DCIT, New Delhi v. Smt Sneha J.Gandhi, Delhi

ITSSA 25/DEL/2010 | misc
Pronouncement Date: 10-02-2012 | Result: Dismissed

Appeal Details

RSA Number 2520116 RSA 2010
Assessee PAN AAFPG6816R
Bench Delhi
Appeal Number ITSSA 25/DEL/2010
Duration Of Justice 1 year(s) 9 month(s) 3 day(s)
Appellant DCIT, New Delhi
Respondent Smt Sneha J.Gandhi, Delhi
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 10-02-2012
Appeal Filed By Department
Order Result Dismissed
Bench Allotted G
Tribunal Order Date 10-02-2012
Date Of Final Hearing 06-02-2012
Next Hearing Date 06-02-2012
Assessment Year misc
Appeal Filed On 07-05-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : G : NEW DELHI BEFORE SHRI I.P. BANSAL JUDICIAL MEMBER AND SHRI K.D. RANJAN ACCOUNTANT MEMBER IT (SS) A NO.25/DEL/2010 BLOCK ASSESSMENT PERIOD : 01.04.1990 TO 20.08.2000 DCIT CIRCLE 6(1) ROOM NO.413 CR BUILDING IP ESTATE NEW DELHI. VS. SNEHA J. GANDHI 158 DEEPALI PITAMPURA DELHI. PAN : AAFPG6816R CO NO.290/DEL/2010 (IT (SS) A NO.25/DEL/2010) BLOCK ASSESSMENT PERIOD : 01.04.1990 TO 20.08.2000 SNEHA J. GANDHI 158 DEEPALI PITAMPURA DELHI. PAN : AAFPG6816R VS. DCIT CIRCLE 6(1) ROOM NO.413 CR BUILDING IP ESTATE NEW DELHI . (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI MOHIT A. PAREKH CA REVENUE BY : SHRI NIRANJAN KOULI CIT DR ORDER PER I.P. BANSAL JUDICIAL MEMBER THE APPEAL IS FILED BY THE DEPARTMENT AND THE CROSS O BJECTIONS BY THE ASSESSEE. THEY ARE DIRECTED AGAINST THE ORDER OF THE CIT (A) DATED 22 ND FEBRUARY 2010 FOR THE BLOCK ASSESSMENT PERIOD 01.04.1 990 TO 20.08.2000. THE GROUNDS OF APPEAL FILED BY THE R EVENUE READ AS UNDER: 1. THE ORDER OF THE LEARNED CIT (A) IS ERRONEOUS AN D CONTRARY TO FACTS AND LAW. IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 2 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS.5 98 814/- MADE BY THE ASSESSING OFFICER ON ACCOU NT OF UNDISCLOSED INCOME ON SALE OF JEWELLERY. 2.1 THE LEARNED CIT (A) HAS IGNORED THE FACT THAT THE AS SESSEE COULD NOT ESTABLISH THAT THIS AMOUNT WAS RECEIVED OUT OF S ALE PROCEEDS OF JEWELLERY. 3. THE APPELLANT CRAVES LEAVE TO ADD TO ALTER OR AMEND ANY GROUNDS OF THE APPEAL RAISED ABOVE AT THE TIME OF THE HE ARING. 1.1. IN THE CROSS OBJECTIONS THE ASSESSEE HAS MAINLY CHALLE NGED THE VALIDITY OF INITIATION OF PROCEEDINGS U/S 158BD BY WA Y OF THE FOLLOWING GROUNDS:- 1. THAT THE BLOCK ASSESSMENT ORDERS PASSED BY THE ASSESSING AUTHORITY AND CONFIRMED BY THE CIT (A)-IX DE LHI ARE ILLEGAL AND BAD IN LAW WITHOUT JURISDICTION AND AGAIN ST THE VERY PROVISIONS OF THE SECTION 158BD OF THE ACT. 2. THAT THE NOTICE ISSUED UNDER SECTION 158BD IS NOT IN CONFORMITY WITH THE STATUTORY PROVISIONS OF THE ACT AND IS ALSO BARRED BY TIME