TaxTMI 
TaxTMI 
2012 (7) TMI 620
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....o complete block assessment, the date of seizure of bank accounts earlier covered by a prohibitory order cannot be taken into account? 2. Whether in the facts and circumstances of the case, the Tribunal was right in holding that where material was covered by a prohibitory order would not be part of seized items, even though it was also separately seized and a panchanama was drawn?" This Court, by order dated 18.1.2011, admitted T.C.(A)No.1128 of 2010, filed by the assessee on the following substantial questions of law: "(i). Where the Income Tax Appellate Tribunal has held that the assessment is barred by limitation, whether the Income Tax Appellate Tribunal is right in law in setting aside the assessment on merits? (ii). Search having been made in the case of the appellant's erstwhile wife Smt.Shanthi, whether the Income Tax Appellate Tribunal is right in law in upholding the jurisdiction of assessment in appellant's case on the basis of search conducted on the appellants erstwhile wife Smt.Shanthi? (iii). Where no warrant of search has been issued either on the Estate of the appellant or on the legal heirs of the appellant, whether the Income Tax Appellate Tribunal is....
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..... Tamil Nadu Farmers Service Co-operative Federation), the Tribunal observed that the time limit for framing the assessment was to be counted from the seized items only and not with reference to the prohibitory order issued. Since the date of search was 08.10.1997, the assessment would have to be framed within a period of two years from the end of the month in which seizure was made and this period ended on 31.10.1999. As the assessment was framed on 26.11.1999, it was clearly barred by limitation. Thus on the issue of limitation, the Tribunal held the same against the Revenue. Thus the assessee's appeal was allowed in part. Aggrieved by this, the Revenue has preferred Tax Case (Appeal) No.1257 of 2005 on the issue of limitation. 7. As far as the assessee's appeal (T.C.(A)No.1128 of 2010) is concerned, questions are raised as to the legality of the search contending that there was no search warrant issued either on the estate of the assessee or on the legal representative of the deceased Pandian. 8. As far as Revenue's appeal on limitation issue is concerned, Sub-Clause (1)(b) to Section 158 BE of the Income Tax Act, is the relevant provision, which reads as under: ....
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....pose of calculating the limitation would be the last of panchnama recording the conclusion of search. The Karnataka High Court pointed out that the expression 'last panchnama' has to be read as referrable to the last of the authorisations as used in the main Section. The Karnataka High Court pointed out that once on the basis of an authorisation the search party conducts the search and after the search comes out of the premises, then there is a conclusion of search as defined in Explanation 2; that the panchnama evidencing such investigation and seizure would be the last panchnama in respect of the said premises. Where there are multiple places to search, separate search authorisation should be drawn with reference to each place of search. The authorisation may be issued on different dates, in which event, the last of such authorisation has to be looked into for the purpose of limitation. However, considering the possibility of more than one authorisation issued on the same day and executed, there should be one panchnama in respect of each such authorisation and the authorisation might have been executed on different dates also. In that event, doubt may arise as to which authorisat....
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....r of Income-Tax V. Anil Minda), wherein the Delhi High Court referring to the deeming clause as available in Explanation 2 held that by the deeming provision, authorisation referred to sub-section (1) would be that authorisation which was executed on the conclusion of search as recorded in the last panchnama. Thus the High Court viewed that by this deeming provision, even an authorisation which may not be otherwise a last authorisation would become the last authorisation, if that was executed and if the panchnama in respect thereto was drawn last. Thus the point of limitation has to start from the execution of the warrant on the last panchnama drawn and not before. 12. Learned Standing Counsel appearing for the Revenue fairly placed before us, apart from the above two decisions, the decision reported in Kerala High Court reported in (1999) 238 ITR 501 (T.O.Abraham and Co. and another V. Assistant Director of Income-Tax (Investigation) and others), wherein learned single Judge of the Kerala High Court considered the issue on limitation as provided for under Section 158BE prior to the insertion of Explanation 2, which was only at the stage of a finance bill only. The High Court poin....
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....e authorisation was issued. In other words, in the case of multiple authorisations, the criteria for calculating the limitation would be that irrespective of the date of authorisation, the conclusion of the search as recorded in the last panchnama alone would be taken into consideration. 17. With the above view on Explanation 2 to Sub-Clause (1) to Section 158 BE of the Income Tax Act, the dates pertaining to search, which are admitted by the parties herein, needs to be noted. 18. Admittedly, as far as the first of the search is concerned, the authorisation was first issued on 10.9.1997. The search commenced on 11.9.1997 and the proceedings were completed on 11.9.1997. There was also an authorisation of the same date, in respect of which, another search was commenced on 11.9.1997 and completed on 11.9.1997. The second search commenced on 5.11.1997 was concluded on 5.11.1997. Subsequent thereto, in connection with this, there was one more authorisation dated 31.10.1997, for which the search commenced on 3.11.1997 and concluded on 3.11.1997. 19. Thus the last of the panchnama evidencing the conclusion of search with reference to the authorisation issued on 31.....