M/s. Golden Financiers, Erode V. ACIT, Erode

ITSSA 4/CHNY/2011

• Counselvise Citation: [2013] 121 COUNSELVISE.COM (IT) 9126 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 1 month(s) 28 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 09-04-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 09-04-2013
• Assessment Year: misc
• Appeal Filed On: 11-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Block assessment
• Section: 143(3)

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL C BENCH, CHENNAI. BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT & SHRI S.S. GODARA, JUDICIAL MEMBER I.T(SS).A. NO.54/MDS/2008 BLOCK ASSESSMENT PERIOD: 01.04.1988 TO 01.07.1998 A. MANI (LATE) REPRESENTED BY LEGAL HEIRS 1) M. THAVAMANI (WIFE), 2) MINOR SON NAVINPRABHU (REPRESENTED BY MOTHER AND ARUMUGA GOUNDER LEGAL HEIR OF WIFE SUBBAYAL WHO WAS THE LEGAL HEIR OF A. MANI, UDAYAR GOUNDAR THOTTAM, APPIYAPALAYAM, ETTIVEERAMPALAYAM POST, PERUMANALLUR, TIRUPUR TK. [PAN:AEBPT3641R] VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE II, ERODE. (APPELLANT) (RESPONDENT) I.T(SS).A. NO.4/MDS/2011 BLOCK ASSESSMENT PERIOD: 1989-1999 [01.04.1988 TO 0 1.07.1998] M/S. GOLDEN FINANCIERS C/O MR. S. SRIDHAR, ADVOCATE, 112/1, PERIYAR STREET, ERODE. [PAN: AAGFG4392R] VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE II, ERODE. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE RESPONDENT BY : SHRI G.K. DHALL, CIT DR DATE OF HEARING : 0 9 . 0 4 .201 3 DATE OF PRONOUNCEMENT : 09.04.2013 ORDER PER S.S. GODARA, JUDICIAL MEMBER THESE TWO APPEALS OF DIFFERENT ASSESSEES ARE DIREC TED AGAINST I.T I.TI.T I.T(SS) (SS) (SS) (SS).A. .A..A. .A. NO. NO. NO. NO.5 55 55 55 5/M/ /M/ /M/ /M/08 & 08 & 08 & 08 & I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 2 DIFFERENT ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS) I, COIMBATORE DATED 10.03.2008 IN APPEAL NO. 361/06-07 AND DATED 30.11.2010 IN APPEAL NO. 312/09-10 RESPECTIVELY, FOR THE BLOCK ASSESSMEN T PERIOD 01.04.1988 TO 01.07.1998. THE RELEVANT PROCEEDINGS ARE UNDER SECT ION 158BC R.W.S.143(3) & 254 OF THE INCOME TAX ACT 1961 [IN SHORT THE ACT ] IN RESPECT OF FIRST ASSESSEE. FOR THE 2 ND ASSESSEE, THEY ARE UNDER SECTION 158BC R.W.S. 254 OF THE ACT. I.T.(SS).A. NO. 54/MDS/2008 2. THIS APPEAL BY THE DECEASED ASSESSEE THROUGH HI S L/H WIDOW NAMELY SMT. M. THAVAMANI, CHALLENGES THE LEGALITY OF PROCE EDINGS INITIATED UNDER SECTION 158BC R.W.S. 143(3) AND 254 OF THE ACT. A T THE OUTSET, THE AR REPRESENTING THE ASSESSEE CONCEDED THAT HE IS NOT C HALLENGING CIT(A)S ORDER ON MERITS AND RESTRICTED HIS ARGUMENTS ONLY O N THE LEGALITY ASPECT OF THE SATISFACTION RECORDED BEFORE INITIATING PROCEED INGS UNDER SECTION 158BD OF THE ACT. THEREAFTER, INVITING OUR ATTENTION TO WRITTEN SUBMISSIONS, HE SUBMITS THAT THE IMPUGNED SATISFACTION AGAINST THE ASSESSEE UNDER SECTION 158BD WAS RECORDED ON 07.05.1999, WHEREAS, THE NOTI CE UNDER SECTION 158BC OF THE ACT TO THE SEARCHED PERSON WAS ISS UED ON 11.05.1999. IN VIEW THEREOF, THE CONTENTIONS OF THE ASSESSEE, AS B ASED ON THE CASE LAW [2008] 113 ITD 377 (DELHI)(SB) MANOJ AGGARWAL V. DC IT, IS THAT THE SATISFACTION IN QUESTION IS BEFORE THE SAME BEING R ECORDED IN CASE OF THE SEARCHED PERSON AFORESAID. HE PLACE RELIANCE ON THE CASE LAW OF HONBLE I.T I.TI.T I.T(SS) (SS) (SS) (SS).A. .A..A. .A. NO. NO. NO. NO.5 55 55 55 5/M/ /M/ /M/ /M/08 & 08 & 08 & 08 & I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 3 PUNJAB & HARYANA REPORTED AS [2011] 198 TAXMAN 463 (PUNJ. & HAR.) TITLED AS CIT V. PARVEEN FABRICS (P.) LTD. AND PRAY S FOR ACCEPTANCE OF THE APPEAL. 