Shri Ramkrishna Loya (HUF), Raisen V. The A.C.I.T., Bhopal

ITSSA 38/IND/2010

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8395 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 22 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 25-05-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 03-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Assessee Lawyers: ASHVINI RINWA
• Keywords: Search and seizure; Document seized; Period of limitation; Block assessment; Time period of passing order; Documents seized
• Section: 132; 15

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 IT(SS)A NO.38/IND/2010 BLOCK PERIOD 1.4.1996 TO 13.12.2002 RAMKRISHNA LOYA (HUF) UDAIPURA, DISTT. RAISEN PAN AADHR3290L APPELLANT VS ACIT-1(1), BHOPAL RESPONDENT APPELLANT BY : SHRI ASHVINI RINWA, ADVOCATE RESPONDENT BY : SMT. APARNA KARAN, SR. DR O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER BY WAY OF THIS APPEAL, THE ASSESSEE HAS CHALLENGED THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) DATED 4.1.2010 ON THE GROUND THAT THE ORDER U/S 158 BD READ WITH SECTION 158BC/143(3) DATED 25.11.2008 IS BAD I N LAW AS THE SAME WAS PASSED BEYOND THE PERIOD OF LIMITATION AS ALSO ON 2 THE GROUND THAT THE LD. FIRST APPELLATE AUTHORITY W AS NOT JUSTIFIED IN CONFIRMING THE AMOUNT OF RS. 60,000/- AS UNDISCL OSED INCOME FOR THE BLOCK PERIOD UNDER CONSIDERATION. 2. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE ORDER DATED 25.11.208 IS VOID AB INITIO AS THE SAME WAS PASSED BEYOND THE LIMITATION PERIOD WHEREAS THE LEA RNED SENIOR DEPARTMENTAL REPRESENTATIVE DEFENDED THE IMP UGNED ORDER. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. BRIEF FACTS ARE THAT THE ASSE SSEE EARNS INCOME FROM AGRICULTURE, BANK INTEREST AND RENT, ET C. AND FILED ITS RETURN OF INCOME WHICH WAS ACCEPTED BY THE DEPARTME NT. A SEARCH AND SEIZURE ACTION U/S 132(1) WAS CARRIED OU T AT THE RESIDENTIAL AND BUSINESS PREMISES OF CHANDAK & MALA NI GROUP AT UDAIPURA, DISTT. RAISEN ON 13.12.2002. DURING T HE COURSE OF SEARCH, CERTAIN DOCUMENTS WERE FOUND AND SEIZED ALL EGEDLY CONTAINING THE ENTRIES PERTAINING TO THE ASSESSEE, THEREFORE, NOTICE U/S 158BD READ WITH SECTION 158BC WAS ISSUED TO THE 3 ASSESSEE ON 27.12.2004. IN RESPONSE TO THE SAID NOT ICE, THE ASSESSEE FILED THE RETURN IN FORM NO. 2B ON 10.2.20 05. LATER ON SIMILAR NOTICES WERE ALSO ISSUED ON 28.8.2006 AN D 27.11.2006. THE STAND OF THE ASSESSEE IS THAT BLOC K ASSESSMENT WERE OUT OF LIMITATION PERIOD AS PROVIDE D U/S 158BE OF THE ACT IN VIEW OF THE FACT THAT ASSESSMENT WAS FRAMED AFTER TWO YEARS FROM THE DATE OF ISSUE OF 158BD NOTICE. D URING HEARING, IT WAS ALSO EXPLAINED BY THE LD. COUNSEL F OR THE ASSESSEE THAT THE ENTRIES PERTAINING TO THE ASSESSE E WHICH WERE ALLEGEDLY RECORDED IN THE SEIZED DOCUMENTS WER E FULLY EXPLAINED TO THE LEARNED ACIT WHO WAS SATISFIED WIT H THE EXPLANATION OF THE ASSESSEE. THE ASSESSEE RECEIVED THE TOTAL AMOUNT OF RS. 60,000/- FROM CHANDAK GROUP DURING TH E FINANCIAL YEAR 2002-03. NOW THE QUESTION ARISES AS TO WHETHER THE BLOCK ASSESSMENT WAS COMPLETED OUT OF LIMITATIO N PERIOD AS PROVIDED U/S 158BE OF THE ACT. BEFORE COMING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUNDER SECTION 15 8BE OF THE ACT :- 4 TIME LIMIT FOR COMPLETION OF BLOCK ASSESSMENT. 