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TMI Blog2020 (9) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... to be done on the basis of certain documents found from other persons during the course of search then the assessment could have been framed under section 153C of the Act but no such action was taken in assessee s case rather the action was taken indirectly under section 147 r.w.s 148 of the Act. As decided in in the case of CIT Vs. Kelvinator of India Ltd. [ 2002 (4) TMI 37 - DELHI HIGH COURT] it is well settled principle of law that what cannot be done directly cannot be done indirectly If any material was found relating to the assessee during the course of search on third parties then the correct course of action would have been to proceed against the assessee under section 153C of the Act and there was no justification for the A.O. to initiate the proceedings under section 147 r.w.s 148 of the Act. So respectfully following the case SHRI ADARSH AGRAWAL VERSUS THE INCOME TAX OFFICER, WARD-61 (1) , NEW DELHI [ 2020 (1) TMI 620 - ITAT DELHI] we are of the view that there was no justification on the part of the A.O. to initiate the reassessment proceedings under section 147 r.w.s 148 of the Act against the assessee. Accordingly the said order of the A.O. is set aside and qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 5. That the Ld. Commissioner of Income Tax (Appeals)-3, Gurgaon while adjudicating the appeal, has dismissed various grounds of appeal raised by the Appellant by relying on statements of various persons and data without affording any opportunity to cross examine such persons thereby ignoring the basic principles of natural justice despite the fact that a specific ground was raised to this effect. 5. Vide Ground No. 1 the assessee challenged the validity of initiation of proceedings under section 148 of the Income Tax Act, 1961 (hereinafter referred to as Act ). 6. The facts related to this issue as emerging from the assessment order dt. 29/12/2016 in brief are that a search and seizure operation under section 132(1) of the Act was initiated by the Department on 21/02/2014 at the business and residential premises of Bhushan Power Steel Group (BPSL) alongwith its Directors and other related entities persons. During the course of pre search / post search enquiries, various incriminating documents, papers, books of accounts etc were found and seized which indicated that bogus Long Term Capital Gain (LTCG), accommodation entries in the case of individuals of BPSL G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the search folder revealed that the assessee s name was not appearing on warrant of authorization, therefore, he had written a letter dt. 13/10/2015 to the DDIT, Faridabad for clarification. As nothing was heard from the DDIT-I Faridabad. The A.O. again wrote a letter dt. 31/12/2015 to the Addl. CIT and after normal discussion it was stated that the notice under section 153A in the case of the assessee to be dropped. On 08/01/2016 a letter for seeking approval / permission for dropping the proceedings under section 153A was written to the Addl. CIT Range Central Chandigarh for dropping the proceedings under section 153A of the Act and the approval for dropping the proceedings under section 153A of the Act was received from Addl. CIT vide letter dt. 13/01/2016. Thereafter, the A.O. from the ITR s of the assessee noticed that income was claimed exempt from sale of shares of various listed companies from A.Y. 2011-12 to 2014-15 and in the statement recorded on 06/03/2014 and 19/03/2014 under section 132(4) of the Act, Shri Sanjay Singal was not able to satisfactorily reply the question asked by authorized officer and finally he voluntarily surrendered unaccounted income of ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd, 4) Global Infratech Ltd. formly known as Asian Lak Capital Finance Ltd. 5) Rutron International Ltd. and 6) Grandama Trading Agencies Ltd. As per the information gathered from the analysis of various documents a total of approximately ₹ 144.02 crores exempt LTCG has been earned by the assessee through Sh. R.K. Kedia and Sirish Chandrakant Shah (SCS). The details of exempt LTCG of ₹ 144.02 crores related to the assessee are given in table below:- Figures in Rs. Exempt LTCG earned by M/s Sanjay Singal HUF, Names of penny stock companies A.Y. 2011-12 A.Y. 2012-13 A.Y. 2013-14 A. Y. 2014-15 Grand Total Prraneta Industries Ltd 21,65,80,899/- DB International 15,55,41,448/- Blue Circle 40,48.37,931/- Unisys Software Holding Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olling and managing the affairs of the company 1 Pranneta Industries Ltd. Sh. Shirish Chandrakant Shah (SCS) 2 DB International Stock Brokr Ltd. Sh. S.N. Daga 3 Blue Circle Services Ltd. Sh. Jagdish Prashad Purohit 4 U nisys Software Holding Ltd. Sh. Jagdish Prashad Purohit 5 Global Infratech Ltd. Sh. Jagdish Prashad Purohit 6 Rutron International Ltd. Sh. Anil Aggarwal 7 Grandama Trading Agencies Ltd. Sh. Sawan Jaju 2.2. Thus, from the above discussion it is inferred