Shri Kiritkumar Keshavlal Patel, Surat V. The ACIT.,Circle-3, Surat

ITSSA 66/AHD/2009

• Counselvise Citation: [2011] 124 COUNSELVISE.COM (IT) 8145 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 16-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 06-07-2011
• Assessment Year: misc
• Appeal Filed On: 23-09-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G S SOURYAVANSHI
• Keywords: Document seized; Block assessment; Reason to believe; Documents seized
• Section: 132; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : C BENCH : AHMEDABAD (BEFORE HONBLE SHRI T.K. SHARMA, J.M. & SHRI A. MO HAN ALANKAMONY, A.M.) I.T.(SS)A.NO.66/AHD./2009 BLOCK PERIOD : 1990-91 TO 19 99-2000 & UPTO 29.10.1999 SHRI KIRIT KUMAR KESHARLAL PATEL, SURAT VS- ACIT, CIRCLE-3, SURAT (PAN : AANPP 3673K) (APPELLANT) (RESPOND ENT) APPELLANT BY : NONE (WRITTEN SUBMI SSION) RESPONDENT BY : SHRI G.S.SOURYAVANSHI , SR.D.R. DATE OF HEARING : 06/07/2011 DATE OF PRONOUNCEMENT : 16/09/2011 O R D E R PER SHRI T.K. SHARMA, JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER DATED 15-07-2009 OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS),-II SUR AT FOR THE BLOCK PERIOD : 1990- 91 TO 1999-2000 & UPTO 29.10.1999. 2. BRIEFLY STATED, THE FACTS ARE THAT A SEARCH OPER ATION UNDER SECTION 132 OF THE I.T. ACT, 1961 WAS CONDUCTED AT THE BUSINESS PREMISES OF M/S. OHM DEVELOPERS ON 29.10.1999 AND SOME BOOKS OF ACCOUNTS WERE SEIZED. THE SEARCH PARTY, IN THE SEIZED MATERIALS, NOTICED THAT THE TRANSACTIONS OF INVESTM ENTS IN PURCHASE OF FLATS MADE BY THE BUYERS IN M/S. OHM DEVELOPERS AND PAYMENTS OF ON MO NEY TO THE BUILDER WERE REFLECTED THEREIN. AT PAGE NO. 19 OF KHATAVAHI FOUN D AND SEIZED AS PER ANNEXURE B5-4, IT WAS NOTICED THAT THE ASSESSEE HAD PURCHASED A FL AT NO. B-104 ADMEASURING 1285 SQ. FT. FOR WHICH A TOTAL PAYMENT OF RS. 6,30,935/- WAS SAID TO HAVE BEEN MADE TILL THE DATE OF SEARCH. THE STATEMENT OF ONE OF THE PARTNERS OF M/S. OHM DEVELOPERS WAS RECORDED DURING SEARCH U/S. 132(4) OF THE ACT, WHEREIN THE S AID PARTNER HAD ACCEPTED THE RECEIPT OF ON MONEY OVER AND ABOVE THE DOCUMENTED CONSIDERA TION. THE SAID INTIMATION WAS PASSED ON TO THE ASSESSING OFFICER OF THE ASSESSEE I.E. ACIT CIRCLE 3, SURAT. ON RECEIPT OF THE AFORESAID INFORMATION, THE ACIT, CIR CLE-3, SURAT ISSUED NOTICE UNDER SECTION 158BD R.W.S. 158BC OF THE ACT DATED 22-01-2 007, WHICH WAS SERVED UPON THE IT(SS)A NO.66-AHD-09 2 ASSESSEE ON 21-01-2007 ASKING HIM TO FILE THE RETUR N OF INCOME WITHIN 45 DAYS OF SERVICE OF NOTICE. IN RESPONSE TO THE SAID NOTICE, THE ASSESSEE FILED THE RETURN OF INCOME SHOWING NIL UNDISCLOSED INCOME. