DCIT CIR. - 5 THANE, V. Sri. MAGANLAL K. THAKKAR, MUMBAI

ITSSA 820/MUM/2003

• Counselvise Citation: [2014] 122 COUNSELVISE.COM (IT) 0370 (ITAT-MUMBAI)
• Duration Of Justice: 10 year(s) 9 month(s) 20 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 24-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 20-08-2014
• Assessment Year: misc
• Appeal Filed On: 04-12-2003
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S D SHRIVASTAVA
• Keywords: Search and seizure; Period of limitation; Block assessment; Time period of passing order
• Section: 132

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL J , BENCH MUMBAI , BEFORE : SHRI R.C.SHARMA , A M & SHRI SANJAY GARG, J M IT (SS) A NO. 802 / MUM/20 03 ( /BLOCK PERIOD FROM 01 - 04 - 19 89 TO 08 - 07 - 1999 ) SHRI MAGANLAL KHIMJI THAKKAR, 6 TH FLOOR, DHANLAXMI CHAMBERS, OPP. KHANDELWAL SWEETS, GOKHALE ROAD, T HANE (W EST ) , MUMBAI - 400 601 VS. A CIT ,CIR - 5, THANE PAN/GIR NO. : ( APPELLANT ) .. ( RESPONDENT ) AND IT (SS) A NO. 820 / MUM/20 03 ( /BLOCK PERIOD FROM 01 - 04 - 19 89 TO 2 8 - 07 - 1999 ) D CIT,CIR - 5, THANE VS. SHRI MAGANLAL KHIMJI THAKKAR, 6 TH FLOOR, DHANLAXMI CHAMBERS, OPP. KHANDELWAL SWEETS, GOKHALE ROAD, THANE (WEST), MUMBAI - 400 601 PAN/GIR NO. : ( APPELLANT ) .. ( RESPONDENT ) /ASSESSEE BY : SHRI VIJAY MEHTA /REVENUE BY : SHRI S.D.SHRIVASTAVA DATE OF HEARING : 2 6 TH AUGUST , 201 4 DATE OF PRONOUNCEMENT : 24 TH SEPT , 201 4 O R D E R PER R.C.SHA RMA ( A .M.) : TH ESE ARE THE CROSS APPEALS FILED BY THE REVENUE AND ASSESSEE AGAINST THE ORDER OF CIT(A ) DATED 24 - 9 - 2013, IN THE MATTER OF ORDER PASSED U/S. 158BC(C) OF THE I.T. ACT FOR THE BLOCK PERIOD 01 - 04 - 1989 TO 08 - 07 - 1999 . IT (SS) A NO S . 802&820 / 03 2 2 . WE HAVE HEARD RIVAL CONTEN TIONS AND PERUSED THE RECORD. BRIEF FACTS OF THE CASE ARE THAT A SEARCH AND SEIZURE ACTION WAS INITIATED U/S. 132(1) OF THE INCOME - TAX ACT, 1961 IN THE PREMISES OF S HRI NANJI THAKKAR, SHRI MAGANLAL THAKKAR, SHRI PRABHULAL KHIMJI THAKKAR, S HRI VALJI KANJI T HAKKAR AND THEIR FAMILY MEMBERS ON 28.07.1999. THE SEARCH WAS CONCLUDED ON 30 .07.1999 AND A PANCHNAMA DATED 30. 07.1999 WAS DRAWN UP. SIMUL TANEOUSLY, A RESTRAINT ORDER U/ S. 132(3) OF THE ACT PLACED ON FLAT NO. 403 AT LANDMARK BULDING, DEVIDAYAL ROAD, MULUND, WHICH DID NOT BELONG TO THE ASSESSEE AND ASSESSEE HAD GIVEN ONLY ADVANCE AMOUNT OF RS.10,000/ - TO THE BUILDER OF LANDMARK BUILDING . THEREAFTER SEARCH PARTY AGAIN VISITED THE PREMISES AND PREPARED PANCHNAMA ON 8 - 9 - 1999. HOWEVER, NOTHING WAS FOUND NOR SEIZE D ON 8 - 9 - 1999. THE QUESTION AROSE AS TO THE LIMITATION PERIOD OF ASSESSMENT DATED 31 - 8 - 2001 WHETHER TO BE COUNTED FROM 30 - 7 - 1999 OR 8 - 9 - 1999. 