that, Sh. R.K. Kedia has played key role in arranging the exempt LTCG accommodation entries for the assessee from the above named companies. During the post search investigation, various information related to the above named listed paper companies was collected which shows that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Name of the person No. of Shares Amount 04.08.2009 Sanjay Singal HUF 32,00,000 72,00,000 4.1. It to state that during the course of search and survey at the office premises of Shri Shirish Chander Shah (SCS), backup of the books of account was taken and in that an excel sheet named Kedia 2 was also impounded in the MS excel File acLxls in the Bips Folder located at the pathF:\pen drive back up\Removable Disk\ Bips backup 14.02.12. In the Kedia 2 Sheet details of the shares of M/s. PIL sold by the BPSL family have been recorded under the heading new account . The above sheet contains the details of cash received by SCS from Kedia (Le. Shri R.K. Kedia of Delhi) on behalf of Bhushan Group against the payout made on the purchase of shares. 4.2. From the analysis of the trade details of M/s PIL received from BSE and enquiries conducted by department, it is observed that majority of the shares of M/s PIL held by 'BPSL Family were sold to (Counter parties) entities controlled and managed by SCS. Some of these entities are gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e executed within 5 minutes of placing the orders on the exchange [The trading data received from BSE was analyzed for time difference of placing of the order and execution of trade], 6. The evidence and statements of the employees of Sirish Chander Shah (SCS) were confronted to him during the course of search and in the post search proceedings, in his statements referred to above. In these statements he has admitted to have provided various types of accommodation entries against receipt of cash from the clients either directly or through intermediaries. He has also admitted to be engaged in synchronised trading in the shares of various listed companies managed and controlled by him so as to facilitate LTCG to the clients against receipt of cash from them. In these statements Shirish Chander Shah (SCS) recorded under section 132(4) of the Act has himself admitted and accepted that he is engaged in providing accommodation entries against receipt of cash. The modus operandi accommodation entries including exempt LTCG of his statement. The modus opedandi followed entries of LTCG, as explained by him in his statement is summarized hereunder: The preferential shares are allo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard to PIL it is clear from the statement of SCS and OPK, discussed above. * To have effective control over the shares of the penny stock companies, the share capital of these penny stock companies is structured by SCS by allotting a large number of fresh shares through private placement. The structuring of share capital involves two types of allotment: b. Majority of the shares are allotted a number of private companies which too are under control of SCS. The investment is made by the private limited companies in the shares of listed companies following two modus operandi: * Firstly, the unaccounted cash received from clients is layered into the investing private company which invests in the shares of the listed company and the listed company in turn provides accommodation entry of share capital / premium to the client from whom cash was received. * Secondly, an artificial structure of share capital of the listed company is created, wherein, private limited company managed by SCS subscribes to the shares of the listed company. The listed company in turn advances these funds to another private limited company managed by SCS. This money so received by the second ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with evidence seized in the case of shri Praveen Kumar Jain (alias Pintu/Chintan) which is sufficient to establish that the entries recorded in the evidence seized are true, correct and independently verifiable. 7.3 Analysis of Books of Accounts ofSirish Chandrakant Shah (SCS), Praveen Kumar Jam (Pintu alias Chintan), R.K. Kedia and bank accounts of BPSL was also made and the entries recorded in 'Kedia2 Sheet' viz-a-viz payments made from A/c 0131008700000327 in Punjab National Bank in the name of M/s Bhushan Power Steel Ltd. were cross verified. From this verification/analysis, it is observed that the transactions recorded in Kedia2 Sheet' are exactly same as recorded in the bank statement of A/c No 0131008700000327, PNB of M/s BPSL Thus, this further establishes that the transactions recorded in 'Kedia2 Sheet' are authentic and the assessee group was involved in receiving accommodation entries. 7.4. Further the documents found seized during the search action on Shri R.K. Kedia and related entities on 13.06.2014 by the Directorate of Income Tax(lnv.), New Delhi also corroborate the same facts. 