TMI Blog2017 (4) TMI 1519X X X X Extracts X X X X X X X X Extracts X X X X ..... case in the Financial year 2010-11 relevant to A.Y. 2011-12, and if that be so, then the A.O would had no jurisdiction for issuing notice under Section 153A r.w Sec. 153C for the said year, viz. A.Y. 2004-05, to the assessee, and as a fall out of the same the assessment framed in the hands of the assessee under Section 144 r.w.s. 153C, dated 30.12.2011, being devoid of any force of law, would be rendered non est D.R had neither placed on record any material to controvert and dislodge the claim of the ld. A.R that the handing over of the assets/documents relatable to the assessee by the Assessing officer of the searched person, to the Assessing officer of the asessee had taken place in F.Y. 2010- 11 relevant to A.Y. 2011-12, but then we being not oblivious of the fact that as the exact date of actual handing over of the material by the A.O of the searched person, viz. M/s Om Sai Motors Pvt. Ltd.cannot be deciphered from either the orders of the lower authorities, or the record before us, therefore in all fairness for the said limited purpose of verifying the said factual position, therein set aside the matter to the file of the A.O The Additional Ground of appeal No. 1 raised b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 ('Act ) is bad in law in as much as the proceedings u/s. 153C read with section 153A of the Act could not have been taken for the assessment year 2004-05. Your appellant therefore, prays that the impugned assessment order, being bad in law, be quashed. Additional Ground No.2: On the facts and in the circumstances of the case, and in law, the additions made in the impugned assessment order, which are disputed in Ground No. 2 3 could not have been legally made in assessment order u/s. 153C, there being no reference to any incriminating material on record having any bearing on those additions. Your appellant, therefore, prays that the said additions, being bad in law, be deleted. The ld. Departmental Representative (for short D.R ) had objected to the admission of the additional grounds of appeal. We however find that as the aforesaid additional grounds of appeal involve purely a question of law emerging from the facts available from record, therefore going by the judgment of the Hon ble Supreme Court in the case of National Thermal Power Company Limited Vs. CIT (1998) 229 ITR 383 (SC), we thus admit the same. 2. Briefly stated, the facts of the case are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings and had throughout evaded furnishing of the replies to the queries raised by the A.O in the course of the assessment proceedings, as well as failed to place on record any material which could go to substantiate that he had filed the return of income in response to notice under Section 153C, therein rejected the contentions raised by the assessee. The CIT(A) further observing that not only the satisfaction on the part of the A.O for taking the requisite action under Section 153C was duly recorded, but rather a copy of the reasons for initiating action under Section 153C was supplied to the assessee, in response to which the assessee had even filed his objections vide his letter dated 23.12.2011, thus finding no force in the aforesaid contention of the assessee, rejected the same. The CIT(A) further adverting to the contentions raised by the assessee as regards the addition aggregating to ₹ 53,00,592/- made in the course of the assessment proceedings, therein called for a remand report from the A.O. The CIT(A) after perusing the report filed by the A.O, therein deleted an addition of ₹ 36,00,592/- (out of total addition of ₹ 53,00,592/-), whil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gadhar Shetty Group), but from the very fact that the reasons for issuing notice under Section 153C were recorded on 21.12.2010, it could thus safely be inferred that the actual handing over of the said seized material by the Assessing officer of the searched person, viz. M/s Om Sai Motors Pvt. Ltd.(supra), to the Assessing officer of the assessee, must have taken place on that day itself. The ld. A.R in support of his aforesaid contention therein drew our attention to Page 17-20 of his Paper book (APB), which we find is a copy of the reasons recorded for issue of notice under Section 153C of the Income-tax Act 1961 in the case of the assessee, viz. Shri Diwakar N. Shetty for A.Ys 2004-05 to 2009-10. The ld. A.R thus submitted that now when the handing over of the incriminating material by the A.O of the searched person, viz. M/s Om Sai Motors Pvt. Ltd. (supra), to the A.O of the assessee had taken place only in the Financial year 2010-11 relevant to A.Y 2011-12, therefore the A.O though remained vested with the jurisdiction to frame assessments in respect of the preceding six assessment years ,viz. A.Y 2005-06 to A.Y 2010-11, but had no jurisdiction to frame assessment in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment in the hands of the assessee for A.Y 2004-05. 5. We have heard the ld. Authorized Representatives for both the parties on the issue under consideration, perused the orders of the lower authorities and the material placed on record. We have given a thoughtful consideration to the facts of the case and find that the jurisdiction to frame assessment or re-assessment pursuant to search and seizure action under Section 132, or making of a requisition under Section 132A, as regards the six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made, can be traced in Section 153A of the Act . However, for the purpose of framing of an assessment in the case of a person where the jurisdiction had been assumed by the A.O under section 153C, viz. a person other than the person referred to in Section 153A, the reference to the date of initiation of the search under Section 132, or making of a requisition under Section 132A provided in the 2nd proviso of Section 153A, shall therein stand substituted by and read as the date of receiving the books of account or documents or assets seized or requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... previous years preceding the year in which the search takes place can be reopened but in case of any other person, who is not searched but his assets are seized from the searched person, the period for which the assessments could be reopened would be much beyond the period of six years. This is so because the date of handing over of assets/documents of a person, other than the searched person, to the A.O. would be subsequent to the date of the search. This, in our view, would be contrary to the scheme of Section153C(1) of the Act, which construes the date of receipt of assets and documents by the A.O of the Assessee (other than one searched) as the date of the search on the Assessee. The rationale appears to be that whereas in the case of a searched person the A.O. of the searched person assumes possession of seized assets/documents on search of the Assessee; the seized documents belonging to a person other than a searched person come into possession of the A.O. of that person only after the A.O. of the searched person is satisfied that the assets/documents do not belong to the searched person. Thus, the date on which the A.O. of the person other than the one searched assumes the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , where action is initiated under Section 153C, the jurisdiction to frame assessment/reassessment in the hands of such other person would be the six assessment years relevant to the previous year in which such books of accounts or documents or assets seized or requisitioned relatable to such other person are delivered by the Assessing Officer of the searched person, to the Assessing Officer of such other person . Thus in the backdrop of the aforesaid settled position of law, we are of the considered view that now in the case of the present assessee as the reasons recorded for issue of notice under Section 153C for A.Y. 2004-05 to 2009-10 are dated 21.12.2010, therefore though it can safely be presumed that the A.O of the searched person, viz. M/s Om Sai Motors Pvt. Ltd. (supra) must had handed over the seized material relatable to the assessee, to the A.O having jurisdiction over the latters case in the Financial year 2010-11 relevant to A.Y. 2011-12, and if that be so, then the A.O would had no jurisdiction for issuing notice under Section 153A r.w Sec. 153C for the said year, viz. A.Y. 2004-05, to the assessee, and as a fall out of the same the assessment framed in the han ..... X X X X Extracts X X X X X X X X Extracts X X X X
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