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2020 (11) TMI 560 - AT - Income TaxAssessment u/s 153A or 153C - Period of limitation - Whether the assessment for assessment year 2010-11 was required to be framed u/s. 153C of the Act being part of block assessment period or the assessment has been rightly made under regular provisions considering impugned assessment year relevant to the year of search? - HELD THAT - Since the Revenue has itself admitted the fact that the year of search would be Financial Year 2010-11 relevant to AY 2011-12 the block period of six years for search assessment u/s.153C of the Act would comprise of assessment years 2005-06 to 2010-11. The assessment for AY 2010-11 being part of block assessment period should have been u/s 153A r.w.s. 153C of the Act. We find merit in the additional ground of appeal raised by the assessee. In the case of CIT vs. Jasjit Singh 2015 (8) TMI 982 - DELHI HIGH COURT has held that the date of initiation of search u/s. 132 of the Act or requisition u/s.132A of the Act in the case of other person shall be the date of receiving the books of account or documents or assets seized or requisition by the AO having jurisdiction over such other person. In the instant case although the Assessing Officer of the searched person and the other person(the assessee) was the same satisfaction was recorded by the Assessing Officer for invoking the provisions of section 153C of the Act on 21/12/2010 the said date would be deemed to be the date of receiving documents by the Assessing Officer. Thus the year of search would be FY 2010-11 relevant to AY 2011-12. Since the Revenue has itself admitted the fact that the year of search would be Financial Year 2010-11 relevant to AY 2011-12 the block period of six years for search assessment u/s.153C of the Act would comprise of assessment years 2005-06 to 2010-11. Under these facts the assessment for AY 2010-11 being part of block assessment period should have been u/s 153A r.w.s. 153C of the Act. We find merit in the additional ground of appeal raised by the assessee.
Issues Involved:
1. Validity of the assessment order passed under section 144 of the Income Tax Act, 1961. 2. Determination of the 'year of search' for the purpose of invoking provisions under section 153C of the Act. Issue-wise Detailed Analysis: 1. Validity of the Assessment Order Passed Under Section 144 of the Income Tax Act, 1961: The appellant challenged the validity of the assessment order dated 30/12/2011 passed under section 144 for the assessment year 2010-11. The appellant contended that the assessment should have been made under section 153C, as the assessment year 2010-11 falls within the block of six assessment years referred to in section 153C of the Act. The appellant argued that the assessment order is "bad in law" and should be quashed. The Tribunal admitted the additional ground of appeal raised by the appellant, as it involved a jurisdictional issue with all relevant material already on record. 2. Determination of the 'Year of Search' for the Purpose of Invoking Provisions Under Section 153C of the Act: The primary issue was whether the assessment for the assessment year 2010-11 should have been framed under section 153C as part of the block assessment period or under regular provisions, considering the impugned assessment year relevant to the year of search. The Tribunal noted that the Assessing Officer recorded satisfaction for assuming jurisdiction under section 153C on 21/12/2010 and issued a notice on the same day, asking the appellant to furnish the return of income for assessment years 2004-05 to 2009-10. The assessment order for the block period was passed on 30/12/2011. The appellant had previously challenged the invoking of section 153C jurisdiction for assessment year 2004-05 before the Tribunal, which held that the assessment year 2004-05 was outside the purview of the block assessment period. The Tribunal restored the issue back to the Assessing Officer for verification of facts. After verification, the Assessing Officer admitted that the assessment year 2004-05 does not fall within the block assessment period, as the relevant material was handed over in the financial year 2010-11, relevant to assessment year 2011-12. Consequently, the year of search would be financial year 2010-11, relevant to assessment year 2011-12. The Tribunal found merit in the appellant's argument that the block period of six years for search assessment under section 153C would comprise assessment years 2005-06 to 2010-11. Therefore, the assessment for assessment year 2010-11 should have been made under section 153C of the Act. Judicial Precedents: The Tribunal relied on the following judicial precedents to support its decision: 1. CIT vs. Jasjit Singh: The Hon'ble Delhi High Court held that the date of initiation of search or requisition in the case of a person other than the searched person shall be 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. 2. EON Auto Industries Pvt. Ltd. vs. DCIT: The Delhi Bench of the Tribunal held that for determining six assessment years prior to the date of search, the relevant date for invoking provisions of section 153C would be the date of recording satisfaction under section 153C. Conclusion: The Tribunal concluded that the assessment order for the assessment year 2010-11 suffers from legal infirmity as it should have been made under section 153C. Therefore, the assessment order was quashed. The appellant succeeded on the legal issue raised in the additional ground of appeal. Consequently, the grounds raised in the appeal assailing additions on merit became academic and were not deliberated upon. Order: The appeal of the appellant was allowed, and the order was pronounced on 30th September 2020.
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