SHRI CHINTANKUMAR RAMESHBHAI PATEL,RAJKOT V. THE DCIT / ACIT CEN. CIR-1, , RAJKOT

ITSSA 78/RJT/2023

AI Insights

The case involves a series of appeals by Chintankumar Rameshbhai Patel and Princekumar Kantilal Rubara against the assessment orders issued by the Deputy Commissioner of Income Tax/Assistant Commissioner of Income Tax, Central Circle-1, Rajkot. The appeals were consolidated due to the commonality of issues across the cases, which pertained to the assessment years 2016-17 and 2017-18. The primary contention was the legality of the assessment orders passed under section 153C of the Income Tax Act, 1961, which were challenged on grounds of being time-barred. The Tribunal examined the procedural adherence to the statutory timelines for completing assessments under the said section and found discrepancies that led to the quashing of the orders.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 473476 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 4 month(s) 10 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 27-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 23-10-2024
• Assessment Year: 2016-2017
• Appeal Filed On: 17-07-2023
• Other Referred Cases: Collector, Land Acquisition vs Mst. Katiji and others, MAK Data Pvt. Ltd. vs. Commissioner of Income tax, Nazir Ahmed v. King Emperor, Ram Phal Kundu v. Kamal Sharma, Indian Bank's Association v. Devkala Consultancy Service, Orissa Rural Housing Development Corpn. Ltd vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY PUNGALIYA; LD.
• Assessee Lawyers: FENIL H. MEHTA
• Keywords: Condonation of delay; Question of law; Unexplained investment; Document seized; Documents seized; Period of limitation
• Section: 143(3); 142(1); 143(2); 250; 132; 153A; 68; 69; 12A; 69C; 69B; 69A; 153C; 73

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER AND SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER आयकर अपील (खोज और जÞती) सं./IT(SS)A No.78 & 79/ RJT/2023 (Assessment Years: 2016-17 to 2017-18) (Physical Hearing) Chintankumar Rameshbhai Patel, Chintan, block no. 243., Janakpuri Society, Street no. 7, Behind Sadhuvasvani School, University, Rajkot – 360005. Vs. The DCIT/ACIT, Central Circle – 1, Rajkot èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AXPPP2200B (अपीलाथȸ/Assessee) (Ĥ×यथȸ/4Respondent) आयकर अपील (खोज और जÞती) सं./IT(SS)A No.80 to 81/RJT/2023 (Assessment Years: 2016-17 to 2017-18) (Physical Hearing) Princekumar Kantilal Rubara 103, Rudra Prayag Apartment, Paradise Hall Main Road, Rajkot - 360005 Vs. The DCIT/ACIT, Central Circle – 1, Rajkot èथायीलेखासं./जीआइआरसं./PAN/GIR No.: APMPR9317Q (अपीलाथȸ/Assessee) (Ĥ×यथȸ/4Respondent) Ǔनधा[ǐरतीकȧओरसे/Assessee by : Shri Fenil H. Mehta, AR राजèवकȧओरसे/Respondent by : Shri Sanjay Pungaliya, Ld. CIT-DR I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 2 सुनवाईकȧतारȣख/ Date of Hearing : 23/10/2024 घोषणाकȧतारȣख/Date of Pronouncement : 27/11/2024 आदेश / ORDER PER ARJUN LAL SAINI, AM: This is the bunch of four appeals for assessment years (AYs) 2016-17 to 2017-18, filed by the different assessee in IT(SS)A No.78 to 79/Rjt/2023 and in IT(SS)A Nos.80 to 81/Rjt/2023. All these appeals filed by the different Assessees, are directed against the separate orders passed by the Learned Commissioner of Income Tax (Appeals), which in turn arise out of separate assessment orders passed by the Assessing Officer (in short ‘AO’) u/s 143(3) r.w.s 153C of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). 2. Since, the issues involved in all the appeals are common and identical; therefore, these appeals have been heard together and are being disposed of by this consolidated order. For the sake of convenience, the grounds as well as the facts narrated in IT(SS)A No.78/Rjt/2023, for assessment Year 2016-17, in case of Chintan Kumar Rameshbhai Patel, have been taken into consideration for deciding the above appeals en masse. 3. The grounds of appeal raised by the assessee as per ‘lead case’ in IT(SS)A No. 78/Rjt/2023, for assessment year (AY).2016-17, are as follows: “1. That the learned A.O. has grievously erred in law and on facts in passing the assessment order u/s 153C of the Act, after the end of time limit for completion of assessment u/s 153C of the Act, as specified u/s 153B of the Act and hence the assessment order is bad and illegal being barred by limitation. 2. That the learned CIT(Appeals) has grievously erred in law and on facts in rejecting the ground of the assessee that assessment order is time barred as no tax payable is determined as well as no notice of demand u/s 156 of the Act is served to I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 3 the assessee and hence assessment order is bad and illegal being barred by limitation or otherwise. 3. That the learned CIT(Appeals) has grievously erred in law and on facts in upholding the action of the learned A.O. even in taxing the alleged unexplained investment in the hands of the Assessee particularly when it is alleged to be the expenditure of the V R Infosystem LLP, in which the Assessee is a partner. 4. That the learned CIT(Appeals) has grievously erred in law and on facts in upholding the action of the learned A.O. in taxing the alleged amount as unexplained investment of the Assessee when no sufficient opportunity is provided to the Assessee 5. That the learned A.O. has grievously erred in law and on facts in assuming jurisdiction u/s 153C of the Act. 6. That the assessee craves leave to add, amend, alter, vary and / or withdraw any or all the above grounds of Appeal.” 4.The assessee also raised additional grounds of appeal, which are reproduced below: “1. That the learned A.O. has grievously erred in law and on facts in passing the assessment order u/s 153C of the Act after the end of time limit for completion of assessment u/s 153C of the Act, as specified u/s 153B of the Act and hence the assessment order is bad and illegal being barred by limitation. 