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ON BEHALF OF THE ASSESSEE, SHRI ASHOK B. PATEL, C.A. A TTENDED BEFORE THE AO. VIDE LETTER DATED 12.01.2009, THE ASSESSEE SUBMITTED AS UNDER: 'A NOTICE U/S.158BD R.W.S. 158BC OF THE INCOME-TAX ACT SERVED ON ME FOR THE FIRST TIME ON 22-01-2007 IN CONNECTION WITH THE SEA RCH OPERATIONS U/S. 132 CARRIED IN CASE OF M/S. OHM BUILDERS OF SURAT ON 29 .10.99, THE ASSESSMENTS OF WHICH MUST HAVE BEEN COMPLETED WAY BACK ON OR BEFOR E 31.10.2001. THUS, THE NOTICE WAS SERVED LATE BY 62 MONTHS AND 22 DAYS. IT MAY BE NOTED THAT ALONG WITH THE SAID NOTICE, NO 'SATISFACTION NOTE' OF AO OF SEARCH PARTY WAS PROVIDE TO ME.............................................. ..IF AT ALL IT IS AVAILABLE WITH YOUR HONOUR AND ALSO DETAILS OF SEIZED MATERIALS AND THE STATEMENT RECORDED IN THE CASES OF THOSE PERSONS ON WHICH YOU HAVE RELIED TO ISSUE THIS NOTI CE' 2.1 AFTER CONSIDERING THE AFORESAID REPLY, THE AO H ELD THAT THE AFORESAID CONTENTION OF THE ASSESSEE CANNOT BE ACCEPTED AS THERE IS NO S PECIFIC TIME LIMIT FOR ISSUANCE OF NOTICE UNDER SECTION 158 BD OF THE ACT. THE AO ALSO OBSERVED THAT COPIES OF RELEVANT SEIZED DOCUMENTS WERE ALREADY PROVIDED TO THE ASSES SEE WITH NOTICE UNDER SECTION 158BD. THE AO, THEREAFTER REPRODUCED THE ACCOUNTS O F THE ASSESSEE IN THE KHATAVAHI OF M/S. OHM DEVELOPERS IN PARA 6 OF THE ASSESSMENT ORDER. IN PARA 7, THE AO RELIED ON THE JUDGMENT OF ITAT, PUNE IN THE CASE OF GOLANI BR OTHERS VS- ACIT IN ITA NO.579 TO 583/P/1998 AND ASSESSED THE ON MONEY AMOUNTING TO RS.4,35,935/- AS UNDISCLOSED INCOME FOR THE BLOCK PERIOD. 3. ON APPEAL, IN THE IMPUGNED ORDER, THE LD. CIT(A) UPHELD THE ACTION OF THE AO BY OBSERVING THAT SATISFACTION HAS BEEN DULY RECORD ED BY BOTH THE DCIT, CC-IV AND THE ASSESSING OFFICER HAVING THE JURISDICTION OVER THE ASSESSEE. AGGRIEVED WITH THE ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL ON THE FOLLOWING GROUNDS: 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED C.I.T.(A)-II, SURAT HAS ERRED IN CONFIRMING THE ASSESSMENT FRAMED IN THE CASE OF THE APPELLANT U/S. 158BD R.W. S. 158BC OF THE ACT WITHOUT CONSIDERING THE FACT THAT THE ASSESSMENT ORDER PASS ED WAS BAD-IN-LAW, NULL AND VOID AND WITHOUT JURISDICTION ON THE FOLLOWING GROU NDS. IT(SS)A NO.66-AHD-09 3 A. THE ASSESSMENT U/S. 158BD R.W.S. 158BC WAS F RAMED WITHOUT CONSIDERING THE FACT THAT THE AO OF THE SEARCH PARTY HAD FAILED TO RECORD HIS SATISFACTION AS LAID DOWN U/S. 158BD OF THE ACT AND THEREFORE, THE ASSESSMENT IS BAD IN LAW AND VOID AB INITIO. B. THE ASSESSMENT FRAMED U/S. 158BD R.W.S. 158BC VIDE