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TMI Blog2010 (10) TMI 158X X X X Extracts X X X X X X X X Extracts X X X X ..... grounds: 1. That in any view of the matter order passed under section 158-BC(c) of the Income-tax Act, 1961 dated 31-5-2000 is bad both on the facts and in law and his action as confirmed by the learned Commissioner of Income-tax (Appeals) is highly unjustified in the facts and circumstances of the case. 2. That in any view of the matter the appellant is not a person against whom search was conducted nor cash was seized from his possession, therefore proceeding under section 158BC of the Act as per notice dated 8-3-2000 is illegal, invalid and without jurisdiction. 3. That in any view of the matter on 2-5-1998 three persons viz. Mukesh Kumar Khandelwal, Vijay Kumar Soni and Phool Raj Singh from whose possession cash was seized by the police, therefore the seized amount added and considered in the hands of the appellant is highly unjustified, illegal and without jurisdiction. 4. That in any view of the matter the authorization under section 132 of the Act was issued on 3-5-1998 by the learned Commissioner of Income-tax, simply on the basis of police information, therefore there was no reason or satisfaction recorded by the department, hence the Commissioner of Income-tax ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is highly unjustified. 13. That in any view of the matter before charging the interest no proper opportunity was allowed to the appellant. 14. That in any view of the matter the appellant reserves his right to take any fresh ground before hearing of the appeal. 2. Vide ground Nos. 1 to 7, the assessee has challenged the validity of the search. The facts related to this issue, in brief, are that on 02/05/98, three persons namely Shri Mahesh Kumar Khandelwal, Shri Vijay Kumar Soni and Shri Phool Raj Singh were going in one rickshaw to Allahabad station to board the train namely Prayag Raj Express for going to Delhi in connection with business but were detained by the Police at Jhonstonganj, Allahabad. During the course of interrogation by the Police, a sum of Rs. 17,00,000 was found from the possession of the said three persons out of which a sum of Rs. 5,45,000 was with Shri Vijay Kumar Soni, Rs. 6,00,000 with Shri Phool Raj Singh and Rs. 5,55,000 was with Shri Mahesh Kumar Khandelwal. In reply to the query by the Police, all the three persons stated that they have got the money from Guddu i.e. Shri Anil Kumar Chaddha, assessee. The Assessing Officer did not believe the conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the assessee s case. Therefore the notice issued to the assessee is vague. The assessee rely on following decision: 300 ITR 83 (Delhi HC) 289 ITR 341 (SC) That since the amount was seized from the three persons and not from the assessee therefore issue of notice under section 158BC is illegal and require notice under section 158 BD. 4. The learned CIT (A), after considering the submissions of the assessee, observed that the Assessing Officer was fully justified in issuing notice under section 158BC in the name of the assessee since the three persons who were interrogated by the Police clearly stated in their statements that the money seized from them belonged to the assessee. The learned CIT (A) also observed that there is no difference in the notice which is issued under section 158BC or under section 158BD, both the notices were the same and the assessment has to be made under section 158BC in whose name seizure was made. Now the assessee is in appeal. 5. The learned counsel for the assessee reiterated the submissions made before the authorities below and further submitted that there was no search in the hands of the assessee and even no warrant of authorisation was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt was issued in the name of the assessee. The requisition under section 132A of the Act was made from the SHO, Kotwali, Allahabad. From the above document, it is established that there was no search warrant in the name of the assessee and no search took place in the hands of the assessee. Therefore, the provisions of section 158BC of the Act were not applicable in assessee s case. The said provisions of section 158BC read as under: 158BC. Where any search has been conducted under section 132 or books of account, other documents or assets are requisitioned under section 132A, in the case of any person, then, [(a) the Assessing Officer shall (i) in respect of search initiated or books of account or other documents or any assets requisitioned after the 30th day of June, 1995, but before the 1st day of January, 1997, serve a notice to such person requiring him to furnish within such time not being less than fifteen days; (ii) in respect of search initiated or books of account or other documents or any assets requisitioned on or after the 1st day of January, 1997, serve a notice to such person requiring him to furnish within such time not being less than fifteen days but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, the assessment framed under section 158BC in the hands of the assessee was illegal. The Hon ble Jurisdictional High Court in the case of Raghu Raj Pratap Singh And Others v. ACIT [2008] 307 ITR 450 (All) has held as under: When a statutory power is conferred on a particular statutory authority, it has to be exercised by the same authority and the scope of such power cannot be lessened or enhanced by giving a wider interpretation to the definition clause. An interpretation clause is not a positive enactment and having regard to limited operation, it must be given a limited effect. While giving effect thereto, the court must not forget that the scope and object of such a provision subject to its applicability and it is used having relation to the context only. 7.2 In the instant case also, the provisions of section 158BC were not applicable in the case of the assessee whereas the provisions of section 158BD were applicable. We, therefore, are of the view that the learned CIT(A) was not justified in holding that there is no difference in the notice which is issued under section 158BC or 158BD and that both the notices are same and assessment has to be made under section 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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