2. That the learned CIT(Appeals) has grievously erred in law and on facts in upholding the action of the learned A.O. even in taxing the alleged unexplained investment in the hands of the Assessee particularly when it is alleged to be the expenditure of the V R Infosystem LLP, in which the Assessee is a partner. 3. That the learned AO has grievously erred in law and on facts in assuming jurisdiction u/s 153C of the Act. The assessee reserves its right to add, amend, alter or modify any of the grounds stated hereinabove either before or at the time of hearing.” 5.The appeal filed by the assessee [in IT(SS)A No.78/Rjt/2023-lead case] and appeal in IT(SS)A No. 79/Rjt/2023, both are barred by limitation by 76 days. Appeal filed by the assessee [in IT(SS)A No.80/Rjt/2023] and appeal [in IT(SS)A No.81/Rjt/2023] both are barred by limitation by 73 days. In all the appeals, the sufficient cause explained by the assessee, are similar and I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 4 identical. We have gone though the petition of condonation of delay in all these appeals and find that the reasons explained by these assessees are similar, therefore, as a sample, the reasons explained in IT(SS)A No. 79/Rjt/2023, for condonation of delay, are reproduced below: “1. It is respectfully submitted that the Applicant herein has filed appeal. However, an apparent delay has occurred in filing the appeal before this Hon’ble Bench. Hence, this application of the condonation of delay. 2. The period of limitation for filling the appeal under section 253(3) of the Income Tax Act, 1961 is sixty days of the date on which the order sought to be appealed against is communicated to the assessee or to the Principal Commissioner or commissioner as the case may be. 3. It is submitted that order of the CIT(A) u/s 250 of that Act dated 03.03.2023, which is the order appealed against is not served on the registered email address namely [e-mail] of the assessee and therefore assessee was not aware of the fact that order u/s 250 is passed. Even in the appeal memo form no.35, the email address namely [e-mail] is stated for communication. Despite that the said order is served only on the old email address namely [e-mail] which is of earlier consultant. (Copy of the screenshot of the portal showing registered email address namely [e-mail], copy of the form no.35 and screenshot of the portal showing the service of the said order on an old email address namely [e-mail] of earlier consultant are hereto annexed and marked as Annexure A, B and C respectively) 4. It is pertinent to mention here that the notice of hearing u/s 250 of the Act has been served on both the email addresses namely [e-mail] and [e-mail], however the order u/s 250 of the Act has not been served on the registered email address namely [e-mail] of the Assessee.(Copy of screenshot of the portal showing service of notice of hearing u/s 250 of the Act on both the email addresses are hereto annexed and marked as Annexure - D) 5. It is further submitted that only on 01.07.2023 the Assessee came to know about the fact that appellate order u/s 250 of the Act is passed, when the assessee has logged into his account on portal to know the status of the appeal filed. 6. Therefore, in the light of the above stated reason the appeal could not be filed in time and thus a delay has taken place. Hence, there is an appropriate and sufficient reason to condone the delay. 7. From the above facts, it is most respectfully submitted that when substantial justice and technical considerations are pitted against each other, the cause of I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 5 substantial justice deserves to be preferred, the other side cannot claim to have vested right in injustice being done because of non-deliberate delay. It is further submitted that the appeal may kindly be decided on merits rather than rejecting the same on the ground of delay and latches as the cause of substantial justice shall prevail over the technical considerations.” 6. Learned Counsel for the assessee, submitted that similar and identical contents are existed in the petition for condonation of delay, in case of other appeals also, therefore, a consolidated order, in case of delay in filing these appeals, may be passed, by this Tribunal, as the sufficient cause explained by these assessee`s are similar and identical. The ld. Counsel stated that order appealed against is not served on the registered email address of “[e-mail]” of the assessee and therefore assessee was not aware of the fact that order u/s 250 of the Act, by the Commissioner of Income tax( appeals) was passed or not. Even in the appeal memo form no.35, the email address namely [e-mail] is stated for communication. Despite that the said order is served only on the old email address namely ‘[e-mail]’ which is of earlier consultant. (Copy of the screenshot of the portal showing registered email address namely [e-mail], copy of the form no.35 and screenshot of the portal showing the service of the said order on an old email address namely [e-mail] of earlier consultant were filed by the assessee before the Bench.). The Ld. Counsel for the assessee argued that assessee has explained the sufficient cause/reason in the petition for condonation of delay and therefore, in the interest of justice, the delay may be condoned. The Ld. Counsel for the assessee argued that reasons mentioned in the petition for condonation of delay are sufficient to condone the delay, therefore, the minor delay, in all these appeals, may be condoned. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 6 7. On the other hand, Learned Commissioner of Income-tax - Departmental Representative (Ld. CIT-DR) opposed the prayer of the assessee to condone the delay and stated that delay should not be condoned on such flimsy reasons. The assessee, has explained only one reason stating that order passed by the learned CIT(A) was delivered, on the email-id of old tax consultant, who in turn, did not inform the assessee, is not a sufficient cause, to condone the delay, hence, delay should not be condoned in all these appeals, and these all appeals should be dismissed. 