9911796707
Advanced Search 
TMI Blog2018 (12) TMI 1873X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer under Section 148 of the Act, for the purpose of reopening the assessments which were already finalised for the assessment years 1995-1996 and 1996-1997. 3. The third writ petition viz., WP No.7623 of 2002 is filed by the same writ petitioner with a prayer to forbear the first and second respondents from making an assessment on the petitioner under Chapter XIV-B of the Income Tax Act for the Block Period 1987-1988 to 1997-1998 pursuant to the notice issued under Section 158-BC of the Income Tax Act (hereinafter referred to as the 'Act'), by the second respondent on 8th October 2001. 4. The learned counsel for the writ petitioner advanced his arguments, by commencing the initial ground raised by the writ, petitioner that the fair opportunity had not been provided to the writ petitioner to put forth his case before the Authorities Competent. The materials gathered during the search operations in the premises of the writ petitioner had not been shared at all. Thus, the writ petitioner was deprived of his opportunity of knowing the materials, which were secured at the time of search operations. This made the writ petitioner unable to submit his defence before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the income assessed in this Chapter shall not be included in the regular assessment of any previous year included in the block period. 9. Relying on the abovesaid two Explanations inserted by virtue of amendment Finance (No.2) Act, 1998, implemented with retrospective effect from 1.7.1995, the learned counsel for the writ petitioner is of the firm view that the facts and circumstances of the present lis on hand squarely falls within the ambit of these Explanations inserted in the original provision under Section 158-BA of the Act. 10. As per the Explanation, there cannot be any two assessments in respect of the same income. In the present cases, the Assessing Officer is attempting to do so. There is an unambiguity in respect of the actions initiated in this regard by the Assessing Officer by issuing a notice under Section 148 of the Act. Even as per the judgment of the Hon'ble Supreme Court, the aggrieved person at the earliest point of time, is entitled to approach the Court of Law, more specifically, under Article 226 of the Constitution of India. Thus, the writ petitioner has established that such a parallel proceedings are impermissible and would cause prejudice to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e dismissed in limine. 15. The learned Senior Standing Counsel for the Income Tax Department with reference to the arguments in respect of the interpretation of the provisions of the Act, contended that Chapter XIV-B of Section 158-B stipulates that "unless the context otherwise requires,- (a) "block period" means 66(a) the previous years relevant to ten assessment years preceding the previous year in which the search was conducted under Section 132 or any requisition was made under Section 132-A and includes, in the previous year in which such search was conducted or requisition made, the period up to the date of the commencement of such search or, as the case may be, the date of such requisition. 16. Referring the abovesaid provision, the learned Senior Standing Counsel for the Income Tax Department states that the Competent Authorities are empowered to take ten assessment years under the provisions of Section 158-B (a) of the Act. In the present cases, the ten years period is taken from the year 1986, more specifically, the block period is considered by the authorities with effect from 1.4.1986 to 31.3.1996 and from 1.4.1996 to 15.7.1996. Thus, the Authorities Competent had ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any other law for the time being in force, then, the Principal Director General or Director General or Principal Director or Director or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner may authorise any Additional Director, Additional Commissioner, Joint Director, Joint Commissioner, Assistant Director or Deputy Director, Assistant Commissioner or Deputy Commissioner or Income-tax Officer (hereafter in this section and in sub-section (2) of section 278D referred to as the requisitioning officer) to require the officer or authority referred to in clause (a) or clause (b) or clause (c), as the case may be, to deliver such books of account, other documents or assets to the requisitioning officer. 18. The learned Senior Standing Counsel for the Income Tax Department is of the firm opinion that the informations and the materials received from the FERA on account of the search taken by the FERA is also source for initiation of the action under the provisions of the Income Tax Act in respect of block assessment already made with reference to the assessment of the writ petitioner. The block assessment was taken based on the informations an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore this Court by the learned Standing Counsel would be followed scrupulously in the matter of providing opportunity to the writ petitioner in respect of his right to inspect the documents at his request and other opportunities to be provided under the Act. 22. The learned counsel for the writ petitioner cited the judgment of the Gujarat High Court in the case of Cargo Clearing Agency (Gujarat) Vs. Joint Commissioner of Income Tax [(2008) 76 CCH 0915 GujHC], wherein in paragraphs 28, 29, 32 and 33, it has been held as under:- "28. In the present case, none of the exceptional contingencies exist. As already noticed, on a plain reading it becomes discernible that there are two separate streams of procedure provided by the Legislature : (1) under Chapter XIV of the Act which provides for "procedure for assessment", and (2) under Chapter XIV-B of the Act which provides for "a special procedure for assessment of search cases". Only in the event the special procedure for assessment has not provided for some procedure for assessment can one refer to the procedure under Chapter XIV of the Act. Therefore, the interpretation sought to be placed by the Revenue on the provisions of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ading. In the circumstances, as per the established rules of interpretation, unless and until a plain reading of the two streams of assessment procedure does not result in the procedures being independently workable, only then the question of resolving the conflict would arise. But to the contrary, in the present case, in the light of the provisions of section 158BH of the Act, once there is a conflict between the two streams of procedure, as laid down by the apex court, the provisions of Chapter XIV-B of the Act shall prevail and have primacy. 