAHESHWARI VS. ACIT (2007) 289 ITR 341 AND MANOJ AG ARWAL (SUPRA) HELD THAT IF THE ASSESSMENT U/S.158BC OF THE ACT, WAS CO MPLETED ON 13-12-2003 THEN ISSUING THE NOTICE U/S.158BD ON 29-3-2006 AGAI NST THE ASSESSEE SHOULD BE BARRED BY LIMITATION. 10. IN THE CASE OF BHARAT BHUSHAN JAIN VS. ACIT (20 09) 17 DTR (DEL.)((TRIB) 498 DELHI BENCH OF TRIBUNAL HAS HELD THAT EVEN THOUGH NO LIMITATION IS PRESCRIBED FOR INITIATING PROCEEDING S U/S. 158BD, THE SAME SHOULD BE INITIATED WITHIN A REASONABLE PERIOD. PRO CEEDINGS, INITIATED U/S. 158BD AFTER 19 MONTHS OF COMPLETION OF PROCEEDINGS U/S. 158BC CANNOT BE SUSTAINED. 11. IN THE PRESENT CASE, IT IS AN UNDISPUTED FACT T HAT BLOCK ASSESSMENT IN CASE OF PARIVAR TELEVISION PVT. LTD., WAS COMPLETED ON 31-12-2003 AND NOTICE U/S.158BD WAS ISSUED TO ASSESSEE ON 29-5-200 7. RESPECTFULLY FOLLOWING THE ABOVE DECISIONS, WE ARE OF THE VIEW T HAT SINCE THE NOTICE U/S.158BD WAS ISSUED AFTER MORE THAN 4 YEARS, THE P ROCEEDINGS U/S. 158BD CANNOT BE SUSTAINED. THUS, THIS GROUND OF THE ASSES SEE IS ALLOWED. IT(SS) A NO 332/AHD/2010 A.YR.. 2005 -06 5 12. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN OPEN COURT ON 28 - 9 - 201 2. SD/- SD/- ( D. K. TYAGI) (ANIL CHATURVEDI) JUDICIAL MEMBER ACC OUNTANT MEMBER AHMEDABAD. S.A.PATKI. COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS)-IV, SURAT. 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD. 1.DATE OF DICTATION 2 - 8 -2012 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 26,27 / 9 / 2012 MEMBER.OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S 27 - 9 -2012. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 28 - 9 -2012 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 28 - 9 -2012 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 2 8 - 9 -2012. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..