8.We have heard both the parties on this preliminary issue. We are of the view that provisions of law have to be adhered strictly and that one cannot be allowed to act in leisure and make a mockery of enacted law, because law and provisions are laid down to benefit both sides of litigation. Be that as it may, we have to do justice and the Hon’ble Supreme Court in the case of Collector, Land Acquisition vs Mst. Katiji and others, reported in 167 ITR 471, (1988 SC 897) (7) has observed as follows: “4. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non- deliberate delay.” 9. When we weigh these aspects then the side of justice becomes heavier and casts a duty on us to deliver justice. We note that the reasons given in the affidavit for condonation of delay were convincing and these reasons would constitute reasonable and sufficient cause for the delay in filing these appeals. We also note that the sufficient cause or the reasons explained by these assessees, in the petition for condonation of delay, are identical and similar. We, therefore, condone the delay and admit these appeals for hearing. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 7 Facts of the assessee`s case. 10. The facts of the case which can be stated quite shortly are as follows: The assessee, before us, is an individual and has filed his return of Income u/s 139(1) of the Act, on 04.03.2017, declaring total income at Rs. 2,85,620/-. A search action u/s 132 of the Act was carried out at the residential premises of Shri Dignesh Rajeshbhai Patel, located at 4, 5, 6 \"Matushree\", Rajhans Colony, Dharoi Canal Road, Visnagar. Further, during the post search investigation, enquiries of digital data, extracted from the 1-phone 6s was done. During the enquiry some of the incriminating images, pertaining to the assessee were also found. All such documents were duly analyzed either during the course of search action or during post search enquiries. On analysis of the said images, it has been found that the assessee has made unaccounted transactions. During the course of assessment proceeding u/s 153A, in the case of Shri Dignesh Patel, a satisfaction note was recorded, considering all the facts of the case. Again, a satisfaction also recorded, in accordance to the provision of the Income Tax Act 1961, by the jurisdictional assessing officer and notice u/s 153C was issued, which were duly served upon the assessee. Copy of the satisfaction note and Seized documents have also supplied to the assessee. Notice u/s 153C of the Act was issued on 18.03.2021, which was duly served upon the assessee through registered e-mail. The return of income was required to be filed within 7 days of the receipt of the notice. In response to the notice u/s 153C of the Act, assessee has filed his return of income, on 30.03.2021, showing therein income of Rs. 3,21,950/-. Further detailed questionnaire was issued on 25.03.2021, along with notices issued u/s 142(1) of the Act. A notice u/s 143(2) of the Act was issued on 12.04.2021, which was served upon the assessee. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 8 11.In response to the above notice/questionnaire, the assessee has submitted his submissions, before the assessing officer. During the assessment proceedings, the assessing officer noticed that the assessee is a 10% partner in a Limited Liability Partnership- firm, named, as M/s VR Infosystem LLP. Shri Dignesh Patel is also a 35% partner in the said concern. During the course of digital data analysis of the images recovered from the mobile phone (i-phone - 6S) of Shri Dignesh Patel, it was noticed that images represent the expense incurred by the partner on behalf of the M/s VR Infosystems LLP. The analysis of the files shows that the partners have incurred cash expense of Rs.36,02,400/-. When the transactions mentioned in the above referred pages were matched with the books of the concerned firm, and it was found that expense of Rs.3,53,670/- and Rs. 10,55,095/- were not recorded in the books of accounts of M/s VR Infosystems LLP. As, the share of the assessee is 10%, therefore, the assessee must have incurred unaccounted expense on behalf of firm of Rs.35,367/- and Rs.1,05,509/-. In this regards a show cause notice was issued to the assessee, whereby he was requested to explain the contents of the I-phone images and prove whether the same are accounted in his books. The show cause notice is produced below: “The assessment proceedings in your case for FY 2015-16 relevant to AY 2016-17 are under progress with this office. In continuation with the earlier notices and after considering the submissions filed till date, following further explanation is required before finalization of the ongoing assessment- On verification of the ITR filed for the year under consideration u/s 153C of the Act, it is noticed that you have considered Rs. 35,367/- being your share in the expenditures incurred for your partnership firm M/s VR info System LLP and paid the taxes thereon as per normal slab rates applicable to Individuals. In this regard, kind attention is invited towards the provisions of section 69B of the Income tax Act. Since, the expenses incurred on behalf of the firm have been unaccounted (not offered for taxable income till notice u/s 153C was issued) the same are to be charged to tax as per the provisions of section 1158BE of the Income-tax Act.” I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 9 Section 1158BE as it stood for the year under consideration stipulates as under- \"Tax on income referred to in section 68 or section 69 or section 69A or section 69B or section 69C or section 69D. 115BBE. (1) Where the total income of an