| The Tax Publishers2020 TaxPub(DT) 3198 (Mum-Trib) : (2020) 185 ITD 0324 INCOME TAX ACT, 1961
Section 158BC
Where search and seizure action under section 132 was carried out and Panchnama was issued, considering that period between the second last Panchnama and the last Panchnama was almost one year for which there was no explanation given by revenue and as per section 132(8A), said prohibitory order came to an end, thereafter revenue was not justified in converting non-existent prohibitory order into deemed seizure, and issuing panchnama only for purpose of extending limitation period of block assessment, which was barred by limitation period.
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Search and seizure - Block assessment under section 158BC - Time limitation of complete block assessment - Period between the second last Panchnama and the last Panchnama was almost one year for which there was no explanation given by revenue
Search and seizure action under section 132 was carried out on the residential and business premises of certain group of cases and assessee-company was one of group entities. Panchnama was issued by the Investigation Wing on various dates. Assessee contended that block assessment framed by AO was barred by limitation. Case of assessee was that based on one authorization issued one year back, revenue could not conduct search after one year and draw a Panchnama concluding search and thereby contending that limitation under section 158BE read with Explanation 2 thereto should begin from date of last drawn Panchnama. Held: In present case of assessee, period between the second last Panchnama and the last Panchnama was almost one year for which there was no Explanation given by revenue and as per section 132(8A), said prohibitory order came to an end. Even prohibitory order came to an end after 60 days and there was no extension after the expiry of 60 days. Investigation wing of department after almost one year, only converted non-existent prohibitory order into deemed seizure, and therefore, panchnama was only for the purposes of extending the limitation period. During period of one year no examination of any items was done. Therefore, assessment order was barred by limitation and block assessment order was quashed.
Distinguished:VLS Finance Ltd. & Anr. v. CIT & Anr. (2007) 289 ITR 286 (Del-HC) : 2007 TaxPub(DT) 838 (Del-HC).
REFERRED : VLS Finance Ltd. & Anr. v. CIT & Anr. (2016) 384 ITR 1 (SC) : 2016 TaxPub(DT) 2250 (SC), Pr. CIT v. Surya Vinayak Industires Ltd. (2017) 398 ITR 71 (Del-HC) : 2017 TaxPub(DT) 2107 (Del-HC), A Rakesh Kumar Jain Prop. Supreme Computers v. Jt. CIT (2013) 214 Taxman 39 (Mad) : 2013 TaxPub(DT) 208 (Mad-HC), CIT v. Anil Minda (2010) 328 ITR 320 (Del) : 2010 TaxPub(DT) 2249 (Del-HC), C. Ramaiah Reddy v. Asstt. CIT (2011) 339 ITR 210 (Karn) : 2011 TaxPub(DT) 2018 (Karn-HC), CIT v. Deepak Aggarwal (2009) 308 ITR 116 (Del) : 2009 TaxPub(DT) 738 (Del-HC), CIT v. Sandhya P. Naik (2002) 178 CTR 448 (Bom) : 2002 TaxPub(DT) 195 (Bom-HC) and Dr. C. Balakrishnan Nair & Anr. v. CIT & Anr. (1999) 237 ITR 70 (Ker) : 1999 TaxPub(DT) 1121 (Ker-HC).
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