TaxTMI 
TaxTMI 
2024 (8) TMI 293
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....der section 153C was always clear and had to be calculated from the date of the search? 2.2 Whether the Id. ITAT has erred in law by quashing the assessment under section 153C on grounds that the relevant assessment year should be decided based on the date of recording satisfaction and not in accordance with the date of the search. The ld. ITAT ignored the fact that the satisfaction was recorded on 15.05.2019 and by the time of the amendment to the section 153C was already into effect (01.04.2017) which clarified that the relevant assessment years have to be calculated according to the date of search? 2.3 Whether the ld. ITAT erred in law by ignoring that the implementation provisions have to be interpreted in consonance with the charging provision and there cannot be any anomalous situation created by the interpretation of the implementation provision. The provision under section 153A and 153C of the Act have to be constructed in such a harmonious way that there will not be any different sets of 6 years for reopening of the assessments in case of the person searched and the other person? 2.4 Whether the ld. ITAT erred in law by ignoring the fact that the....
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....is prospective in nature. Since satisfaction has been recorded after amendment in the Act, amended provisions are applicable in the present case. The appellant also relied upon decision of Hon'ble Delhi High Court in the case of Brahm Datt v/s ACIT (2018) (12) TMI 832-Delhi High Court stating that the initiation of proceedings for A.Y. 2011-12 had become time barred on 31/03/2017, the amendment in Section 153C w.e.f. 01/04/2017 cannot be interpreted/meant for extending/enhancing/ revival of already time barred proceedings up to 31/03/2017. This decision was in the context of proceedings u/s 147 of Income Tax Act and not applicable to the present case. As per Act, there is no time limit for issue of notice u/s 153C of Income Tax Act. In view of above discussion, it is held that the Assessing Officer has rightly initiated proceedings u/s 153C of Income Tax Act from AY 2011-12 to 2016 17. Hence, Ground No. 1 is dismissed. In view of amended provisions to section 153C of Income Tax Act and the fact that satisfaction was recorded after amendment w.e.f 01.04.2017, the Assessing Officer has rightly completed assessment u/s 153C for AY 2012-13. Hence, Ground No. 2 is dismissed....
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....books of account, other documents or any assets are requisitioned under Section 132-A after the 31st day of May, 2003 [but on or before the 31st day of March, 2021], 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 assessment years [and for the relevant assessment year or years] referred to in clause (b), in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under Section 139; (b) assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made [and of the relevant assessment year or years]: Provided that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years [and for the relevant assessmen....
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....ove, clause (c) of that Proviso clearly stipulates that no notice for assessment or reassessment for the relevant assessment year or years could be issued if a search had been made prior to 01 April 2017. This is evident from the Second Proviso stipulating that the amended block period provision would get attracted only if the search had been initiated or requisition made on or after the first day of April 2017. Undisputedly in the facts of the present case the search was conducted on 07 April 2016. 10. We note that the Tribunal has firstly faulted the appellants on the ground of the search itself having been conducted on 07 April 2016 and thus the extended period of ten years not being applicable at all. The position so taken clearly appears to be unexceptional bearing in mind the plain language in which the Second Proviso to Section 153A (1) stands couched. We also bear in mind the position of an assessment under Section 153C of the Act broadly following the same procedure as envisaged by Section 153A. This is evident from the former Section employing the phrase "in accordance with the provisions of Section 153A". The contemporaneous amendments which came to be included in Sec....
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....n 153-A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of such other person [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 referred to in sub-section (1) of Section 153-A] : ] [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 132-A in the second proviso to [sub-section (1) of Section 153-A] 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 : ]" 13. The second submission which was addressed was in the backdrop of the facts of the present case, and where the Assessing Officer [AO] was common for both the searched as well as the non-searched entity and thus the jurisdictional AO being the same. In such a scenario, Mr. Mann contended that there would be no occas....
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.... of the searched and non-searched entity were the same. This would also lead and constrain the Court to restrict the application of the First Proviso to Section 153C (1) of the Act only to those cases where the AO of the non-searched entity be one different from that of the searched person. This would clearly amount to a reconstruction of Section 153C and creating an exception which the Legislature chose not to introduce. 17. The First Proviso to Section 153C (1) has been consistently recognized as not being concerned merely with the aspect of abatement, which is spoken of in the Second Proviso to Section 153A (1) of the Act, but also to regulate the date from which the six-year period or the "relevant assessment year" insofar as the non-searched entity is concerned, is to be reckoned. This position has been consistently followed not just by this Court but also by the Supreme Court in Commissioner of Income Tax 14 vs. Jasjit Singh 2023 SCC Online SC 1265. The relevant paragraphs of the said decision are reproduced hereinbelow: - "8. In SSP Aviation (supra) the High Court inter alia reasoned as follows:- "14. Now there can be a situation when during the search c....
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....Section 153-C was enacted. The revenue argued that the proviso [to Section 153 (c) (1)] is confined in its application to the question of abatement. 10. This Court is of the opinion that the revenue's argument is insubstantial and without merit. It is quite plausible that without the kind of interpretation which SSP Aviation adopted, the A.O. seized of the materials - of the search party, under Section 132 - would take his own time to forward the papers and materials belonging to the third party, to the concerned A.O. In that event if the date would virtually "relate back" as is sought to be contended by the revenue, (to the date of the seizure), the prejudice caused to the third party, who would be drawn into proceedings as it were unwittingly (and in many cases have no concern with it at all), is dis-proportionate. For instance, if the papers are in fact assigned under Section 153-C after a period of four years, the third party assessee's prejudice is writ large as it would have to virtually preserve the records for at latest 10 years which is not the requirement in law. Such disastrous and harsh consequences cannot be attributed to Parliament. On the other hand,....