TMI Blog2000 (12) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... ce issued under section 158BC of the Income-tax Act, the assessee filed a return showing income of Rs.11,05,374. Against this income, the assessment was completed at Rs.44,20,643, vide order dated December 31, 1997. Aggrieved by this order of the Assessing Officer, the assessee filed appeal before the Income-tax Appellate Tribunal. While assailing the order dated December 31, 1997, the assessee raised as many as 32 grounds. It was contended, inter alia, that the assessing and the authorised officers were biased and hostile to the appellants, that the rules of natural justice were not followed during the course of the proceedings, that the provisions of section 132(9) were not complied with, etc. The main ground apart from the merits was that the assessment was barred by limitation, the last date of completion being October 31, 1997. The Income-tax Appellate Tribunal thought it fit to take up this ground about the impugned assessment being barred by limitation first inasmuch as it felt that if the assessee 'succeeded on this vital issue, the other issues would become only academic in nature. Accordingly, the parties were heard, on this point only. The case of the assessee was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat an order under section 132(3) is not a panchanama as referred to in section 158BE of the Income-tax Act. As per the contention of the assessee, the last of the panchanamas in the execution of the search warrant was made on October 16, 1996, and hence, the assessment was barred by limitation on October 31, 1997. On behalf of the Department, it was submitted that the assessment was completed within one year of the execution of the search warrant and, as such, the assessment framed was within the statutory time. It was submitted that the search commenced on October 20, 1996, and concluded on December 13, 1996, when the last panchanama was drawn. According to learned counsel appearing for the Department, in between there was a lull because of the invervening holidays and Diwali days. Learned counsel referred to the second proviso to section 132(1) of the Income-tax Act and submitted that on October 20/21, 1996, at 2.30 a.m. it was not possible to remove from the residence of the assessee 45 kgs. of silverware. It was contended by him that all the silverware was put in the almirah and a prohibitory order was placed as per the second proviso to section 132(1) of the Income-tax Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner, Circle-I, Margao, the Income-tax Appellate Tribunal came to the conclusion that the search in this case was concluded on October 20, 1996, when the seizure of cash, jewellery and books of account was made and a valid panchanama was drawn and that the proceedings thereafter were only with regard to the restraint order under section 132(3) which did not amount to seizure in view of the Explanation to section 132 of the Income-tax Act. The Income-tax Appellate Tribunal accordingly held that the assessment stood barred by limitation on October 31, 1997. It also held that it was invalid. It further observed that since the assessee had succeeded on the preliminary ground that the assessment was barred by limitation, the other grounds were academic in nature and, therefore, it did not feel it necessary to adjudicate upon the same in view of the judgment of the Nagpur Special Bench in the case of Rahul Kumar Bajaj v. ITO [2000] 241 ITR (A.T.) 1 (SB). Thus, the appeal filed by the assessee in each case was allowed. Being aggrieved by the same, the Department, has now approached this court by way of filing these tax appeals. Learned counsel, Shri Rivonkar, made the very same su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party leaves the premises after carrying with it the seized material and thus authorisation for search is fully implemented and execution is complete. For this proposition, the Income-tax Appellate Tribunal Bench, Pune, took support of the decision of the Bangalore Bench in the case of Kirloskar Investments and Finance Ltd. v. Asst. CIT [1998] 67 ITD 504. In the present case at hand, the cupboard in which 45 kgs. of silver articles were kept was sealed by making an order under section 132(3) of the Income-tax Act. The authorised officers were obviously very much aware of the contents of the cupboard and the nature of the articles in view of the inventory made by them. They had also come to the conclusion that the said 45 kgs. of silver articles need not be seized. There was no practical impediment to seizure of the said 45 kgs. of silver, if it was considered by the authorised officer as necessary. The contention of learned counsel for the Department that it was not practical to seize huge quantity of silver at odd hours, was rightly held to be untenable by the Income-tax Appellate Tribunal, because at the same odd hour, the search party seized and removed from the premises of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed under section 132(3) covering one cupboard in which all the silver articles were placed and sealed. It is also very obvious that there was no warrant of authorisation for search in the name of Ashish Abrol. In his own affidavit, so also in his statement when he appeared before the Income-tax Appellate Tribunal, Mr. Abrol categorically stated that he had a very limited role in this entire episode and that he had no locus standi in the matter. As far as the validity of the panchanama is concerned, one has to look to the provisions of the Criminal Procedure Code, 1973. The panchanama is to be drawn as far as possible, keeping in mind the provisions of the Criminal Procedure Code. It has to be said that obtaining of panch witnesses was not an impossible task for Mr. Abrol, who is supposed to have conducted the deemed seizure operation on December 13, 1996. In fact, the Department itself has admitted that there were many defects in the panchanama. They were repeatedly saying that there were many defects in the panchanama and still were saying that "believe in it and accept it", is not acceptable. Having heard both the advocates at length and having gone through the impugne ..... 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