TMI Blog2017 (3) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... TE ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE M.R. SHAH) 1.0. As all these appeals are with respect to common assessee and are interconnected, all these appeals are decided and disposed of together by this common judgment and order. 2.0. Feeling aggrieved and dissatisfied with the impugned judgment and order dated 30.08.2007 passed by the learned Income Tax Appellate Tribunal, Ahmedabad B Bench, Ahmedabad (hereinafter referred to as the learned Tribunal ) passed in MA No.34/AHD/2007 in IT (SS) No. 18/AHD/2000 for the block period from 1.4.1986 to 31.3.1996 and 1.4.1996 to 1.8.1996, by which, the learned Tribunal has allowed the said MA and has recalled the earlier order passed in IT (SS) No. 18/AHD/2000 and has ordered to restore the said appeal to file, the Revenue has preferred Tax Appeal No. 866 of 2008 to consider the following substantial question of law. 1.Whether the Appellate Tribunal is right in law and on facts in recalling its entire earlier order dated 17.11.2006 on the ground that ground Nos. 1 and 2 were allegedly not disposed of ? 2.Whether the impugned order of the Appellate Tribunal does not amount to review of the earlier order? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised by the assessee in the appeal namely block assessment under Section 158BC r.w.s. 158BD was without jurisdiction and therefore, voidabinitio and therefore, liable to be annulled were not considered by the learned Tribunal. That by order dated 30.08.2007, the learned Tribunal allowed the said MA and recalled the judgment and order dated 17.11.2006 passed in IT(SS) A No. 18/AHD/2000 and restored the appeal to file. (the said order dated 30.08.2007 passed in MA No.34/AHD/2007 is subject matter of Tax Appeal No. 866 of 2008). 3.3. That in the meantime and before Tax Appeal No. 866 of 2008 could be finally heard, decided and disposed of the appeal on remand came up for hearing before the learned Tribunal and by judgment and order dated 15.5.2009, the learned Tribunal has allowed the said appeal and has quashed and set aside the block assessment under Section 158BC r.w.s.158BD of the Income Tax Act mainly on the ground that satisfaction has been recorded after assessment was completed in the case of searched person. (judgment and order dated 15.05.2009 in IT(SS) A No.18/AHD/2000 is the subject matter of Tax Appeal No. 1002 of 2008). 3.4. That despite the fact that earlier jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 2397 of 2010 what is challenged by the revenue is the subsequent judgment and order passed by the learned Tribunal dated 30.04.2010 passed in IT(SS) A No.37/AHD/2008, by which, the learned Tribunal has allowed the said appeal and has quashed and set aside the subsequent block assessment order which was passed by the learned AO on remand, pursuant to earlier judgment and order passed by the learned ITAT dated 17.11.2006 passed in IT(SS) A No.18/AHD/2000. It is required to be noted that subsequently and pursuant to the judgment and order dated 17.11.2006 passed in IT(SS) A No.18/AHD/2000, by which, the learned Tribunal remanded the matter to the AO to pass denovo assessment order, AO subsequently passed passed fresh block assessment order. However, it is required to be noted that in the meantime the order of remand dated 17.11.2006 passed in IT(SS) A No.18/AHD/2000 came to be recalled and the appeal no. IT(SS) A No.18/AHD/2000 was restored to file. Under the circumstances, when the remand order itself was recalled by the learned Tribunal, as rightly held by learned Tribunal that the subsequent block assessment order was without jurisdiction. Under the circumstances, the learned Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C r.w.s.158BD of the Income Tax Act on the ground that the satisfaction note by the AO was subsequent assessment order framed in the case of searched person cannot be sustained and same deserves to be quashed and set aside. 8.0. Present appeal is vehemently opposed by Shri Kirtikant Thaker, learned counsel for the assessee. Shri Thaker, learned counsel for the assessee has heavily relied upon the decision of the Delhi High Court in the case of Commissioner of Income Tax vs. Bharat Bhusan Jain reported in (2015) 370 ITR 695 (Delhi). It is submitted that considering para 44 of the decision of the Hon'ble Supreme Court in the case of Calcutta Knitwears (supra), the Delhi High Court in the aforesaid case has held that even in a case where the satisfaction note is immediate i.e. belated the block assessment is required to be quashed and set aside. It is submitted that in the present case the satisfaction note was after a period of approximately one year and therefore, in the facts and circumstances of the case, the learned Tribunal has not committed any error in quashing and setting aside the block assessment under Section 158BC r.w.s 158BD. Making above submission and relying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of search initiated or books of account or other documents or any assets are requisitioned on or after 01.01.1997. We would examine whether the Tribunal or the High Court are justified in coming to the aforesaid conclusion. 41. We would certainly say that before initiating proceedings under Section 158BD of the Act, the assessing officer who has initiated proceedings for completion of the assessments under Section 158BC of the Act should be satisfied that there is an undisclosed income which has been traced out when a person was searched under Section 132 or the books of accounts were requisitioned under Section 132A of the Act. This is in contrast to the provisions of Section 148 of the Act where recording of reasons in writing are a sine qua non. Under Section 158BD the existence of cogent and demonstrative material is germane to the assessing officers satisfaction in concluding that the seized documents belong to a person other than the searched person is necessary for initiation of action under Section 158BD. The bare reading of the provision indicates that the satisfaction note could be prepared by the assessing officer either at the time of initiating proceedings for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to extend the period of limitation to recording of satisfaction note would run counter to the avowed object of introduction of Chapter to provide for costeffective, efficient and expeditious completion of search assessments and avoiding or reducing long drawn proceedings. 44. In the result, we hold that for the purpose of Section 158BD of the Act a satisfaction note is sine qua non and must be prepared by the assessing officer before he transmits the records to the other assessing officer who has jurisdiction over such other person. The satisfaction note could be prepared at either of the following stages: (a) at the time of or along with the initiation of proceedings against the searched person under Section 158BC of the Act; (b) along with the assessment proceedings under Section 158BC of the Act; and (c) immediately after the assessment proceedings are completed under Section 158BC of the Act of the searched person. 11.1. Therefore, as such the aforesaid question is now not resintegra. As observed by the Hon'ble Supreme Court in the case of Calcutta Knitwears (supra) satisfaction note can be after the assessment is completed in the case of searched person. Under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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