TMI Blog2007 (5) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... sts that the search and seizure operation had come to an end on November 6, 1996, and that on September 14, 1998, there was no restraint order in respect of the fishing trawlers of the assessee and, therefore, the search and panchnama drawn on September 14, 1998, were not in accordance with law. This being the position, it cannot be said that the last panchnama drawn up in respect of the search and seizure operation pertaining to the assessee, in terms of Explanation 2 to section 158BE of the Act, was drawn up on September 14, 1998-it was actually drawn on November 6, 1996-and the period of limitation must, therefore, run from that date onwards. We are clearly of the view that the action for seizing the fishing trawlers ought to have been taken by the Revenue u/s 132(1) of the Act and not u/s 132(3) of the Act. By merely resorting to a restraint order u/s 132(3) of the Act, and that too only up to September 30, 1997, the Revenue could not have extended the time limit for passing an assessment order. Learned counsel for the assessee submitted, that even otherwise, September 14, 1998, cannot be the date of the last panchnama because in fact no seizure was effected on that da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax, in his assessment order dated September 30, 1998, levied tax on the assessee against which an appeal was filed before the Tribunal. In the appellate forum, the assessee raised an additional ground, which was permitted by the Tribunal, to the effect that the assessment order passed on September 30, 1998, is without jurisdiction being barred by limitation as provided under section 158BE of the Act. This contention was accepted by the Tribunal and it was held that the assessment order was invalid with the result that the appeal filed by the assessee was allowed. 7. Being aggrieved, the Revenue has filed this appeal under section 260A of the Act seeking the framing of some substantial questions of law. In our opinion, no substantial question of law arises for consideration since the issues raised are no longer res integra. 8. The principal question that arises for consideration is whether the last panchnama was drawn on November 6, 1996, when certain documents were seized by the Revenue and a restraint order was passed in respect of the fishing vessels/trawlers under section 132(3) of the Act or whether the search and seizure operations concluded when a panchnama was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egal or valid. 12. Similarly, in CIT v. Mrs. Sandhya P. Naik [2002] 253 ITR 534, it was held by the Bombay High Court that simply stating in the panchnama that the search is temporarily suspended does not entitle the authorised officer to keep the search proceedings alive by passing a restraint order under section 132(3) of the Act. In arriving at this conclusion, the Bombay High Court placed reliance upon Sriram Jaiswal v. Union of India [1989] 176 ITR 261 decided by the Allahabad High Court. 13. A general consensus appears to have emerged among the High Courts to the effect that a search under section 132 of the Act should be continuous and if it is discontinued and thereafter resumed, then there must be a valid explanation for the gap. In so far as the present case is concerned, the facts on record show that prima facie there was absolutely no justification for keeping the search pending for more than one year and ten months without any semblance of any activity by the Revenue. 14. By way of justification for the hiatus, we were told by learned counsel for the Revenue that there was a transfer of jurisdiction in respect of some officers and enquiries were required to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or thing an order restraining him from removing or parting or otherwise dealing with the said article or thing except with the previous permission of the authorised officer and such action shall be deemed to be a seizure of such valuable article or thing. On the other hand, section 132(3) of the Act comes into operation when it is not possible to seize any valuable article or thing for reasons other than those mentioned in the second proviso to sub-section (1) and by an Explanation added to section 132(3) of the Act, it is made clear that the serving of an order under section 132(3) of the Act shall not be deemed to be a seizure of such valuable article or thing. 19. It is obvious that the fishing trawlers could not be seized by reason of their volume or weight. Appropriately, therefore, an order could be passed by the authorised officer only of deemed seizure under section 132(1) of the Act. Passing an order under section 132(3) of the Act was not at all warranted given the nature of the articles, that is, fishing trawlers. 20. In B. K. Nowlakha v. Union of India [1991] 192 ITR 436, this court held that if a seizure is effected then an order is required to be made under sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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