LIMITATION HENCE THE BLOCK ASSESSMENT COMPLETED IN PURSUANCE OF THE SAID NOTICE IS ILLEGAL BAD IN LAW WITHOUT JURISDICTION AND THE SAME IS LIABLE TO BE QUASHE D. 3. THAT THE LD. CIT (A)-IX HAS FAILED TO APPRECIATE THAT THE ASSESSMENT FRAMED UNDER SECTION 158BD READ WITH SECTION 158BC OF THE ACT WITHOUT GRANTING THE ASSESSEE A FAIR P ROPER AND REASONABLE OPPORTUNITY WAS IN VIOLATION OF THE PRI NCIPLES OF NATURAL JUSTICE AND THEREFORE A NULLITY. 4. THAT NO SATISFACTION HAS BEEN RECORDED BEFORE THE IN ITIATING THE PROCEEDINGS U/S 158BD OF THE ACT AND THEREFORE THE WHOLE PROCEEDINGS ARE ILLEGAL BAD IN LAW AND WITHOUT COMPL IANCE OF THE SAID PROVISIONS OF LAW. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE PROCE EDINGS INITIATED AND CONCLUDED BY THE ASSESSING AUTHORITY U/S 1 58BD OF THE ACT IS WRONG ILLEGAL AND WITHOUT ANY COGENT GROUNDS/MATERIALS/EVIDENCE BROUGHT ON RECORD AND AS S UCH LIABLE TO BE DECLARED NULL AND VOID. 6. THE RESPONDENT CRAVES LEAVE TO ADD TO AMEND TO ALTER AND/OR WITHDRAW ANY OF THE GROUND(S) OF CROSS OBJECTIO NS OF APPEAL EITHER BEFORE OR AT THE TIME OF HEARING OF THE AP PEAL. IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 3 2. THE ASSESSMENT IN THE CASE OF THE ASSESSEE HAS BEEN FRAMED VIDE ASSESSMENT ORDER DATED 2 ND JANUARY 2009 PASSED U/S 158BD OF THE INCOME-TAX ACT 1961 (THE ACT). IN THE ASSESSMENT ORDER IT HAS BEEN MENTIONED THAT A SEARCH AND SEIZURE OPERATION U/ S 132 OF THE ACT WAS CONDUCTED IN THE CASE OF SHRI MANOJ AGGARWAL AND SHRI BISHAN CHAND RESIDENT OF C-25/2 BALDEV PARK NEW DELHI AN D THEIR ASSOCIATED CONCERNS ON 3 RD AUGUST 2000 AND CONSEQUENTLY ASSESSMENT IN THE CASES OF SHRI BISHAN CHAND AND SHRI MANOJ AGGARWAL WER E COMPLETED U/S 158BC OF THE ACT. IT IS FURTHER MENTIONED IN THE ASSESSMENT ORDER THAT INQUIRIES MADE IN THE SEARCH OPERATIONS AND POST SE ARCH OPERATIONS REVEALED THAT M/S BISHAN CHAND MUKESH KUMAR WAS NOT IN REAL BUSINESS BUT WAS ONLY PROVIDING BOGUS ACCOMMODATIO N ENTRIES WITH RESPECT TO PURCHASE OF JEWELLERY. IT IS FURTHER MENTIONED IN THE ASSESSMENT ORDER THAT DURING THE ASSESSMENT PROCEEDINGS OF M /S BISHAN CHAND MUKESH KUMAR U/S 158BD READ WITH SECTION 158BC IT HAD COME TO THE NOTICE OF DCIT CENTRAL CIRCLE NEW DELHI THAT THE ASSESSEE IS ONE OF THE BENEFICIARIES AND SHE HAD OBTAINED ADJUSTMENT ENTRY AMOUNTING TO ` 5 98 814/- VIDE BILL NO.354 DA TED 17 TH NOVEMBER 1997 THROUGH BOGUS SALE PROCEEDS OF JEWELLERY. SINCE THE ADDRESS OF THE ASSESSEE WAS OF MUMBAI DCIT CENTRAL CIRCLE NEW DE LHI VIDE HIS LETTER DATED 2 ND MARCH 2005 INTIMATED THIS TRANSACTION TO CCIT-I MUMBAI ON THE BASIS OF WHICH ACIT CIRCLE 22 (2) HAD ISSUED NOTICE TO THE ASSESSEE U/S 158BD ON 23 RD MARCH 2005. IN RESPONSE