ORDER DATED 28-01- 09 IS BEYOND THE PRESCRIBED LIMIT U/S. 158BE OF THE ACT AND THEREFORE, THE SAME IS NULL AND VOID. C. THE STATEMENT OF ONE OF THE PARTNERS OF SUCH PA RTY VIZ. M/S. OHM DEVELOPERS RECORDED U/S. 132(4) OF THE ACT IS NOT A 'SEIZED MA TERIAL' AND 'ANNEXURE BS-4' IS NOT 'BOOKS OF ACCOUNTS' AND THEREFORE, THE ACTIO N INITIATED U/S. 158BD OF THE ACT CONSIDERING THE SAME AS SEIZED MATERIAL IS BAD IN LAW AND WITHOUT JURISDICTION. 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AS WELL AS LAW ON THE SUBJECT, THE LEARNED C.I.T. (A)- II, SURAT HAS ERRED IN CONF IRMING THE ADDITION OF RS. 4,35,935/- ON ACCOUNT OF UNDISCLOSED INCOME IN FORM OF ON MONEY PAID FOR PURCHASE OF FLAT ON THE BASIS OF A STATEMENT OF A T HIRD PARTY, WHICH WAS NOT BINDING TO THE APPELLANT, WITHOUT ESTABLISHING WITH COGENT EVIDENCE THAT ANY SUCH PAYMENT WAS EVER MADE BY THE APPELLANT, 4. ON THE DATE FIXED FOR HEARING, NONE WAS PRESENT FROM THE SIDE OF THE ASSESSEE. ON 27.01.2010, WRITTEN SUBMISSIONS WERE FILED, WHER EIN IT WAS CONTENDED THAT CONTROVERSY INVOLVED IN GROUND NO.1 IS COVERED BY T HE DECISION OF THE ITAT, AHMEDABAD AND OTHER TRIBUNALS AND COURTS, WHO HAVE DECIDED THE MATTER IN FAVOUR OF THE ASSESSEE. IN THE WRITTEN SUBMISSIONS, WITH REGA RD TO GROUND NO.1, IT WAS STATED THAT IT IS A COVERED MATTER ON LAW POINTS AND ON THE VER Y SIMILAR FACTS, THE ITAT, AHMEDABAD, OTHER TRIBUNALS AND COURTS HAVE DECIDED THE MATTER IN FAVOUR OF THE ASSESSEE. FURTHER, IN THE WRITTEN SUBMISSIONS, THE ASSESSEE SUBMITTED THE FOLLOWING: ITAT AHMEDABAD BENCHS DECISIONS A. ADIL PARVEZ RANDERIA VS. ACIT [IT(SS) A NO.25/AHD/2 007] B. SHRI AMITBHAI B. SOJITRA VS. ACIT [M.A. NO.155/AHD/ 2008 & IT(SS)A NO.81/AHD/2007] C. RAMESH VAGHASIA [ITA(SS)NO.80/A/2008] E. P J ULHANAND [ITA(SS)NO.19/A/2008] OTHER DECISIONS A. MANISH MAHESHWARI VS. ACIT [289 ITR 341 ( SC)] B. MANOJ AGARWAL VS. DCIT [117 TTJ 14 5 (DEL - SB) C. NEW DELHI AUTO FINANCE PVT. LTD. VS. JCIT [300 J TR 83 (DEL)] D. V.B. GIRI VS. ACIT [126 TTJ 217 (JODHPUR)] IT(SS)A NO.66-AHD-09 4 E. RADHESHYAM BANSAL [ITA(SS)NO.12/DE L/07 (ITAT DEI}] F. MANOJ BANSAL [ITA(SS)NO.L 4/DEL/07 (ITAT DEI)] 3. IT IS RESPECTFULLY SUBMITTED THAT THE APPELLA NT WAS SERVED WITH NOTICE U/S. 158BD IN CONNECTION WITH SEARCH PROCEEDINGS CARRIED OUT AT THE BUSINESS PREMISES OF M/S. OHM DEVELOPERS ON 29-10-1999. ON P AGE NO. 19 OF HE SAID KHATAVAHI, IT WAS NOTICED THAT THE APPELLANT HAD PU RCHASED A FLAT NO. B-104 FOR WHICH THE PAYMENT FOR A SUM OF RS. 6,30,935/- WAS S AID TO HAVE BEEN MADE BY THE APPELLANT WHEREAS, ACCORDING TO THE APPELLANT, HE HAD PAID A SUM OF RS. L,95,000/- ONLY AND NO ADDITIONAL AMOUNT TO THE TUN E OF RS. 4,35,935/- WAS PAID BY THE APPELLANT BY WAY OF ON MONEY. 