TMI Blog2012 (8) TMI 971X X X X Extracts X X X X X X X X Extracts X X X X ..... block period is contrary to the provisions of the ct and therefore bad in law. 3. In the appeal in ITSS no.196 of 2005 the assessee has raised an additional ground as under: On the facts and in the circumstances of the case, the learned Commissioner of Income Appeals erred in confirming the order of the assessing officer u/s.158BA read with Section 158BC of the Income Tax Act, 1961 particularly when the notice u/s.158BC were issued by the assessing officer to the return of income for the block period from 01.04.1990 to 14.12.2000 was within 15 days instead of not less than 15 days and therefore the block assessment is bad in law, illegal and void ab initio. 4. We have heard the Ld. AR as well as Ld. DR and considered the relevant record relating admissibility of the additional ground raised in the appeal in ITSS 196 of 2005. The Ld. AR of the assessee has submitted that the additional ground raised by the assessee is purely legal and no new facts are required to be examined or investigated and, therefore, in view of the decision of Hon ble Supreme Court in the case of National Thermal Power Co. Ltd. vs. CIT 229 ITR 383 the additional ground raised by the assessee may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch after first January, 1997 the time limit may be given upto 45 days for compliance. Following the decision of Hon ble Supreme Court in the case of Hotel Blue Moon, the Hon ble High Court of Karnataka in case of CIT vs. Micro Labs Ltd. in ITA No.2748/2005 C/W ITA Nos.3060/2005, 2303/2005, 749/2006, 3148/2005 has held that the AO shall serve a notice u/s.158BC requiring the assessee to submit the return within such time not being less than 15 days but not more than 45 days. Therefore, the mandatory period of time as stipulated u/s.158BC is not complied with if the notice u/s.158BC calls upon the assessee to submit the return of income within a period of 15 days. The Ld. AR of the assessee has also relied upon the decision of Hon ble Supreme court in the case of CIT vs. Brathwate and Co. 201 ITR 343 and submitted that the term not less than 7 years has been construed by the Hon ble Supreme Court as the period should go beyond 7 years. The Ld. AR has also pointed out that the decision in the case of CIT vs. Micro Labs Ltd. has been followed by the Karnataka High Court in the subsequent decision in the case of CIT vs. Ghewarchand Surana in ITA No.3053 of 2005 dated 14th September, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oon. 7. We have considered the rival submissions as well as the relevant material on record. There is no dispute that notice issued by the AO u/s.158BC requiring the assessee to furnish the return in the prescribed Form No.2B within 15 days from the service of notice. We reproduce relevant part of the notice dated 05.02.2002 issued u/s.158BC as under: The return should be in the prescribed Form 2B and be delivered in this office within 15 days from the service of this notice, duly verified and signed in accordance with the provisions of section 140 of the Income-tax Act, 1961. 8. The Ld. DR has also not disputed this fact that the time period mentioned in the said notice is within 15 days. Sub-clause (ii) of clause (a) of sec.158BC stipulates service of a notice to such person requiring him to furnish return in the prescribed form within such time not being less than 15 days but not more than 45 days. The relevant part of sec.158BC reads as under: Where any search has been conducted under section 132 or books of account, other documents or assets are requisitioned under section 132A, in the case of any person, then,- (a) the Assessing Officer shall- (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not find any material indicating undisclosed income in any one or more of the previous years comprised in the block period, it will not be necessary to do the exercise of computing the undisclosed income for the relevant years and the exercise may be limited to the years in respect of which the undisclosed income has been found. On determination of the undisclosed income of the block period, the Assessing Office shall issue an order of assessment and determine the demand payable by him on the basis of such assessment. The assets seized in the course of search or taken possession of as a result of requisition under section 132A shall be retained to the extent necessary and shall be dealt with in the manner laid down under section 132B. 10. Further, the Hon ble Karnataka High Court after the decision of Hon ble Supreme Court in the case of Hotel Blue Moon (supra) has considered and decided an identical issue in case of CIT vs. Micro Labs Ltd. (supra) in Para 13 14 as under: 13. Reliance was also placed by the assessee on the judgment in the case of Assistant Commissioner of Income Tax and another vs. Hotel Blue Moon reported in [2010] 321 ITR 362 (SC) to contend th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 15 days . Within a period of 15 days is less than 15 days. Therefore, the mandatory period of time as stipulated under Section 158 BC has not been complied with. The notice therefore is invalid. An invalid notice cannot confer any jurisdiction on the authority. Hence, the entire proceedings are bad in law. The notice is ab-initio void. 11. The decision of Hon ble jurisdictional High Court in the case of Shirish Madhukar Dalvi is on the point where the validity of a notice was to be examined when a subsequent notice was issued by the AO. The Hon ble High Court has observed in Para 46 to 48 as under: 46. Having examined factual matrix, statutory provision, law laid down by various Courts presently holding the field, if one turns to the facts of the case at hand, it is not in dispute that notice dt. 6 th July, 1998 did not mention correct provisions of the Act; it did not mention correct block period for which the return was required to be filed; it did not give 15 days clear notice. Though the said notice was defective, it did not cause any prejudice to the appellant. Undisputed factual matrix reveals that appellant was served with another notice dt. 17 th Sept., 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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