Shasindra Shetty, Pune v. ACIT,, Pune

ITA 28/PUN/2006 | misc
Pronouncement Date: 16-12-2010 | Result: Allowed

Appeal Details

RSA Number 2824514 RSA 2006
Assessee PAN ADWPS9536J
Bench Pune
Appeal Number ITA 28/PUN/2006
Duration Of Justice 4 year(s) 11 month(s) 7 day(s)
Appellant Shasindra Shetty, Pune
Respondent ACIT,, Pune
Appeal Type Income Tax Appeal
Pronouncement Date 16-12-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 16-12-2010
Assessment Year misc
Appeal Filed On 09-01-2006
Judgment Text
IN THE INCOME TAX APPLLATE TRIBUNAL PUNE BENCH A PUNE BEFORE SHRI I.C. SUDHIR AND SHRI D. KARUNAKARA RAO ITA NO. 28/PN/06 (BLOCK PERIOD 97-98 TO 03-04) SHASHINDRA SHETTY C/O. KHANDELWAL JAIN & ASSO CAS 1 ST FLOOR ALANKAR CINEMA BLDG. PUNE: 411 001 PAN NO. ADWPS9536J .... APPELLANT VS. ACIT CEN. CIRCLE 2(1) PUNE . RESPONDENT APPELLANT BY : SHRI NILESH KHANDELWAL RESPONDENT BY : SHRI HARESHWAR SHARMA ORDER PER D. KARUNAKARA RAO AM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE CIT(A)-II PUNE DATED 18-11-2005 FOR THE BLOCK PERIOD 1997-98 TO 2003-04. 2. AT THE VERY OUTSET LD. COUNSEL FOR THE ASSESSEE MENTIONED THAT THIS IS A CASE WHERE THE BLOCK ASSESSMENT WAS COMPLETED BEYOND THE ALLOWED PERIOD OF TWO YEARS IN VIOLATION OF THE PROVISIONS OF SEC. 158 BE OF TH E ACT. COUNSEL MENTIONED THAT THERE ARE TWO WARRANTS OF AUTHORISTION (WOA) AND TWO CORR ESPONDING PANCHANAMAS . COPIES ARE AVAILABLE IN THE PAPER BOOK. IN THIS REG ARD REFERRING TO WOA MARKED SR. NO. B-4. LD COUNSEL MENTIONED THAT THIS A WOA B-4 BEARS THE NAME OF THE ASSESSEE SHASHINDRA S SHETTY AND THE RELEVANT PAN CHANAMA BEARING PARTY NO. B-4 IS PLACED IN THE PAPER BOOK AT PAGE 6 AND IT ALSO B EARS THE NAME OF THE ASSESSEE. REFERRING TO PARA 8 OF THE SAID PANCHANAMA THE COU NSEL MENTIONED THAT THE 8. THE SEARCH COMMENCED ON 27-06-2002 AT 8.00 AM. T HE PROCEEDINGS WERE CLOSED ON 28-06-2002 AT 6.30 PM AS FINALLY CONCLUDED/ AS TEMPORARILY CONCLUDED FOR THE DAY TO BE COMMENCED SUBSEQUENTLY FOR WHICH PURPOSE SEALS WERE PLACED ON THE ENTIRE PLACE IN OUR PRESENCE. THUS AS PER LD. COUNSEL THE SEARCH WAS CONCLUDED ON 28-06-2002 AND CONSEQUENTLY PANCHANAMA BEARING B-4 SHOULD BE LA ST PANCHANAMA DRAWN. ACCORDINGLY THE BLOCK ASSESSMENT SHOULD HAVE BEEN COMPLETED BY THE END OF JUNE ITA NOS. 28/PN/06 BLOCK PERIOD: 97-98 TO 03-04 PAGE 2 OF 5 2004 AND NOT IN THE MONTH OF AUGUST 2004 AS DONE BY THE AO. AS PER THE RECORDS THE BLOCK ASSESSMENT WAS COMPLETED ON 30-08-2004. 