4. IT IS RESPECTFULLY SUBMITTED THAT THE LEAR NED CIT (APPEALS) WHILE PASSING THE ORDER FAILED TO APPRECIATE THAT THE ASSESSMENT PROCEEDINGS INITIATED U/S. 158BD R.W.S. 158BC OF THE ACT WAS BAD IN LAW AND VOID AB INITIO AND CONSEQUENTLY, THE ASSESSMENT FRAMED BY THE LEARNED AO WAS ALSO BAD IN LAW AND INVALID AND ALSO NULL AND VOID. IT IS HUMBLY SU BMITTED THAT THE SEARCH ACTION WERE CONDUCTED AT THE PREMISES OF M/S. OHM D EVELOPERS ON 22-10-1999 AND THEREFORE, THE ASSESSMENT OF THE SAID FIRM WAS TO BE COMPLETED ON OR BEFORE 31-10-2001 . IN THE CASE OF THE APPELLANT; NO NOTICE U/S. 158BD OF THE ACT WAS ISSUED BEFORE 31-10-2001. IN FACT, THE NOTICE U/S. 158BD R.W.S. 158BC OF THE ACT DATED 22-01-2007 WAS ISSUED AND SERVED UPON THE APPELLANT ON 31-01- 2007 WHICH WAS LATE BY 62 MONTHS AND 22 DAYS . UNDER SUCH CIRCUMSTANCES, THE ASSESSMENT FRAMED WAS BEVOND THE PRESCRIBED TIM E LIMIT U/S. 158BE OF THE ACT AND THEREFORE, THE ASSESSMENT IS NULL AND VOID. 5. IT IS RESPECTFULLY SUBMITTED THAT THE APPELLAN T WAS NOT PROVIDED WITH THE 'SATISFACTION NOTE' OF THE AO OF SEARCH PARTY ALONG WITH THE NOTICE ISS UED U/S. 158BD OF THE ACT. EVEN DURING ASSESSMENT PROCEEDING S ALSO, NO SUCH 'SATISFACTION NOTE' WAS PROVIDED AND THEREFORE, THE APPELLANT HAD REASON TO BELIEVE THAT THERE WAS NO 'SATISFACTION NOTE' OF TH E AO OF THE SEARCH PARTY ON RECORD. IT IS RESPECTFULLY SUBMITTED THAT AS PER TH E PROVISIONS OF SECTION 158BD OF THE ACT, THE 'SATISFACTION NOTE' OF THE SEARCH P ARTY FOR INITIATING ACTION UNDER CHAPTER XIV-B OF THE ACT WAS REQUIRED AND THE 'SATI SFACTION NOTE' OF THE JURISDICTIONAL ASSESSING OFFICER WAS INVALID AND IT DESERVED TO BE TREATED AS CANCELLED. IT IS FURTHER SUBMITTED THAT THE APPELLANT HAD FILE D HIS RETURN OF INCOME UNDER PROTEST AND WITH A SPECIFIC REQUEST TO PROVIDE A CO PY OF 'SATISFACTION NOTE' OF THE AO OF THE SEARCH PATTY. THE APPELLANT HAD ALSO RAISED HIS OBJECTION ON THE PROCEEDINGS U/S. 158BD OF THE ACT ON THE GROUND THA T THE PROCEEDINGS WERE BARRED BY LIMITATION AND THE RETURN OF INCOME FOR T HE BLOCK PERIOD A.Y. 1990-91 TO A.Y. 2000-2001 WAS FILED ONLY TO COOPERATE THE D EPARTMENT AND TO COMPLY WITH THE PROVISIONS OF THE LAW. EVEN DURING THE ASSESSMENT PROCEEDINGS, THE APPELLANT HAD SPECIFICALLY OBJECTED TO THE ASSESSME NT PROCEEDINGS AND ALSO IT(SS)A NO.66-AHD-09 5 DEMANDED THE 'SATISFACTION NOTE' OF THE SEARCH PART Y VIDE HIS LETTER DATED 19- 01-2009 SUBMITTED TO THE AO ON 23-01-2009. 