TO SUCH NOTICE THE ASSESSEE VIDE LETTER DATED 4 TH APRIL 2005 INTIMATED THE DEPARTMENT ABOUT CHANGE OF HER ADDRESS FROM MUMBAI TO DELHI. THEREAFTER DCIT CIRCLE 6 (1) NEW DELHI ISSUED NOTI CE U/S 158BD TO THE ASSESSEE ON 24 TH JANUARY 2007 AND ALSO A NOTICE U/S 142(1) DATED 10 TH JANUARY 2007 ASKING THE VARIOUS DETAILS FROM THE ASSESSEE . IN THIS MANNER THE ASSESSMENT OF THE ASSESSEE WAS PROCEEDED WITH AN D THE INCOME OF THE ASSESSEE HAS BEEN ASSESSED AT A SUM OF ` 5 98 8 14/- BY WAY OF THE AFOREMENTIONED ASSESSMENT ORDER DATED 2 ND JANUARY 2009. IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 4 3. BEFORE CIT (A) THE ASSESSEE CHALLENGED THE INITIATI ON OF PROCEEDINGS U/S 158BD AS WELL AS THE ADDITION ON MERIT WAS ALSO CHALLENGED. BEFORE THE CIT (A) THE ASSESSEE CHALLENGED THE VALIDITY OF INITIATION OF PROCEEDINGS U/S 158BD ON THE BASIS OF THE SPECIAL BENCH DECISION IN THE CASE OF MANOJ AGGARWAL VS. DCIT (200 8) 113 ITD 377 (DELHI) (SB). LEARNED CIT (A) WITHOUT GOING INTO T HE FACTS PROPERLY REGARDING THE CONTENTION OF THE ASSESSEE OF INORDINATE DELAY IN INITIATION OF PROCEEDINGS HAS COME TO THE CONCLUSION T HAT THE PROCEEDINGS WERE INITIATED AGAINST THE ASSESSEE AT MUMBAI WHERE SHE WAS RESIDING AND THEREFORE THE INITIATION OF PROCEE DINGS U/S 158BD CONTESTED ON THE GROUND OF INORDINATE DELAY WAS NOT SU STAINABLE. IT IS IN THIS MANNER LEARNED CIT (A) HAS UPHELD THE VALIDI TY OF INITIATION OF PROCEEDINGS U/S 158BD INTER ALIA BY REJECTING THE GRO UND OF THE ASSESSEE REGARDING THE INORDINATE DELAY IN INITIATION O F 158BD PROCEEDINGS EVEN THOUGH THE REFERENCE WAS MADE BY THE ASSESSEE TO AFOREMENTIONED DECISION OF THE SPECIAL BENCH. 4. AFTER NARRATING THE FACTS AND REFERRING TO THE AF OREMENTIONED DECISION OF THE SPECIAL BENCH THE LEARNED AR SUBMITT ED THAT THE FOLLOWING CHART WILL BE RELEVANT TO DISPOSE OF THE CA SE OF THE ASSESSEE ON THE SIMPLE GROUND THAT INITIATION OF PROCEEDINGS U /S 158BD WAS BEYOND THE JURISDICTION:- S. NO. NAMES OF THE ASSESSEE AND THEIR GROUP CONCERNS STATUS DATE OF SEARCH/ACTI ON ACTION AND THE IT ACT 1961. DATE OF BLOCK ASSTT. ORDER REMA -RKS 1 SH. BISHAN CHAND AGGARWAL INDIVIDUAL & DIRECTOR 03.08.2000 158BC 29.08.2002 2. MANOJ AGGARWAL - DO - 03.08.2000 158BC 29.08.200 2 3. M/S BEMCO JEWELLERS P LTD. PVT. LTD.(COMP ANY) 03.08.2000 158BC 29.08.2002 4. M/S BISHAN CHAND MUKESH KUMAR PARTNERSH- IP FIRM 19.12.2002 158BD* 31.12.2004 5. FRIENDS PORTFOLIO PVT. LTD. PVT. LTD.