2019 (8) TMI 1340 - HC - Income Tax

Assessment u/s 153C - period of limitation - HELD THAT - Legislature has specifically made the amended provisions of Section 153C of the Act applicable with prospective effect from 01.06.2015. The Court held that if such amended provisions are not made applicable to the searches carried out prior to 01.06.2015, they would affect the substantive rights of the persons who are brought within the ambit of Section 153C by virtue of such amendment. So far as the third question is concerned with regard to the limitation, the Court in ANILKUMAR GOPIKISHAN AGRAWAL VERSUS ACIT 2019 (6) TMI 746 - GUJARAT HIGH COURT took the view that when the statute itself provides for an alternative period of limitation, merely because the period of limitation is provided under the first part has elapsed; it cannot be said that the notices were barred by the limitation on such ground In case any notices u/s 153C which have been issued for assessment years beyond the six assessment years referred to herein above, such notices would be beyond jurisdiction as the same do not fall within the six assessment years as contemplated u/s 153A - Decided in favour of assessee.

Summary

Issues:
1. Maintainability of the writ applications
2. Applicability of Section 153C of the Act post amendment from 01.06.2015
3. Limitation period for notice u/s. 153C of the Act
4. Relevant Assessment Years under Section 153A of the Act

Issue 1: Maintainability of the writ applications
The Court found the writ applications maintainable. The coordinate bench held that the petitions were maintainable, allowing the case to proceed further.

Issue 2: Applicability of Section 153C of the Act post amendment from 01.06.2015
The Court interpreted that the amended provisions of Section 153C of the Act, effective from 01.06.2015, applied prospectively. It reasoned that applying the amendments retrospectively would impact the substantive rights of individuals brought under Section 153C.

Issue 3: Limitation period for notice u/s. 153C of the Act
Regarding the limitation period, the Court clarified that when the statute provides an alternative period of limitation, the mere elapse of the initial period does not render the notices barred by limitation.

Issue 4: Relevant Assessment Years under Section 153A of the Act
The Court analyzed Section 153A of the Act concerning the trigger point for issuing notices. It specified that the notice must be issued for six assessment years preceding the assessment year relevant to the previous year of the search. The judgment detailed the assessment years for different groups based on the search dates.

The final order quashed and set aside the impugned notices issued under Section 153C of the Income Tax Act, 1961, and any corresponding assessment orders challenged. The Court ruled that the initiation of proceedings under Section 153C was without jurisdiction, leading to the success of the petitions. The judgment aligned with principles established in a prior case, applying the same legal standards to the present matter.

In conclusion, the Court allowed the petition, quashing the impugned notice and any related Assessment Order under Section 153C of the Income Tax Act, 1961. The ruling made the rule absolute in favor of the petitioners, with no order as to costs.