3 . THE AO FRAMED ASSESSMENT U/S. 158BC MAKING VARIOUS ADDITIONS. IN AN APPEAL FILED BY THE ASSESSEE BEFORE THE CIT (A), SOME OF THE ADDITIONS WERE DELETED AND SOME OF THE ADDITIONS WERE CONFIRMED BY THE CIT(A). AGAINST THE ORDER OF THE CIT(A), BOTH ASSESSEE AND REVENUE ARE IN APPEALS BEFORE US. 4. IN THIS APPEAL, ASSESSEE HAS BASICALLY ARGUED THE GROUND WITH REGARD TO EXPIRY OF LIMITATION PERIOD FOR COMPLETION OF BLOCK ASSESSMENT U/S. 158BE. WE FOUND THAT EXACTLY SIMILAR ISSUE WAS DECIDED BY THE COORDINATE BENCH IN THE CASE OF OTHER GROUP MEMBERS, NAMELY , SHRI NANJI K. THAKKAR, MRS. DHANLAXMI N. THAKKAR, SHRI PARESH N. T HAKKAR. ETC. IT (SS) A NO S . 802&820 / 03 3 VIDE ORDER DATED 5 - 9 - 2014 HAVING EXACTLY SIMILAR FACTS. THE CONCLUSION OF THE COORDINATE BENCH WAS AS UNDER : - 4 . GROUNDS TAKEN BY THE ASSESSEE BEFORE THE CIT(A) WITH REGARD TO BLOCK ASSESSMENT COMPLETED AFTER EXPIRY OF LIMITATION PERIOD AS L AID DOWN U/S. 158BE OF THE ACT WAS DECIDED BY THE CIT(A) AGAINST THE ASSESSEE. IN APPEAL BEFORE US, THE ASSESSEE HAS BASICALLY ARGUED THE GROUND WITH REGARD TO EXPIRY OF LIMITATION PERIOD FOR COMPLETION OF BLOCK ASSESSMENT U/S. 158BE. THE REVENUE IS BEFORE U S WITH REGARD TO THE ADDITIONS DELETED BY CIT(A). 5 . FIRST, WE SHALL TAKE THE GROUND TAKEN BY THE ASSESSEE WITH REGARD TO THE VALIDITY OF BLOCK ASSESSMENT COMPLETED IN TERMS OF PROVISIONS OF SECTION 158BC OF THE I.T. ACT. 6 . LEARNED AR AT THE OUTSET PLACE ON RECORD ORDER OF THE TRIBUNAL IN CASE OF ANOTHER FAMILY MEMBERS SHRI VAJI KANJI THAKKAR, WHO WAS PART OF THE SAME SEARCH, WHEREIN THE TRIBUNAL HAS DECIDED THE ISSUE ON TIME BARRING IN FAVOUR OF THE ASSESSEE. LEARNED AR ALSO PLACED ON RECORD DECISION OF I TAT SPECIAL BENCH IN THE CASE OF M/S SHREE RAM LIME PRODUCTS, 137 ITD 220 AS WELL AS THE DECISION OF THE VARIOUS HIGH COURTS ON SIMILAR ISSUE. OUR ATTENTION WAS INVITED TO THE DECISION OF THE HON BLE KARNATAKA HIGH COURT IN THE CASE OF CHILDRENS EDUCATION SOCIETY, 2009 - (017) - DTR - 0194 - KAR , WHEREIN EXACTLY SIMILAR ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE. THE DEPARTMENT FILED AN SLP AGAINST THE SAID ORDER OF KARNATAKA HIGH COURT BEFORE THE HONBLE APEX COURT AND THE HONBLE SUPREME COURT DISMISSED THE SAM E VIDE ITS ORDER DATED 17 - 7 - 2009. OUR ATTENTION WAS ALSO