assessee includes any income referred to in section 68, section 69, section 69A, section 69B, section 69C or section 69D, the income-tax payable shall be the aggregate of- (a) the amount of income-tax calculated on income referred to in section 68, section 69, section 69A, section 69B, section 69C or section 69D, at the rate of thirty per cent, and (b) the amount of income-tax with which the assessee would have been chargeable had his total income been reduced by the amount of income referred to in clause (a). (2) Notwithstanding anything contained in this Act, no deduction in respect of any expenditure or allowance shall be allowed to the assessee under any provision of this Act in computing his income referred to in clause (a) of sub-section (1).” Therefore, please show cause on or before 12.04.2021 as to why the sum of Rs.35,367/- should not be charged to tax at a special rate as per the provisions of section 115BBE of the Act as reproduced hereinabove.” 12. In response to the above, said show-cause notice, the assessee furnished following reply: 1.0 Return of income in response to notice u/s 153C of the Income Tax Act, 1961 ['the Act') for A.Y.2011-12 to 2017-18 have been filed on 30.03.2021. In the Return of Income, I have considered an income of Rs 35,367/-. Due tax on additional income has already been paid by me. 2.0 Point wise details/information as required vide notice u/s 142(1) of the Act are submitted separately. 3.0 In addition to above, it is submitted that I have been served with above mentioned show-cause notice in which you have proposed to apply section 115BBE on income offered by me of Rs. 35,367/-. In this respect it is submitted that whatever material found and seized are belongs to/pertaining to and relates to Sh. Dignesh Rajeshbhai Patel only. Statement given by him is bounding on him only. I cannot be made responsible for the acts/statement of Sh. Dignesh Rajeshbhai Patel unless he has been instigated by me or done with my knowledge or consent. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 10 However, to avoid long drawn litigation and purchase peace of mind, I have added Rs.35,367/- (10% of Rs.3,53,670/-) respectively in my return of income filed in response to notice u/s 153C of the Act. Therefore, you are requested not to charge to tax as per provisions of section 115BBE of the Act, income of Rs. 35,367/-,being offered by me for tax in my Return of income to avoid long drawn litigation and purchase peace of mind and consider the income at normal rate and oblige.” 13. However, the assessing officer, rejected the contention of the assessee and held that an income of the assessee of Rs.35,367/- should be treated as unexplained investment of the assessee in the partnership -firm, therefore, addition u/s 69B r.w.s. 115BBE was made in the hands of the assessee. Findings of the Learned, CIT(A) 14. Aggrieved by the order of assessing officer, the assessee carried the matter in appeal before Ld. CIT(A), who has confirmed the action of the assessing officer, observing as follows: “7.1 I have carefully considered the assessment order and submission of the assessee. It is observed that the only issue is whether the additional income disclosed by the assessee in return of income filed in response to notice u/s. 153C of the Act should taxed on special rate as specified in section 115BBE or not. In this case, the assessee had filed his original return of income u/s.139(1) of the Act on 04.03.2017 determining total income at Rs.2,85,620/-. Thereafter, a search action u/s.132 of the Act was carried out at the residential premises of Shri Dignesh Rajeshbhai Patel at Visnagar. During the course of search action, digital data was extracted from the I-phone 6S of Shri Dignesh Patel. On analysis of the said digital data, it was noticed that the partners on behalf of firm M/s. V. R. Infosystem LLP, had incurred cash expenses of Rs.3,60,240/-. When the transaction mentioned in the seized digital data were matched with the books of account of the said firm, it was noticed that expense of Rs.3,53,670/- for A.Y.2016-17 and Rs.10,55,095/- for A.Y.2017-18 were not recorded in the books of the account of M/s. V. R. Infosystem LLP. It is also noticed that Shri Dignesh Rajeshbhia Patel & the assessee Shri Chintan R. Patel were the partner of 35% & 10% respectively in the firm M/s. V. R. Infosystem LLP. Accordingly, notice u/s.153C of the Act was issued to the assessee, on 18.03.2021 and the assessee had filed return of income in response to the notice u/s 153C of the Act on 30.03.2021 showing total income of Rs.3,21,950/- including voluntary disclosed additional income of Rs.35,367/- (10% of total unexplained investment of Rs.3,53,670/-). The AO had also noticed that the CIT(A) had confirmed the addition of Rs. 1,23,784/- (35% of Rs.3,53,670/-) for A.Y.2016-17 and Rs.3,69,283/- (35% of Rs. 10,55,095/-) for A.Y.2017-18 in the hand of Shri I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 11 Dignesh Patel on the same issue. The AO had also noticed that in the ratio of partnership i.e. 10%, the assessee had voluntary disclosed the income of Rs.35,367/- (10% of Rs. 3,53,670/-) in the return of income filed u/s. 153C of the Act and the assessee had not explained the source of the said amount and shown the said income as income from other source. The AO had not accepted the claim of the assessee regarding showing the said income as income from other source because the assessee had not proved the same by appropriate evidences. Therefore, after considering the reply of show cause of the assessee, the AO had treated the said income of Rs. 35,367/- as unexplained investment of the assessee u/s.69B of the Act and taxed on special rate as per section 115BBE of the Act. 7.2 During the course of appellate proceedings, the assessee has stated that whatever material found and seized belonged to searched person only but to avoid long drawn litigation and purchase peace of mind the assessee offered Rs.35,367/- in return of income filed in response to notice u/s. 153C of the Act. Thus, the assessee cannot be penalized by applying higher rate of tax on Rs.35,367/-. 