TMI Blog2016 (10) TMI 937X X X X Extracts X X X X X X X X Extracts X X X X ..... For The Assessee : Shri Ashok Johri ORDER PER RAJESH KUMAR, A. M: This is an appeal filed by the assessee challenging the order of the ld.CIT(A) dated 28.10.2003 for the block assessment period 1.4.1989 to 17.12.2099. 2. Grounds of appeal taken by the assessee are as under : A. VALIDITY OF ASSESSMENT: 1. The Ld. CIT (Appeals) erred in holding that the assessment was not barred by limitation of time. 2. The Ld. CIT (Appeals) in doing so did not appreciate that the order u/s 132 (3) passed on 17.12.1999 and vacated on 14.02.2000 was a futile excise not supported by any evidence as held by the jurisdictional and other High Courts in the matter. B. MERITS: 3. The Ld. CIT (Appeals) erred in confirming the addition of ₹ 3,35,000/-as undisclosed income in respect of certain electronics items. 3.1 In any event the LO. CIT (Appeals) ought to have held that the estimate adopted by the Assessing Officer was on high side and that too without any material. 4. The Ld. CIT (Appeals) erred in confirming the addition in respect unaccounted jewellery as undisclosed income to the extent of ₹ 76,115/ - out of the addition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment was not barred by limitation. The issue has been challenged by the assessee before the ld. CIT(A) vide ground no.1 which was dismissed by the ld. CIT(A) after considering the submissions and argument of the assessee by holding and observing as under : 4. In ground No.1, the appellant has contested the action of the Assessing Officer in passing the order under section 158BC read with section 143(3) of the Act under appeal dated 27.02.2002 on the ground that the said order was passed beyond the period specified in section 158BE of the Act. It was submitted that in the instant case, the search initiated on 17.12.1999 was concluded on the same date. Thereafter, prohibitory order was only served on the appellant which was finally lifted on 14/02/2000 when a portion of the residence and the locker previously placed under the prohibitory order were searched. It was submitted that the prohibitory order under section 132(3) was passed which was subsequently removed on 14.02.2000 was in respect of the premises that were not such as to envisage any practical difficulty for search on the first date of the search on 17.12.1999 so as to put a restrained order in terms of sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be taken for considering the period of limitation only if the panchanama was not validly drawn. 7. If the case of Mrs. Sandhya B. Nayak is examined, the ratio-decendi of which has been relied upon by the appellant's representative, it is true that the Hon'ble IT AT had held that the block assessment order passed was void having been passed on a date beyond the prescribed time limit. That decision was taken primarily on the ground that the last panchanama drawn was defective in many respects and hence, cannot be taken into account in the determination of time limit under section 158BE of the Act. This is however, not so in the instant case. The appellant cannot sit over the judgement of the Authorised Officer to invoke the provisions of section 132(3) of the Act on the temporary conclusion of the search on 17.12.1999 that was again started on 14.02.2000 and concluded on the same date. Moreover, the fact that the order under section 132(3) of the Act does not tantamount to seizure has been clarified in the Explanation below the said sub-section. 8. Further, in respect of the order of restraint under section 132(3) of the Act dated 17.12.1999 as well as the conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee in terms of warrant of authorisation dated 16.12.1999 which was in the name of assessee and his brother Shri Banwarilal Bawri. Similarly, a search was carried out at the premises of M/s Macleods Pharmaceutical Ltd. in terms of separate warrant of authorizing in which the appellant was Director. The ld. Counsel submitted that nothing was seized in the search action at the residential premises of the assessee whereas the authorized officer Shri R.K. Vishwakarma inventorised jewellery found at the residence of assessee which value at ₹ 4,23,354/- by the department s valuer and was stored in the small cupboard in the residence of the assessee in the appellant s daughter and a prohibitory order u/s 132(3) of the Act the was passed sealing the cupboard in the search proceedings. The key of the SBI Bank locker was also seized and sealed. Besides search team inventorised various articles like shares and list of bank accounts and the search was concluded accordingly. The bank locker with State Bank of India was sealed by an order passed u/s 132(3) of the Act on 23.12.1999 in pursuance of the order dated 12.12.1999 issued in the name of bank. The counsel of the assessee fur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f provision of section 132(3) of the Act which has been adequately explained in the case of Mrs.Sandhya B. Nayak Others (supra). The ld. Counsel submitted that the prohibitory order could not continued for longer period if the facts did not warrant such continuation. In the present case the whole process got concluded which has been specified in the panchnama adequately. It was pointed out that nothing was seized in the last panchanam dated 14.2.2000 and it was only to vacate the order passed u/s 132(3) of the Act. Therefore the block assessment order dated 27.2.2002 was barred by limitation as provided in section 158BE(1)(b) of the Act. The said order should have been passed with reference to first panchnama dated 17.12.1999 or at the most 2nd panchanama dated 23.12.1999.Lastly the ld AR prayed that the assessment order passed by the AO be quashed on the ground of barred by limitation. 6. The ld. DR reiterated the facts as mentioned in the appellate order and heavily relied on the orders of authorities below. The ld Dr ,while vehemently opposing the arguments of the ld AR, submitted that the assessment was made well within time as the last punchnama was drawn on 14.2.2000 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4,68,954/- was handed over to the wife of the assessee in term of punchnama dated 14.02.2000. Thus it is apparent from the above that nothing was found and seized on 14.02.2000 in terms of punchnama dated 14.02.2000. Now the legal issue qua the search is whether the block assessment as made by the AO was barred by limitation u/s 158BE(1)(b) of the Act. According to the provisions of section 158BE (1)(b) of the Act order in the block assessment has to be passed by the AO within two years from the end of the month in which the search was conducted and concluded .Now the issue to be adjudicated is whether the search concluded in 17.12.1999/23.12.1999 or 14.02.2000. From the facts discussed and narrated above it is clear that no seizure was made on 14.02.2000 but only the bank locker was opened at the strength of order dated 14.2.2000 and the prohibitory order u/s 132(3) of the Act were vacated. In view of the said fact it clear that the date of conclusion of search can not be taken as 14.02.2000 and has to be either 17.12.1999 or 23.12.1999 especially when nothing was found and seized on 14.2.2000. Moreover it is also clearly mentioned in the punchnama dated 17.12.1999 and dated 23.12 ..... 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