INVITED TO THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF S.K.KATYAL, 308 ITR 168 , IN THIS CASE, ALSO DEPARTMENTS SLP WAS DISMISSED BY THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. R ANJANAN KATYAL, 322 ITR 4 (ST.) . LEARNED AR ALSO INVITED OUR ATTENTION TO THE FOLLOWING DECISION S IN WHICH IT WAS HELD THAT LIMITATION STARTS ON THE DATE O N WHICH THE LAST DATE OF AUTHORIZATION IS EXECUTED : - 1. CIT V. MRS. SANDHYA P. NAIK AND OTHERS [25 3 ITR 534 (BORN)] 2. DCIT V. ADOLF PATRI C PINTO [100 ITD 191 (MUM)] - AFFIRMED BY BOMBAY HIGH COURT IN INCOME - TAX APPEAL O. 856 OF 2008 DATED 05.09.2008 - SLP DISMISSED VIDE 322 ITR (ST) 3 3. S. K. KATYAL THROUGH L/H MRS. RANJANA KAY TAL V. DCIT [111 TT J 8 (DEL)] - AFFIRMED IN 308 ITR 168 (DEL) - SLP DISMISSED VIDE 322 ITR (ST) 4 4. CIT V. RAJINDER KASHYAP [2011 - TIOL - 785 - DEL - IT] 5. SMT. MEENA WADHWA V. DCIT [128 TAXMAN (MAG.) 149 (DEL)] 6. M. SIVARAMAKRISHNAIAH & CO. V. ACIT [93 TTJ 1035 (VISAKHA)] 7. ACIT V. WHITE & WHITE MINERA L (P.) LTD. [114 TTJ 405 (JD)] 7 . ON THE OTHER HAND, LEARNED DR RELIED ON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF VLS FINANCE LTD. VS. CIT, 289 ITR 286(DEL.) AND CONTENDED THAT ASSESSMENT WA S NOT BARRED BY LIMITATION U/S.158BE. 8 . WE HAVE CONSIDERED RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW . WE HAVE ALSO DELIBERATED ON THE JUDICIAL PRONOUNCEMENTS CITED AT BAR BY LD. AR AND LD. DR DURING THE COURSE OF HEARING BEFORE US. F ROM THE RECORD WE FOUND FROM THAT A SEARCH AND SEIZURE ACTION WAS INITIATED U/S. 132(1) OF THE INCOME - TAX ACT, 1961 IN THE IT (SS) A NO S . 802&820 / 03 4 PREMISES OF S HRI NANJI THAKKAR, SHRI MAGANLAL THAKKAR, S HRI PRABHULAL KHIMJI THAKKAR, S HRI VALJI KANJI THAKKAR AND THEIR FAMILY MEMBE RS ON 28.07.1999. THE SEARCH WAS CONCLUDED ON 29.07.1999 AND A PANCHNAMA DATED 29.07.1999 WAS DRAWN UP. SIMULTANEOUSLY, A RESTRAINT ORDER UL S. 132(3) OF THE ACT WAS PASSED AND WAS PLACED ON THE CUPBOARD WHEREIN CERTAIN PAPERS FOUND DURING THE SEARCH WERE KEPT. THEREAFTER ON 17.08.1999, THE SEARCH PARTY VISITED THE HOUSE AND OPENED THE CUPBOARD, VACATED THE RESTRAINT ORDER U / S 132(3) OF THE ACT AND PREPARED A PANCHNAMA DATED 17.08.1999. I N THE SAID PANCHNAMA IT WAS STATED THAT THE PROCEEDINGS WERE COMMENCED AT 1.05 P.M. AND CONCLUDED AT 1.45 P.M. FURTHER, NEITHER ANY SEIZURE WAS MADE NOR ANY STATEMENT WAS RECORDED ON 17.08.1999 . BASED ON THE ABOVE PACHNAMA, THE AO PASSED THE ORDER U/ S 158BC OF THE ACT ON 29.08.2001. THE