7.3 In this regard, it is observed that the assessee has taken plea that in order to buy Peace and to avoid long drawn litigation, he has already paid the tax along with interest on additional income offered amounting to Rs.35,367/-, I find that the claim of the assessee is not correct because the assessee was well aware of the facts that he had made unexplained investment in cash in the firm M/s. V. R. Infosystem LLP during the year under consideration and the said cash investment was not offered in the original return of income filed u/s.139(1) of the Act. Therefore, to cover up the issue of unexplained investment, the assessee had offered additional income of Rs.35,367/- in the return filed in response to notice u/s.153C of the Act subsequent to the search action conducted and related documents in the form of digital data was found & seized from the premise of his partner Shri Dignesh Patel. It is also important to mention here that the assessee had also failed to explain the reason for not incorporating the additional income of Rs.35,367/- in original return of income filed u/s.139(1) of the Act and no satisfactory details for the source of the said unexplained investment in cash was filed. Therefore, it is a clear-cut case of concealment of income in the form of additional income and the same should be treated as unexplained Investment u/s.69B of the Act in place of income from other source. 7.3.1 Reliance is placed on the decision of the Hon'ble Supreme Court of India in the case of MAK Data Pvt. Ltd. vs. Commissioner of Income tax [2014] 1 SCC 674 wherein Hon'ble court observed that \"the AO, in our view, shall not be carried away by the plea of the assessee like 'voluntary disclosure', 'buy peace', 'avoid litigation', 'amicable settlement etc., to explain away its conduct. The question is whether the assessee has offered any explanation for concealment of particulars of income or furnishing inaccurate particulars of income.\" 7.4 It is necessary to discuss about the section 115BBE of the Income Tax Act. Section 115BBE has been introduced in the statute by the Finance Act, 2012 with effect from 1.4.2013. In other words, the provisions of Section 115BBE are applicable with effect from assessment year 2013-14. Section 115BBE is a Section I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 12 contained in Chapter XII of the Act titled \"Determination of Tax in Certain Special Cases\". Title of Section 115BBE is \"Tax on income referred to in Section 68 or Section 69 or Section 69A or Section 69B or Section 69C or Section 69D\". 7.4.1 Insertion of new section 115BBE:- “After section 115BBD of the Income-tax Act, the following section shall be inserted with effect from the 1st day of April, 2013, namely:- \"115BBE. Tax on income referred to in section 68 or section 69 or section 69A or section 69B or section 69C or section 69D.-(1) Where the total income of an assessee includes any income referred to in section 68, section 69, section 69A, section 69B, section 69C or section 69D, the income-tax payable shall be the aggregate of- (a) the amount of income-tax calculated on income referred to in section 68, section 69, section 69A, section 69B, section 69C or section 69D, at the rate of thirty per cent; and (b) the amount of income-tax with which the assessee would have been chargeable had his total income been reduced by the amount of income referred to in clause (a). (2) Notwithstanding anything contained in this Act, no deduction in respect of any expenditure or allowance shall be allowed to the assessee under any provision of this Act in computing his income referred to in clause (a) of sub-section (1)\". 7.5 In view of the above, it can be said that for triggering section 115BBE what is relevant is whether income is disclosed or undisclosed or explained or unexplained. If the income is disclosed or explained as mandated by the law, then same would be taxable in the ordinary manner. On the other hand, if the income is undisclosed or unexplained then the provisions of section 115BBE may be triggered depending upon the facts involved in each of the cases. 7.6 In view of the above discussion and factual matrix of the case, the action of the AO in taxing on special rate as per section 115BBE is upheld. Thus, the grounds of appeal no. 2 to 4 are dismissed. 8. The ground of appeal no. 5 is against the AO is initiation of penal proceedings u/s.274 r.w.s. 271AAC (1) of the Act, being premature is not entertained and is dismissed. 9. The ground of appeal no. 6 is against the AO charging interest under Section 234A, 234B, 234C and 234D of the Act. Since, charging of interest is mandatory and consequential in nature, this ground of appeal no. 3 is dismissed. 10. The ground of appeal no. 7 is general in nature, hence dismissed. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 13 11. Additional ground of appeal-: During the course of appellate proceedings, the assessee has taken additional ground of appeal, which is reproduced as under: - \"The assessment order is time barred as no tax payable is determined by the AO within the time prescribed under section 153A of the Act. As the tax payable on assessed income is not determined and served within prescribed assessment became time barred on this ground. The CIT(A) prayed to consider the assessment time- barred on this ground.\" 11.1 In this regard, the assessee has stated that the said grounds could not be included in original grounds of appeal as the assessee was not aware about the complicated legal provisions and he come know about correct position only recently. 