(COMP ANY) IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 5 5. HE SUBMITTED THAT EVEN IF THE CONTENTION OF THE CIT (A) IS ACCEPTED THAT THE DATE OF ISSUE OF FIRST NOTICE IN THI S CASE IS TAKEN AS EARLY AS 23 RD MARCH 2005 EVEN THEN THE INITIATION OF PROCEEDI NGS U/S 158BD HAS TO BE HELD INVALID IN VIEW OF AFOREMENTION ED DECISION OF SPECIAL BENCH. REFERRING TO THE CHART HE SUBMITTED THAT THE ASSESSMENT IN THE CASES OF BISHAN CHAND AND MANOJ AGGARWAL WERE COMPLETED ON 29 TH AUGUST 2002 AND THEREFORE THE PROCEEDINGS IF ANY U/S 158BD COULD BE INITIATED AGAINST THE ASSESSEE WA S TO BE NOT LATER THAN 29 TH AUGUST 2002. HE SUBMITTED THAT EVEN IF THE DATE OF COMPLETION OF ASSESSMENT IN THE CASE OF M/S BISHAN CHAND M UKESH KUMAR IS TO BE TAKEN THEN ALSO THE LATEST DATE ON WH ICH THE PROCEEDINGS AGAINST THE ASSESSEE COULD BE INITIATED WAS TO BE 31 ST DECEMBER 2004 AND NOTICE HAVING BEEN ISSUED TO THE A SSESSEE BY THE MUMBAI OFFICE WAS ON 23 RD MARCH 2005 THUS THE ASSESSMENT SHOULD HAVE BEEN QUASHED BY LEARNED CIT (A) SIMPLY ON THE BA SIS THAT THE PROCEEDINGS U/S 158BD WERE NOT INITIATED WITHIN THE P ERIOD OF COMPLETION OF THE ASSESSMENT IN THE HANDS OF THE PERSON I N WHOSE CASE THE SEARCH WAS CONDUCTED. HE ALSO INVITED OUR ATTENTIO N TO THE FOLLOWING OBSERVATIONS OF THE AFOREMENTIONED SPECIAL BENCH DECISION:- 122. IN OUR CONSIDERED OPINION SUCH SATISFACTION CANNOT BE RECORDED BEYOND THE DATE OF THE BLOCK ASSESSMENT IN THE SECTION 158BC PROCEEDING AND THE DATE OF THE BLOCK ASSE SSMENT IS THE OUTER LIMIT FOR RECORDING SUCH SATISFACTION. THIS IS FOR THE REASON THAT THE SATISFACTION HAS TO BE RECORDED BY THE AS SESSING OFFICER EXAMINING THE MATERIAL IN THE CASE OF THE PERSO N SEARCHED AND HE WILL HAVE TO FIND OUT WHETHER THERE IS ANY UNDISCLOSED INCOME AT ALL UNEARTHED WHICH AGAIN CAN B E ONLY IN THE COURSE OF SUCH PROCEEDING. AFTER FINDING THAT THERE IS UNDISCLOSED INCOME HE WILL HAVE TO GIVE A FINDING A S TO WHETHER SUCH INCOME BELONGS TO THE PERSON SEARCHED AND THIS TOO HAS TO BE IN THE COURSE OF THE SAID PROCEEDING ONLY. IF HE F INDS THAT ANY OR ALL OF SUCH INCOME BELONGS TO A PERSON NOT SEARCHE D THEN HE HAS TO RECORD SUCH FINDING IN THIS BEHALF AND TAKE FOL LOW UP ACTION AS ENVISAGED IN SECTION 158BD WHICH AGAIN HAS TO BE ONLY IN THE COURSE OF THE SECTION 158BC PROCEEDING AND HENC E IF NO SUCH SATISFACTION IS RECORDED IN THE COURSE OF THE SECTI ON 158BC PROCEEDING THEN ASSUMPTION OF JURISDICTION UNDER SECTI ON 158BD IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 6 IS NOT POSSIBLE . IN THE CIRCUMSTANCE WE ARE OF THE FIRM VIEW THAT THE ABSENCE OF THE WORDS 'IN THE COURSE OF THE PROCEEDI NG' IN THE SECTION IS NOT MATERIAL TO THE ISSUE IN THE CONTEXT OF TH E SAID SECTION ITSELF AND SO THE CASE LAWS REFERRED TO BY THE L EARNED DEPARTMENTAL REPRESENTATIVE IN THIS BEHALF ARE NOT CONSID ERED AS RELEVANT TO THE ISSUE IN THE VIEW WE HAVE HEREIN TAKE N. .. .. 