3. FURTHER REFERRING PAGE 7 OF THE PAPER BOOK THE COUNSEL DEMONSTRATED THAT THE REVENUE MADE ANOTHER PANCHANAMA BEARING THE PAR TY NO. B-2 PLACED AT PAGE 7 BASED ON THE WOA WITH SR. NO. B-2. LD. COUNSEL M ENTIONED THE SAID WOA ALSO BEARS THE NAME OF THE ASSESSEE I.E. SHASHINDRA SHETTY AND HOWEVER THE PANACHANAMA B-2 DOES NOT BEAR THE NAME OF THE ASSES SEE. REFERRING TO COLUMN A OF THE SAID PANCHANAMA ON ITS FRONT PAGE HE MENTIO NED THAT ETC IS MENTIONED IN CONTINUATION A COUPLE OF THE NAMES. AR STATED THAT SUCH EXPRESSION IE ETC SHOULD NOT BE EQUATED TO INCLUDE THE NAMES OF THE ASSESSEE . FURTHER REFERRING TO PARA 4 OF THE SAID PANCHANAMA LD. COUNSEL MENTIONE D THAT SO FAR AS THE ASSESSEE IS CONCERNED NOTHING WAS EITHER SEIZED OR IMPOUNDED BY THE DEPARTMENT AFTER SEARCHING THE PREMISE. FURTHER HE NARRATED STATING THAT WHAT IS ESSENTIALLY SEARCHED AND SEIZED OR IN THE CASE OF JAGANNATH SHETTY WHICH IS THE FIRST NAME APPEARING ON THE WOA NUMBERED B-2 AS WELL AS THE RELEVANT PANCHA NAMA. REVENUE DID NOT BEAR THE SIGNATURE OF THE ASSESSEE ON THE FACE OF THE WOA WHICH IS A NORMAL PRACTICE AT THE COMMENCEMENT OF THE SEARCH AND THEY DID NOT EVEN RECORD THE STATEMENT OF THE ASSESSEE. T HUS THE COUNSEL FOR THE ASSESSEE DEVELOPED HIS ARGUMENTS TO THE ULTIMATE CONCLUSION THAT THERE IS NO SEARCH ON THE ASSESSEE VIDE THE WOA B-2 AND RELEVANT PANCHANAMA B -2. THESE WOA B-2 AND RELEVANT PANCHANAMA B-2 RELATE TO SHRI JAGANN ATH B.SHETTY ONLY. FURTHER LD. COUNSEL MENTIONED THAT THE ASSESSEE SH ASHINDRA SHETTY DOES NOT BELONG TO THE GROUP OF JAGANNATH B. SHETTY. ASSESSEE IS NOT PARTY TO T HE PROCEEDINGS CONSEQUENT TO THE WARRANT I.E. SR.NO. B-2. FINALLY LD COUNSEL MENTIONED THAT THE WARRANT SR. NO. B-2 WHICH WAS NOT SHOWN BY THE ASSESSEE AND WHEN THE PREMISES WAS SEARCHED DOES NOT HAVE ANYTHI NG TO DO WITH THE ASSESSEE WHEN THE CORRESPONDING PANCHANAMA PG. 7 OF THE PAPE R BOOK DOES NOT APPEAR THE ASSESSEES NAME. NO ASSETS BELONG TO THE ASSESSEE O R FOUND AND SEIZED SUCH PANCHANAMA CANNOT BE DEEMED AS THE LAST PANCHANAMA DRAWN. THUS A.O ERRONEOUSLY CAME TO THE CONCLUSION THAT SEARCH ON T HE ASSESSEE IS CONCLUDED ON THE DATE 01-08-2002 AND CONSIDERED PANCHANAMA B-2 AS THE LAST PANCHANAMA DRAWN. IN THIS REGARD LD. COUNSEL RELIED ON COUPLE OF DECI SIONS THEY ARE S.K. KATYAL 16 DTR (DEL) 285 AND RAJU LALCHAND SUD 3 DTR (MUMBAI) 371. 