TMI Blog2010 (4) TMI 1078X X X X Extracts X X X X X X X X Extracts X X X X ..... t recorded under section 131 on the same day, 8-12-2000, the assessee refused to have given any amount to said Shri Manharbhai G. Patel. He has denied to have given any amount to Shri Manharbhai G. Patel. Later on, a further statement of the assessee was recorded on 20-12-2000, in which the assessee admitted to have given the amount of ₹ 3,00,000 to his partner to obtain cheques/DD from M/s. Vir Finance so that the same could be invested in their partnership firm by the name Sun Borax Industries. The Assessing Officer, therefore, noted that the above evidences and sequences of facts clearly indicated that the assessee has earned undisclosed income in the relevant block period which had not been disclosed to the Income-tax Department and the same warranted assessment under section 158BD of the Income-tax Act. Notice was accordingly, issued to the assessee to file return for the block period in prescribed form. The assessee filed return of income for the block period in Form No. 2B on 17-1-2003 on time and declared undisclosed income of ₹ 50,000. The assessee explained before the Assessing Officer that the assessee owned up the amount of ₹ 3,00,000 seized from the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is clarificatory in nature . In this view of the matter ground No. 4 of the appeal of the assessee is dismissed being not pressed. Ground Nos. 1 and 5 of the appeal is general in nature and calls for no specific finding and are accordingly, dismissed. 5. The learned Counsel for the assessee on Ground No. 2 of the appeal submitted that the block assessment order passed by the Assessing Officer is without jurisdiction and has to be cancelled. The assessee also raised additional ground of appeal challenging the jurisdiction of the Assessing Officer/ACIT, Central Circle-2(3), Ahmedabad being not the Assessing Officer having jurisdiction over the assessee as required under section 158BD of the Income-tax Act. The learned Counsel for the assessee referred to PB-10 which is the copy of the acknowledgement for filing of regular return of income for assessment year 2001-02 and submitted that the same was filed with Range-VI. He has therefore, submitted that transfer of his case from Ward 6(2) to Central Circle 2(3) is without jurisdiction and as such the Assessing Officer has no jurisdiction to pass any block assessment order in the matter. The learned Counsel for the assessee however, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether an Assessing Officer has jurisdiction to assess any person, the question shall be determined by the Director General or the Chief Commissioner or the Commissioner as the case may be or by the Board. Sub-clause (3) to section 124 of the Income-tax Act provides that no person shall be entitled to call in question the jurisdiction of the Assessing Officer after expiry of one month from the date on which notice under section 142 of the Income-tax Act is served or after completion of the assessment whichever is earlier. Hon'ble Allahabad High Court in the case of Hindustan Transport Co. v. IAC [1991] 189 ITR 326, considering the objections to the jurisdiction of the Assessing Officer held that objection cannot be raised after assessment is completed . In this case, the assessment year under consideration was 1985-86 and the Hon'ble Allahabad High Court considering the provisions of section 124 of the Income-tax Act has considered the following points:- (i) What is the nature of the power of transfer conferred by the Act? (ii) How the Act itself views a defect of the nature involved in the present case? We may mention that the provisions of section 124(5) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee for framing assessment for the block period. He has submitted that only notice under section 158BD of the Income-tax Act was issued on 10-12-2002. He has submitted that since the Assessing Officer did not proceed under section 158BC of the Income-tax Act and that no satisfaction has been recorded by the Assessing Officer of the persons searched to transfer the seized material to the Assessing Officer of the assessee, therefore, the block assessment order is null and void. He has relied upon the decision of the Hon'ble Supreme Court in the case of Manish Maheshwari v. Asstt. CIT [2007] 289 ITR 341 in which the Hon'ble Supreme Court considering the provisions of section 158BD of the Income-tax Act laid down the condition for invoking jurisdiction under section 158BD of the Income-tax Act (i) satisfaction must be recorded by the Assessing Officer that any undisclosed income belonged to any person, other than the person with respect of whom, search was made under section 132 of the Income-tax Act, (ii) the books of account or documents or assets seized had been handed over to the Assessing Officer having jurisdiction over such other persons and (iii) the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee voluntarily filed return of income for the block period in pursuance of the notice under section 158BD of the Income-tax Act dated 10-12-2002 and declared undisclosed income of ₹ 50,000. It would, therefore, clearly prove that the assessee admitted undisclosed income based upon the search conducted in the case of Shah Finance Group of cases. It is well-settled that by non-mentioning of relevant provision of law would be of no consequence because overall facts and circumstances of the case shall have to be considered. The Assessing Officer ultimately proceeded against the assessee under section 158BC of the Income-tax Act to compute undisclosed income of the assessee for the block period. ITAT Amritsar Bench (Special Bench) in the case of Smt. Mahesh Kumari Batra v. Jt. CIT [2005] 95 ITD 152 considering the identical question held that (i) the provisions of section 158BC are procedural in nature, (ii) any defect in the notice or with regard to its issue cannot render the block assessment proceedings to be null and void . 9. Considering the above discussions, we are of the view that the assessee has not raised this point before any of the authorities and no specific gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch in the case of Shah Finance Group of cases. The Assessing Officer, therefore, rightly preceded under section 158BD of the Income-tax Act against the assessee for computing undisclosed income of the assessee. The assessee never disputed the addition of ₹ 3,50,000 before the learned CIT(A) in the block assessment. Section 158BA (1) and (2) of the Income-tax Act provides as under: 158BA. (1) Notwithstanding anything contained in any other provisions of this Act, whereafter the 30th day of June, 1995 a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A in the case of any person, then, the Assessing Officer shall proceed to assess the undisclosed income in accordance with the provisions of this Chapter. (2) The total undisclosed income relating to the block period shall be charged to tax, at the rate specified in section 113, as income of the block period irrespective of the previous year or years to which such income relates and irrespective of the fact whether regular assessment for any one or more of the relevant assessment years is pending or not. [Explanation.-For the removal of do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment year 2001-02 in which, in the note, it is specifically mentioned that during the course of search at M/s. Vir Finance, Ahmedabad, the assessee was investigated and cash amounting to ₹ 3,00,000 was found at that time and thereafter, the assessee declared the same as additional income in his statement before the DDIT (Inv.) which is also seized by the officials. It would, therefore, show that ₹ 3,00,000 was connected with the search matter and as such there was no reason for the assessee to have declared a sum of ₹ 3,00,000 in the return for regular assessment. ₹ 3,00,000 is, therefore, being connected with the search matter should have been assessed as undisclosed income in accordance with the provisions of Chapter XIV-B of the Income-tax Act. It appears that the assessee declared ₹ 3,00,000 in the regular return in order to get the benefit of reduction in the tax liability because for the block assessment the liability of the tax is more as compared to the regular assessment. We may also note here that the assessee in his statement dated 20-12-2000 admitted ₹ 3,50,000 as his undisclosed income for the block period over and above the regular ..... X X X X Extracts X X X X X X X X Extracts X X X X
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