7.5. Further, On the date of search on Bhushan Po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 58,657.67/- 9. I have gone through the complete record and perused the details available with the department and I am satisfied that this is a fit case to issue notice u/s 148 as the amount of ₹ 23,78,58,657.67 has not been offered for tax. Therefore, in view of the above, I have reason to believe that the amount of ₹ 23.78 Crores has escaped assessment within the meaning of Section 147 of the Income Tax Act, 1961. 6.3 In response to the above notice the assessee filed its return of income on 05/04/2016 declaring total income of ₹ 2,31,150/- and requested for supply of reasons recorded under section 147 of the Act which were provided to the authorized representative of the assessee on 15/09/2016. The A.O. mentioned that as the assessee had not filed any objection with respect to the reasons recorded for reopening of the case therefore the procedures laid down by the Hon'ble Supreme Court in the case of M/s GKN Driveshafts (India) Ltd. Vs. Income Tax Officer and Other, Appeal Civil No. 7731 of 2002 were not applicable in the case of the assessee. Accordingly, the A.O. framed the assessment by observing that the transaction of LTCG claime ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r shall assess or reassess the total income in respect of each assessment year falling within such six assessment year: Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years referred to in this [sub section] pending on the date of initiation of the search under section 132 or making of requisition under section 132A, as the case may be, shall abate. (3) It is implicit in the above provisions that where an assessment order has already been passed for a year within the relevant six assessment years, then the Assessing Officer is duty bound to reopen those proceedings and reassess the total income but by taking note of the undisclosed income if any, unearthed during the search. The legislative intent behind incorporating the said provisions into the statute book was to establish a live link/ undeniable nexus between some incriminating material/document etc. found/unearthed/discovered in the course of search u/s 132 and undisclosed income arising therefrom. (4) In this regard, it is humbly and respectfully submitted that the provisions of law, as enshrined in Section 153A of the Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to file returns for six AYs immediately preceding the previous year relevant to the AY in which the search takes place. ii. Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as a fresh exercise. iii. The AO will exercise normal assessment powers in respect of the six years previous to the relevant AY in which the search takes place. The AO has the power to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words, there will be only one assessment order in respect of each of the six AYs in which both the disclosed and the undisclosed income would be brought to tax . iv. Although Section 153A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment 'can be arbitrary or made without any relevance or nexus with the seized material. Obviously, an assessment has to be made under this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal Chandigarh Bench of the Hon'ble Income Tax Appellate Tribunal in the case of Mala Builders (P) Ltd vs AC1T, Central Circle - II, Chandigarh vide order dated 23/08/2016 in ITA Nos. 433 to 437 of 2014 has also unequivocally affirmed the above interpretation of law. It is respectfully prayed that the above ground may kindly be adjudicated in the light of the submissions made above. 8. The assessee also submitted the written submission on the merits of the case which is incorporated at page no. 124-155 of the impugned order, for the cost of repetition the same is not reproduced herein. However the Ld. CIT(A) did not find merit in the submissions of the assessee who sustained the addition made by the A.O. by passing the combined impugned order. 9. Now the assessee is in appeal and has challenged the validity of the issuance of initiation of the proceedings under section 147 of the Act by issuing the notice u/s 148 of the Act. 10. Ld. Counsel for the assessee submitted that no incriminating material for the purpose of Section 153A of the Act was found at the time of search on the group to which the assessee belongs, which took place on 21/02/2014, therefore the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) 41 ITR 191 (SC) b) ITO Vs. Lakmani Mewal Das, (1976) 103 ITR 437 (SC) c) Sheo Nath Singh Vs. AACIT, 972 SCR (1) 175 (SC) d) S. Narayanappa and Ors. Vs. CIT, Bangalore, AIR 1967 SC 523 10.2. It was submitted that the reasons recorded for the resort to the reassessment proceedings and consequent issue of the notice under section 148 of the Act in the instant case was based solely on information received from the Investigation Wing which had not been independently verified by any degree of application of mind or conducting any such enquiries by the AO who merely by relying upon the information provided by the DIT during the course of the assessment proceedings