TaxTMI 
TaxTMI 
2018 (1) TMI 1765
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....Rs. 53,71,411/- as self assessment tax by ignoring the provisions of Section 132b of the I.T. ACT. 2. The CIT(A) has erred in law in directing not to charge interest u/s 234B of the Act from the date of seizure of cash to the date of assessment in respect of seized cash of Rs. 53,71,411/- which is contradicting to her direction to adjust the seized cash as self assessment tax. 3. (a) The order of the CIT(Appeals) is erroneous and not tenable in law and on facts." 3. The assessee has raised the following grounds of appeal in cross objection:- "1. That the Ld. C.I.T.(A) on the facts of the case and in law has rightly allowed credit of cash seized towards tax liability of the respondent, as it is in line with the law and judicial precedence by various courts and tribunals. 2. That Ground No. 2 of the department is completely erroneous and vague as it contradicts the decision of Hon'ble ITAT, Kolkata on similar set of facts in the case of AC.I.T. vs. Narendra N Thacker (IT (SS) A No.01/Kol/2012, dated 28.09.2015). 3. That the Ld. C.I.T.(A) has rightly directed the AO to not charge interest u/s 234B from 4. That on the facts and i....
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....ded as the error is apparent from records. 6. The ld Authorised Representative submitted a written submission stating that issue is squarely covered in favour of the assessee by the decision of Kolkata Bench in case of ACIT Vs. Narender N Thacker (supra) relied upon by the ld CIT(A). He submitted that the provisions u/s 132B per explanation 2 does not apply to the facts of the case as it was introduced w.e.f. 01.06.2013. 7. We have carefully considered the rival contentions and the facts have already been stated above. The above issue has been discussed at length by the coordinate bench in 82 Taxmann.com 64 in ACIT Vs. Narender N Thacker as under:- "4. The brief facts of this issue is that the search and seizure operation was conducted on Thacker Group on 27.7.2006 and it was seen that the four brothers Sri Dinesh N Thacker, Sri Vinod N Thacker, Sri Narendra N Thacker and Sri Mahendra N Thacker were doing separate business. The activities relating to the family unit of Sri Narendra N Thacker are mainly investment related activities which are carried on in the names of his family members. Pursuant to the search, a notice u/s 153A was issued on the assessee on 10.8.200....
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....f seized cash is illegal. 6. We have heard the rival submissions and perused the materials available on record. We find that the action of the Learned AO in adjusting the seized cash towards the tax liability determined to be payable pursuant to section 153A assessment framed by the Learned AO is in order in terms of section 132B of the Act. For the sake of convenience, the provisions of section 132B of the Act is reproduced here in below: '132B. (1) The assets seized under section 132 or requisitioned under section 132A may be dealt with in the following manner, namely:- (i) the amount of any existing liability under this Act, the Wealth-tax Act, 1957 (27 of1957), the Expenditure-tax Act, 1987 (35 of 1987), the Gift-tax Act, 1958 (18 of 1958) and the Interest-tax Act, 1974 (45 of 1974), and the amount of the liability determined on completion of the assessment under section 153A and the assessment of the year relevant to the previous year in which search is initiated or requisition is made, or the amount of liability determined on completion of the assessment under Chapter XIV-B for the block period, as the case may be (including any penalty levied o....
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.... the amount of liabilities aforesaid by any other mode laid down in this Act. (3) Any assets or proceeds thereof which remain after the liabilities referred to in clause (i) of sub-section (1) are discharged shall be forthwith made over or paid to the persons from whose custody the assets were seized. (4) (a) The Central Government shall pay simple interest at the rate of one-half per cent for every month or part of a month on the amount by which the aggregate amount of money seized under section 132 or requisitioned under section 132A, as reduced by the amount of money, if any, released under the first proviso to clause (i) of sub-section (1), and of the proceeds, if any, of the assets sold towards the discharge of the existing liability referred to in clause (i) of subsection (1), exceeds the aggregate of the amount required to meet the liabilities referred to in clause (i) of sub-section (1) of this section. (b) Such interest shall run from the date immediately following the expiry of the period of one hundred and twenty days from the date on which the last of the authorisations for search under section 132 or requisition under section 132A was executed to the ....
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....ntive law is concerned with the ends which the administration of justice seeks ; procedural law deals with the means and instruments by which those ends are to be attained. The latter regulates the conduct and relations of courts and litigants in respect of the litigation itself; the former determines their conduct and relations in respect of the matters litigated. What facts constitute a wrong is determined by the substantive law ; what facts constitute proof of a wrong is a question of procedure. So far as the administration of justice is concerned with the application of remedies to violated rights, we may say that the substantive law defines the remedy and the right, while the law of procedure defines the modes and conditions of the application of the one to the other. " 9. It is also pertinent to look into the larger bench decision of the apex court rendered in the case of CIT v. Vatika Township (P.) Ltd [2014] 367 ITR 466/227 Taxman 121/49 taxmann.com 249, wherein their Lordships while deciding the issue of applicability of levy of surcharge u/s 113 of the Act brought in the statute with effect from 1.6.2002 is not to be construed as retrospective i....
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....ngly we hold that the amendment brought in section 132B would be construed prospective only as it is a provision which is onerous to the assessee. 11. Moreover, even if we hold that the said amendment in section 132B of the Act is to be construed as retrospective in operation, still it will not disturb the impugned case as in the facts of the instant case, the assessee never requested for adjustment of seized cash towards advance tax liability. He only requested for adjustment of seized cash towards self assessment tax. It is beyond doubt that the terms ' advance tax' and 'self assessment tax' are distinct and separate. 12. Looking at the issue of the Learned AO under section 154 proceedings revoking the adjustment of seized cash towards the tax liability determined on completion of search assessment from another angle, we find that this issue has reached the corridors of various courts as to the legality of the adjustment of seized cash and that itself makes the issue highly debatable and hence in any case cannot be the subject matter of rectification u/s 154 of the Act. It is well settled that an issue which is highly debatable cannot be rectifie....