TMI Blog2013 (12) TMI 1110X X X X Extracts X X X X X X X X Extracts X X X X ..... ORDER:- PER : Sanjay Garg Present appeal has been preferred by the assessee against the order dated 20.10.2011 of learned CIT(A)-36 passed in Appeal No. CIT(A)/IT-91/11-12 relevant to A.Y. 2008-09 under section 154 of the Income Tax Act. The following grounds of appeal have been taken :- "(1) The order passed by learned CIT(A)-36 Mumbai is against the provisions of Income Tax Act, unlawful, unjustified and therefore liable to be quashed. (2) The learned CIT(A) erred in confirming the order of the Assessing Officer passed under section 154 of the Income Tax Act 1961, wherein he had charged the interest under section 234B of the Income Tax Act, 1961 up to the date of 'actual' adjustment of the seized cash and not up to the date of the seizure being the date since when the cash has been lying with the Income Tax Department. (3) The learned CIT(A) failed to appreciate the fact that, the interest was being charged @ 12% p.a. whereas the interest on the seized cash that would be available to the appellant was only @ 6% p.a." 2. In brief, facts of the case are that there was a search and seizure operation on the appellant on 25.3.2008 and during the sear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the interest amount. From the perusal of the above facts it is well established that since the Assessing Officer had not dealt with the application moved by the assessee for appropriation of the seized cash hence, the issue was neither taken nor decided by the Assessing Officer. As such application u/s. 154 was not only found maintainable but was also partly allowed by the Assessing Officer. So findings of the learned CIT(A) that the application was not maintainable or the issue was debatable, in our view is not correct specially when the issue was not dealt with by the Assessing Officer in the assessment order. Had the Assessing Officer dealt with the issue and given an appropriate findings either giving the credit of the cash seized or rejecting it, then perhaps application u/s. 154 would not have been maintainable, because in that event there would not have been any mistake apparent on record. 5. Now coming to the issue on merits, the contention of learned AR is that adjustment of the seized cash towards advance tax liability should be from the date of seizure and not from the date of completion of assessment, hence, the assessee is not liable to pay any interest for d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther mode laid down in this Act. (3) Any assets or proceeds thereof which remain after the liabilities referred to in clause (i) of sub-section (1) are discharged shall be forthwith made over or paid to the persons from whose custody the assets were seized. (4) (a) The Central Government shall pay simple interest at the rate of [one-half per cent for every month or part of a month] on the amount by which the aggregate amount of money seized under section 132 or requisitioned under section 132A, as reduced by the amount of money, if any, released under the first proviso to clause (i) of sub-section (1), and of the proceeds, if any, of the assets sold towards the discharge of the existing liability referred to in clause (i) of sub-section (1), exceeds the aggregate of the amount required to meet the liabilities referred to in clause (i) of sub-section (1) of this section. (b) Such interest shall run from the date immediately following the expiry of the period of one hundred and twenty days from the date on which the last of the authorisations for search under section 132 or requisition under section 132A was executed to the date of completion of the assessment [u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the concerned person/assessee makes an application during the course of assessment proceedings to adjust the remaining amount towards his future liability, the Assessing Officer after passing of 120 days from the last date of execution of search and seizure operation is liable, either to return the remaining amount to the assessee/concerned person and or to adjust the same towards his future liability if a specific request has been made by the assessee in this respect. A reasonable time of 120 days after the last date of execution of search and seizure operation has been granted to the Assessing Officer/tax authority to dealt with the seized cash and to adjust it towards existing liability of the assessee and the remaining amount is required to be returned to the assessee/concerned person. If the amount remains with the Assessing Officer/tax authority after 120 days then the Central Government is liable to pay interest @ one half percent per month on the remaining amount. A perusal of section 132B further reveals that no automatic duty or liability has been prescribed under this section to adjust cash seized towards future liability of the assessee. If no request is made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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