TMI Blog2010 (7) TMI 718X X X X Extracts X X X X X X X X Extracts X X X X ..... nce the block assessment in the case of the S. K. Bhatia group under section 158BC of the Act was framed on March 30, 2005, whereas the satisfaction as contemplated under section 158BD in the case of the present assessee was recorded on July 15, 2005, thus, the proceedings were bad in law. - Decided against the revenue. - 154 of 2010 - - - Dated:- 20-7-2010 - ADARSH KUMAR GOEL, AJAY KUMAR MITTAL JJ. JUDGMENT Ajay Kumar Mittal J.- 1. In this appeal filed under section 260A of the Income-tax Act, 1961 (in short "the Act"), at the instance of the Revenue, it has been submitted that the following substantial questions of law arise in this appeal for the consideration of this court, from the order of the Income-tax Appellate T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on February 5, 2003. During the search operation, some incriminating documents pertaining to the assessee-firm were found. The Assessing Officer accordingly issued notice under section 158BD of the Act on February 10, 2006, on the assessee which was served on it on February 14, 2006. The assessment was, thereafter, completed under section 158BC read with section 158BD of the Act on February 8, 2008. The Assessing Officer did not accept the position mentioned in the return and finalized the assessment after making the additions of Rs. 16,05,744 on account of unexplained investment and Rs. 5,71,172 of profit element. Feeling dissatisfied, the assessee preferred an appeal to the Commissioner of Income-tax (Appeals-II) (in short "the CIT(A)"). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... valid and the assumption of jurisdiction by the Assessing Officer to make the impugned block assessment as invalid and void. To put in plain words, the assessment framed in the case was, thus, cancelled as lacking in jurisdiction. Hence, this appeal. 4. The provisions of sections 158BD and 158BE came up for consideration by this court in CIT v. Mridula, Prop. Dhruv Fabrics (I. T. A. No. 591 of 2009), ([2011] 335 ITR 266 (P H)) wherein it was held as under (page 270) : "Section 158BD was inserted in Chapter XIV-B by the Finance Act, 1995, with effect from July 1, 1995. The aforesaid provision is made applicable when the following conditions are fulfilled : (a) there should be undisclosed income within the meaning of section 158B( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed income belongs to such other person so as to take action under section 158BD of the Act against that person. The Act nowhere specifically prescribes any time limit or limitation for initiation of proceedings under section 158BD of the Act or for recording of satisfaction before taking action under that provision. The plain and reasonable construction that can be placed on the aforesaid provision would be that the recording of satisfaction for taking action against any other person under section 158BD of the Act has to be between initiation of proceedings under section 158BC and before completion of block assessment under section 158BC of the Act in the case of the person searched. It, would, thus, mean that the action contemplated under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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