4. ON THE OTHER HAND LD. DR FOR THE REVENUE ARGUED STATING THAT THERE IS AN EXISTENCE OF WOA IN THE NAME OF THE ASSESSEE VIDE S R. NO. B-2 AND IT BEARS THE NAME OF THE ASSESSEE IN CLEAR EXPRESSION. WHEN RELA TABLE PANCHANAMA B-2 IS READ IN CONJUNCTION IN THE WOA B-2 IN PARTICULAR THE CONTENTS IN COLU MN A IE SHRI JAGANNATH B AHETTY SMT SHAKUNTALA B SHETTY ETC ANY BODY SHALL COME TO THE INFERENCE THAT THE NAME OF THE ASSESSEE IS DEEM ED INCLUDED IN THE SAID EXPRESSION ETC. FURTHER RELYING ON THE PROVISIONS OF THE ACT THE DR MENTIONED THAT ITA NOS. 28/PN/06 BLOCK PERIOD: 97-98 TO 03-04 PAGE 3 OF 5 THERE IS NO REQUIREMENT OF SEIZURE OR DISCLOSURE OF ANY UNDISCLOSED ITEMS OR ARTICLES TO QUALIFY EITHER THE OCCURRENCE OF SEARCH OR FOR C ONSIDERING THE RELEVANT PANCHANAMA AS THE LAST PANCHANAMA DRAWN SPECIFIED I N EXPLANATION 2(A) TO SECTION158 BE OF THE ACT. FURTHER HE IS OF THE OPI NION THAT WHEN THERE IS WARRANT IN THE NAME OF THE ASSESSEE AND THE PREMISES SEARCHED THEY MEET THE REQUIREMENTS OF THIS LAW. ACCORDINGLY THE COMPUTATION OF TIME LIMITATION WILL START FROM THE IMPUGNED PANCHANAMA NOT A THE PANCHANAMA NAMED B-2 IE 1.8.2004 IN THAT CASE THE ORDER PASSED BY THE AO IS IN ORDER. 5. WE HAVE HEARD BOTH THE PARTIES PERUSED THE ORDE R OF REVENUE AS WELL AS THE CITATIONS RELIED UPON BY THE ASSESSEE. WE HAVE ALSO GONE THROUGH THE COPIES OF THE WOA AND THE PANCHANAMAS PLACED IN THE PAPER BOOK. THERE IS NO DISPUTE ON T HE FACTS AND THE DATES NARRATED ABOVE. THE DISPUTES AR E ONLY WITH REGARD TO - I) WHETHER EXPRESSION ETC INCLUDES NAME OF THE AS SESSEE. II) WHETHER PANCHANAMA B-2 PLACED AT PAGE 7 OF T HE PAPER BOOK IS THE LAST PANCHANAMA DRAWN WHICH REFLECTS THE MAIN FOCU S ON J.B. SHETTY AND SHASHINDRA SHETTY AND NOT THE ASSESSEE. THIS PANCHA NAMA DOES NOT REFLECT ANY SEARCH ACTIVITY INVOLVING THE ASSESSEE SHRI SHA SHINDRA SHETTY. 6. FURTHER WE HAVE ALSO PERUSED THE JUDGMENTS CITE D BY THE CONSEL. REGARDING THE DISPUTED ISSUE IF THE EXPRESSION ETC TO INCLUDE THE NAME OF THE ASSESS EE IN OUR OPINION IF SUCH EXPRESSION ARE INDEPENDENTLY A PPEARING ON A DOCUMENT THE ANSWER IS NEGATIVE AND IN FOVOUR OF THE ASSESSEE. B UT IN THIS INSTANT CASE BOTH THE WOA B-2 AND THE PANCHANAMA B-2 WHEN EXAMINED TOGETH ER IN OUR OPINION THERE EXISTS MERGER OF INFORMATION OF THE NAMES APPEARING IN WOA B-2 WITH THE NAMES APPEARING IN COLUMN A ON THE PANCHANAMA B-2. IT I S RELEVANT TO NOTE THAT SAID COLUMN A IN PANCHANAMA DEMANDS THE DETAILS OF WARRENT IN THE CASE OF . IN THAT CASE IT IS REASONABLE TO INFER THE NAME OF TH E ASSESSEE