TMI Blog2012 (12) TMI 164X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusion of the search and issuance of panchanama and in case of single authorisation, the moment such party leaves the premises by drawing of the panchanama noting conclusion of the search, the limitation period begins As to the search completed on 13.12.2001 with drawing of the panchanama and the search party leaving the premises, the mere fact that the panchanama contain the observation that "search continues" per se would not enable the search party to keep the search in a suspended animation to carry on the search in future date to contend that the limitation has to be worked out on the last panchanama drawn ie. 15.02.2002, thus calculating the limitation from 15.02.2002. Accepting the case of the assessee that the limitation ends on 31.12.2003. In favour of assessee - Tax Case (Appeal). No.1240 of 2006 - - - Dated:- 25-9-2012 - MRS. CHITRA VENKATARAMAN AND MR. K. RAVICHANDRABAABU JJ. For Appellant: Mr. T.N. Seetharaman For Respondent: Mr. M. Swaminathan Standing Counsel for Income Tax Department JUDGMENT (Judgment of the Court was made by CHITRA VENKATARAMAN, J) The assessee is on appeal as against the order of the Income Tax Appellate Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucted pursuant to any authorisation issued, that, even though while first of the panchanama was drawn noting that the "search continued" and there were prohibitory orders made on 13.12.2001 or 08.02.2002, nevertheless, the prohibitory orders made not being in pursuance of any fresh authorisation, the limitation could not be calculated from 15.02.2002, but only from 13.12.2001. Going by that, the two year period for passing the assessment order expired on 31.12.2003 ; as the assessment order was passed on 27.02.2004, hence, beyond the period of limitation, the same was invalid and contrary to the provisions. Aggrieved by the assessment made, the assessee filed appeal before the Income Tax Appellate Tribunal. 5. In the course of hearing, the Revenue relied on the decision of the Special Bench of the Tribunal, Bangalore in the case of C.Ramaiah Reddy Vs. ACIT, reported in 87 ITD 439 (Bang)(SB). The Income Tax Appellate Tribunal held that the issue raised was squarely covered by the Special Bench of the Tribunal, consequently, the plea of limitation was not sustainable. The Tribunal held the merits of the case as against the assessee and thus it ultimately dismissed the appeal. Agg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in whose case, warrant was issued has to be taken note as starting point of panchanama drawn. 10. We had in our earlier unreported decision expressed our agreement with the decision of the Karnataka High Court and Delhi High Court. It is no doubt true that the decision given by us related to the multiple authorisations issued, nevertheless, we may note that the Karnataka High Court considered elabortely a case similar to the facts here. 11. Before going into the merits of the contention, sub-clause (1) of Section 158BE reads as under: " Time limit for completion of block assessment 158 BE (1) The order under Section 158BC shall be passed- (a) within one year from the end of the month in which the last of the authorisations for search under Section 132 or for requisition under Section 132A as the case may be, was executed in cases where a search is initiated or books of account or other documents or any assets are requisitioned after the 30th day of June 1995, but before the 1st day of January, 1997; (b) within two years from the end of the month in which the last of the authorisations for search under Section 132 or for requisition under Section 132A, as the case may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... For the purpose of limitation, there can be only one search and one panchnama." 13. As reasoned out therein, there could be only one authorisation and a panchanama drawn as regards the conduct of the search, i.e., once when the search party concluded the search and leaves the premises after carrying with them the seized material, the authorisation for the search is fully implemented upon and execution completed. There afterwards , if the Department has to enter the premises again, as by way of search, certainly, one requires fresh authorisation; however, as stated by the Karnataka High Court, no such authorisation is required to enter the premises to inspect the materials, which are the subject matter of prohibitory order or restraint order. The said order itself acts as an authorisation to enter the premises and inspect the materials, which are the subject matter of those orders. However, after entering the premises of such person, he has to confine his actions only for inspection of the subject-matter of prohibitory order or restraint order. He cannot search the premises over again. Any material seized after such inspection would be the undisclosed income for the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here any incriminating material. It does not amount to search as understood under Section 132 of the Act. It is only because of paucity of time he has gone back and wants to come back and look into the matter leisurely. There is no provision in the Criminal Procedure Code or in the Income-tax Act or the rules for postponing the search for a long period. Then, the concept of search as understood either under the provisions of the Criminal Procedure Code or the Act which are made applicable expressly, would lose its meaning. " 15. As already seen, merely because, more than one panchanama is drawn in the given case on one authorisation, one cannot construe that the subsequent and the last of the panchanama issued as one flowing out of the search as a last of the panchanama referrable to Explanation (2) to Section 158BE. Once the warrant of authorisation has been issued and the premises is searched and the search party leaves the premises, there is the end of the search and what could be postponed is only seizure of the articles and issuance of prohibitory order ; however, limitation for the completion of the block assessment begins on the conclusion of the search and issuance of pan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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