ASSESSEE HAS CHALLENGED THE VALIDITY O F THE ORDER PASSED BY THE AO ON THE PLEA THAT THE ORDER PASSED BEYOND TIME LIMIT PRESCRIBED U/S. 158BE . A S PER PROVISIONS OF SECTION 158BE, THE TIME LIMIT FOR THE PASSING THE ASSESSMENT ORDER AS PER S. 158BE OF THE ACT IS WITHIN TWO YEARS FROM THE END OF T HE MONTH IN WHICH THE LAST AUTHORIZATIONS F OR SEARCH U/ S 132 WAS EXECUTED. FURTHER AS PER EXPLANATION 2(A) TO S. 158BE OF THE ACT, AUTHORIZATION SHALL BE DEEMED TO HAVE BEEN EXECUTED IN THE CASE OF SEARCH, ON THE CONCLUSION OF SEARCH AS RECORDED IN THE LAS T PANCHNAMA DRAWN IN RELATION TO ANY PERSON IN WHOSE CASE THE WARRANT OF AUTHORIZATION HAS BEEN ISSUED. IN THE INSTANT CASE BEFORE US, WE FOUND THAT THE LAST PANCHNAMA WAS DRAWN UP ON 17.08.1999 , WHEN THE PROCEEDINGS LASTED FOR ONLY 40 MINUTES AND ON THAT DATE NO ACTUAL SEARCH TOOK PLACE, NOR ANY DOCUMENTS WERE SEIZED NOR ANY STATEMENT WAS RECORDED. THE SEARCH PARTY ON THAT DAY MERELY OPENED THE CUPBOARD AND VACATED THE RESTRAINT ORDER. ACCORDINGLY, THE SEARCH WHICH COMMENCED ON 28TH/29TH .07.1999 WAS EFFEC TIVELY COMPLETED ON 29.07.1999. THE RESTRAINT ORDER PASSED U/ S 132(3) DATED 29.07.1999 WHICH WAS FINALLY VACATED ON 17.08.1999 IS NOT A PANCHNAMA IN THE EYES OF LAW. WE ALSO FOUND THAT THE ENTIRE PROCEEDINGS ON THAT DAY LAST ED ONLY FOR 40 MINUTES, WHEREIN NEITHER ANY SEIZURE WAS MADE NOR STATEMENT OF ANY PERSON WAS RECORDED ON THAT DATE. AS THE SEARCH WAS EFFECTIVELY COMPLETED ON 29.07.1999, THE TIME LIMIT FOR PASSING THE ASSESSMENT ORDER AS PER SECTION 158BE OF THE ACT WAS 31.07.2001 , WHEREAS THE ASSESSME NT ORDER WAS PASSED BY THE AO ON 29.08.2001 AND HENCE IS TIME BARRED AND BAD IN LAW. 9 . THE CONTENTION OF LEARNED DR WAS THAT SEARCH WAS TEMPORARILY SUSPENDED ON 29.07.1999 AND WAS FINALLY CONCLUDED ON 17.08.1999 AND , HENCE , THE TIME LIMIT FOR PASSING TH E ASSESSMENT ORDER HAS TO BE DETERMINED FROM THE LAST DRAWN PANCHNAMA I.E. 17.08.1999. M ERELY BECAUSE A PANCHNAMA IS DRAWN UP ON A PARTICULAR DATE, IT DOES NOT MEAN THAT A SEARCH WAS CONDUCTED AND CONCLUDED ON THAT DATE. THE PANCHNAMA IS ON RECORD OF SEARC H OR SEIZURE FOR IT TO QUALIFY AS PANCHNAMA MENTIONED IN EXPLANATION 2(A) TO S. 158BE R.W.S. 132(13) OF THE ACT AND RULE 112 . WE FOUND THAT IN THE CASE OF ANOTHER FAMILY MEMBER SHRI VAJI KANJI THAKKAR, WHO WAS ALSO PART OF THE SAME SEARCH, THE TRIBUNAL HAS DECIDED THE ISSUE OF TIME BAR IN FAVOUR OF THE ASSESSEE. THE PRECISE OBSERVATION OF THE TRIBUNAL WAS AS UNDER : - IT (SS) A NO S . 