TMI Blog2014 (11) TMI 1012X X X X Extracts X X X X X X X X Extracts X X X X ..... ash Chand Yadav (Adv.), Sachin Jain (CA) For the Respondent: Sulekha Verma (DR) ORDER I. C. Sudhir (Judicial Member) In the appeals referred by the assessee against the first appellate order on the regular grounds that the ld. CIT(A) has erred in (i) sustaining the disallowance of deduction claimed u/s 54F, (ii) not giving the credit of TDS, and (iii) sustaining the treatment of expenses incurred on telephone, vehicle, depreciation and conveyance to the extent of 15% as personal in nature. Besides, two more additional grounds (numbered as 4 and 5) have been raised. Vide order dated 01/05/2014 the Tribunal has allowed additional ground numbered as ground no. 4 for the adjudication. This additional ground reads as under: That under the facts and circumstances of the case, an assessment order passed by the ld. AO u/s 143(3) of the Income Tax Act, 1961 is illegal and non maintainable since the same has to be passed u/s 153C and not u/s 143(3) of the Act. 2. Since the issue raised in the above additional ground is legal in nature and goes to the root to the matter, we preferred to adjudicate upon it first. 3. Heard and considered the arguments advanced b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the date of search would be 15/06/2009 which falls under A.Y. 2010-11 and the six previous years would be from A.Y. 2004-05 to 2009-10 and not from A.Y. 2003-04 to 2008-09 as done by the AO. In this regard he placed reliance on the decision of Delhi Bench of the Tribunal in the case of V.K. Fiscal in ITA Nos. 5460 to 5466/2012 and in the case of DSL Properties ITA No. 1344/Del/2012. 6. The ld. AR also emphasized the decision of Hon ble Jurisdictional Delhi High Court on the issue in the case of SSP Aviation Limited vs. DCIT in W.P.C. No. 309/2011 dated 29/03/2012 (para nos. 13, 14 15). 7. Taking strength from the ratio laid down in the above cited decisions the ld. AR submitted that proviso 1 to section 153C is only in respect of abatement of proceedings and not in respect of assessment of proceedings. He pointed out that in the case of assessee there was no pending proceedings as on the date of search hence there was no question of abatement of proceedings. 8. The ld. AR submitted further that while interpreting the provisions laid down u/s 153A and 153C the Delhi Bench of the Tribunal in the case of DSL Properties (supra) has held that harmonious interpretation shoul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed further that if we apply the mandate of the proviso of section 153C read with 153A(1) and principle of law as laid down by the Tribunal in the case of DSL Properties Ltd. (supra) then the six years which were to be covered are assessment years 2009-10, 2008 09, 2007-08, 2006-07, 2005-06 and 2004-05 and not 2008-09 to 2003-04. He submitted that provisions of section 153C are mandatory hence notice of section 153C and recording of satisfaction is sine qua non for assuming jurisdiction of a year which as per the provisions of proviso falls under the period of six years as held by the coordinate bench of the Tribunal in the case of Jindal Stainless Limited vs. ACIT, 120 ITD 301 (Del.). With the assistance of these submissions the ld. AR prayed that the assessment should be declared as null and void, in the result, the appeal of the assessee should be allowed and appeal of the Revenue should be dismissed. 11. Ld. CIT(DR) on the other hand, submitted that reference of proviso 1 to section 153C is only in relation to second proviso to sub-section (1) of section 153A which speaks about the abatement of the pending proceedings of six assessment years and not regarding the assessment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontention of the ld. AR remained that the search year in the case of assessee would be A.Y. 2010-11 and six previous assessment years would be 2009-10 to 2003-04. In other words, the regular assessment u/s 143(3) of the Act in the present case should have been framed for the assessment year 2010 11 and the assessment for the assessment year under consideration should have been framed u/s 153C read with 143(3) of the I.T. Act. In support the above cited decisions were relied upon by the ld. AR. 14. The contention of the ld. CIT(DR) on the contrary remained that the reference of proviso 1 of section 153C is only in relation to the second proviso to sub-section 1 of section 153A which speaks about the abatement of the pending proceedings of six assessment years and not regarding the assessment of the preceding six assessment years which will be the same as in section 153A as well as in section 153C of the Act. In this regard she placed reliance on the decision of Hon ble Delhi High Court in the case of SSP Aviation Ltd. vs. DCIT (supra). 15. We find that an identical issue has been decided by Delhi Bench of the Tribunal in the case of DSL Properties P. Ltd. (supra) in favour of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to in this [sub-section] pending on the date of initiation of the search u/s 132 or making of requisition u/s 132A, as the case may be, shall abate. 21. From the above, it is evident that as per clause (b) of subsection (1) of section 153A and second proviso, the AO can be issue notice for assessment or reassessment of total six assessment years immediately preceding the assessment year relevant to previous year in which search is conducted. As per proviso to section 153C, the date of search is to be substituted by the date of receiving the books of account or documents or assets seized by the AO having jurisdiction over such other person. Ld. DR has stated that since the AO of the person searched and the AO of such other person was the same, no handing over or taking over of the document was required. That section 153C(1) and its proviso have to be read together in a harmonious manner. While interpreting section 153C, we have already held that for initiating valid jurisdiction u/s 153C, even if the AO of the person searched and t he AO of such other person is the same, he has to first record the satisfaction in the file of the person searched and thereafter, such note along ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allenged by the assessee by way of other grounds of appeal do not survive, and, therefore, do not require any adjudication. 16. We thus, find that the issue raised in the additional ground has been answered in favour of the assessee, by the Coordinate Delhi Bench of the Tribunal in the case of DSL Properties (supra). 17. So far as decision of Hon ble Delhi High Court in the case of SSP Aviation Ltd. vs. DCIT (supra) relied upon by the ld. CIT(DR) is concerned, we find that it is not helpful to the revenue as in that case also in para no. 14 of the judgment it has been held as under: 14. Now there can be a situation when during the search conducted on one person u/s 132, some documents or valuable assets or books of account belonging to some other person, in whose case the search is not conducted, may be found. In such case, the AO has to first be satisfied u/s 153C, which provides for the assessment of income of any other person, i.e., any other person who is not covered by the search, that the books of account or other valuable article or document belongs to the other person (person other than the one searched). He shall hand over the valuable article or books of acco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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