2019 (8) TMI 461 - HC - Income Tax

Assessment u/s 153C - maintainability of the petitions - whether Section 153C of the Act as amended with effect from 01.06.2015 would be applicable to the case where search is initiated prior to that date? - Whether the notice u/s.153C of the Act was barred by limitation? - relevant Assessment Years contemplated u/s. 153A of the Act. HELD THAT - The coordinate bench took the view that the writ-applications were maintainable. With regard to the second question, the Court took the view that the 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 of the Act by virtue of such amendment. So far as the third question is concerned with regard to the limitation, the 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 Notices under section 153C of the Act 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 under section 153A -See ANILKUMAR GOPIKISHAN AGRAWAL VERSUS ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 3 (2) AHMEDABAD 2019 (6) TMI 746 - GUJARAT HIGH COURT

Summary

Issues:
1. Maintainability of writ-applications
2. Applicability of Section 153C of the Act pre and post 01.06.2015
3. Bar on limitation for notice u/s. 153C of the Act
4. Relevant Assessment Years under Section 153A of the Act

Issue 1: The maintainability of writ-applications was confirmed by the coordinate bench, allowing the petitions to proceed.

Issue 2: The Court clarified that the amended provisions of Section 153C of the Act, effective from 01.06.2015, would apply prospectively. It emphasized that applying these provisions retroactively would impact the substantive rights of individuals under Section 153C.

Issue 3: Regarding the limitation for notices under Section 153C of the Act, the Court held that alternative limitation periods provided by the statute should be considered. The mere expiry of the period under the first part does not automatically render the notices time-barred.

Issue 4: The Court analyzed Section 153A of the Act to determine the relevant Assessment Years for issuing notices. It stated that the trigger for issuing a notice under this section is a search under Section 132 or a requisition under Section 132A. The Court specified the computation of six assessment years preceding the relevant assessment year, based on the date of search or requisition.

Final Order: The Court allowed the petitions, quashing and setting aside the impugned notices under Section 153C of the Income Tax Act, 1961. Assessment orders challenged were also quashed on grounds of jurisdictional issues. The Court applied principles from a previous judgment to the present case, leading to the quashing of the impugned notice and any related Assessment Orders under Section 153C of the Act.