158BE. 14 [(1) THE ORDER UNDER SECTION 158BC SHALL BE PASSED ( A ) WITHIN ONE YEAR FROM THE END OF THE MONTH IN WHICH THE LAST OF THE AUTHORISATIONS FOR SEARCH UND ER SECTION 132 OR FOR REQUISITION UNDER SECTION 132A , AS THE CASE MAY BE, WAS EXECUTED IN CASES WHERE A SEARCH IS INITIATED OR BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ANY ASSETS ARE REQUISITIONED AFTER THE 30TH DAY OF JUNE, 1995, BUT BEFORE THE 1ST DAY OF JANUARY, 1997; ( B ) WITHIN TWO YEARS FROM THE END OF THE MONTH IN WHICH THE LAST OF THE AUTHORISATIONS FOR SEARCH UND ER SECTION 132 OR FOR REQUISITION UNDER SECTION 132A , AS THE CASE MAY BE, WAS EXECUTED IN CASES WHERE A SEARCH IS INITIATED OR BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ANY ASSETS ARE REQUISITIONED ON OR AFT ER THE 1ST DAY OF JANUARY, 1997. (2) THE PERIOD OF LIMITATION FOR COMPLETION OF BLOC K ASSESSMENT IN THE CASE OF THE OTHER PERSON REFERRED TO IN SECTION 158BD SHALL BE ( A ) ONE YEAR FROM THE END OF THE MONTH IN WHICH THE NOTICE UNDER THIS CHAPTER WAS SERVED ON SUCH OTHER PERSON IN RESPECT OF SEARCH INITIATED OR BOOK S OF ACCOUNT OR OTHER DOCUMENTS OR ANY ASSETS REQUISITIONED AFTER THE 30TH DAY OF JUNE, 1995, BUT BEFORE THE 1ST DAY OF JANUARY, 1997; AND ( B ) TWO YEARS FROM THE END OF THE MONTH IN WHICH THE NOTICE UNDER THIS CHAPTER WAS SERVED ON SUCH OTHER PERSON IN RESPECT OF SEARCH INITIATED OR BOOK S OF ACCOUNT OR OTHER DOCUMENTS OR ANY ASSETS ARE REQUISITIONED ON OR AFTER THE 1ST DAY OF JANUARY, 1997.] 15 [ EXPLANATION 1. IN COMPUTING THE PERIOD OF LIMITATION FOR THE PURPOSES OF THIS SECTION, 5 ( I ) THE PERIOD DURING WHICH THE ASSESSMENT PROCEEDING IS STAYED BY AN ORDER OR INJUNCTION OF A NY COURT; OR ( II ) THE PERIOD COMMENCING FROM THE DAY ON WHICH THE ASSESSING OFFICER DIRECTS THE ASSESSEE TO GET HIS ACCOUNTS AUDITED UNDER SUB-SECTION (2A) OF SECTION 142 AND ENDING ON THE DAY ON WHICH THE ASSESSEE IS REQUIRED TO FURNISH A REPORT OF SUCH AU DIT UNDER THAT SUB-SECTION; OR ( III ) THE TIME TAKEN IN REOPENING THE WHOLE OR ANY PART OF THE PROCEEDING OR GIVING AN OPPORTUNITY TO THE ASSESSEE TO BE RE-HEARD UNDER THE PROVISO TO SECTION 129 ; OR ( IV ) IN A CASE WHERE AN APPLICATION MADE BEFORE THE SETTLEMENT COMMISSION UNDER SECTION 245C IS REJECTED BY IT OR IS NOT ALLOWED TO BE PROCEEDED WI TH BY IT, THE PERIOD COMMENCING ON THE DATE ON WHICH SUCH APPLICATION IS MADE AND ENDING WITH THE DATE O N WHICH THE ORDER UNDER SUB-SECTION (1) OF SECTION 245D IS RECEIVED BY THE COMMISSIONER UNDER