INCOME TAX ACT, 1961

Section 158BC

Search and seizure - Block assessment - Validity vis-à-vis assessment order passed beyond period of limitation -

A search and seizure operation under section 132 was conducted in premises of assessee-company on 15-9-1998. Subsequently, assessment proceedings under section 158BC were taken up for block year under consideration and ultimately, the assessment order was passed on 27-12-2000. Assessee contended that the said assessment order passed on 27-12-2000 was beyond the limitation period of two years, the search having taken place on 15-9-1998.Held: As per section 158BE(1)(b), assessment order under section 158BC in case of search under section 132 or requisition under section 132A made on or after 1-1-1997 should be passed within two years from the end of the month in which the last of the authorizations for search or requisition was executed. In instant case, search in premises of assessee, which was carried out pursuant to warrant of authorization dated 14-9-1998, was executed on 15-9-1998 itself. Thus, having regard to the limitation of two years from the end of the month in which the authorization was executed, the time limit for passing the assessment order under section 158BC was available till 30-9-2000 only. Accordingly, the assessment order passed on 27-12-2000 was beyond the limitation period of two years and hence, the same was quashed.

REFERRED : CIT v. Shri S.K. Katyal (2009) 177 Taxman 380 (Del) : 2009 TaxPub(DT) 1037 (Del-HC) and CIT v. Sandhya P. Naik (2002) 253 ITR 534 (Bom) : 2002 TaxPub(DT) 195 (Bom-HC).

FAVOUR : In assessee's favour.

A.Y. :

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