without supplementing the same to any degree by application of mind or any independent enquiries of his own has only relied upon a suspicion as to the escapement of income and that the relevant legal provisions in this regard specially call for a definite conclusion as to the reason to believe as opposed to reason to suspect . It was reiterated that in the assessee s case there was only a suspicion as to some income having escaped assessment which suspicion cannot by itself sustain any action under section 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents were found and not in the case of third parties. Accordingly it was submitted that the material which was unreliable piece of evidence and bereft of evidentiary value and thus could not have been entrusted in the hands of the Ld. AO to provide him jurisdiction for reopening the concluded assessments by invoking the provisions of Section 147 of the Act. 10.5 It was also stated that the disclosure was made under section 132(4) of the Act amounting to ₹ 250 Crores by Shri Sanjay Singal under duress and the same shall be evident from the fact that bereft of any such incriminating material such an admission was unwarranted. It was further submitted that Shri Sanjay Singal was examined for long hours and the said disclosure was made merely to buy peace which was totally against the CBDT Circular No. F. No. 286/2/2003-IT(Inv.) dt. 10/03/2003 and F. No. 286/98/2013-IT dt. 18/12/2014 wherein the proposition that assessment pursuant to search operation are required to be based on incriminating material discovered as a result of search operation in the case of the assessee and that no reliance should be placed on confessions / admissions of undisclosed income obtained in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 153A of the Act in the case of Shri Sanjay Singhal, Aarti Singhal, and Aniket Singhal, therefore, the reopening of the assessment merely on the basis of borrowed satisfaction was insufficient for the purpose of sustaining any such addition under section 148 of the Act. The Ld. Counsel for the assessee stated that the reasons recorded for reopening the assessment under section 147 of the Act was a reproduction of the orders under section 153A in the cases of the aforesaid assessee. In support of the above, a chart was furnished which read as under: Reasons for reopening as reproduced in Shri Sanjay Singal (HUF) Order for A.Y. 2011-12 - Para No. Page No. Corresponding Para in Assessment Order u/s 153A in the case of Sanjay Singhal for A.Y. 2011-12 Para 1.1, Pg. 3 Para 8, Pg. 34 Para 2.1, Pg. 4 Para 1.1, Pg. 65, Para 1.2, Pg. 69 Para 2.2, Pg. 5 Para 1.4, Pg. 69 Para 3.1, Pg. 5 Para 2. Pg. 70 Para 3.2, Pg. 6 Para 2.1, Pg. 71 Para 3.3. P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the A.Y. 2011-12 to 2013-14 stood completed under section 143(1) of the Act and the time limit for issuing notices under section 143(2) of the Act stood expired as on the date of reopening of the assessment and that even if scrutiny assessments under section 143(3) of the Act were to have been made, the same would not fulfil criteria laid down under section 142(2) of the Act since the AO had not conducted any such independent enquiry of his own but had merely relied on borrowed satisfaction, on the basis of third party material / statements which could in no manner be termed to be incriminating in nature, even for the purpose of Section 153A or 153(C) of the Act to render the same sufficient for the purpose of Section 148 of the Act. Therefore when none of the said material and / or statements were independently examined by the AO so as to put such material to the assessee under section 142(3) or for that to even to sustain the addition under section 143(3) of the Act then how the same could have been utilized for reopening the assessment under section 148 of the Act in the assessee s case. It was submitted that what could not have been done directly was not permissible to be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mission the Ld. Standing Counsel strongly supported the impugned order passed by the Ld. CIT(A) and further submitted that the AO had the information that the assessee had wrongly claimed exempt income from sale of shares of various listed companies as such the income escaped the assessment. Accordingly notice under section 148 of the Act was issued and the assessee did not raised any objection. It was further submitted that during the second search on 13/06/2014 incriminating documents were found from the premises of Shri R.K. Kedia which were not doubted and established that assessee s income escaped the assessment and thus documents / material found during the course of search could have been used for reopening the assessment under section 148 of the Act. It was further submitted that Shri Sanjay Singal in his statement recorded under section 132(4) of the Act offered the income for taxation which was later on retracted without any reason, therefore the AO rightly held that the income of the assessee escaped the assessment and