TaxTMI 
TaxTMI 
2021 (8) TMI 56
X X X X Extracts X X X X
X X X X Extracts X X X X
....Rs. 11,84,250/- as unexplained expenditure on account of brokerage. 3. On the facts and in the circumstances of the case, the Ld. CIT(A) had erred in law and on facts in holding that the initiation of action u/s 153C of the Act, for completing assessment u/s 153C/153A of the Act, is barred by limitation by relying on the decision in the case of CIT vs. RRJ Securities Ltd. by the jurisdictional High Court which has not been accepted by the department and SLP against the same has been filed before Hon'ble Supreme Court. 4. On the facts and in the circumstances of the case, the Ld. CIT(A) had erred in law and on facts by relying on the decision in the case of Sh. Kabul Chawla by the jurisdictional High Court which has not been accepted by the department and SLP against the same has been filed before Hon'ble Supreme Court. 5. On the facts and in the circumstances of the case, the Ld. CIT(A) had erred in law and on facts in arriving at the conclusion that the words 'total income' as used in Section 153C/153A would only mean undisclosed income discovered from seized / incriminating material. 6. On the facts and in the circumstances of the case, the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uring the course of search by the AO of the searched person to the AO of the appellant. Admittedly, the search took place on 30.10.2012 and the documents relating to the appellant were handed over to its AO on 12.02.2015 which is also the date of recording of the satisfaction note. In absence of any specific date of handing over of material in the satisfaction note, the date of recording of satisfaction will be assumed to be the date of handing over the material. Satisfaction notesare appended at page no.15-16 of the appellant's Paper Book. 6. According to the appellant, once the documents are handed over, six preceding assessment years from the date of handing over of the documents, lay open for assessment under section 153C read with section 153A of the Act. 7. According to the appellant, six preceding assessment years, from the date of the handing over of the documents, i.e. 12.02.2015, are beginning from A.Y. 2009-10 to 2014-15. The appellant contended that the impugned assessment related to A.Y. 2008-09. This assessment could not have been reopened for action under section 153C since first of the six preceding assessment years was A.Y. 2009-10 and not A.Y. 2008-09.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e AO of searched person but never provide the copy of seized material on the basis of which satisfaction was recorded. (Copy of satisfaction note recorded by the AO of searched person is attached at page no. 15 and copy of note recorded by the AO of the assessee is at page no.16 of the paper book) 6. The assessee vide letter dated 04.03.2015 the assessee had filed detailed objections against the initiation of the proceedings under section 153C of the Act. Refer page no. 25-26 of the paper book. 7. Thereafter the Ld. AO issued notices under section 142(1) along with questionnaire to the assessee and asked for the various detailsof share applicants and the evidences to establish their identity, creditworthiness and genuineness of the transaction. 8. In response to the notices issued by the Ld. AO the assesseefurnished the details as required by the Ld. AO from time to time. 9. In spite of the various explanations and documentary evidences submitted before the Ld. AO, the Ld. AO had completed the assessment u/s 153C of the Acton 31.03.2015 without passing the speaking order disposing off the objections raised by the assessee company against....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in absence of any specific date of handing over of material, the date of recording satisfaction i.e, 12.02.2015 is to be treated as the date of handing over of material and therefore the six AYs preceding the year of the search, for which the assessment was proposed to be reopened, should be A.Y. 2009-10 to A.Y. 2014-15. 4. The relevant assessment year i.e, A.Y. 2008-09istherefore barred by limitation. 5. Consequently, the notice under Section 153C (1) could have been issued for AYs 2009-10to A.Y. 2014-15. 6. It is a settled legal position that prior to the amendment by Finance Act, 2017 the date on which the AO of the person other than the one searched assumes the possession of the seized assets would be the relevant date for applying the provisions of Section 153A of the Act. 7. Issuance of notice for the relevant assessment year is invalid and without jurisdiction. 