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TMI Blog2024 (7) TMI 1414X X X X Extracts X X X X X X X X Extracts X X X X ..... t case, the six year period prior to AY 2012-13 i.e. AY 2007-08 to AY 2012-13. Thus no notice could be issued under Section 153 C of the Act to reopen the Assessee's assessment for A Y 2006-07 In fact, the manner in which ground No. 1 to 3 are raised, without relying any contrary judicial decision, makes the grounds, superfluous. We have no reason to differ from the conclusion drawn by CIT(A). Accordingly, ground No. 1 to 3, of the appeal of revenue, which go to the root of the exercise of jurisdiction, cannot be sustained. Consequently, the appeal of the Revenue is dismissed. - SHRI G.S. PANNU, HON BLE VICE PRESIDENT AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER For the Assessee : Shri Kanwaljit Singh, CA For the Revenue : Shri P.N. Barnwal, CIT-DR ORDER PER ANUBHAV SHARMA, JM: This appeal is preferred by the Revenue against the order dated 16.12.2019 of the Commissioner of Income Tax (Appeals)-XXVI, New Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. FAA ) in Appeal No. 10519/18-19 arising out of the appeal before it against the order dated 30.12.2018 passed u/s 153C r.w.s. 143(3) of the Income Tax Act, 1961 (hereinafter referred as the Act ), by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng accommodation entries to the beneficiaries. 7. That the ld. CIT(A) has erred in law and on facts in deleting disallowance of bogus expenses of Rs. 5,80,314/- booked in profit and loss account being not genuine and not allowable u/s 37 of the Act. 8. (a) The Ld. Commissioner of Income Tax (Appeals) is erroneous and not tenable in law and on facts. (b) The appellant craves leave to add, amend any/all the grounds of appeal before or during the course of hearing of the appeal. 3. Heard and perused the record. 4. The ld. DR has submitted that the ld.CIT(A) has failed to take the notice of the various incriminating documents on the basis of which additions were made by the CIT(A). 5. However, the ld. AR has relied the order of the CIT(A) and has argued particularly, on ground No. 1 to 3, of revenue s appeal, submitted that CIT(A) has rightly held that the exercise of jurisdiction u/s 153A for the year in had was vitiated. 6. We accordingly take up for discussion the ground no 1 to 3 of the appeal first for discussion. As we appreciate the order of ld.CIT(A), it comes forth that in regard to the present assessment year 2010-11, the case set up by the assessee is that the issuance of no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2018-19 i.e. AY 2019-20 and six earlier assessment years would be 201314 to 2018-19. It is pertinent to refer to the provisions of section 153C which reads as under- Section. 153C 153C.(1) 96[Notwithstanding anything, contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that,- (a) Any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) Any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in section 153 A, then, the books of account or documents or assets, seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person] and that Assessing Officer shall proceed against each such other person and issue notice and assess or reassess the income of the other person in accordance with the provisions of section 153 A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere any assessment or reassessment has abated under the second proviso), specify the class or classes of cases in which the Assessing Officer shall not M/s Pragun Finance Pvt. Ltd. -be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made. Provided also that no notice for assessment or reassessment shall be issued by the Assessing Officer for the relevant assessment year or years unless (a) the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more in the relevant assessment year or in aggregate in the relevant assessment years; (b) The income referred to in clause (a) or part thereof has escaped assessment for such year or years; and (c) The search under section 132 is initiated or requisition under section 132A is made on or after the 1st day of April, 2017. Explanation 1. For the purposes of this sub-section, the expression releva ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 132 of the Act took place on 11th November 2010 in the Tinna Group of cases. The documents pertaining to the Assessee were forwarded along with a satisfaction note by the AO of the searched party to the AO of the Assessee on 3rd January 2013. The AO of the Assessee issued notice to the Assessee, which qua the searched party was the 'other person', under Section 153C on 4th January 2013. 4. Sub-section (1) of Section 153 C provides that the assessment or re- assessment of the income of the 'other person' would be in accordance with the provisions of Section 153 A. The first proviso to sub-section (1) of Section 153 C further states that, in case of such other person, the reference to the date of initiation of search in the second proviso to Section 153 A(l) shall be construed as reference to the date of receiving the books of accounts or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person. 5. In terms of Section 153 A(l) (b) of the Act, the AO shall assess or re- assess the total income of six A Ys immediately preceding the A Y relevant to the previous year in which the search was conducted. The second ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f such other person, the proceedings for assessment/reassessment of income of the other person has to proceed in accordance with provisions of Section 153A of the Act. Section 153A requires that where a search has been initiated under Section 132 of the Act, the AO is required to issue notice requiring the notice to furnish returns of income in respect of six assessment years relevant to the six previous years preceding the previous year in which the search is conducted. As discussed hereinbefore, by virtue of second proviso to Section I53A, the assessment/reassessment pending on the date of initiation of search abate. In the context of proceedings_ under Section 153C of the Act, the reference to the date of initiation of the search in the second proviso to Section 153A has to be construed as the date on which the AO receives the documents or assets from the AO of the searched person. Thus, by virtue of second proviso to Section 153A of the Act as it applies to proceedings under Section 153C of the Act, the assessment/reassessment pending on the date on which the assets/documents are received by the AO would abate. In respect of such assessments which have abated, the AO would have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t time that for both the searched person and the other person the period of reassessment would be six AYs preceding the year of search. The said amendment is prospective. 12. Consequently, no substantial question of law arises from the impugned order of the IT AT. The appeal is, accordingly, dismissed. iv. It is clear from the above discussions that the case/s for AYs 201011, 2011-12 and 2012- 13 reopened under section 153C are clearly beyond jurisdiction as envisaged under the relevant provisions as listed above. It is therefore, clear that the impugned orders u/s 153C are beyond jurisdiction permitted as per law. It was also contended that the documents seized did not pertain to the appellant. The appellant had sold its investment in Mysore Finlease Private Limited in 2012-13. Accordingly, the said incriminating documents did not belong to the appellant on the date of search which was 23.07.2015 subsequent date as the shares were sold on 19.072013 which was before the date of search. It is seen from the provision that action under Section 153C can be taken in respect of any other person than the person searched if the Assessing Officer of the person searched is satisfied that any ..... X X X X Extracts X X X X X X X X Extracts X X X X
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