SUB- SECTION (2) OF THAT SECTION, SHALL BE EXCLUDED: PROVIDED THAT WHERE IMMEDIATELY AFTER THE EXCLUSION OF THE AFORESAID PERIOD, THE PERIOD OF LIMITATION REFERRED TO IN SUB-SECTION (1) OR SUB-SECTION (2) AVAILABLE TO THE ASSESSING OFFICER FOR MAKING AN ORDER UNDER CLAUSE ( C ) OF SECTION 158BC IS LESS THAN SIXTY DAYS, SUCH REMAINING PERIOD SHALL BE EXTENDED TO SIXTY DAYS AND THE AFORESAID PERIOD OF LIMITATIO N SHALL BE DEEMED TO BE EXTENDED ACCORDINGLY.] 16 [ EXPLANATION 2. FOR THE REMOVAL OF DOUBTS, IT IS HEREBY DECLARED THAT THE AUTHORISATION REFERRED TO IN SUB-SECTION (1) SHALL BE DEEMED TO HAVE BEEN EXECUTED, ( A ) IN THE CASE OF SEARCH, ON THE CONCLUSION OF SEARCH AS RECORDED IN THE LAST PANCHNAMA DRAWN IN 6 RELATION TO ANY PERSON IN WHOSE CASE THE WARRANT OF AUTHORISATION HAS BEEN ISSUED; ( B ) IN THE CASE OF REQUISITION UNDER SECTION 132A ,, ON THE ACTUAL RECEIPT OF THE BOOKS OF ACCOUNT OR OT HER DOCUMENTS OR ASSETS BY THE AUTHORISED OFFICER.] 4. IF THE LANGUAGE EMPLOYED IN THE AFORESAID SECTIO N AND THE ARGUMENTS ADVANCED BY THE LEARNED RESPECTIVE COUNSE LS IS ANALYSED WITH THE FACTS OF THE CASE, FIRSTLY THE SE CTION PROVIDES THE PERIOD OF ONE YEAR FROM THE END OF THE MONTH IN WHICH THE LAST OF THE AUTHORIZATION FOR SEARCH, AS THE CASE M AY BE, WAS EXECUTED AND WITHIN TWO YEARS FROM THE END OF THE M ONTH IN WHICH THE LAST AUTHORIZATION FOR SEARCH U/S 132 OR FOR REQUISITION U/S 132A, AS THE CASE MAY BE, WAS EXECUTED. IN THE PRESENT APPEAL, THE SEARCH AND SEIZURE OPERATION U/S 132(1) WAS CARRIED OUT AT THE PREMISES OF CHANDAK AND MALANI G ROUP ON 13.12.2002 , THEREFORE, ASSESSMENT U/S 158BD IS TO BE COMPLETED WITHIN TWO YEARS FROM THE DATE OF NOTICE U/S 158BD WHICH WAS 27.12.2004. HOWEVER, THE ASSESSMENT ORDER U/S 158BD READ WITH SECTION 158BC WAS COMPLETED VIDE OR DER DATED 25.11.2008. THE NOTICE WAS ISSUED TO THE ASS ESSEE ON 27.12.2004, THEREFORE, THE ASSESSMENT WAS FRAMED BE YOND THE 7 PERIOD OF LIMITATION I.E. TWO YEARS FROM THE DATE O F NOTICE U/S 158BD OF THE ACT, CONSEQUENTLY, THE ORDER IS VOID A B INITIO, CONSEQUENTLY, THE APPEAL OF THE ASSESSEE DESERVES T O BE ALLOWED ON THE GROUND OF LIMITATION. 5. SO FAR AS GROUND NO. 2 IS CONCERNED, WE HAVE FOU ND THAT THE AMOUNT OF RS. 60,000/- HAS ALREADY BEEN DISCLOS ED BY THE ASSESSEE IN ITS REGULAR RETURN FILED FOR THE ASSESS MENT YEAR 2003-04 WHICH CANNOT BE ADDED AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD AS THE SAME WILL AMOUNT TO DOUBLE TAXA TION, WHICH IS NOT PERMISSIBLE UNDER THE PROVISIONS OF THE ACT, THEREFORE, ON MERIT ALSO, THE APPEAL OF THE ASSESSEE DESERVES TO BE ALLOWED. FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESEN CE OF LEARNED REPRESENTATIVES OF BOTH THE SIDES AT THE CO NCLUSION OF HEARING ON 25 TH MAY, 2011. (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 25.5.2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, G UARD FILE 8 D/-