TaxTMI 
TaxTMI 
2023 (12) TMI 103
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....ncome Tax Act, 1961 for A.Y. 2013-14, on the ground of being illegal and beyond jurisdiction inter alia for the reason that the same is beyond the limitation prescribed under Section 149 of the Income Tax Act, (hereinafter to be referred as 'the Act'). 2. Since both these writ applications involves common question of law as such both are heard together and disposed of by this common order. 3. The brief fact of the case is that Mr. Naresh Kumar Kejriwal, the Petitioner in W.P. (T) No. 2651/2023 is an individual and chartered accountant by profession. Devika Constructions Pvt. Ltd., the Petitioner in W.P. (T) 2650/2023, is a company registered under the Companies Act, 1956 and is engaged primarily in the construction and development of residential flats, commercial establishments and schools. The genesis of the present dispute relates to issuance of notice dated 31.03.2023 to the respective Assessees issued under section 148 of the Act by the Respondent. The basis of issuance of the aforesaid notices was stated to be search and seizure operations conducted on the business premises of Mr. Naresh Kumar Kejriwal on 09.06.2022. Pertinently, Devika Constructions was only subje....
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.... In support of her contentions, learned counsel relied upon following decisions:- (a) S.S. Gadgil vs Lal & Company : (1964) 53 ITR 231 (SC) (b) Brahm Dutt VS ACIT: (2018) 100 taxman.com 324 (Delhi) (c) C. B. Richards Ellis Mauritius Ltd. vs ADIT : [2012] 21 taxmann.com 535 (Delhi). (d) Oracle India Pvt. Ltd vs DCIT. : (2015) 376 ITR 411 (Delhi) 5. Mr. R. N. Sahay, learned senior standing counsel appearing for the revenue oppose the prayer of the petitioners and submits that Section 149 of the Act prescribes limitation to issue notice under Section 148 of the Act. He further submits that with the amendment made by the Finance Act, 2021, though Section 153A is no longer applicable for making assessment of income where search has been conducted on or after 01.04.2021; the Hon'ble Apex Court in the case of Union of India Vs. Aashish Agrawal reported in (2022) 138 taxmann.com 64 (SC) has held in Para-7 & 8 (part) as under: "7. Thus, the new provision substituted by the Finance Act, 2021 being remedial and benevolent in nature and substituted with a specific aim and object to protect the rights and interest of the assessee as well as and th....
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.... examination, it was found that page 01 and 02 of the loose sheets of NKK-01, contains the accommodation entries of loan given to Devika Construction and Developers Private Limited. As per these loose sheets, M/s Devika Construction and Developers Private Limited has received bogus loan of Rs.88,00,000/- on 29.06.2012, Rs. 1,00,000/- on 23.07.2012, Rs. 1,00,000/- on 27.11.2012 and Rs.3,00,000/- on 08.01.2013. As detailed in the said seized/impounded document, the loan has been given at the interest rate of Rs. 1.5% per month. However, the enquires conducted by the Investigating Officer reveal that the aforesaid loans given by Mr. Kejriwal to M/s Devika Construction and Developers Private Limited have not been accounted for in the books of account of the petitioner company. It further appears that the petitioner company in its ITR filed before the department for AY 2013-14, has declared its liability as 'NIL'. Thus, prima-facei it appears from this fact that the Petitioner Company has not declared any loan in ITR filed for AY 2013-14. The sole question which is to be decided by this Court is "whether in the facts and circumstances of these cases, with the amendment brought in by ....
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....under section 132A, on or after the 1st day of April, 2021, in the case of the assessee; or (ii) a survey is conducted under section 133A, other than under sub-section (2A) or sub-section (5) of that section, on or after the 1st day of April, 2021, in the case of the assessee; or (iii) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner, that any money, bullion, jewellery or other valuable article or thing, seized or requisitioned under section 132 or section 132A in case of any other person on or after the 1st day of April, 2021, belongs to the assessee; or (iv) the Assessing Officer is satisfied, with the prior approval of Principal Commissioner or Commissioner, that any books of account or documents, seized or requisitioned under section 132 or section 132A in case of any other person on or after the 1st day of April, 2021, pertains or pertain to, or any information contained therein, relate to, the assessee, the Assessing Officer shall be deemed to have information which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the three assessment years imme....
