1999 (6) TMI 65 - AT - Income Tax

Summary

Issues Involved:
1. Bias and hostility of assessing and authorised officers.
2. Flouting of natural justice rules by the AO.
3. Non-compliance with provisions of s. 132(9).
4. Approval authority reducing the function of approval to a formality.
5. Assessment extending to income disclosed in regular proceedings before AO.
6. Assessment barred by limitation.

Summary:

Issue 6: Assessment Barred by Limitation
The Tribunal first addressed whether the assessment order was barred by limitation. The search started on 16th Oct., 1996, and concluded on 20th Oct., 1996. The assessment should have been completed by 31st Oct., 1997, but was completed on 31st Dec., 1997. The Tribunal noted that the search warrant was executed between 16th Oct., 1996, and 20th Oct., 1996, and the search party left the premises on 20th Oct., 1996, after seizing valuables. The Tribunal held that the search concluded on 20th Oct., 1996, and any subsequent actions, including the order under s. 132(3) on 13th Dec., 1996, were irrelevant for determining the limitation period. Therefore, the assessment was barred by limitation and annulled.

Issue 1: Bias and Hostility of Assessing and Authorised Officers
The assessee contended that the assessing and authorised officers were biased and hostile. However, since the assessment was annulled due to being barred by limitation, this issue was not adjudicated.

Issue 2: Flouting of Natural Justice Rules by AO
The assessee argued that the AO flouted all rules of natural justice during the proceedings. This issue was rendered academic due to the annulment of the assessment on the ground of limitation.

Issue 3: Non-Compliance with Provisions of s. 132(9)
The assessee claimed non-compliance with s. 132(9). Since the assessment was annulled on the ground of limitation, this issue was not addressed.

Issue 4: Approval Authority Reducing Function of Approval to Form
The assessee argued that the approving authority reduced the function of approval to less than a formality. This issue was not adjudicated due to the annulment of the assessment on the ground of limitation.

Issue 5: Assessment Extending to Income Disclosed in Regular Proceedings
The assessee contended that the assessment extended to income disclosed in regular proceedings before AO. This issue was not adjudicated as the assessment was annulled on the ground of limitation.

Conclusion:
The Tribunal annulled the assessment on the ground that it was barred by limitation, rendering other issues academic and unnecessary to adjudicate. The appeal was allowed pro tanto.