TaxTMI 
TaxTMI 
2005 (9) TMI 64
X X X X Extracts X X X X
X X X X Extracts X X X X
....-tax Department in the business premises of the appellants in Delhi on February 1, 2000, which continued till 10 a.m. on February 2, 2000, when the survey proceedings were converted into a search. In the course of the said proceedings, the authorised officer passed an order in terms of section 132(3) of the Income-tax Act, 1961 (for short "the Act") in regard to the contents of an almirah and cupboard found in the premises being searched. On the conclusion of the search, a notice under section 158BC was issued to the appellant on January 22, 2002, asking him to furnish a return setting forth his undisclosed income. In response to the said notice, the appellant filed a "nil" return. Shortly after the filing of the return, the appellant addre....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed to the panchnama. (iv) Rs. 2,69,928, representing undisclosed interest income. Aggrieved by the order aforementioned, the appellant appealed to the Commissioner of Income-tax (Appeals), New Delhi, inter alia, contending that the search proceedings as also the proceedings under section 158BC of the Act were illegal and beyond the period of limitation prescribed for the same. The estimation of the undisclosed income brought to tax was also assailed by the appellant. This appeal succeeded in part and was allowed by the Commissioner of Income-tax in terms of his order dated January 16, 2003, who held that the survey converted into search by issue of a warrant followed by proceedings under section 158BC of the Act were within the four c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....g upon the decision of a Special Bench of the Tribunal at Bangalore in C. Ramaiah Reddy v. Asst. CIT (Investigation) [2004] 268 ITR (AT) 49, held that the validity of the action taken under section 132 of the Act could not be examined in the appeal filed before it. We see no reason to take a different view. Any appeal before the Tribunal against the block assessment made under section 158BC does not take within its fold questions touching the validity of the search conducted under section 132 of the Act. Whether or not the conditions precedent for a search stipulated under clauses (a), (b) and (c) of section 132(1) of the Act were satisfied in a given case falls beyond the scope of assessment proceedings instituted under section 158BC of th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....itioner to re-agitate the question of validity of the authorization and the legality of the search proceedings either before the Commissioner of Income-tax or before the Tribunal for that matter. The question of validity or otherwise of the search proceedings stood concluded by the judgment of this court dated May 6, 2002, in the writ petition mentioned above. The Tribunal was, in that view, perfectly justified in repelling the contention of the appellants that the search proceedings were invalid or that the same could not pro vide a sound basis for the authorities to initiate action under section 158BC of the Act. The conversion of the survey proceedings into a search was in any event based on the satisfaction of the Director of Investigat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....th section 132(5) of the Act. Section 158BE(1)(b) and Explanation 2 which are relevant for our purposes may be extracted: "158BE. (1) The order under section 158BC shall be passed,- ... (b) within two years from the end of the month in which the last of the authorisations for search under section 132 or for requisition under section 132A, as the case may be, was executed in cases where a search is initiated or books of account or other documents or any assets are requisitioned on or after the 1st day of January, 1997. Explanation 2.- For the removal of doubts, it is hereby declared that the authorisation referred to in sub-section (1) shall be deemed to have been executed,- (a) in the case of search, on the conclusion of sear....