TaxTMI 
TaxTMI 
TaxTMI 
2023 (11) TMI 335
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....March, 2014. As part of the search, the assessee was searched on 11th March, 2014 in her new residence. The Assessing Officer issued a notice under section 153A in response to which the assessee filed the return under section 153A on 24/02/2015 declaring total income of Rs. 6,54,72,866/-. During the course of search at assessee's premises documents relating to foreign bank account in the name of her former husband, Shri Surendra Hiranandani was found and seized. The assessee was not able to give complete bank details pertaining to these documents. The Assessing Officer proposed to make FT & TR reference to the Appropriate Authority through proper channel. The assessment was subsequently concluded wherein the Assessing Officer vide order dated 29/12/2016, made an addition of unexplained cash credit under section 68 on protective basis in the hands of the assessee for an amount of Rs. 2,09,58,000/-. On further appeal, the CIT(A) confirmed the addition made on protective basis. Aggrieved by the order of the CIT(A), the assessee is in appeal before the Tribunal. 3. The assessee raised various grounds contending the issue on merits and the assessee vide letter dated 215/06/2023 also ra....
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.... exchanged. The Ld.AR, therefore, submitted as per the amended protocol of the Indo Swiss Treaty, the exchange of information prior to 1st April, 2011 is not applicable and, therefore, the reference made by the revenue on 08.08.2016 asking for information pertaining to assessment year 2008-09 in assessee's case is not a valid reference. Accordingly it was submitted that the extension of time limit under Explanation (ix) to section 153B is not available to the assessing officer to complete the assessment and that the assessment order passed under section 153A read with section 143(3) dated 29/12/2016 is barred by limitation and liable to be quashed. The Ld.AR in this regard relied on the decision of ITAT, Delhi Bench "G" in the case of Praveen Sawhney vs ACIT (2023) 224 TTJ 46 (Del). 8. The Ld.DR relied on the order of the CIT(A). 9. We heard the parties and perused the material on record. To recapitulate the facts of the case, there was a search in the case of the assessee on 11th March, 2014 and during the course of search, a Swiss Bank account statement with JP Morgan in the name of Mr.Surendra Hiranandani (the ex-husband of the assessee) was found. In the statement recorded fr....
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....ion 90 or section 90A and ending with the date on which the information requested is last received by the Principal Commissioner or Commissioner or a period of one year, whichever is less; or" 11. It is submitted by the ld DR that the search was conducted on 11.03.2014 and time limit as per section 153B(1) for completing the assessment under section 153A which falls on 31/12/2015 gets extended to 31.12.2016 as per above provisions and therefore the order of the assessing officer dated 29.12.2016 is valid. The argument of the ld AR is that when the reference itself is invalid since the information prior to 1.04.2011 could not be exchanged as per the protocol of the Indo-Swiss Treaty, there is no question assessing officer getting the extended time limit under Explanation (ix) to section 153B of the Act. 12. In this regard it is relevant to look at the Indo Swiss Treaty. We notice that vide notification No.S.O. 2903(E) dated 27th December, 2011, there was a protocol amending the agreement between Republic of India and Swiss Confederation for Avoidance of Double Taxation with respect to tax (DTAA / Treaty). The said notification provides that with respect to article 26 of the Agreem....
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....e Contracting States shall exchange such information as is foreseeably relevant for carrying out the provisions of this Agreement or to the administration or enforcement of the domestic laws concerning taxes covered by the Agreement insofar as the taxation thereunder is not contrary to the Agreement. The exchange of information is not restricted by Article 1. 2. Any information received under paragraph 1 by a Contracting State shall be treated as secret in the same manner as information obtained under the domestic laws of that State and shall be disclosed only to persons or authorities (including courts and administrative bodies) concerned with the assessment or collection of the enforcement or prosecution in respect of, or the determination of appeals in relation to the taxes referred to in paragraph 1, or the oversight of the above. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions. Notwithstanding the foregoing, information received by a Contracting State may be used for other purposes when such information may be ....