6. THE APPELLANT RELIES ON THE DECISION OF THE HON 'BLE SUPREME COURT IN THE CASE OF MANISH MAHESHWARI VS. ACIT [289 ITR 341] WHEREIN IT IS HELD THAT THE AO OF THE SEARCH PARTY MUST BE SATISFIED FOR IN ITIATING ACTION U/S. 158 BD OF THE ACT. THE HON'BLE ITAT DELHI SPECIAL BENCH IN TH E CASE OF MANOJ AGARWAL VS. DCIT HELD THAT IN ORDER TO INVOKE JURISDICTION U/S. 158B D A FINDING TO THE EFFECT THAT THE INCOME UNDISCLOSED DURING SEARCH BE LONGED TO SOME OTHER PERSON OTHER THAN THE PERSON SEARCHED HAS TO BE REC ORDED BY THE AO OF PERSON SEARCHED BEFORE THE EXPIRY OF TIME LIMIT PRESCRIBED IN SECTION 158 BE EITHER IN PROCEEDINGS U/S. 158BC OR IN THE NOTE HANDING OVER THE MATERIAL SEIZED TO THE AO OF SUCH OTHER PERSON AND AFTER EXPIRY OF TIME LI MIT PRESCRIBED IN SECTION 158 BE, NO PROCEEDINGS U/S. 158 BD CAN BE INITIATED . THE HON'BLE ITAT AHMEDABAD BENCH IN THE CASE OF ADIL PERVAZ RANDERIA VS. ACIT [IT(SS)A NO. 25 / AHMD / 2007] AND OTHER CASES AS STATED HEREINABOVE, FOLLOWED THE VIEW OF THE ABOVE REFERRED DECISIONS A ND GAVE THE DECISION IN FAVOUR OF THE ASSESSEE. IT IS RESPECTFULLY SUBMITTE D THAT THE FACTS OF THE SAID CASES ARE IDENTICAL AND SIMILAR TO THE FACTS OF THE APPELLANT AND THEREFORE, THE CASE OF THE APPELLANT IS COVERED BV THE DECISION OF THE HON'BLE ITAT AHMEDABAD. 5. ON THE OTHER HAND, SHRI G.S.SOURYAWANSHI, APPEAR ING ON BEHALF OF THE REVENUE, VEHEMENTLY SUPPORTED THE ORDERS OF THE REV ENUE AUTHORITIES. 6 WE HAVE HEARD BOTH THE PARTIES AND GONE THROUGH T HE ORDER OF THE AUTHORITIES BELOW. WE HAVE ALSO GONE THROUGH VARIOUS DECISIONS REFERRED TO BY THE LEARNED CIT(A) AND RELIED UPON BY THE ASSESSEE. WE FIND THAT THE I SSUE IS SQUARELY COVERED BY THE DECISION OF THE SPECIAL BENCH OF THE DELHI TRIBUNAL IN THE CASE OF MANOJ AGGARWAL V. DCIT (2008) 113 ITD 377 (DEL.)((SB). WE FIND FROM THE D ECISION OF THE SPECIAL BENCH THAT THE ISSUE IS SQUARELY COVERED BY THE FIN DING IN PARA 113 TO 116, WHICH READS AS UNDER:- 113. SECTION 158BD COMMENCES WITH THE WORDS WHERE THE ASSESSING OFFICER IS SATISFIED THAT ANY UNDISCLOSED INCOME BE LONGS TO ANY PERSON, OTHER THAN THE PERSON WITH RESPECT TO WHOM SEARCH W AS MADE AND THUS IT IS CLEAR THAT THE SATISFACTION OF THE ASSESSING OFFICER ASSESSING THE PERSON SEARCHED IS THE FIRST AND FOREMOST REQUIREME NT. THE ASSESSING OFFICER CAN ARRIVE AT THIS SATISFACTION ONLY AFTER ASCERTAINING WHETHER THERE IS ANY UNDISCLOSED INCOME AT ALL AND THIS FIN DING CAN BE ARRIVED AT BY HIM ONLY IN THE COURSE OF THE SECTION 158BD ASSE SSMENT PROCEEDING. IT(SS)A NO.66-AHD-09 6 THEREAFTER, HE HAS TO ARRIVE AT A FINDING AS TO THE PERSON TO WHOM SUCH INCOME BELONGS. THIS FINDING ALSO CAN BE