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....eding proviso, the period of limitation available to the Assessing Officer for passing an order under clause (d) of section 148A is less than seven days, such remaining period shall be extended to seven days and the period of limitation under this sub-section shall be deemed to be extended accordingly. Explanation.-For the purposes of clause (b) of this sub-section, "asset" shall include immovable property, being land or building or both, shares and securities, loans and advances, deposits in bank account. (2) The provisions of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151.] 153A. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, in the case of a person where a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A after the 31st day of May, 2003, the Assessing Officer shall- (a) issue notice to such person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect of each assessment year falling within six ....
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....section 132 is initiated or requisition under section 132A is made on or after the 1st day of April, 2017. Explanation 1.-For the purposes of this sub-section, the expression "relevant assessment year" shall mean an assessment year preceding the assessment year relevant to the previous year in which search is conducted or requisition is made which falls beyond six assessment years but not later than ten assessment years from the end of the assessment year relevant to the previous year in which search is conducted or requisition is made. Explanation 2.-For the purposes of the fourth proviso, "asset" shall include immovable property being land or building or both, shares and securities, loans and advances, deposits in bank account. (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 to sub-section (1), shall stand revived with effect from the date of receipt of the order o....
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....y 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 and for the relevant assessment year or years as referred to in sub-section (1) of section 153A except in cases where any assessment or reassessment has abated. (2) Where books of account or documents or assets seized or requisitioned as referred to in sub-section (1) has or have been received by the Assessing Officer having jurisdiction over such other person after the due date for furnishing the return of income for the assessment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A and in respect of such assessment year- (a) no return of income has been furnished by such other person and no notice under sub-section (1) of section 142 has been issued to him, or (b) a return of income has been furni....
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....e for the relevant assessment year beginning on or before first day of April 2021, if notice under Section 148 or Section 153 A or under Section 153 C could not have been issued at that time on account of being beyond the period of limitation specified under the provisions of clause (b) of sub-Section (1) of this section or Section 153A or 153C as the case may be; in other words, any notice under Section 148 in the amended provision can be issued only and only if the same could have been issued under the old provision of 153A and/or 153C. 8. In the instant case since the search was conducted on 09.06.2022, then as per the first proviso of Section 149 read with unamended Section 153A and 153C and also the amended Section 148 explanation 2 the assessing officer could and has rightly issued notice under Section 148 of the I.T. Act. for the AY 13 - 14 for the following reasons: - (i) Under the old provision, there were three categories of reassessment i.e. 4 years, 6 years and 16 years; however, after the amendment w.e.f. Finance Act 21, there was only two categories i.e., 3 years but not more than 10 years with certain conditions. After the amendment by Finance Ac....
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....ks of account were also incorporated as clause 149(1)(b)(iii) apart from existing terms of asset in 149(1)(b)(i) & expenditure in respect of transaction in relation to an event or occasion in 149(1)(b)(ii). Thus, the legislature has expanded the power of AO in search proceedings and as stated herein above, the search was conducted on 09.06.22. To find out whether the cases before us will come under extended period of ten years, at the cost of repetition, the facts of the case are reiterated. During the course of search at the business premises of Naresh Kumar Kejriwal situated at GEL Church Complex, Ranchi a bunch of loose sheets containing written pages 1 to 110 identified as NKK01 was seized. On examination, it was found that page 01 and 02 of the loose sheets of NKK-01, contains the accommodation entries of loan given to Devika Construction and Developers Private Limited. As per these loose sheets, M/s Devika Construction and Developers Private Limited has received bogus loan of Rs.88,00,000/- on 29.06.2012, Rs. 1,00,000/- on 23.07.2012, Rs. 1,00,000/- on 27.11.2012 and Rs.3,00,000/- on 08.01.2013. As detailed in the said seized/impounded document, the loan has been giv....