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....tion laws in the normal course of administration) as is necessary for carrying out the provisions of this Agreement in relation to the taxes which are the subject of this Agreement. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons other than those concerned with the assessment and collection of the taxes which are the subject of this Agreement. No information as aforesaid shall be exchanged which would disclose any trade, business, industrial or professional secret or trade process. 2. In no case shall the provisions of this Article be construed as imposing upon either of the Contracting States the obligation to carry out administrative measures at variance with the regulations and practice of either Contracting State or which would be contrary to its sovereignty, security or Public policy or to supply particulars which are not procurable under its own legislation or that of the State making application." 13. A perusal of the aforementioned relevant clauses of the DTAA shows that the same is effective from 01.04.2011. This is further clarified form the following notification: "NOTIFICATION NO. S.O. 2903(E) [NO. 62/2011 (F. NO. ....
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....for in the said Protocol will be applicable for information that relates to any fiscal year beginning on or after the 1st day of April, 2011. PROTOCOL AMENDING THE AGREEMENT BETWEEN THE REPUBLIC OF INDIA AND THE SWISS CONFEDERATION FOR THE AVOIDANCE OF DOUBLE TAXATION WITH RESPECT TO TAXES ON INCOME WITH PROTOCOL, SIGNED AT NEW DELHI ON 2 NOVEMBER 1994, AS AMENDED BY THE SUPPLEMENTARY PROTOCOL SIGNED AT NEW DELHI ON 16 FEBRUARY 2000 ARTICLE 8 Article 26 [Exchange of information] of the Agreement shall be deleted and replaced by the following Article: Article 26 Exchange of information 1. The competent authorities of the Contracting States shall exchange such information as is foreseeably relevant for carrying out the provisions of this Agreement or to the administration or enforcement of the domestic laws concerning taxes covered by the Agreement insofar as the taxation there under is not contrary to the Agreement. The exchange of information is not restricted by Article 1. 2. Any information received under paragraph 1 by a Contracting State shall be treated as secret in the same manner as information obtained under the domestic laws of that State and shall be disclos....
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....ure of information covered by this paragraph, notwithstanding paragraph 3 or any contrary provisions in its domestic laws." 14. The aforementioned Notification No. 2903 (E) is loud and clear and has specifically mentioned that Exchange of Information provided for in the said Protocol will be applicable for information that relates to any fiscal year beginning on or after the 1st day of April 2011 and if the said notification is read with the reference made by the department, we find that the specific periods for which the reference has been made calling for information is 01.04.1995 to 31.03.2012. Therefore, qua the notification, information called by the Revenue by issuing the said reference was invalid for the period prior to 01.04.2011. 15. A reference to the decisions for analogous provisions can throw some light on this issue. The Hon'ble High Court of Rajasthan was considering the reference for Special Audit u/s 142(2A) of the Act in the case of Bajrang Textiles 294 ITR 561and held as under: "Direction of the AO for special audit of assessee's accounts under s. 142(2A) one day before the expiry of limitation for completing the block assessment being merely to get ex....
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.... ACIT has specifically mentioned that "the special audit u/s 142(2A) of the Act in the case of captioned assessee for A.Y 2009-10 is ordered accordingly". This clearly proves that while making a reference u/s 142(2A) of the Act and thereafter passing the order u/s 142(2A) of the Act, the Assessing Officer did not apply his mind and mechanically adopted the figure of A.Y 2009-10 and passed the order u/s 142(2A) of the Act for A.Y 2009-10 without realizing that he is dealing with A.Y 2008-09. 16. The contention of the ld. DR that the letter to the appellant referred to both the A.Ys i.e. 2008-09 and 2009-10 and, therefore, there is no error in the same. We do not find any force in this contention of the ld. DR. As mentioned elsewhere, since each A.Y is considered as a separate unit the Assessing Officer should have made out a case for A.Y 2008-09 only and since the order framed u/s 142(2) of the Act also refers to A.Y 2009-10, then the same cannot be used for A.Y 2008-09. 17. The quarrel before us is as to whether the assessment order framed u/s 143(3) is passed within the period of limitation period prescribed under the Act or not. In our considered opinion, for coming to such a....