IS PART OF THE EXPRESSION ETC. THE ETC IS MENTIONED ONLY TO AVOID REPETIT ION OF THE NAMES. IN THE INSTANT CASE WOA UNDISPUTEDLY BEARS THE NAME OF THE ASSESS EE AND RELEVANT PANCHANAMA BEARS ONLY ETC. UNLIKE IN THE CASES REFERRED BY T HE ASSESSEES COUNSEL IN THE CASE OF RAJU LALCHAND SUD (SUPRA) THE PAUCITY OF THE SPACE IN COLUMN A IN THE PANCHANAMA IS NOT THE ISSUE HERE. 7. WE FIND LOT OF ROOM FOR MENTIONED REST OF THE NA MES IS EVIDENT FROM THE FACT OF THE PANCHANAMA. FURTHER IN THE SAID CASE OF RAJ U LALCHAND SUD (SUPRA) WHICH IS DISTINGUISHABLE ON FACTS THE SAID ASSESSEES NAME APPEARED AS ONE OF THE PANCHAS AND IT IS LOGICAL THAT THE REVENUE CANNOT PRESUME T HE PANCH CAN BE THE PERSON SEARCHED TOO. THEREFORE WE ARE OF THE OPINION THA T IMPUGNED PANCHANAMA DATED 1.8.2004 IS CERTAINLY DRAWN IN THE NAME OF THE ASSE SSEE ALSO. THEREFORE THIS PART OF ITA NOS. 28/PN/06 BLOCK PERIOD: 97-98 TO 03-04 PAGE 4 OF 5 THE ARGUMENT OF THE COUNSEL FOR THE ASSESSEE IS DISMISSED AND THE RELATED DISPUTED IS DECIDED IN FAVOUR OF THE REVENUE. 8. FURTHER REGARDING THE OTHER DISPUTE WHETHER THERE IS SEARCH IN THE CASE OF THE ASSESSEE VIDE THE WOA B2 AND THE PANCHANAMA B-2 IN VIEW OF THE PECULIARITY OF THE EVENTS ON THE DATE OF 1 ST AUGUST 2004 QUA THE ASSESSEE WE FIND IT NECESSARY TO NARRATE THE EVENTS. ON FACTS NEITHER THE IMPUGNED WOA B-2 WAS SHOWN TO THE ASSESSEE NOR HE TOOK PART IN THE PROCE EDINGS ON THAT DAY NOR THERE WAS ANY SEIZURE OF ANY CASH JEWELRY OR THE DOCUMEN TS BELONGING TO THE ASSESSEE NOR THERE ANY RECORDING OF THE STATEMENT OF THE ASS ESSEE. THESE FACTS ARE NOT CONTROVERTED. IN SUCH CIRCUMSTANCES WE HAVE TO DEC IDED IF THERE IS A SEARCH ON THE ASSESSEE ON 1/8/2004 VIDE THE WOA AND THE PANCHANAM A B2 AND SUCH PANCHANAMA CONSTITUTE THE LAST PANCHANAMA DRAWN AS MENTIONED IN EXPLANATION 2(A) TO SECTION 158BE OF THE ACT. IN THIS REGARD WE HAVE PERUSED THE RATIO IN THE CASE OF S.K. KATYAL (SUPRA) RELIED UPON BY THE ASSESSEES COUNSE L IN SUPPORT OF HIS ARGUMENTS. RELEVANT PROPOSITION OF THIS ORDER IS THAT - IF THE PANCHANAMA DOES NOT REVEAL THAT THE SEARCH WAS CARRIED OUT ON THAT DAY TO WHICH IT RELATES THEN IT WOULD NOT BE A PANCHANAMA RELATING TO A SEARCH AND CONSEQUENTLY IT WOULD NO T BE A PANCHANAMA OF THE TYPE WHICH FINDS MENTION IN THE S AID EXPLN. 2(A) TO S. 158BE . 