2023 (5) TMI 1398

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....and material required for this ground are already available on record. Placing reliance on the judgments of Hon'ble Supreme Court in the case of NTPC Ltd. 229 ITR 383(SC) and CIT vs. Sinhad Technical Education Society 397 ITR 344 (SC) the ld. AR submitted that legal issue were facts exists on record can be taken as additional ground at any stage of proceedings even before the Tribunal first time. 3. Replying to the above the ld. Senior DR strongly opposed to the admission of additional ground. 4. The assessee seeks to raise additional legal ground which reads as under: "That under the facts and circumstances, the proceedings initiated u/s. 147/148 of I.T. Act are unwarranted and without jurisdiction against, at the most, corr....

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....ound in search of a 3rd party, the provisions of Sec. 153C are applicable which excludes the application of Sec. 147 / 148. The scope of Sec. 147 / 148 viz a viz 153C are different Sec. 147 is applicable where there is any information other than taken out from the seized material in search of a 3rd party while, Sec. 153C is to be invoked where the reasstt. is proposed on the basis of incriminating material found in search on a 3rd party. Hence, on the basis of seized material, the impugned proceedings could had been initiated only us. 153C and not u/s. 147 / 148, hence whole proceedings are liable to be quashed CASE LAWS Saurashtra Color Tones Pvt. Ltd. Vs. ITO ITA No. 6276 / Del / 2018 Dtd. 22.01.20....

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.... "Reassessment - validity - reassessment on the basis of incriminating material found in search of 3rd party - provisions of section 153C are applicable which exclude the application of SS. 147 and 148 - hence notice issued under section 148 and proceedings under S. 147 are illegal and void ab initio - A.O. having not followed procedure under S. 153C, reassessment order was rightly quashed by CIT(A)" 7. The learned Senior DR has also placed written submissions on the strength of order of ITAT Ahmedabad in the case Shailesh S. Patel vs. ITO (2018) 97 taxmann.com 570 and order of ITAT Pune in the case of Sushil Kumar S Nadkarni vs. ITO order dated 29.11.2013 and submitted that a conjoining reading of section 147 and 153C shows that ju....

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....s juncture it is pertinent to take cognizance of order of ITAT Delhi Bench in the case of Saurashtra Color Tones Pvt. Ltd. (supra) wherein the co-ordinate bench adjudicating the identical legal issue held has follows:- "Therefore, there was no justification for the A.O. to have been initiated proceedings us. 147 / 148 of the I.T. Act. The correct course of action would have been to proceed against the assessee under section 153C of the I. T. Act. Therefore initiation of reassessment proceedings w/s. 147 / 148 of the I.T. Act is wholly invalid, void and bad in law" 10. On careful perusal of orders of co-ordinate bench in the case of Shailesh S. Patel (supra) and Sushil Kumar Nadkarni (supra) are not applicable to the facts of the....