TaxTMI 
TaxTMI 
2016 (6) TMI 378
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....estion involved in all the 84 appeals, ITA No.84/2015 was taken as the main case and only the common question involved in the 84 appeals alone was considered and judgement was rendered answering the question against the Revenue and thus dismissing all appeals. 3. The second common question in 21 cases due to inadvertence was not brought to our notice and therefore, the said question could not be considered by us and in such circumstances Revenue filed review petitions in the above appeals, the review petitions were allowed and it is thus the above 21 appeals are coming before us to consider the common question involved therein. The common question raised in the above appeals are enumerated as follows: "1.(a) Whether on the facts and in the circumstances of the case, is not the Tribunal erroneous in holding that addition in pursuance to notice issued under Section 153A can be made only if incriminating material is found and seized in case where there is also abatement of regular assessment proceedings, and are not, such an approach and the resultant conclusion perverse and uncalled for ? (b) Whether on the facts and in the circumstances of the case and when the Assessing Of....
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....or Counsel for the Revenue and learned Senior Counsel appearing for the assessee. 8. The main contention advanced by the learned Senior Counsel for the Revenue is that, the Tribunal erred in holding that the addition in pursuance to notice issued under Section 153A can be made only if incriminating material is found and seized in case where there is also abatement of regular assessment proceedings. That apart it is contended that such a restriction to Section 153A is artificial in nature since the Assessing Officer under law is vested with power to assess or re-assess income for six prior period assessment years notwithstanding the provisions of Sections 139, 147, 148, 149, 151 and 153. Learned Senior Counsel also contended that the view taken by the ITAT is against the settled principles of interpretation of statutes and hence perverse. Therefore, learned Senior Counsel contended that the findings rendered by the Appellate Tribunal with respect to the scope of Section 153A cannot be sustained under law. Learned counsel has also invited our attention to Section 153A of the Income Tax Act and contended that the word "incriminating" is not used anywhere in the said provision and the....
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....wer with the Assessing Officer to assess or re-assess the total income in respect of each assessment years falling within such six assessment years. 10. It is therefore contended that the Tribunal went wrong in holding that in order to proceed under Section 153A incriminating materials should be recovered. Learned Senior Counsel contends that such findings of the Tribunal cannot be sustained under law since under Section 153A nowhere it is stated that the materials recovered while conducting search under Section 153A should be incriminating in nature. It is also contended that whatever materials unearthed during the search operations under Section 132 is sufficient to proceed under Section 153A of the Income Tax Act. That being the situation, the Tribunal went wrong in holding that there are no incriminating materials before the Assessing Officer to proceed against the assessee. It is also contended by the learned Senior Counsel for the Revenue that during the search operations the Managing Partner of the firms involved in the above 21 appeals has conceded that an amount of Rs. 2.75 Crores was not disclosed by him while submitting the returns. It is also contended by the learned S....
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....gement of the Apex Court in Income Tax Officer, Special Investigation Cirlcle "B", Meerut v. Seth Brothers and others [(1969) 74 ITR 836] to contend that as per Section 132 of the Income Tax Act, the warrant of authorisation do not require to specify the particulars of documents and books of accounts but it contemplates only the general authorisation to search for and seize documents and books of account relevant to or useful for any proceeding to comply with the requirements of the Act and the Rules, that it is for the officer making the search to exercise his judgement and seize or not seize any documents or books of account. An error committed by the officer in seizing documents which may ultimately be found not to be useful for or relevant to the proceeding under the Act will not by itself vitiate the search, nor will it entitle the aggrieved person to an omnibus order releasing all documents seized. That apart it is also contended that any irregularity in the course of entry, search and seizure committed by an officer acting in pursuance of the authorisation will not be sufficient to vitiate the action taken, provided the officer has, in executing the authorisation, acted bona....
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....rial shall be unearthed. Thus it is contended by the counsel that the finding of the Tribunal that there are no incriminating materials before it so as to justify the action of the Assessing Officer is not a legal and valid finding and thus he seeks interference of this court in these appeals. 14. On the other hand learned Senior Counsel for the assessee contended that in order to assess under Section 153A of the Act, the materials that are unearthed can alone be applied against the relevant assessment years in question as contemplated under Section 153(1)(b) and therefore, the Tribunal was right in holding that there was no incriminating materials received during the search operations in order to proceed under Section 153A. It is also contended that Section 153A can be invoked only if materials are procured during the search operations under Section 132 and a mere statement made by the Managing Partner, which was retracted by him at the appellate stage, cannot be taken into account to proceed with the assessment under Section 153A. In order to substantiate the said contention, learned Senior Counsel has invited our attention to the common judgement of the Bombay High Court in Com....
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....y the learned Senior Counsel for the assessee that the scope of assessment under Section 153A in the case of assessment that are abated and in the case of assessments that have attained finality as on the date of search, which has been settled by the decision of the Special Bench of the Tribunal referred supra wherein it is held that in case assessment has abated, the Assessing Officer retains the original jurisdiction as well as jurisdiction under Section 153A for which assessment shall be made for each assessment separately. Thus according to the learned Senior Counsel, in that circumstances, the Assessing Officer can make additions in the assessment, even if no incriminating material has been found. Therefore, according to the learned Senior Counsel, it thus means that, the assessment under Section 153A will be made on the basis of incriminating material, which in the context of relevant provisions means books of account and other documents found in the course of search but not produced in the course of original assessment and undisclosed income or property found during the course of search. Learned counsel also contended that going by the first proviso to Section 153A it is cat....
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....me-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 131 of the 1961 Act, or a notice under sub-section (4) of section 22 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 142 of 1961 Act was issued to produce, or cause to be produced, any books of account or other documents has omitted or failed to produce, or cause to be produced, such books of account or other documents as required by such summons or notice etc. etc., can authorise the officers referred therein to enter and search any building etc. etc. Such authorised officer under sub-section (4) of Section 132 may during the course of search or seizure examine on oath any person who is found to be in possession or control of any books of account, document, money, bullion, jewellery or other valuable article or thing and any statement made by such person during such examination may thereafter be used in evidence in any proceeding under the Indian Income-tax Act, 1922 or under the Act 1961. Therefore, going by the said provision not only the books, documents etc. etc. that are unearthed during the course of search but a statement made by such person during such examination can al....
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....ing within such six assessment years: Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years referred to in this sub-section pending on the date of initiation of the search under section 132 or making of requisition under section 132A, as the case may be, shall abate. Provided also that the Central Government may by rules made by it and published in the Official Gazette (except in cases where any assessment or reassessment has abated under the second proviso), specify the class or classes of cases in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made. [(2)] If any proceeding initiated or any order of assessment or reassessment made under sub- section (1) has been annulled in appeal or any other legal proceeding, then, notwithstanding anything contained in sub-section (1) or section 153, the assessment or reassessment relating to any assessment year which has abated under the second proviso....