ARRIVED AT ONLY IN THE COURSE OF THE SECTION 158BC PROCEEDING IN THE CASE OF THE PER SON SEARCHED. HE MAY FIND THAT PART OF THE SAID UNDISCLOSED INCOME B ELONGS TO THE PERSON SEARCHED AND THE REST BELONGS TO OTHER PERSON OR PE RSONS. AT THIS STAGE, HE HAS TO GIVE A FINDING IN THIS BEHALF AS TO WHICH OF THE UNDISCLOSED INCOME BELONGS TO THE PERSON TO WHOM THE REST OF TH E INCOME BELONGS. THIS FINDING TOO HAS TO BE ARRIVED AT IN THE COURSE OF THE SECTION 158BC PROCEEDING. AFTER ARRIVING AT THIS FINDING, HE MAKE S AN ASSESSMENT OF THE UNDISCLOSED INCOME RELATING TO THE PERSON SEARCHED IN HIS HANDS AND HANDS OVER THE MATERIAL RELATING TO THE UNDISCLOSED INCOME BELONGING TO THE OTHER PERSON OR PERSONS TO THE RESPECTIVE ASSES SING OFFICER. AS SECTION 158BC PROCEEDING IS SPECIFICALLY INTENDED F OR DETERMINING THE UNDISCLOSED INCOME, THE MATERIAL UNEARTHED HAS TO B E EXAMINED IN THE COURSE OF THE SAID PROCEEDING AND IF SUCH EXAMINATI ON SHOWS THAT THE UNDISCLOSED INCOME BELONGS TO SOME OTHER PERSONS A FINDING IN THIS BEHALF HAS TO BE RECORDED IN THE COURSE OF THE SECT ION 158BC PROCEEDING AS SUCH FINDING HAS TO FORM AN INTEGRAL PART OF THE SAID PROCEEDING AND IN CONFORMITY WITH THE INTENTION BEHIND THE SAID PR OVISION. SO, IT IS ESSENTIAL THAT SUCH FINDING HAS TO FORM PART OF THE SECTION 158BC PROCEEDING AND SO MUST FIND A PLACE IN THE ORDER UN DER SECTION 158BC. THE ASSESSING OFFICER ASSESSING THE PERSON SEARCHED HAS TO GIVE A FINDING ON EACH AND EVERY MATERIAL AND EVIDENCE UNE ARTHED AFTER A CAREFUL AND JUDICIOUS EVALUATION AND SUCH EXERCISE INVOLVES A FINDING THAT THE UNDISCLOSED INCOME BELONGS TO A SPECIFIED PERSON AS FOUND BY HIM ON THE SECTION 158BD PROCEEDING REVOLVES. IF, T HEREFORE, IN THE COURSE OF THE SECTION 158BC PROCEEDINGS THE ASSESSI NG OFFICER ASSESSING THE PERSON SEARCHED DOES NOT GIVE A FINDING THAT AN Y PART OF THE UNDISCLOSED INCOME UNEARTHED BELONGS TO A PERSON OT HER THAN THE PERSON SEARCHED, SECTION 158BD CAN NEVER BE INVOKED. IT I S THIS FINDING THAT IS AN INTEGRAL PART OF BOTH THE PROCEEDINGS WHETHER UN DER SECTION 15BC OR 158BD. FOR, SUCH FINDING DETERMINES IN WHOSE HANDS THE UNDISCLOSED INCOME UNEARTHED HAS TO BE TAXED. IF THE UNDISCLOSE D INCOME BELONGS TO THE PERSON SEARCHED, HE IS SUBJECTED TO BLOCK ASSES SMENT ON SUCH INCOME UNDER SECTION 158BC BUT IF SUCH INCOME OR PART OF S UCH INCOME BELONGS TO A PERSON NOT SEARCHED, SECTION 158BD TAKES OVER. THIS IS THE ESSENCE OF THE ENTIRE ENACTMENT RELATING TO SEARCH. 