was justified in issuing the notices under section 148 of the Act as the income of the assessee escaped the assessment. It was accordingly submitted th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve considered the submissions of both the parties and perused the material available on the record. In the present case, it is not in dispute that a search and seizure operation under section 132 of the Act took place on 21/02/2014 in the case of BPSL Group to which the assessee belongs. The basis for the search was certain pre existing third party material / statement. However, no incriminating material for the purpose of Section 153A was found. The A.O. issued the noticed dt. 29/01/2015 under section 153A of the Act to the assessee and also issued notice under section 142(1) of the Act dt. 12/08/2015 seeking details of LTCG claim in ITR, ledger of purchaser / seller in the books of the Assessee(s) cash flow statement, the A.O. also issued show cause notice dt. 20/10/2015 and 09/11/2015. Thereafter the A.O. sought approval from the Ld. Additional CIT vide letter dt. 08/01/2016 for dropping the proceedings under section 153A of the Act in the case of the assessee and the approval was granted on 13/01/2016. Accordingly the proceedings under section 153A of the Act in the case of assessee were dropped but the A.O. proceeded to issue notice under section 147 r.w.s 148 of the Act for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rior to reopening the assessment, to conclude that he has reason to believe that income has escaped assessment. Unless that basic jurisdictional requirement is satisfied a post mortem exercise of analysing materials produced subsequent to the reopening will not make an inherently defective reassessment order valid. It has further been held as under: that once the date on which the so-called accommodation entries were provided was known, it would not have been difficult for the Assessing Officer, if he had in fact undertaken the exercise. To make a reference to the manner in which those very entries were provided in the accounts of the assessee, which must have been tendered along with the return, which was filed on November 14,2004 and was processed under section 143(3) of the Act. Without forming a prima facie opinion, on the basis of such material, it was not possible for him to have simply concluded that it was evident that the assessee company has introduced its own unaccounted money in its bank by way of accommodation entries. The basic jurisdictional requirement was application of mind by the Assessing Officer to the material produced before issuing the notice for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was required to apply. From the perusal of the reasons recorded and the order of rejection objections, the names of the companies were available with the authority their existence was not disputed. The assessee in its objections had stated that the companies had bank accounts and payments were made to the assessee through banking channel. The identity of the companies was not disputed. Under these circumstances, the initiation of proceedings under section 147 and issuance of notice under section 148 of the Act were to be quashed. 16 In the present case also the A.O. acted on the basis of information received from the investigation wings of the Department and had not independently verified from the record available to him in the form of return of income filed by the assessee. So there was only suspicion that some income having escaped assessment which cannot by itself be sufficient to sustain the action under section 147 r.w.s 148 of the Act. 16.1 In the instant case the A.O. mentioned that the statement of Shri Sanjay Singal was recorded during the course of search under section 132(4) of the Act, a disclosure was made amounting to ₹ 250 Crores and subsequently in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... huge amount of accommodation entries in the garb of exempt LTCG. Therefore, if any action was required to be done on the basis of certain documents found from other persons during the course of search then the assessment could have been framed under section 153C of the Act but no such action was taken in assessee s case rather the action was taken indirectly under section 147 r.w.s 148 of the Act. On a similar issue, their Lordship of the Hon'ble Delhi High Court in the case of CIT Vs. Kalvinator of India Ltd. (supra) observed at page no. 15 that it is well settled principle of law that what cannot be done directly cannot be done indirectly . 