3. PER CONTRA, THE REVENUE STRONGLY ARGUES THAT TH E AFORESAID CASE LAW IS NOT APPLICABLE QUA THE FACTS OF INSTANT CASE AND TH E SATISFACTION UNDER SECTION 158BD OF THE ACT HAD BEEN VALIDLY RECORDE D AGAINST THE ASSESSEE. 4. BRIEF FACTS OF THE INSTANT CASE ARE THAT THERE WAS A SEARCH IN CASE OF SRI A.P. SHANMUGARAJ (A BUSINESS ASSOCIATE OF THE A SSESSEE) ON 01.07.1998. THEREAFTER, A NOTICE UNDER SECTION 158B C(A) R.W.S. 158BD OF THE ACT WAS ISSUED TO HIM ON 11.05.1999. IN THE MEANT IME, THE IMPUGNED SATISFACTION TO INITIATE RELEVANT PROCEEDINGS AGAIN ST THE ASSESSEE WAS ALSO RECORDED ON 07.05.1999. SINCE WE ARE DEALING WITH P URELY A LEGAL PLEA, WE ARE NOT FOCUSING ON THE ASSESSMENT ORDER DATED 29.1 2.2006 AND THE CIT(A) ORDER UNDER CHALLENGE. IT IS, THIS SATISFACTION DAT ED 07.05.1999, WHOSE VALIDITY IS SOUGHT TO BE ASSAILED BY THE ASSESSEE B Y CONTENDING THAT THE SAME IS CONTRARY TO THE VERY PROVISION I.E. 158BD O F THE ACT AND THE CASE LAW CITED HEREINABOVE. 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE CASE LAW (SUPRA) RELIED UPON BY THE ASSESSEE. A PERUSAL OF THE RELEV ANT STATUTORY PROVISION I.E. SECTION 158BD OF THE ACT, MAKES CLEAR THAT IT NOW HERE PRESCRIBES THAT SATISFACTION THERETO HAS TO BE RECORDED BEFORE THAT IN CASE OF THE SEARCHED I.T I.TI.T I.T(SS) (SS) (SS) (SS).A. .A..A. .A. NO. NO. NO. NO.5 55 55 55 5/M/ /M/ /M/ /M/08 & 08 & 08 & 08 & I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 4 PERSON UNDER SECTION 158BC(A) OF THE ACT. IT IS A LSO EVIDENT THAT THE PROCEEDINGS IN BOTH CASES DATED 07.05.1999 AND 11.0 5.1999 ARE ALMOST CONTEMPORANEOUS. COMING TO THE CASE LAW CITED BY TH E ASSESSEE, IT IS FOUND THAT THE HONBLE SPECIAL BENCH WAS CONCERNED WITH S PECIFIC QUESTION OF VDI SCHEME 1997 AND ITS EFFECT ON THE INCOME OF THE CON CERNED ASSESSEE FROM UNDISCLOSED SOURCES. FURTHER, THE VERY ISSUE BEFORE US HAS NEITHER BEEN ADJUDICATED UPON BY THE SPECIAL BENCH NOR THE HONB LE PUNJAB & HARYANA HIGH COURT (SUPRA). RATHER, IN THE SAID CASES, NO S UCH PLEA ALIKE THE ONE RAISED BEFORE US HAD BEEN AGITATED BY THE PARTIES C ONCERNED. THEREFORE, THE CASE LAW CITED BY THE ASSESSEE IS NOT APPLICABLE QU A PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE. 6. CONSEQUENTLY, IN VIEW OF OUR ABOVE DISCUSSIONS, WE HOLD THAT THE PROCEEDINGS UNDER SECTION 158BD OF THE ACT HAD BE EN VALIDLY INITIATED AGAINST THE ASSESSEE. HENCE, ASSESSEES LEGAL PLEA IS DECIDED IN FAVOUR OF THE REVENUE. AS ALREADY CLARIFIED HEREINABOVE, NO ARGUMENT HAS BEEN ADVANCED BY THE AR AT THE BEHEST OF THE ASSESSEE ON MERITS OF T HE CASE. THEREFORE, THE APPEAL IS DISMISSED. I.T.(SS)A. NO. 04/MDS/2011 7. BOTH PARTIES BEFORE US FAIRLY CONCEDED THAT THE ISSUES INVOLVED HEREIN ARE AKIN TO THOSE DECIDED BY US IN I.T.(SS)A. NO. 5 4/MDS/2008 HEREINABOVE I.T I.TI.T I.T(SS) (SS) (SS) (SS).A. .A..A. .A. NO. NO. NO. NO.5 55 55 55 5/M/ /M/ /M/ /M/08 & 08 & 08 & 08 & I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 I.T.(SS) NO. 4/11 5 AND THE SAME BE FOLLOWED IN THE INSTANT CASE AS WEL L. AFTER GOING THROUGH THE SUBMISSIONS OF THE ASSESSEE, WE FIND THAT IN THIS C ASE, THE SEARCHED PERSON WAS PARTNER OF THE ASSESSEE FIRM AND ISSUES ARE IDE NTICAL. THEREFORE, THE STAND ADOPTED BY BOTH PARTIES IS FOUND FAIR. ACCORD INGLY, WE REJECT ASSESSEES CONTENTIONS IN THE LIGHT OF OUR FINDING IN I.T.(SS) A. NO. 54/MDS/2008. 9. CONSEQUENTLY, BOTH APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON TUESDAY, THE 9 TH OF APRIL, 2013 AT CHENNAI. SD/- SD/- (DR. O.K. NARAYANAN) VICE - PRESIDENT (S.S. GODARA) JUDICIAL MEMBER CHENNAI, DATED, THE 09.04.2013 VM/- TO: THE ASSESSEE//A.O./CIT(A)/CIT/D.R.