TaxTMI 
TaxTMI 
2019 (9) TMI 950
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....of accounts or documents belonging to the appellant for the assessment year was seized or requisitioned. He should have appreciated that nothing has been brought on record by the AO and no reference has been made to such material relating to the appellant for the assessment year being unearthed. In the absence of any incriminating evidence or any money, bullion, jewellery or valuable article or things etc. the assessment u/s. 153A r.w.s. 153C is not valid" 3. The Tribunal vide its common order dated 10.04.2019 disposed of the appeals by observing as under:- "8. We have heard both the parties and perused the material on record. In this case, here was a survey u/s. 133A of the Act on 31/10/2011 in the case of M/s. Kunhitharuvai Memorial Charitable Trust, Calicut. The search revealed that the assessee was receiving training charges for College of Nursing which is an institution under KMCT. A notice u/s. 153A(a) r.w.s. 153C was issued to the assessee for A.Y. 2006-07 to 2011-12 on 31/05/2012 and notice u/s. 142(1) dated 08/08/2012 was issued for A.Y. 2012-13 for furnishing the return of income. Notices were issued to the assessee on 05/06/2012 and 14/08/2012 respectively. T....
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.... which such search is conducted or requisition is made: Provided that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling 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 an....
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....the 1st day of April, 2004 but before the 1st day of April, 2010],- (i) the provisions of clause (a) or clause (b) of this subsection shall have effect as if for the words "two years" the words "twenty-one months" had been substituted; (ii) the period of limitation for making the assessment or reassessment in case of other person referred to in section 153C, shall be the period of twenty-one months from the end of the financial year in which the last of the authorizations for search under section 132 or for requisition under section 132A was executed or nine months from the end of the financial year in which books of account or documents or assets seized or requisitioned are handed over under section 153C to the Assessing Officer having jurisdiction over such other person, whichever is later: Provided also that in case where the last of the authorisations for search under section 132 or for requisition under section 132A was executed during the financial year commencing [on or after the 1st day of April, 2005 but before the 1st day of April, 2009] and during the course of the proceedings for the assessment or reassessment of total income, a reference unde....
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....is later: Provided also that in case where the last of the authorisations for search under section 132 or for requisition under section 132A was executed during the financial year commencing on the 1st day of April, 2009 or any subsequent financial year and during the course of the proceeding for the assessment or reassessment of total income, in case of other person referred to in section 153C, a reference under subsection (1) of section 92CA is made, the period of limitation for making the assessment or reassessment in case of such other person shall, notwithstanding anything contained in clause (ii) of the second proviso, be the period of thirty-six months from the end of the financial year in which the last of the authorisations for search under section 132 or for requisition under section 132A was executed or twenty-four months from the end of the financial year in which books of account or documents or assets seized or requisitioned are handed over under section 153C to the Assessing Officer having jurisdiction over such other person, whichever is later. Explanation.-In computing the period of limitation for the purposes of this section,- (i) the pe....
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....sessing Officer shall proceed against each such other person and issue such other person notice and assess or reassess income of such other person in accordance with the provisions of section 153A : Provided that in case of such other person, the reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to [sub-section (1) of] section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person: Provided further that the Central Government may by rules made by it and published in the Official Gazette, specify the class or classes of cases in respect of such other person, 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 except in cases where any assessment or reassessment has abated. (2) Where books of account or documents or assets sei....
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....all proceed against each of such other person and issue such other person notice and assess or re-assess income of such other person in accordance with the provisions of section 153A of the Act, meaning thereby that action u/s. 153C of the Act always depends upon the action u/s. 153A of the Act upon some other person. The AO of such person in whose case search was conducted is satisfied that the money, bullion, jewellery or other valuable articles or things or books of account or documents seized or requisitioned belong to some other person, he after forming the belief to that extent regarding the same shall hand over the relevant material to the concerned AO having jurisdiction over such other person. In other words, we say that before initiating proceedings u/s 153C, the AO who has initiated proceedings for completion of assessment u/s. 153A of the Act should be satisfied that there is no undisclosed income which has been traced out when a person was searched u/s. 132 of the Act or the books of account were requisitioned u/s. 132A of the Act. Thus, in contrast to the provisions of section 148 of the Act where recording a reason in writing are sine qua non. Under Section 153C the ....