802&820 / 03 5 A CAREFUL STUDY OF THE ABOVE PROVISIONS WILL SHOW THA T BLOCK ASSESSMENT U/ S 158BC HAS TO BE COMPLETED. WITHIN 2 YEARS FROM THE END OF THE MON TH IN WHICH THE LAST OF THE AUTHORIZATION FOR SEARCH U/ S 132 OF THE ACT WAS EXECUTED. AS PER EXPLANATION 2, THE AUTHORIZATION REFERRED IN SUB SECTION (1) OF SECTION 158BE SHALL BE DEEMED TO HAVE BEEN EXECUTED IN THE CASE OF SEARCH ON THE CONCLUSION OF SEAR CH AS RECORDED IN T HE LAST P ANCHANARNA DRAWN IN RELATION TO ANY PERSON IN WHOSE CASE, THE WARRANT OF AUTHORIZATION HAS BEEN ISSUED AND IN THE TERMS OF RULE 112(7) OF INCOME - TAX RUL ES, 1962 , A PANCHAN AM A IS REQUIRED TO B E DRAWN ONLY IN CASE OF SEIZURE. CONS EQUENTLY, AN ORDER U/S 1 32(3) IS NOT A PANCHANARNA AS HAS BEEN REFERRED TO IN SECTION 158BE OF INCOME - TAX ACT . IN THE PRESENT CASE, THE SEARCH WAS COMMENCED ON 28 - 7 - 1999 AND PANCHNAMA WAS DRAWN ON 29 - 7 - 1999 . THEREFORE, THE ASSESSMENT WAS TO BE COMPLETED BY 31 - 7 - 2001 WHEREAS THE ASSESSMENT IN THE PRESENT CASE HAS BEEN COMPLETED ON 31 - 8 - 2001. THEREFORE, THE ASSESSEE WAS BARRED BY LIMITATION. THE CONTENTION OF THE LEARNED DEPARTMENTAL REPRESENTATIVE THAT THERE WAS EXTENSION OF SEARCH WITH THE ISSUANCE OF RESTR AINED ORDER U/S. 132(3) CANNOT BE ACCEPTED BECAUSE OF INSERTION OF EXPLANATION TO SECTION 132(3) WITH EFFECT FROM 01 - 07 - 1995 TO THE EFFECT T6HAT A RESTRAINED ORDER DOES NOT AMOUNT TO SEIZURE AND IF THERE IS NO SEIZURE, PANCHNAMA CANNOT BE DRAWN. AS IT HAPPE NED IN THE PRESENT CASE, THERE WAS NO SEIZURE ON 17 - 08 - 1999. CONSEQUENTLY. FOR ALL PRACTICAL PURPOSES, SEARCH WAS CONCLUDED ON 29 - 07 - 1999 ITSELF, SO THE LIMITATION PERIOD HAS TO BE COUNTED FROM T HAT DATE ONLY I.E. FROM 29 - 7 - 99 AND NOT FROM 17 - 08 - 1999. THE REFORE THE IMPUGNED ASSESSMENT ORDER DATED 30 - 8 - 2001 IS BARRED BY LIMITATION AND, HENCE, INVALID. THE CASE OF THE ASSESSEE IS COVERED BY THE RATIO OF T HE DECISION OF THE JURISDICTIONAL HIGH COURT IN SANDHYA P NAYAK (SUPRA) , WHEREIN THE HONBLE BOMBAY HIGH COURT HELD AS UNDER : - ACTION UNDER SECTION 132(3) OF THE INCOME - TAX ACT, 1961, CAN BE RESTORED TO, ONLY IF THERE IS ANY PRACTICAL DIFFICULTY IN SEIZING THE ITEM WHICH IS LIABLE TO BE SEIZED. WHEN THERE IS NO SUCH PRACTICAL DIFFICULTY THE OFFICER IS LEFT WITH NO OTHER ALTERNATIVE BUT TO SEIZE THE ITEM, IF HE IS OF THE VIEW THAT IT PRESENTS UNDISCLOSED INCOME . P OWER UNDER SECTION 132(3) OF THE ACT CANNOT BE EXERCISED SO AS TO CIRCUMVENT THE PROVISIONS OF SECTION 132(3) READ WITH