11.2 In this regard, it is observed that the claim of the assessee is not correct because on perusal of column of 2(b) of the form 35 [prescribed form for filing appeal before the CIT(A)], it is clearly seen that the assessee has clearly written the date of order is 24.04.2021 and similarly, on perusal of column of 2(c) of the form 35, the assessee has clearly written the date of service of order/Notice of Demand is 25.04.2021. It is also significant to mention here that the assessee has also categorically written the amount of disputed demand in column no. 6(e) of form 35 is Rs. 14,992/-. 11.3 In view of the above facts, it becomes crystal clear the additional ground taken by the assessee is incorrect. Thus, the additional ground of appeal is dismissed. 12. In the result, the appeal is dismissed.” 15. Aggrieved by the order of Ld. CIT(A), the assessee is in further appeal before us. Adjudication of additional ground raised by the assessee. 16. The assessee has raised the additional ground, which we have already noted above, stating that assessing officer was erred in law and on facts in passing the assessment order u/s 153C of the Act, after the end of time limit for completion of assessment u/s 153C of the Act, as specified u/s 153B of the Act, and hence the assessment order is bad and illegal being barred by limitation. The Ld. Counsel for the assessee, prayed the Bench that additional I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 14 grounds raised by the assessee should be admitted and it should be adjudicated first because it goes to the root of the matter. 17. However, Ld. DR for the Revenue, opposed the prayer of the assessee, stating that the assessee cannot raise such legal ground, for the first time, before the Tribunal, as the assessee, did not raise this issue, during the assessment proceedings, therefore, additional ground raised by the assessee, may not be admitted. 18. We have heard both the parties on this preliminary issue and noted that additional ground raised by the assessee; pertain to passing the assessment order u/s 153C of the Act, after the end of time limit for completion of assessment u/s 153C of the Act, as specified u/s 153B of the Act. The facts relating to above additional ground, were there before the assessing officer, at the time of passing the assessment order. We note that it is purely a legal issue and all facts are already on record which goes to the root of the matter and no further inquiry is required for deciding the same as all facts are already on record. The same and identical, additional ground are raised, in all these four appeals, by the assessees. That is, all these four appeals, contain the similar and identical additional ground on technical issue. Therefore, in the light of ratio laid down by the Hon'ble Supreme Court in the case of National Thermal Power Company Ltd., vs. CIT (1998) 229 ITR 382 (SC), we admit the additional grounds raised by the assessee in all these four appeals. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 15 Arguments of Learned Counsel for the assessee, on additional ground. 19. Shri Fenil H. Mehta, Learned Counsel for the assessee, at the outset, argued before us, that assessing officer has not passed the order u/s 153C of the Act, in case of all these assessees, within the time limit, prescribed under section 153B the Act. The Ld. Counsel for the assessee took us through sub- section (1) of section 153B of the Act and the proviso thereof and contended that as per the proviso, 9 months period is available and as per clause (a) and clause(b), 21 months period is also available, therefore, whichever period is later, should be considered, for passing the assessment order. The ld Counsel stated that assessment order was passed by the assessing officer, under section 153C read with section 143(3) of the Act, on 21.04.2021. The assessment order ought have been passed on 31.12.2020. Therefore, number of days of delay in passing the assessment order comes at 111 days, hence, assessment order, itself may be quashed. Similar facts are there in all other appeals of the assessees, therefore assessment order framed by the assessing officer, under section 153C read with section 143(3) of the Act, may be quashed. Arguments of Learned DR for the Revenue on additional ground 20. On the other hand, Ld. CIT-DR for the Revenue submitted that first of all, additional grounds raised by the assessee contain mixed question of law and facts, therefore, these four appeals filed by the assessees, may be remitted back to the file of the lower authorities, for adjudication afresh. The Ld. CIT- DR submitted that assessee has filed the return of income in response to notice u/s 153C of the Act and paid the taxes and the issue relating to time barred of assessment has neither been raised during the assessment proceedings nor during the appellate proceedings, the assessee has challenged the jurisdiction I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 16 u/s 153C of the Act, first time, before the Tribunal, which should not be entertained. The Ld. CIT-DR for the Revenue also relied on the judgement of Hon’ble Supreme Court in suo motu writ petition in MA No. 21 of 2022 (SC- - Suo Motu Writ Petition-COVID period) and stated that in assessee’s case assessment order was framed by the assessing officer, beyond the time limit prescribed under section 153B of the Act, because Covid-19 period was involved, where everybody was working with safety, therefore assessment order was framed late, due to COVID-19 pandemic, hence as per the judgment of Hon’ble Supreme Court (supra), there should not be any delay in framing the assessment order. Analysis and Conclusion 22. We have heard both the parties and carefully gone through the submissions put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the facts of the case including the findings of the ld. CIT(A) and other material brought on record. For the sake of clarity and also being pertinent, we reproduce, the provisions of sub-section (1) of section 153B of the