125. IN THE INSTANT CASE WE MAY NOW EXAMINE WHETHER THERE IS ANY RECORD OF SATISFACTION THAT MEETS THE REQUIREMENT OF L AW AS ENUNCIATED ABOVE. WE HAVE ALREADY REPRODUCED THE COPY OF THE SAID RECORD DATED 19-12-2002 . IT IS SIGNED BY THE DY. COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE - 3 NEW D ELHI. IT IS THEREFORE ADMITTEDLY RECORDED BY THE ASSESSING OFFICER MAKING THE SECTION 158BD ASSESSMENT AS THE NOTICE UNDER THE SAID SECTION HAS ALSO BEEN ISSUED BY HIM. THIS NOTE RECORD S THAT SEARCH IN THE CASE OF SHRI MANOJ AGGARWAL AND ASSOCI ATE CONCERNS AND THE BLOCK ASSESSMENT MADE ON HIM CONCLUS IVELY ESTABLISHES THE FACT THAT HE WAS INVOLVED IN PROVIDING B OGUS ACCOMMODATION BOOK ENTRIES TO VARIOUS PERSONS ON COMMI SSION BASIS AND FOR THIS PURPOSE HE HAD USED THE NAMES AND BANK ACCOUNTS OF VARIOUS COMPANIES BENAMI PROPRIETORSHIP CONCERNS IN THE NAMES OF HIS EMPLOYEES IN THE NAMES OF RELATIV ES VARIOUS HUF ENTITIES AND FIRMS AND ONE SUCH CONCERN I S M/S. BISHANCHAND MUKESH KUMAR THE BANK ACCOUNTS OF WHICH W ERE OPERATED BY S/SHRI MUKESH KUMAR AND BISHANCHAND AGGA RWAL; THAT THE SOURCES OF CASH AND CLEARING DEPOSITS AND THE WITHDRAWALS FROM THESE BANK ACCOUNTS NEED TO BE EXAMINE D; THESE ACCOUNTS HAVE BEEN USED FOR ACCOMMODATION BOOK E NTRIES AND HENCE UNDISCLOSED INCOME HAS ARISEN IN THE HAND S OF THIS CONCERN WHICH HAS BEEN FOUND DURING THE COURSE OF SE ARCH AND SEIZURE OPERATIONS IN THE CASE OF SHRI MANOJ AGGARWAL AND HIS ASSOCIATE CONCERNS; THUS PROCEEDINGS UNDER SECTION 15 8BD ARE APPLICABLE IN THIS CASE. ADMITTEDLY THIS NOTE IS AFTER TH E DATE OF BLOCK ASSESSMENT IN THE CASE OF MANOJ KUMAR AGGARWAL WHICH WAS FINALIZED ON 29-8-2002. FURTHER THE NOTE OF SATISF ACTION IS NOT RECORDED BY THE DY. CIT CENTRAL CIRCLE-3 NEW DEL HI ACTING AS THE ASSESSING OFFICER MAKING THE ASSESSMENT UNDER S ECTION 158BC OF MANOJ KUMAR AGGARWAL SINCE THE SAID ASSESSM ENT HAS BEEN FINALIZED EARLIER. CLEARLY THE NOTE OF SATISFACTIO N DATED 19- 12-2002 IS BEYOND THE DATE OF BLOCK ASSESSMENT IN THE S ECTION 158BC PROCEEDINGS DATED 29-8-2002 IN THE CASE OF SHRI MANOJ AGGARWAL. THEREFORE THE SATISFACTION RECORDED IS BELA TED . 126. FURTHER THE SAID NOTE OF SATISFACTION SPEAKS OF MA NOJ KUMAR AGGARWAL DOING ACCOMMODATION BUSINESS THROUGH V ARIOUS IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 7 BENAMI CONCERNS AND IN THE NAMES OF VARIOUS PERSONS AND EARNING COMMISSION THROUGH SUCH ACCOMMODATION AND THAT ONE SUCH CONCERN USED BY HIM IS THE APPELLANT-FIRM. IT FU RTHER STATES THAT THE BANK ACCOUNTS OF THE FIRM HAVE TO BE EXAMINED AN D THE SOURCE OF THE CASH AND CLEARING DEPOSITS AND THE WITHDR AWALS FROM THE BANKS HAVE TO BE EXAMINED. THERE IS THUS NO F INDING IN THE SAID NOTE THAT ON EXAMINATION OF THE