9911796707
TMI Blog2008 (1) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... This appeal by the Revenue, seeks to challenge the judgment of the Income Tax Appellate Tribunal dated 26.5.2003, accepting the appeal of the assessee, and holding the block assessment, to be barred by time. 2. This appeal was admitted on 21.7.2004, by framing following two substantial questions of law: "(i) Whether in the facts circumstances of the case, on true interpretation of Section 158BE read with explanation 2 the Tribunal was justified in holding the assessment orders passed by the Assessing Officer as barred by time? (ii) Whether in the facts and circumstances of the case, the Tribunal was justified in holding that the authorisation for search made with approval of search operation could not be validly given by D.C.I.T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would lie to the Commissioner, and not to the Tribunal, and the Tribunal overruled the objection. Then, the matter was heard by the Tribunal, and the appeal of the assessee was allowed vide impugned order dated 26.5.2003. The learned Tribunal found that in the present case, the service of authorization under Section 132A falls between 1.7.1995 to 31.12.1996. However, the objection was raised, that since the assessment order was passed on 13.11.97, it becomes barred by time, and also on the ground, that there was no previous approval, obtained from the CIT, to pass the assessment order in question. Learned Tribunal was of the opinion, that the assessment was barred by time, inasmuch as the requisition by the Tribunal was made on 25.3.1996, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dment was expressly made retrospective, by using the words "following explanation shall be inserted and shall be deemed to have been inserted with effect from the 1 st day of July, 1995", therefore, the legislature had expressly amended the provision of Section 158BE, by adding the second Explanation with retrospective effect, and according to that Explanation 2(b), in the case of requisition under Section 132A, the authorization is deemed to have been executed on actual receipt of the assets, by the authorized officer, which, in the present case, were received on 5.6.1997, pursuant to the order of this Court dated 16.5.1997, passed in Criminal Misc. Petition, referred-to above, and therefore, the limitation is required to be calculated fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ressly provide or clearly imply retrospective operation… … …" 10. In that case, by amendment of Section 80P(2)(a) (iii), the legislature substituted the word "of", which was construed by the Supreme Court in 1998 as "belonging to" with the phrase "grown by" and it was in that context, that the Hon'ble Supreme Court held, that the amendment should not be construed as authorizing the revenue authorities to reopen the assessment, when the reopening was clearly barred by limitation. A look at the amending provision being the Finance Act 2 of 1998, Section 46 thereof does show, that the words used are "In Section 158BE of the Income Tax Act, after sub section(2), the existing explanation shall be renumbered as Explanation 1 and after Explana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... starting point of time for calculation of limitation. Taking any other interpretation, about possibility of not giving retrospective effect to the Explanation, would have the effect of rendering the amendment, otiose. 12. Thus, in our view, this Explanation 2, as added on 1.4.1998, with effect from 1.7.1995, does govern the present controversy also, and since the assets have been received by the concerned officer on 5.6.1997, the period of one year has to be computed from that date. The assessment order in the case, has been passed on 13.11.1997, which, in view of the above, is clearly within the period of one year. Likewise, at that time, the DCIT was the competent authority to grant previous consent for the assessment u/s.158BG, as it ..... X X X X Extracts X X X X X X X X Extracts X X X X
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