8. To support its contentions the assessee relies upon the following judgements of the various High Courts and Tribunals: a. Hon'ble High Court of Delhi in the case of RRJ Securities (380 ITR 612) has held that: - dated 30.10.2015 Held: In terms ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....arch of the Assessee; the seized assets/documents belonging to a person other than a searched person come into possession of the AO of that person only after the AO of the searched person is satisfied that the assets/documents do not belong to the searched person. Thus, the date on which the AO of the person other than the one searched assumes the possession of the seized assets would be the relevant date for applying the provisions of Section 153A of the Act.We, therefore, accept the contention that in any view of the matter, assessment for AY 2003-04 and AY 2004-05 were outside the scope of Section 153C of the Act and the AO had no jurisdiction to make an assessment of the Assessee's income for that year. b. Hon'ble ITAT Delhi - R.L. Allied Services - (54 taxmann.com 222) Held: In the case under appeal before us, as mentioned by the Assessing Officer in paragraph 2 of his order, the seized material was received on 12th March, 2009 from ACIT, Central Circle-17. Thus, the year in which seized material was seized is previous year 2008-09 relevant to AY 2009-10. The preceding six years would be AY 2008-09, 2007- 08, 2006-07, 2005-06, 2004-05 and 2003-04....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to 5 [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." The position of law is very clear and there is no ambiguity in the Act. This is further clarified by the jurisdictional Hon'ble Delhi High Court in the case of SSP Aviation Ltd. Vs. DCIT in W.P.C. No. 309/2011 dated 29.03.2012 in Para No. 13, 14 & 15 which are as under:- "13. Sections 153A to 153D are placed in Chapter XIV of the Act, which is titled "procedure for assessment". Section 153A provides for the assessment in case of search or requisition. This section applies to a person in whose case a search is initiated under Section 132 or books of account etc. are requisitioned under Section132A. The procedure prescribed under Section 153A is that the Assessing Officer shall call upon the assessee who is searched to furnish returns of income for six assessment years immediately ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cer having jurisdiction over the other person has to proceed against him and issue notice to that person in order to assess or reassess the income of such other person in the manner contemplated by the provisions of Section 153A. Now a question may arise as to the applicability of the second proviso to Section 153A in the case of the other person, in order to examine the question of pending proceedings which have to abate. In the case of the searched person, the date with reference to which the proceedings for assessment or reassessment of any assessment year within the period of the six assessment years shall abate, is the date of initiation of the search under Section 132 or the requisition under Section 132A. For instance, in the present case, with reference to the Puri Group of Companies, such date will be 5.1.2009. However, in the case of the other person, which in the present case is the petitioner herein, such date will be the date of receiving the books of account or documents or assets seized or requisition by the ao having jurisdiction over such other person. In the case of the other person, the question of pendency and abatement of the proceedings of assessment ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... ClT-7 Vs. M/s RRJ Securities Ltd., [2016J 380 1TR 612 (Delhi) (supra). In these facts and circumstances, I bold that the assessment completed u/s 153C/153A, is void ab initio, since notice u/s 153C of the Act, was issued beyond limitation period of 6 years from the reference date of 12.02.2015. Accordingly, ground No. 3, is hereby allowed. 12. We have carefully considered the above submissions and having gone through the facts of the case and applicable law, we would tend to agree with the appellant. The determining date for determination of six preceding assessment years that would lay upon under section 153C read with section 153A of the Act would decidedly be the date of handing over of the documents. Here the satisfaction note recorded by the A.O, of M/s Prakash Industries Ltd. is 12.12.2015, as well as by the A.O. of the appellant is on 12.12.2015, which is to be taken as the date of handing over of documents and date. Six preceding assessment years begin with A.Y. 2010-11 and end with A.Y. 2015-16. It would be the date of handing over the documents or date of recording of satisfaction will be the date for determining the date for calculating the preceeding six as....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the search on the Assessee. The rationale appears to be that whereas in the case of a searched person the AO of the searched person assumes possession of seized assets/documents on search of the Assessee; the seized assets/documents belonging to a person other than a searched person come into possession of the AO of that person only after the AO of the searched person is satisfied that the assets/documents do not belong to the searched person. Thus, the date on which the AO of the person other than the one searched assumes the possession of the seized assets would be the relevant date for applying the provisions of Section 153A of the Act. We, therefore, accept the contention that in any view of the matter, assessment for AY 2003-04 and AY 2004-05 were outside the scope of Section 153C of the Act and the AO had no jurisdiction to make an assessment of the Assessee's income for that year." 13. This judgement has been followed in Hon'ble Delhi High Court in the case of: i) Hon'ble High Court of Delhi in the case of ARN Infrastructure India Ltd. (81 taxmann.com 260) has held that: The decision in RRJ Securities Ltd. (supra) is categorical that under Section ....