2019 (8) TMI 623 - HC - Income Tax

Assessment u/s 153C - maintainability of petition - whether proceedings initiated by issuance of notice u/s 153C are wholly without jurisdiction? - effective and efficacious appeal remedy - HELD THAT - HELD THAT - With regard to the first question, 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 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 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. While answering the last question, the Court held 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. The impugned notices issued u/s 153C in each of the petitions are hereby quashed and set aside. In cases where the assessment orders are subject matter of challenge, the impugned assessment orders are hereby quashed and set aside on the ground that the very initiation of proceedings u/s 153C was without jurisdiction. See ANILKUMAR GOPIKISHAN AGRAWAL VERSUS ACIT 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. Limitation period for notice u/s.153C of the Act
4. Relevant Assessment Years under Section 153A of the Act

Issue 1: Maintainability of writ-applications
The Court found the writ-applications to be maintainable, allowing the case to proceed for further consideration.

Issue 2: Applicability of Section 153C of the Act pre and post 01.06.2015
The Court clarified that the amended provisions of Section 153C of the Act, effective from 01.06.2015, apply prospectively. It emphasized that not applying these provisions to searches conducted before the amendment would impact the substantive rights of individuals under Section 153C.

Issue 3: Limitation period for notice u/s.153C of the Act
Regarding the limitation period, the Court held that when the statute provides an alternative period of limitation, the mere expiration 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 explained that under Section 153A of the Act, notices are issued for six assessment years preceding the assessment year relevant to the previous year of the search. It specified the assessment years for different groups based on the search dates, emphasizing that notices beyond the specified six assessment years would fall outside the jurisdiction of Section 153A.

The final order quashed and set aside the impugned notices under Section 153C of the Income Tax Act, 1961, and any related assessment orders deemed to be without jurisdiction. The judgment aligned with principles established in a prior case, leading to the allowance of the petition and the quashing of the impugned notice and any associated assessment orders issued under Section 153C of the Act.