SECTION 132(5) OF THE ACT. THE POSITION HAS BECOME MUCH MORE CLEAR AFTER THE INSERTION OF THE EXPLANATION TO SECTION 132(3) EFFECTIVE FROM JULY, 1995, THAT A RESTRAINT ORDER DOES NOT AMOUNT TO SEIZURE. THEREFORE, BY PASSING A RESTRAINT ORDER, THE TIME LIMIT AVAILABLE FOR FRAMING OF THE ORDER CANNOT BE EXTENDED. SINCE THE APPEAL HAS BEEN DECIDED ON PRELIMINARY GROUND, IT IS NOT CONSIDERED NECESSARY TO ADJUDICA TE UPON OTHER GROUNDS ON MERIT. 1 0 . THE ITAT SPECIAL BENCH IN THE CASE OF M/S SHREE RAM LIME PRODUCTS (SUPRA), HAVE DEALT WI TH THIS ISSUE AND HELD THAT IF THE PANCHNAMA DOES NOT REVEAL THAT A SEARCH WAS CARRIED OUT ON THE DATE TO WHICH IT RELATES THEN IT WOULD NOT BE A PANCHNAMA RELATING TO A SEARCH AND CONSEQUENTLY IT WOULD NOT BE A PANCHNAMA WHICH FINDS MENTIONED IN EXPLANATI ON 2 TO SECTION 158BE. IT WAS FURTHER OBSERVED THAT IT IS THIS PROPOSITION WHICH HAS BEEN UPHELD BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. WHITE & WHITE MINERALS PVT. LTD., 239 CTR 330 . RELIANCE PLACED BY LEARNED DR ON THE DECISION OF VLS FINANCE LIMITED (SUPRA), IS NOT APPLICABLE TO THE FACTS OF THE INSTANT CASE INSOFAR AS IN THE SAID JUDGMENT IT WAS NOT THE CASE OF THE ASSESSEE THAT THE LAST PANCHNAMA WAS NOT THE PANCHNAMA IN THE EYES OF LAW. THE CASE OF THE IT (SS) A NO S . 802&820 / 03 6 ASSESSEE WAS THAT THE DEP ARTMENT OFFICERS HAVE UNDULY PROLONGED THE SEARCH PROCEEDINGS DUE TO MALAFIDE INTENTIONS. HOWEVER, IN THE INSTANT CASE BEFORE US, IT IS NOT THE CASE OF THE ASSESSEE THAT THE DEPARTMENT HAD MALAFDIE INTENTIONS BEHIND THE SEARCH. IN THE ENTIRE JUDGMENT, ONE WOULD NOT FIND ANY MENTION ABOUT NON - SEIZURE/INVENTORY OF DOCUMENT ON THE LAST DATE OF PANCHNAMA. ACCORDINGLY, THE SAID DECISION RELIED ON BY THE LEARNED DR IS ON DIFFERENT SET OF FACTS AND NOT APPLICABLE TO THE FACTS OF THE INSTANT CASE BEFORE US. FURTHER MORE, T HE HONBLE DELHI HIGH COURT IN SUBSEQUENT DECISION OF S.K.KATYAL (SUPRA) , HAD CONSIDERED THE DECISION IN THE CASE OF VLS FINANCE LTD. (SUPRA) , AND HAVE DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE AND THEREAFTER AN SLP FILED BY THE DEPARTMENT AGAINST THE SAME BEFORE THE HONBLE SUPREME COURT HAS ALSO BEEN DISMISSED. SIMILARLY THE SPECIAL BENCH OF ITAT JODHPUR IN THE CASE OF M/S SHREE RAM LIME PRODUCTS (SUPRA) , HAS ALSO CONSIDERED THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF VLS FINANCE LTD. (SUPRA) , BEFORE ARRIVING AT THE CONCLUSION WITH REGARD TO LIMITATION FOR COMPLETION OF ASSESSMENT U/S.158BE, EXPLANATION 2(A). SIMILARLY, THE THIRD MEMBER DECISION OF ITAT MUMBAI IN THE CASE OF NANDLAL M. GANDHI VS. ACIT, 118 TTJ 289 HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE ON THIS ISSUE AFTER CONSIDERING THE DECISION OF VLS FINANCE LTD. (SUPRA) . 