114.SECTION 158BE PROVIDES FOR TIME LIMIT FOR COMPL ETION OF BLOCK ASSESSMENT. IT STIPULATES THAT THE ORDER UNDER SEC TION 158 BC SHALL BE PASSED WITHIN TWO YEARS FROM THE END OF THE MONTH I N WHICH THE LAST OF THE AUTHORIZATION FOR SEARCH UNDER SECTION132 WAS EXECUTED OR FOR REQUISITION UNDER SECTION 132A AS THE CASE MAY BE A ND SO THE ORDER ENVISAGED UNDER SECTION 158BC HAS NECESSARILY TO BE PASSED WITHIN THIS TIME FRAME SET IN LAW. IF THERE IS A TIME-LIMIT FOR PASSING OF SUCH ORDER, THERE IS AN IMPLIED TIME-LIMIT FOR GIVING A FINDING AS TO THE PERSON TO IT(SS)A NO.66-AHD-09 7 WHOM THE UNDISCLOSED INCOME BELONGS WHICH UNDER NO CIRCUMSTANCES CAN BE BEYOND THE TIME-LIMIT SET IN SECTION 158BE. IF THERE IS NO SUCH FINDING GIVEN IN THE ORDER UNDER SECTION 158BC, THE PROVISIONS OF SECTION 158BD STAND OUSTED AT THE EXPIRY OF THE SAID TIME-L IMIT FOR THE REASON THAT SUCH A FINDING IS THE VERY BASIS FOR INVOKING SECTION 158BD. 115. SECTION 158BD AS SAID EARLIER BEGINS WITH THE EXPRESSION WHERE THE ASSESSING OFFICER IS SATISFIED AND SO VERY SEC TION IMPLIES A RECORDING OF SATISFACTION. THE SATISFACTION CONTE MPLATED IS A JUDICIOUS SATISFACTION AND NOT A SUBJECTIVE SATISFACTION AND UNLESS THE SAME IS RECORDED IT IS NOT POSSIBLE FOR ANY PERSON TO DISCE RN WHETHER THE SATISFACTION MEETS THE REQUIREMENTS OF LAW AT ALL. THE SATISFACTION CAN BE FOUND IN THE ORDER PASSED UNDER SECTION 158BC AN D IF NO SUCH ORDER IS PASSED THEN IT WILL HAVE TO BE FOUND IN THE NOTE HANDING OVER THE MATERIAL SEIZED TO THE ASSESSING OFFICER ASSESSING THE OTHER PERSON. IN ANY EVENT, IT HAS TO BE IN WRITING AND IN VIEW OF S ECTION 158BE, THE SAID RECORDING HAS TO BE MADE BEFORE THE TIME SET IN SEC TION 158BE EXPIRES. AFTER THE SAID DATE, IT IS NOT POSSIBLE TO INVOKE S ECTION 158BD AT ALL. 116. A VIEW IS EXPRESSED THAT WHEREVER A TIME-LIMI T IS INTENDED, THE PARLIAMENT HAS PROVIDED FOR THE SAME AND IN THE ABS ENCE OF A SPECIFIC PROVISION MADE IN THIS RESPECT IT HAS TO BE ASSUMED THAT THERE IS NO TIME- LIMIT INTENDED IN LAW. IT HAS TO BE REMEMBERED THAT THE MATER RELATES TO FIXING HUGE FINANCIAL AND OTHER CIVIL LIABILITY ON THE PERSON AFFECTED AND IT HAS BEEN REPEATEDLY HELD THAT THERE MUST BE A FI NALITY TO ANY PROCEEDING UNDER THE ACT AND THAT A CONCLUDED PROCE EDING CANNOT BE REOPENED AT THE WHIM AND FANCY OF THE ASSESSING OFF ICER WITHOUT THE DUE PROCESS OF LAW. STRICT INTERPRETATION OF FISCAL ST ATUTES IS THE ORDER OF THE DAY AND AS THE PROVISIONS FOR SEARCH ARE DRACONIAN IN NATURE SUCH PROVISIONS HAVE NECESSARILY TO BE STRICTLY CONSTRUE D. IT WILL HAVE TO BE REMEMBERED THAT SECTION 158BD PROVIDES FOR INVOKING JURISDICTION UNDER THE SAID SECTION ENABLING THE ASSESSING OFFIC ER ASSESSING THE OTHER PERSON IN RESPECT OF WHOM THE