SEIZED MATERIAL B Y HIM IN THE CASE OF MANOJ KUMAR AGGARWAL HE HAS FOUND THAT THERE IS UNDISCLOSED INCOME AND THAT SUCH UNDISCLOSED INCOME B ELONGS TO THE ASSESSEE-FIRM. ON THE OTHER HAND IT SAYS THAT THE B ANK ACCOUNTS OF THE FIRM HAVE TO BE EXAMINED. THERE IS NOT EVEN A WHISPER OF DETECTION OF UNDISCLOSED INCOME IN THE HAND S OF THE FIRM. THE VERY RECORD LEAVES A TELL TALE EVIDENCE TO T HE EFFECT THAT NO FINDING HAS BEEN ARRIVED AT TO SHOW THAT THERE EXI STS UNDISCLOSED INCOME OF THE ASSESSEE-FIRM. HAD IT BEEN SO THERE WOULD HAVE BEEN A REFERENCE TO THE SAME AND THERE WAS NO NEED TO STATE THAT FURTHER EXAMINATION OF VARIOUS ACCOUNTS WAS REQUIRED. HENCE THE NOTE ITSELF ADMITS THAT NO UNDISCLOS ED INCOME IN THE HANDS OF THE APPELLANT HAS BEEN FOUND EV EN ON THE DATE OF SUCH NOTING WHICH MILITATES AGAINST THE REQUIR EMENT OF A NOTE OF SATISFACTION IN TERMS OF SECTION 158BD. IN ORDER TO ASCERTAIN WHETHER IN THE COURSE OF THE ASSESSMENT PROCEE DING IN THE CASE OF MANOJ AGGARWAL UNDER SECTION 158BC THERE I S ANY FINDING OF ANY UNDISCLOSED INCOME IN THE CASE OF THE APPELLANT; EVEN THERE WE DID NOT COME ACROSS ANY FINDING THAT ANY PART OF THE UNDISCLOSED INCOME BELONGS TO THE APPELLANT OR ANY REFERENCE TO ANY MATERIAL THEREIN INDICATING THE SAME. I N THE CIRCUMSTANCE WE HAVE TO HOLD THAT THE SATISFACTION NOTE DA TED 19-12-2002 IS NOT THE ONE CONTEMPLATED IN SECTION 158BD AND FURTHER THAT EVEN IF IT IS ASSUMED TO BE IN TERMS OF THE S AID SECTION IT DOES NOT EVEN REMOTELY SHOW THAT THERE IS UNDIS CLOSED INCOME BELONGING TO THE APPELLANT-FIRM CALLING FOR THE ASSUMPTION OF JURISDICTION UNDER SECTION 158BD. IN THE CIRCUMSTANCE WE HOLD THAT THE SAID NOTE OF SATISFACTION IS NON- ESTABLISHED IN LAW AND FURTHER THAT THE SECTION 158BD PROCEEDINGS PURSUANT THERETO IS INVALID AND VOID AB INITIO ON THIS GROUND ALSO. 127. WE ARE OF THE FIRM VIEW THAT THE PROCEEDINGS UNDER SECTION 158BD ARE INVALID FOR THE REASONS ABOVE STATED AND SO THE ASSESSMENT MADE PURSUANT TO THESE PROCEEDINGS IS BAD IN LAW. THE SAME IS ACCORDINGLY LIABLE TO BE CANCELLED. ( EMPHASIS SUPPLIED ) 6. REFERRING TO THE ABOVE FACTS AND AFOREMENTIONED D ECISION OF THE SPECIAL BENCH IT IS THE CASE OF THE LEARNED AR THAT INITIATION OF IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 8 PROCEEDINGS U/S 158BC IN THE PRESENT CASE SHOULD BE HELD INVALID AND ASSESSMENT ON THAT GROUND SHOULD BE QUASHED. 7. ON THE OTHER HAND RELYING UPON THE ORDER PASSED B Y THE LEARNED CIT (A) IT IS THE CASE OF THE LEARNED DR THAT VALIDI TY OF INITIATION OF PROCEEDINGS U/S 158BD HAS TO BE UPHELD IN VIEW OF THE REASONS GIVEN BY LEARNED CIT (A) IN HIS ORDER. 