1 1 . AS THE FACTS AND CIRCUMSTANCES IN THE CASE OF ALL THE FAMILY MEMBERS ARE PARI MATERIA, RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNAL IN THE CASE OF ONE OF THE FAMILY MEMBERS NAMELY SHRI VAJI KANJI THAKKAR (SUPRA) , WHO WAS PART OF THE SAME SEARCH , AS WELL AS DECISION OF THE ITAT SPECIAL BENCH AS WELL AS VARIOUS HIGH COURTS AS MENTIONED ABOVE, WE FOUND THAT THE ORDER PASSED BY THE AO WAS BEYOND LIMITATI ON PERIOD PRESCRIBED U/S. 158BE OF THE ACT. THEREFORE, THE SAME ARE SET ASIDE AND THE APPEALS OF THE ASSESSEE ON THIS GROUND ARE ALLOWED. IN THE INSTANT CASE BEFORE US, WE FOUND THAT LAST PANCHNAMA WAS DRAWN ON 8 - 9 - 1999, ON THAT DATE, NO ACTUAL SEARCH TOO K PLACE N OR ANY DOCUMENT WAS SEIZED. ACCORDINGLY, THE SEARCH WHICH COMMENCED ON 28 TH /29 TH JULY, 1999 , WAS EFFECTIVELY COMPLETED ON 30 - 7 - 1999. THE RESTRAIN ORDER PASSED U/S. 132(3) DATED 30 - 7 - 1999, WHICH WAS FINALLY VACATED ON 8 - 9 - 1999 , IS NOT A PANCHNAMA IN THE EYES OF LAW. AS THE SEARCH WAS EFFECTIVELY COMPLETED ON 30 - 7 - 1999, THE TIME LIMIT FOR PASSING THE ASSESSMENT ORDER AS PER SECTION 158BE OF THE ACT WAS 31 - 7 - 2001, WHEREAS THE ASSESSMENT ORDER WAS PASSED BY THE AO ON 31 - 8 - 2001, HENCE, TIME BARRED AND BAD IN LAW. IT (SS) A NO S . 802&820 / 03 7 5 . AS THE FACTS AND CIRCUMSTANCES IN THE INSTANT CASE BEFORE US ARE EXACTLY SIMILAR, RESPECTFULLY FOLLOWING THE SAME, WE ALLOW THE APPEAL ON THE GROUND OF LIMITATION OF THE ORDER PASSED U/S. 158BC R.W.S.158BE OF THE ACT. 6. AS WE HAVE ALREADY A NNULLED THE ASSESSMENT ON THE GROUND OF LIMITATION, WE ARE NOT GOING TO DEAL WITH THE ADDITIONS DELETED BY CIT(A), AGAINST WHICH THE REVENUE IS IN APPEAL BEFORE US. 7 . IN THE RESULT, APPEAL OF THE ASSESSEE (I.E. ITA NOS. 802 /MUM/2003) IS ALLOWED IN TERMS IN DICATED HEREINABOVE , WHEREAS APPEAL OF THE REVENUE (I.E. ITA NOS. 820 /MUM/2003) IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 24 /09 / 201 4 . 24 /09 /2 014 SD/ - SD/ - ( ) ( SANJAY GARG ) ( ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 24 /09 /2014 /PKM , PS COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( ASSTT. REGISTRAR) / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) - X, MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//