AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2014 (1) TMI 1237
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....ct against the order of the Income Tax Appellate Tribunal, Bilaspur Bench, Bilaspur (the Tribunal) dated 22.01.2010 dismissing the appeal filed by the Income Tax Department (the Department) against Shri Sunil Kumar Jain (the Assessee) for the block period 01.04.1989 to 17.11.1999. THE FACTS 2. The Assessee is a jeweller. A search took place on 17.11.1999 in the residential as well as business premises of the Assessee. Thereafter, a notice under section 158BC of the Act was issued on 10.07.2000. It was served on the Assessee on 29.07.2000. 3. The Assessee filed his return on 11.09.2000 declaring total undisclosed income of Rs. 41,692/-. The Assessing Officer (the AO), by his order dated 30.01.2002, framed the block assessment of Rs. 98,00....
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.... which the action was taken and the order passed under section 263 of the Act. This order has been set aside by the Tribunal and the order of the Tribunal has become final. Now, on the basis of the same material, notice under section 148 of the Act, cannot be issued; (iii) The AO has completed the assessment on protective basis, however, there cannot be protective re-opening; (iv)The fact that the AO had made protective assessment shows that he was not sure about the income of the Assessee and as such it cannot be said that there was any reason to believe that the income of the Assessee had escaped assessment and the condition precedent for issuing of the notice under section 148 of the Act was not satisfied; (v) There was no fresh mater....
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....s vitiating on account of issuance of notice under Section 148 of the Income Tax Act, 1961?' 13. The aforesaid two questions are substantially same as the question mentioned in the opening paragraph of this judgement. THE DECISION Submissions of Department Counsel 14. The counsel for the Department relies upon section 158BH of the Act, and the decisions in: (i) Commissioner of Income Tax v. Suresh N Gupta {(2008) 214 CTR (SC) 274} (the Suresh-Gupta case); and (ii) Commissioner of Income Tax v. Peerchand Ratanlal Baid (HUF) (Gauhati) {322 ITR 544} (the Peerchand case). He submits that: * Section 58BH applies all other provisions of the Act to the assessment under Chapter XIVB of the Act; * Sections 147 and 148 of the Act are other pr....
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....ns 147/ 148 of the Act were applicable in the block assessment or not, was not involved therein. However, in Peerchand case, this very question was involved and was answered in favour of the Department. Sections 147/ 148 Should Be Strictly Construed 21. Kanga, Palkhivala and Vyas on The Law and Practice of Income Tax, Volume-II, Ninth Edition, page 1826 explains the scope of the section 147 of the Act as follows: 'This section imposes no charge on the subject but deals merely with the machinery of assessment, Bhimraj v CIT 32 ITR 289, affirmed in 41 ITR 221 (SC); Radhakant v. Johri 39ITR 182; Chhaganlal v ITO 46 ITR 351, 357; Dalmia v CIT 194 ITR 700,affirmed in 236 ITR 480 (SC) on another issue; CIT v Saraf 207 ITR 217; Sardar Harvinder....
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....n when they are not there. If we do so, then will it be not stretching the words too far? 25. Often the block assessment is in respect of the years for which the assessment has already been done under the Act. The block assessment is a kind of re-assessment, on the basis of material found in the search. This is also indicated by first proviso to section 158BC (a) of the Act. 26. Section 158BC is titled as 'Procedure for Block Assessment'. The first proviso (see below) The relevant portion of the proviso is as follows: 'Provided that no notice under section 148 is required to be issued for the purpose of proceeding under this Chapter to section 158BC(a) of the Act provides that for the purpose of proceedings under Chapter XIVB of the Act, ....