ASSESSING OFFICER ASS ESSING THE PERSON SEARCHED GIVES A FINDING THAT THE UNDISCLOSED INCOM E UNEARTHED AS A RESULT OF SEARCH BELONGS TO THE SAID PERSON AND ONC E SUCH A FINDING IS GIVEN THE PROVISIONS OF SECTION 158BD COME INTO OPE RATION. THIS, THEREFORE, INVOLVES ASSUMPTION OF JURISDICTION AND CANNOT BE CONSTRUCTED AS A PROCEDURAL MATTER. IN THE ABSENCE OF A FINDIN G IN THIS BEHALF, THERE IS NO JURISDICTION TO THE OTHER ASSESSING OFFICER A T ALL TO PROCEED FURTHER IN THE MATTER. AS THE TIME-LIMIT SET IN SECTION 15 8BE APPLIES TO SUCH FINDING, IT IS ONLY LOGICAL THAT THE SAID TIME-LIMI T AUTOMATICALLY APPLIES FOR INVOKING THE PROVISIONS OF SECTION 158BD AND IT IS FOR THIS REASON THAT THE PARLIAMENT DID NOT FIND IT NECESSARY TO SP ECIFY A SEPARATE TIME- LIMIT FOR THE SAME, AS THE ENACTMENT ITSELF SHOWS T HAT BOTH SECTIONS 158BC AND 158BD ARE INTER-LINKED, INTERLACED AND IN TER-WINDED AND BOTH FORM PART AND PARCEL OF THE SAME CHAPTER. IT(SS)A NO.66-AHD-09 8 6.1 IN THE PRESENT CASE, ADMITTEDLY, NOTICE UNDER S ECTION 158BD READ WITH SECTION 158BC OF THE I.T. ACT, 1961 WAS SERVED ON THE ASSES SEE FOR THE FIRST TIME ON 22.01.2007. SEARCH OPERATION UNDER SECTION 132 OF T HE I.T. ACT, 1961 WAS CARRIED OUT IN THE CASE OF M/S. OHM DEVELOPERS OF SURAT ON 29.1 0.1999. THE ASSESSMENT, IN THE CASE OF OHM DEVELOPER, MUST HAVE BEEN COMPLETED ON OR BEFORE 31.10.2001. THUS, THE NOTICE SERVED WAS LATE BY 62 MONTHS AND 22 DAYS. CO NSIDERING THE JUDGEMENT OF THE HONBLE SUPREME COURT IN THE CASE OF MANISH MAHESHW ARI ( SUPRA ) AS WELL AS DECISION OF THE DELHI SPECIAL BENCH, ITAT IN THE CASE OF MAN OJ AGARWAL ( SUPRA ), WE HOLD THAT THE PROCEEDINGS, UNDER SECTION 158BD INITIATED IN T HIS CASE, ARE INVALID BECAUSE THE AO OF THE SEARCH PARTY FAILED TO RECORD HIS SATISFA CTION AS LAID DOWN UNDER SECTION 158BD OF THE ACT. WE, THEREFORE, FOLLOWING THE DECI SION OF THE DELHI SPECIAL BENCH, ITAT IN THE CASE OF MANOJ AGARWAL ( SUPRA ), HOLD THAT THE ASSESSMENT FRAMED IS BEYOND THE PRESCRIBED TIME LIMIT UNDER SECTION 158B E AND THEREFORE THE ASSESSMENT IS NULL AND VOID. 6.2 IN VIEW OF THE ABOVE, WE QUASH THE ASSESSMENT F RAMED UNDER SECTION 158 BD READ WITH SECTION 158BC OF THE I.T. ACT. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. THE ORDER PRONOUNCED IN THE COURT ON 16.09.2011 SD/- SD/- (A.MOHAN ALANKAMONY) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 16/09/2011 COPY OF THE ORDER IS FORWARDED TO:- (1) THE ASSESSEE (2) THE DEPARTMENT. (3) CIT (A.) CONCERNED. (4) CIT CONCERNED. (5) D.R., ITAT, AHMEDABAD. TRUE COPY BY ORDER DEPUTY REGISTRAR, ITAT, AH MEDABAD. TALUKDAR/ SR. P.S.