2015 (8) TMI 462 - AT - Income Tax

Income Tax Tribunal rules notice under section 153C time-barred for 2003-04 assessment year

The Tribunal held that the notice served under section 153C of the Income Tax Act for the assessment year 2003-04 was time-barred based on the date the ... Validity of proceedings under section 153C - Held that:- In the instant case, the seized documents allegedly belonging to the assessee were handed over to the Assessing Officer of such other person on 5.6.2009. Now, as per the proviso to section 153C of the Act, the date of search is to be substituted by the date of receiving books of account or documents or assets seized. Accordingly, the assessment can be reopened of the preceding six years than 5.6.2009. In this case, the previous year in which the documents are handed over is 1.4.2009 to 31.3.2010. The assessment year would be assessment year 2010-2011. Accordingly the AO has the jurisdiction to reopen the assessment for six assessment years preceding this assessment year. They are 2009-2010, 2008-09, 2007-08, 2006-07, 2005-06 & 2004-05. As assessee further submitted that the assessment for assessment year 2003-04 is barred by limitation so far as the present assessee is concerned, in our opinion, there is substance in the above submission of ld counsel for the assessee and, therefore, we hold that the assessment framed u/s. 144/153C of the Act dt.30.12.2010 for assessment year 2003-04 is clearly barred by limitation. See Vijay M. Vimawal v. Asstt. CIT [2009 (6) TMI 626 - ITAT AHMEDABAD-A ] The documents having been handed over to the AO of the assessee on 5.6.2009 relevant to assessment year being 2010-2011, the AO can reopen the assessment for six preceding assessment years i.e. assessment years 2004-05 to 2009-2010 and assessment for assessment year 2003-04 is barred by limitation - Decided in favour of assessee. Issues:1. Validity of notice served under section 153C of the Income Tax Act for the assessment year 2003-04.Analysis:The appeal before the Appellate Tribunal ITAT Kolkata involved the validity of a notice served under section 153C of the Income Tax Act for the assessment year 2003-04. The case originated from a search and seizure operation conducted at the residential and business premises of the assessee and the Singhi Group. The seized documents, including those related to the assessee, were handed over to the Assessing Officer. The Assessing Officer initiated proceedings under section 153C for six assessment years, leading to assessments under section 144/153C. The assessee contended before the ld CIT(A) that the assessment for the year in question was barred by limitation. However, the ld CIT(A) rejected this contention, prompting the appeal before the Tribunal.During the proceedings, the counsel for the assessee argued that the notice under section 153C served on 1.10.2009 was time-barred as per the proviso to section 153C. The counsel contended that the assessment for the year 2003-04 was beyond the limitation period based on the date the documents were handed over to the Assessing Officer. The Tribunal, in agreement with the assessee's counsel, held that the assessment for the year 2003-04 was clearly barred by limitation. The Tribunal cited a decision of ITAT Ahmedabad Bench in a similar case to support its conclusion.The Tribunal emphasized that the date of handing over the seized documents to the Assessing Officer should be considered for determining the limitation period for reopening assessments under section 153C. Based on this interpretation, the Tribunal concluded that the assessment for the year 2003-04 was time-barred. Consequently, the Tribunal allowed the appeal filed by the assessee, quashing the assessment order for the assessment year 2003-04.In summary, the Tribunal's decision revolved around the interpretation of the limitation period for assessments under section 153C of the Income Tax Act. By considering the date of handing over seized documents to the Assessing Officer, the Tribunal concluded that the assessment for the year 2003-04 was beyond the limitation period, leading to the quashing of the assessment order for that year.