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TMI Blog2012 (4) TMI 475X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 281B of the Act. 3. The petitioner No. 1 was subjected to search under Section 132 of the Act resulting in initiation of block assessment proceedings for the period 1st April, 1988 to 22nd June, 1998. The impugned order dated 28th July, 2005 passed under Section 281 B of the Act records as under: " Please refer to block assessment proceedings for the period 1.4.1988 to 22.6.1998 pending in your case. In this connection since the undisclosed income for the block period is yet to be ascertained/assessed and the regular assessment for assessment year 2003-04 and 2004-05 are pending, a provisional attachment u/s 281B in your case has been authorized by the Commissioner of Income Tax (Central)-II, New Delhi vide No. CIT (c)-II 281B 2005-06/346 dated 26.7.2005 to protect the interest of revenue. The following refunds determined in you(sic) case are provisionally attached for a period of 6 months i.e. upto 25.01.2006 DETAILS OF PROPERTY S. NO. A.Y. Amount of Refund (Rs.) 1. 1998-99 1,09,03,472 2. 1999-00 12,44,152 3. 2001-02 2,49,67,988 4. 2004-05 14,19,546 3,85,35,158 4. At this juncture, we may state that the initiati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay granted, the stay period has to be excluded for computing the limitation period for completing the block assessment proceedings. In the said affidavit, reference is made to decision of the Punjab and Haryana High Court in Tek Chand versus ITO, (2001) 252 ITR 799 and Madras High Court in NEPC India Limited versus ACIT, 1999 (104) TAXMAN 651 and it is averred that the order under Section 281B is not surviving and, therefore, the writ petition of the petitioner should be dismissed. It may be appropriate to reproduce the last paragraph in the affidavit, which reads as under:- "Therefore, if it is considered that the order u/s 281B is not surviving, then in view of above quoted judgments the writ petition of the assessee may be dismissed." The aforesaid statement in the affidavit dated 9th April, 2008 has been referred to below and ultimately forms basis for disposing and deciding of the present writ petition. 8. Section 281B as it existed at the time of filing of the petition, i.e., before addition of the third proviso by the Finance (No.2) Act, 2009 with retrospective effect from 1st April, 1988, is as under:- "281B. Provisional attachment to protect revenue in certain cases.-- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irector may for reasons recorded in writing extend the said period or periods, which shall not exceed two years. Thus, the total period for which extension can be granted is two years, after the first order of provisional attachment, which is valid for six months, comes to an end. The period of provisional attachment, therefore, cannot be for more than two years and six months. The said period in the present case, as the first attachment order was issued on 28th July, 2005, came to an end on 24th January, 2008. 10. The third proviso was inserted in 2009 by Finance (No. 2) Act of 2009 with retrospective effect from 1st April, 1988 is as under:- "Provided also that the period during which the proceedings for assessment or reassessment are stayed by an order or injunction of any court shall be excluded from the period specified in the first proviso." 11. During the course of arguments, a number of contentions were raised by the petitioner No.1 on whether or not the third proviso would be applicable to the present case as the period of 2 years 6 months came to an end on 24th January, 2008. Relying upon CIT vs. Oriental Rubber Works, (1989) 145 ITR 477(SC); Thanthi Trust v. Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Injunction/stay order does not on its own or by deeming friction extend the period stipulated/mentioned in an order under Section 281B. 13. Before we conclude, we must refer to one contention raised by the petitioner with reference to our order dated 19th May, 2011, which reads as under:- "Mr. Sanjeev Rajpal, learned counsel appearing for the revenue, submitted that this writ petition should await the verdict of the Apex Court in Civil Appeal arising out of SLP(C) No.1620/2007. Mr. Bajpai, learned senior counsel appearing for the petitioner-assessee submitted that the lis which is pending before the Apex Court has nothing to do with the present case. The aforesaid aspect shall be adverted to on the next occasion and if this court would be prima facie satisfied that there is no connection between the nature of litigations, the hearing shall proceed. Call on 18th August, 2011. The requisite file that was directed to be produced shall be produced by Mr. Rajpal on the next date." 14. The contention of the petitioner is that there is no connection between the block assessment proceedings and the refunds which are due to the petitioner. We may note that in the written su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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