17.1 Similarly, the Hon'ble Gujarat High court in the case of Cargo Cleaning Agency (Gujarat) Vs. JCIT (supra)held as under: 'The entire scheme for bringing to tax income which has escaped assessment under sections 147 to 153 of the Act specifically relates to a specific assessment year and different time limits are provided at different stages which are all interlinked and commence from the end of the relevant assessment year. The definition of assessment year as provided in section 2(9) of the Act means the period of 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has retracted from the fact of taking any loan from assessee and genuineness of the agreement is itself in doubt which was found during the course of search and is not corroborated by any evidence or material on record, therefore, such photo copy of the agreement cannot be relied upon by the A.O. for the purpose of initiating the re-assessment proceedings in the case of the assessee. It is an admitted fact that in the present case the agreement in question was found during the course of search in the case of Shri Naresh Sabharwal and proceedings under section 153A have been initiated against him. Therefore, the agreement in question have been transferred by A.O. of the person searched to the A.O. of the assessee for the purpose of taking remedial action in the matter. It is well settled Law that in the case of assessment made on assessee consequent to the search in another case, A.O. is bound to issue notice under section 153C and thereafter proceed to assess the income under section 153C and if A.O. had proceeded with re-assessment under section 147/148 of the I.T. Act and passed the Order under section 143(3)/148 of the I.T. Act, the same would be illegal and arbitrary and withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tiated proceedings under section 147/148 of the I.T. Act. The correct course of action would have been to proceed against the assessee under section 153C of the I.T. Act. Therefore, initiation of re-assessment proceedings under section 147/148 of the I.T. Act is wholly invalid, void and bad in Law. Since the correct procedure have not been adopted by the A.O. and there is no justification to initiate the re-assessment proceedings against the assessee, we set aside the Orders of the authorities below and quash the reopening of the assessment. Resultantly, all additions stands deleted. 18. In the present case also if any material was found relating to the assessee during the course of search on third parties then the correct course of action would have been to proceed against the assessee under section 153C of the Act and there was no justification for the A.O. to initiate the proceedings under section 147 r.w.s 148 of the Act. So respectfully following the aforesaid referred to orders of the Coordinate Benches of ITAT, we are of the view that there was no justification on the part of the A.O. to initiate the reassessment proceedings under section 147 r.w.s 148 of the Act against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n an appeal should be pronounced by the bench within no more than 90 days from the date of concluding the hearing. It is, however, important to note that the expression ordinarily has been used in the said rule itself. This rule was inserted as a result of directions of Hon ble jurisdictional High Court in the case of Shivsagar Veg Restaurant Vs ACIT [(2009) 317 ITR 433 (Bom)] wherein Their Lordships had, inter alia, directed that We, therefore, direct the President of the Appellate Tribunal to frame and lay down the guidelines in the similar lines as are laid down by the Apex Court in the case of Anil Rai (supra) and to issue appropriate administrative directions to all the benches of the Tribunal in that behalf. We hope and trust that suitable guidelines shall be framed and issued by the President of the Appellate Tribunal within shortest reasonable time and followed strictly by all the Benches of the Tribunal. In the meanwhile (emphasis, by underlining, supplied by us now), all the revisional and appellate authorities under the Income-tax Act are directed to decide matters heard by them within a period of three months from the date case is closed for judgment . In the ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll over the world. Government of India has, vide notification dated 19th February 2020, taken the stand that, the coronavirus should be considered a case of natural calamity and FMC (i.e. force majeure clause) maybe invoked, wherever considered appropriate, following the due procedure . The term force majeure has been defined in Black s Law Dictionary, as an event or effect that can be neither anticipated nor controlled When such is the position, and it is officially so notified by the Government of India and the Covid-19 epidemic has been notified as a disaster under the National Disaster Management Act, 2005, and also in the light of the discussions above, the period during which lockdown was in force can be anything but an ordinary period. 10. In the light of the above discussions, we are of the considered view that rather than taking a pedantic view of the rule requiring pronouncement of orders within 90 days, disregarding the important fact that the entire country was in lockdown, we should compute the period of 90 days by excluding at least the period during which the lockdown was in force. We must factor ground realities in mind while interpreting the time ..... X X X X Extracts X X X X X X X X Extracts X X X X
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