Act, which reads as under: “153B. Time limit for completion of assessment under section 153A (1) Notwithstanding anything contained in section 153, the Assessing Officer shall make an order of assessment or reassessment,— (a) in respect of each assessment year falling within six assessment years and for the relevant assessment year or years referred to in clause (b) of sub-section (1) of section 153A, within a period of twenty-one months from the end of the financial year in which the last of the authorizations for search under section 132 or for requisition under section 132A was executed; (b) in respect of the assessment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A, within a period of twenty-one months from the end of the financial year in which the last of the authorizations for search under section 132 or for requisition under section 132A was executed: I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 17 Provided that in case of other person referred to in section 153C, the period of limitation for making the assessment or reassessment shall be the period as referred to in clause (a) or clause (b) of this sub-section or nine months from the end of the financial year in which books of account or documents or assets seized or requisitioned are handed over under section 153C to the Assessing Officer having jurisdiction over such other person, whichever is later: ……………………” 23. Therefore, the first proviso to sub-section (1) of section 153B of the Act, clearly states that assessment u/s 153C of the Act, should be completed, within the time limit mentioned in clause (a) and clause (b) of sub-section 1 of section153B of the Act, or nine Months from the end of the financial year, in which, books of account or documents or assets seized or requisitioned are handed over under section 153C of the Act, to the Assessing Officer having jurisdiction over such other person, whichever is later.Therefore, as per the above proviso, the assessment should be completed within 9 months or 21 months, whichever is later. Therefore, taking the lead case ( as an example) in IT(SS)A No.78/Rjt/2023, for assessment Year 2016-17, in case of Chintan Kumar Rameshbhai Patel, we note that assessment order was passed by the assessing officer, under section 153C read with section 143(3) of the Act, on 21.04.2021. The assessment order ought have been passed on 31.12.2020. Therefore, number of days of delay in passing the assessment order comes at 111 days. We should examine, the conditions and the time limit mentioned in section 153B of the Act, as follows: (A).In this case, date of execution of authorization is 15.02.2017. Now, we can count 21 Months from the end of the financial year 2016-17, in which the I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 18 last of the authorization for search was executed, which ends on 31.12.2018. ( April 2017 to December 2018= 21 Months). (B).Date on which documents were handed over to assessing officer, or received by the assessing officer, is 09.08.2019 and now, we can count 9 months from the end of the financial year 2019-20, in which book of account or documents or assets seized or requisitioned were handed over, which ends on, 31.12.2020. ( April 2020 to December 2020= 9 Months). Assessment order ought to have been passed on (A) or (B), whichever is later, that is, on 31.12.2020. However, actual date of passing the assessment order in the assessee`s, case, is on 21.04.2021, hence, assessment order passed by the assessing officer, under section 153C read with section 143(3), dated 21.04.2021, is barred by limitation, by 111 days, therefore, the assessment order, should be quashed, on this fact only. 24. The Ld. Counsel for the assessee, submitted before the Bench, a chart showing, appeal- wise, status stating the date of assessment order passed, and the date on which the assessment order ought to have been passed, and the number of days of delay in passing the assessment order as per the conditions mentioned in section 153B of the Act, etc. have been stated, which is reproduced below for ready reference: I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 19 25. We have examined the facts stated in the above chart and noted that in all the appeals, the similar and identical issues were involved, and in case of every appeal, noted above, the assessment order is time barred, therefore, the assessment order, passed by the assessing officer under section 153C read with section 143(3) of the Act, needs to be quashed. 26. Article 265 of the Constitution of India lays down that, “No tax shall be levied or collected except by authority of law”. The Hon’ble Supreme Court of India has held that the this provision under Article 265 of the Constitution of India is applicable not only for levy but also for the collection of taxes and the expression “assessment” within its compass covers both the aspects carried out by the executive functionary. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 20 Chottabhai Vs. Union of India 1962 SCR Supl.2 1006. Therefore, it is required that whole of the process of taxation must follow the procedures which are valid under the law and must adhere to law i.e. substantive one as well as procedural one too. Therefore, in other words it is provided in the Constitution of India that every step should be taken to ensure that levy and collection of the taxes is strictly in accordance with law – not only substantive one but the procedural law, as well. 27. Time limit is laid down for dealing with the return filed by an Assessee. This is to ensure finality to all matters. Purpose behind time limit laid down in various provisions of the Act, including the provisions of section 153B of the Act, are as follows: (i) To promote Repose. In the context of limitation of actions, \"repose\" includes at least four distinct but overlapping concepts: (a) to allow peace of mind; (b) to avoid disrupting settled