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....us, the condition precedent for issuing notice u/s. 153C and assessing or re-assessing income of such other person is that, the money, bullion, jewellery or other valuable articles or things or books of account or documents seized or requisitioned should belong to such other person. If the said requirement is not satisfied recourse cannot be made to the provisions of section 153C of the Act. Thus, the provisions contained u/s. 153C of the Act can only be invoked where there was satisfaction by the AO having jurisdiction over the person searched or requisitioned u/s. 132A during the course of assessment proceedings. Therefore, the proceedings u/s. 153A of the Act always precede the proceedings u/s. 153C of the Act and without recording satisfaction note by the Assessing Officer initiating proceedings for completion of assessment u/s. 153A of the Act cannot be proceeded u/s. 153C of the Act in the case of such other person not searched. Same view was taken by the Supreme Court in the case of CIT vs. Calcutta Knitwears, Ludhiana in civil appeal Nos. 3958 of 2014 (SLP) (C) No. 10542 of 2011 dated 12th March, 2014. Further it was also held by the Supreme Court in the case of Ma....
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....year 2006-07 onwards. It received income from IP and OP collections, dialysis, advertisement, X-rays, Lab, CT scan, MRI, income from hospital canteen in addition to the training charges received from KMCT. Consequently, notice u/s. 153A(a) r.w.s 153C was issued to the assessee. It was therefore, a prima facie proof that condition of section 153C was satisfied before invoking the jurisdiction in the case of the assessee. The assessee had not raised this issue before the Assessing Officer. The additional ground raised by the assessee is not arising out of the impugned order of the authorities below. The assessee must have brought on record the Panchanama from the date of search till the date on which prohibitory orders were lifted in the case of the searched parties, statement recorded u/s. 132(4) of the searched parties, the order sheet entries made by the concerned Assessing Officer in respect of searched parties and order sheet entries made by its Assessing Officer and also if any statement recorded from the present assessee to show that the initiation of proceedings u/s. 153C was not proper. It involves investigation of facts which have not been brought on record by the assessee.....
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....cannot be permitted to raise this issue before the Tribunal for the first time and thereby, change the very basis of assessment. In the facts and circumstances of the case, we are of the view that it would be proper not to exercise the discretionary power vested with the Tribunal in favour of the assessee by permitting them to raise this issue before the Tribunal for the first time. We also place reliance on the judgment of the Jurisdictional High Court in the case of Dr. R.P. Patel vs. CIT (225 CTR 378). In view of this, the additional ground raised by the assessee is rejected." 4. Before us, the learned Counsel for the assessee has filed a brief written submission, which reads as follows:- "The Honourable tribunal did not admit the additional ground and disposed of the appeal by stating that all the facts relating to the ground raised are not on record and the appellant had failed to bring on record the additional evidence required for adjudication of the additional ground filed The Honourable tribunal however has also given a finding that the all the materials connected with the assessment are part of the Assessing Officer's records. The Tribunal should have appr....
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....ies. This conclusion of the Honourable tribunal is an error of law in the light of the principle laid down by the apex court and the jurisdictional high court. It is also submitted that at the time of hearing of the appeal, the honorable tribunal had after considering the additional grounds, directed the Departmental Representative to produce the relevant records. Further, no opportunity or hearing was held after that. Since the finding as per the departmental records has not been adverted to in the appellate order, an error has crept into the order of the honorable tribunal. In the above circumstances, the appellant prays that the Honourable tribunal may be pleased to recall the order in ITA 62/ 2016 and dispose of the appeal after considering the additional ground filed." 5. None appeared on behalf of the Revenue, hence, we proceed to dispose of these miscellaneous applications on merits, after hearing the learned Counsel for the assessee. 6. We have carefully perused the order of the Tribunal along with the argument made by learned Counsel for the assessee. We have no doubt, in our opinion, the assessee herein is making an effort to review the order of th....