33. Thus, viewed from any angle, the stand of the Revenue does not merit acceptance. Once assessment has been framed under section 158BA of the Act in relation to undisclosed income for the block period as a result of search there is no question of the Assessing Officer issuing notice under section 148 of the Act for reopening such assessment as the said concept is abhorrent to the special scheme of assessment of undisclosed income for block period. At the cost of repetition it is required to be stated and emphasised that the first proviso under section 158BC(a) of the Act specifically provides that no notice under section 148 of the Act i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment years 1995-1996 and 1996-1997. Therefore, all these factual details are to be scrutinised by the Authorities Competent and it is premature for this Court to go into such details in the present writ petitions as these writ petitions are filed challenging the very notice issued by the Competent Authorities under Section 148 of the Act and certain factual details are to be arrived only after the scrutiny of all the documents. It is admitted that the search operations were made in the premises of the writ petitioner. Number of materials were seized. The books of accounts and the materials seized are now under the custody of the Income Tax Department. 28. This Court is of an opinion that the materials collected may be by way of statements from various persons and the documents from other resources. Search operation is of such one where the Competent Authorities are bound to get informations from all the sources irrespective of their position, status or otherwise. The very purpose of search operations are to ensure that the Law Enforcing Agency identify all irregular activities which are all undisclosed or black money or otherwise in violation of the Act. 29. The power of search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be accepted and in large number of Statutes such parallel proceedings are permitted enabling the authorities to initiate actions under various law. For instance, the Tamil Nadu Co-operative Societies Act, contemplates an enquiry under Section 81 of the Act. If a statutory enquiry is conducted under Section 81 of the Act, with reference to the irregularities in any Co-operative Society, then an enquiry can be ordered and a report can be submitted by the Enquiry Officer. Such an enquiry report may result into three fold actions against the erring persons. Based on the enquiry report, a criminal prosecution can be initiated by filing a complaint before the Commercial Crime Investigation Wing and disciplinary proceedings can be initiated against the employees of the Department and the surcharge proceedings can be initiated to recover the loss if any occurred to the Institution. Thus, there cannot be any absolute prohibition of parallel proceedings under law. This Court has to examine, when such parallel proceedings are permissible and impermissible with reference to the Statutes and with reference to the facts and circumstances of each case. 32. The concept of parallel proceedings eve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd allow the Assessing officer to assess the income and pass final orders of assessment under the Act. 38. In the present cases on hand, the reasons for reopening of the assessment had already been provided to the writ petitioner. Thus, the writ petitioner ought to have given his explanations/objections in respect of the reasons stipulated in the reply by the Income Tax Department. Contrarily, if this Court adjudicate the merits and demerits, the same would cause prejudice to the Income Tax Department in concluding the reassessment proceedings with reference to Sections 147 to 153 of the Act. 39. The very object and purpose of the reassessment and reopening of the assessment is to ensure that the tax evaders are dealt in accordance with law. If the assessee failed to disclose the actual income to the Department in a parallel assessment year, the Assessing Officer is empowered to reopen the assessment with reference to Sections 147 to 153 of the Act. Once the proceedings are commenced under Section 148 of the Act, then this Court must allow the Assessing Officer to adjudicate the reassessment and arrive a conclusion and pass assessment orders by affording opportunities to the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he present cases on hand, admittedly there was search operations. Admittedly, certain materials were secured by the Authorities Competent. Admittedly, in its order dated 15.11.1996, the Assistant Commissioner of Income Tax provided opportunity to the writ petitioner to inspect all those documents. However, opportunities proposed to be provided was informed by the Assistant Commissioner of Income Tax. 43. However, now the learned Senior Standing Counsel for the Income Tax Department made a submission that an opportunity will be provided to the writ petitioner by following the procedures. This being the submission made, this Court is of an opinion that complete opportunity as contemplated under the Act must be provided to the assessee, enabling him to submit his explanations/objections and the documents if any along with the statements for the purpose of concluding the proceedings in all respects and to ensure that the proceedings reaches its logical conclusion. 44. In this view of the matter, this Court is of an opinion that WP Nos.1143 and 1144 of 2003 as well as the WP No.7623 of 2002 are devoid of merits and stands dismissed and this Court hope that the writ petitioner would co ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