9. FOR DECIDEING THE ISSUE THE FOLLOWING FACTS ARE IGNORABLE. ASSESSEE IS NOT PRIVY TO THE WOA MARKED B-2 AS IT DOES NOT BEAR THE SIGNA TURE OF THE ASSESSEE. NORMALLY AT THE TIME OF EXECUTION OF SEARCH WARRANT IN ANY P REMISES NORMALLY THE WARRANT OF AUTHORISATION IS SHOWN TO THE ASSESSEE AND HIS S IGNATURE IS OBTAINED IF THE PERSON IS AVAILABLE. IN THE INSTANT CASE THERE IS NO SUCH AN EVENT RECORDED. SECONDLY BASED ON THE RECORDED EVENTS IN THE PANCHANAMA THE REVEN UE HAS NOT SEIZED OR IMPOUNDED OR RESTRAINED ANY INCRIMINATING CASH JEW ELRY OR THE DOCUMENTS OR ANY OTHER THINGS BELONGING TO THE ASSESSEE. IN FACT TH ERE IS NO RECORDING ANY EVENT INVOLVING THE NAME OF THE ASSESSEE ON 1 ST AUGUST 2004. REVENUE HAS NOT SUCCESSFULLY CONTROVERTED THE ASSESSEES CONTENTION THAT THE ASSESSEE-SHETTY HAS NO BUSINESS CONNECTION WITH SHRI JAGANNATH B SHETTY AP PEARING AS THE FIRST NAME IN THE IMPUGNED WOA B-2. FURTHER WE FIND THAT THE PANCHA NAMA B-4 AS MENTIONED IN PARA 8 THERE IS CLEAR MENTIONING OF THE FACT THAT THE SEARCH IS FINALLY CONCLUDED. IN SUCH CIRCUMSTANCES WE ARE OF OPINION THE REVENUE HAS ATTEMPTED TO EXTEND THE SEARCH BEYOND 28TH JUNE 2004 ONLY. REVENUE HAS ALSO FAILED TO DEMONSTRATE WHY THE WOA B-2 WAS NEEDED IN THE CASE OF THE ASSESSEE ON WHO THE SEARCH ACTION WAS ACTUALLY CONCLUDED ON 28 TH JUNE 2004.CONSEQUENTLY WE ARE OF THE OPINION TH E PANCHANAMA B-2 CANNOT BE CONSIDERED AS THE LAST PANCHANAMA DRAWN WITH IN THE MEANING OF THE EXPLANATION 2(A) REFERRED TO ABOVE. THEREFORE THE PANCHANAMA B-4 IS THE RELEVANT PANCHANAMA FOR THE PURPOSE OF COMPU TING THE TIME LIMITATION PROVIDED IN SECTION 158BE OF THE ACT. HENCE THE BLO CK ASSESSMENT MADE IN 30 TH ITA NOS. 28/PN/06 BLOCK PERIOD: 97-98 TO 03-04 PAGE 5 OF 5 AUGUST 2004 IS NOT A VALID ONE AND THE SAME IS LIAB LE TO BE QUASHED ON THE LEGAL GROUNDS ITSELF. ACCORDINGLY THIS PART OF THE GROUN DS OF THE ASSESSEE IS ALLOWED . IN VIEW OF DECISION ABOVE THE ADJUDICATION OF THE OTH ER GROUNDS WHICH ARE RAISED WITHOUT PREJUDICE TO LEGAL GROUND AT SL NO 1 ON ME RIT IS MERELY AN ACT OF ACADEMIC EXERCISE AND THEREFORE THESE GROUNDS ARE DEEMED AS ALLOWED IN FAVOUR OF THE ASSESSEE. 10. IN THE RESULT APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDERS PRONOUNCED IN THE OPEN COURT ON 16 TH DECEMBER 2010. SD/- SD/- (I.C. SUDHIR) (D.KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBE R PUNE DATED THE 16 TH DECEMBER 2010 R COPY OF THE ORDER IS FORWARDED TO : 1. ASSESSEE 2. ACIT CENTRAL CIRCLE 2(1) PUNE 3. CIT(A)-II PUNE 4. CIT(CENTRAL) PUNE 5. D.R. ITAT A BENCH BY ORDER ASSISTANT REGISTRAR I.T.A.T PUNE