expectations; (c) to reduce uncertainty about the future; and (d) to reduce the cost of measures designed to guard against the risk of untimely claims. (ii) Minimize Deterioration of Evidence. Another policy underlying statutes of limitation is the policy of avoiding deterioration of evidence. Like the policy of promoting repose, however, avoiding deterioration of evidence serves several distinct but overlapping purposes: (a) to ensure accuracy in fact finding; (b) to prevent the assertion of fraudulent claims; (c) to reduce the costs of litigation; and (d) to preserve the integrity of the legal system. I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 21 (iii) Place Defendants and Plaintiffs on an Equal Footing. One of the most powerful policies supporting limitation of actions is the concern that the passage of time will not only result in the deterioration of evidence, but that it will also allow the plaintiff to gain an unfair advantage over the defendant. Many cases have recognized that one of the purposes of a limitation system is to avoid making it unreasonably difficult for defendants to answer the claims against them. (iv) Encourage the Prompt Enforcement of Substantive Law. Arguably, \"the central purpose of law is to guide behavior.\" Therefore, time limit to pass an assessment order, under any particular section of the Income Tax Act, should be followed strictly. 27. Law is well settled that when the statute requires to do certain thing in certain way, the thing must be done in that way or not at all. Other methods or mode of performance are impliedly and necessarily forbidden. The aforesaid settled legal proposition is based on a legal maxim 'Expressio unius est exclusion alteris', meaning there by that if a statute provides for a thing to be done in a particular manner, then it has to be done in that manner and in no other manner and following of other course is not permissible. (Nazir Ahmed v. King Emperor AIR 1936 PC 253; Ram Phal Kundu v. Kamal Sharma [2004] 2 SCC 759 and Indian Bank's Association v. Devkala Consultancy Service AIR 2004 SC 2615). Similar view has been expressed in the Orissa Rural Housing Development Corpn. Ltd, 343 ITR 316(Orissa). We note that Ld. CIT-DR for the Revenue relied on the judgement of Hon’ble I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 22 Supreme Court in suo motu writ petition in MA No. 21 of 2022 (SC- - Suo Motu Writ Petition-COVID period) and stated that in assessee’s case assessment order was framed by the assessing officer, beyond the time limit prescribed under section 153B of the Act, because Covid-19 period was involved, where everybody was working with safety, therefore assessment order was framed late, due to COVID-19 pandemic, hence as per the judgment of Hon’ble Supreme Court (supra), there should not be any delay in framing the assessment order. 28. We do not agree with the above, stand taken by the Ld. DR for the revenue, as the judgement of Hon’ble Supreme Court in suo motu writ petition in MA No. 21 of 2022, is applicable to appeals and petitions, to be filed, before various Courts and Tribunals and not for framing, the assessment order. That is, MA No. 21 of 2022 in (SC) - Suo Motu Writ Petition(supra) does not apply to the time limit for framing the assessment order or reassessment order. The important para of the above judgement of the Hon`ble Supreme Court, clarifies this situation, which reads as follows: “It is further clarified that the period from 15.03.2020 till 28.02.2022 shall also stand excluded in computing the periods prescribed under Sections 23 (4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings.” 29.We find that in the assessee`s case under consideration, the assessment order was not framed within the time limit prescribed under section 153B of the Act, therefore, assessment order passed by the assessment officer, dated I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 23 21.04.2021, under section 153C read with section 143(3) of the Act, is here by quashed, and consequently, we allow the appeal of the assessee. 30. In the result, appeal filed by the assessee, in IT(SS)A No.78/RJT/2023, is allowed. 31. As the assessment order itself is quashed, therefore, all other issues on merits of the additions, in the impugned assessment proceedings, are rendered academic and infructuous. 32. Since the facts and circumstances in the case of other appeals, viz: in IT(SS)A Nos. 79, 80, and 81/RJT/2023, are identical to those considered in the case of IT(SS)A No.78/RJT/2023, therefore, our decision in the case of IT(SS)A No.78/RJT/2023, shall apply mutatis mutandis in the case of other appeals of the assessees, also. Accordingly, the appeal, in IT(SS)A Nos. 79, 80, and 81/RJT/2023, are also allowed. 33. In the combined result, appeals filed by the assessees, in IT(SS)A No.78/RJT/2023, and in IT(SS)A Nos. 79, 80, and 81/RJT/2023, are allowed. Order pronounced in the open court on 27/11/2024. Sd/- Sd/- (DINESH MOHAN SINHA) (A. L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY Rajkot Dated:27/11/2024 I.T(SS).A Nos.78 to 81/Rjt/2023 Chintakumar R. Patel & Princekumar K. Rabara 24 आदेश कȧ ĤǓतͧलͪप अĒेͪषत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Rajkot 6. Guard file. By order/आदेश से, Assistant Registrar/Sr. P.S./P.S. ITAT, Rajkot Strengthened preparation & delivery of orders in the ITAT 1) Date of dictation 02.08.2024 2) Date on which the typed draft is placed before the Dictating Member & Other Member 05.08.2024 3) Date on which the approved draft comes to the Sr. P.S./P.S. 4) Date on which the fair order is placed before the Dictating Member for pronouncement 5) Date on which the fair order comes back to the Sr. P.S./P.S. 6) Date on which the file goes to the Bench Clerk 7) Date on which the file goes the Head Clerk 8) Date on which the file goes to the Assistant Registrar for signature on the order 9) Date of Dispatch of the order "