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS I N THE LIGHT OF THE MATERIAL PLACED BEFORE US. THE FACTS OF THE CASE HAVE ALREADY BEEN NARRATED. EVEN TAKING THE LATEST DATES IN RESPECT OF FINALISATION OF ASSESSMENT IN THE CASE OF THE PERSON UPON WHOM SEARCH WAS CONDUCTED THE LAST DATE IS 31 ST DECEMBER 2004. ADMITTEDLY IN THE CASE OF THE ASSESSEE NOTICE U/S 158BD HAS BEEN ISSUED BY THE MUMBAI OFFICE ON 23 RD MARCH 2005 WHICH IS BEYOND THE DATE OF COMPLETION OF THE ASSESSMENT IN THE CASES OF THE PERSONS UPON WHOM THE SEA RCH HAS BEEN CONDUCTED. IT IS CLEAR FROM THE ASSESSMENT ORDER TH AT FIRST EVER ACTION OF THE DEPARTMENT AGAINST THE ASSESSEE HAS BEEN IN ITIATED VIDE LETTER DATED 2.3.2005 ISSUED BY DCIT CENTRAL CIRCLE 3 NEW DELHI AND THAT ACTION OF THE DEPARTMENT IS LATER THAN 31 ST DECEMBER 2004. THEREFORE RELYING ON AFOREMENTIONED DECISION OF SPE CIAL BENCH WE HAVE TO HOLD THAT INITIATION OF PROCEEDINGS U/S 158BD IN THE PRESENT CASE WERE INVALID AND THE ASSESSMENT ON THAT GROUND ALON E HAS TO BE HELD TO BE BAD IN LAW. WE THEREFORE HOLD THAT ASSE SSMENT IN THE PRESENT CASE IS BAD IN LAW. SINCE WE HAVE HELD THAT A SSESSMENT IN THE PRESENT CASE WAS BAD IN LAW ON ACCOUNT OF DELAYED INIT IATION OF PROCEEDINGS U/S 158BD WE NEED NOT CONSIDER THE MERITS OF THE DEPARTMENTAL APPEAL WHICH HAS BECOME INFRUCTUOUS. TH E RELEVANT OBSERVATIONS IN THE SPECIAL BENCH DECISION HAVE ALREAD Y BEEN REPRODUCED IN THE ABOVE PART OF THIS ORDER IN WHICH IT HAS BEEN CLEARLY HELD THAT THE SATISFACTION TO BE RECORDED U/S 158BD CA NNOT GO BEYOND IT (SS) A NO.25/DEL/2010 C.O. NO.290/DEL/2010 9 THE DATE OF BLOCK ASSESSMENT IN THE SECTION 158BC PROCE EDINGS AND THE DATE OF BLOCK ASSESSMENT IS THE OUTER LIMIT OF RECOR DING SUCH SATISFACTION. THE SAID OBSERVATIONS CONTAINED IN PARA 1 22 HAVE BEEN REPRODUCED ABOVE. IT HAS FURTHER BEEN OBSERVED BY TH E SPECIAL BENCH THAT IF NO SUCH SATISFACTION IS RECORDED IN THE COURSE O F THE SECTION 158BC PROCEEDINGS THEN ASSUMPTION OF JURISDICTION U/S 158BD IS NOT POSSIBLE. RELYING UPON THE AFOREMENTIONED OBSERVATION S OF THE SPECIAL BENCH WE HOLD THAT THE PROCEEDINGS U/S 158BD IN THE PRESENT CASE WERE NOT IN ACCORDANCE WITH THE LAW HENCE THE ASSESSM ENT IS BAD. 9. IN VIEW OF THE ABOVE DISCUSSION THE CROSS OBJECTIONS FILED BY THE ASSESSEE IS ALLOWED IN THE MANNER AFORESAID AND THE DEPAR TMENTAL APPEAL IS DISMISSED HAVING BECOME ACADEMIC AND INFRUCTU OUS. 10. IN THE RESULT THE APPEAL IS DISMISSED AND THE CROSS O BJECTIONS ARE ALLOWED IN THE MANNER AFORESAID. THE ORDER PRONOUNCED IN THE OPEN COURT ON 10.02.20 12. SD/- SD/- [K.D. RANJAN] [I.P. BANSAL] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 10.02.2012. DK COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ITAT DEPUTY REGISTRAR ITAT DELHI BENCHES