Smt. Geeta Devi, v. The DCIT, 2(1),

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH JUDICIAL MEMBER AND SHRI R.C. SHARMA ACCOUNTANT MEMBER IT(SS) A NO. 61/IND/2006 BLOCK PERIOD 1.4.1985 TO 28.2.1996 SHRI KUMAR DHIRENDRA BHOPAL PAN - AARPD-9910D APPELLANT VS DY. DIRECTOR OF INCOME TAX 2(1) BHOPAL RESPONDENT IT(SS) A NO. 62/IND/2006 BLOCK PERIOD 1.4.1985 TO 28.2.1996 SMT. GEETADEVI BHOPAL PAN AEQPD-1623-Q APPELLANT VS DY. DIRECTOR OF INCOME TAX 2(1) BHOPAL RESPONDENT ASSESSEES BY SHRI H.P.VERMA AND SHRI ASHISH GOYAL DEPTT. BY SHRI K.K. SINGH O R D E R PER SHRI R.C. SHARMA ACCOUNTANT MEMBER THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE ASSESSING OFFICER PASSED U/S 158BD OF THE AC T READ WITH SECTION 143(3) OF THE ACT DATED 31 ST MARCH 2006. 2 2. BOTH THE ASSESSES ARE RELATIVES ONE IS SON AND ANO THER IS WIFE OF SHRI CHHUTTAN PRASAD WHO WAS SEARCHED AND T HE ASSESSMENT WAS FRAMED U/S 158BC ON 28.2.1997. IN BOTH THESE CASES ORIGINAL BLOCK ASSESSMENT ORDERS WERE PASSED U/S 158BD/143(3) OF THE ACT ON 30 TH MARCH 1999. THERE WAS A DIRECT APPEAL AGAINST THIS ORDER TO THE TRIBUNAL AND THE TRIBUNAL VIDE ORDER DATED 26.4.200 4 SET ASIDE THE BLOCK ASSESSMENT ORDER AND DIRECTED THE ASSESSING OFFICER TO AFFORD ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND TO MAKE THE ASSESSMENT AF RESH. THE ASSESSING OFFICER WAS ALSO DIRECTED TO CONSIDER THE DOCUMENTS PLACED BY THE ASSESSEE BEFORE THE TRIBUNA L WHILE FRAMING THE ASSESSMENT AFRESH. IN THE ASSESS MENT FRAMED BY THE ASSESSING OFFICER DATED 30 TH MARCH 2006 AFTER PASSING OF THE ORDER OF THE TRIBUNAL THE ASS ESSING OFFICER HAS JUST REPEATED THE ADDITIONS MADE IN THE ORIGINAL ASSESSMENT BY OBSERVING THAT RELEVANT DETA ILS OF THESE INCRIMINATING DOCUMENTS/PAPERS ETC. AND THE UNDISCLOSED INCOME PASSED ON THEM IN THE CONCERNED ASSESSMENT YEARS FALLING IN THE BLOCK PERIOD FROM 1.4.1985 TO 28.2.1996 WERE ELABORATELY DISCUSSED BY THE THEN ASSESSING OFFICER IN THE BLOCK ASSESSMENT ORD ER U/S 158BD/143(3) OF THE ACT DATED 30 TH MARCH 1999 3 DETERMINING THE TOTAL UNDISCLOSED INCOME OF RS. 9 31 410/- IN THE CASE OF KUMAR DHIRENDRA AND RS. 7 36 540/- IN THE CASE OF SMT. GEETADEVI. THE ASSE SSING OFFICER FURTHER OBSERVED THAT ALL THE SUBMISSIONS M ADE BY THE ASSESSEE DURING SET ASIDE PROCEEDINGS WERE DULY CONSIDERED AND DISCUSSED BY THE THEN ASSESSING OFFI CER WHILE PASSING THE BLOCK ASSESSMENT ORDER DATED 30 TH MARCH 1998. HE THEREFORE UPHELD THE TOTAL INCOM E AS DETERMINED ORIGINALLY WITHOUT ELABORATELY DISCUSSIN G DIFFERENT ADDITIONS MADE IN THE ORIGINAL ASSESSMENT ORDER. THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSES SEE WAS THAT IN THE SET ASIDE PROCEEDINGS THE ASSESSIN G OFFICER HAS NOT ACTED AS PER THE DIRECTIONS GIVEN B Y THE TRIBUNAL AND INSTEAD OF DEALING IN DETAIL THE VARIO US ADDITIONS MADE IN THE ORIGINAL ASSESSMENT JUST REP EATED THE TOTAL INCOME DETERMINED THEREIN. OUR ATTENTION WAS DRAWN TO THE OBSERVATION OF THE TRIBUNAL IN ITS ORD ER DATED 23.4.2004 WHEREIN THE TRIBUNAL HAS SET ASIDE THE BLOCK ASSESSMENT ORDER AND DIRECTED THE ASSESSING O FFICER TO AFFORD ADEQUATE OPPORTUNITY OF BEING HEARD TO TH E ASSESSEE AND MAKE THE ASSESSMENT AFRESH AFTER CONSIDERING THE DOCUMENTS PLACED BY THE ASSESSEE BE FORE THE TRIBUNAL WHILE FRAMING THE ASSESSMENT AFRESH. OUR 4 ATTENTION WAS ALSO DRAWN TO THE DETAILED SUBMISSION S PLACED BEFORE THE TRIBUNAL IN THE FIRST ROUND OF AP PEAL BEFORE IT AND IT WAS CONTENDED THAT NONE OF THESE DOCUMENTS WAS CONSIDERED BY THE ASSESSING OFFICER W HILE FRAMING THE ASSESSMENT AFRESH EVEN AFTER SPECIFIC DIRECTION OF THE TRIBUNAL IN THIS REGARD. 3. FURTHER CONTENTION OF THE LEARNED COUNSEL FOR THE A SSESSEE WAS THAT THE SEARCH WAS CONDUCTED AT THE RESIDENCE OF SHRI CHHUTTAN PRASAD ON 28.2.1996 TO 29.2.1996 WHO WAS FATHER OF KUMAR DHIRENDRA AND HUSBAND OF SMT. GEETADEVI. THE ASSESSMENT ORDER U/S 158BC IN THE CASE OF SHRI CHHUTTAN PRASAD WAS FRAMED ON 28.2.1997. NOTICE U/S 158BD OF THE ACT WAS ISSUED TO THE ASSES SEE ON 6.3.1998 AND THE ASSESSEE HAS DULY FILED RETURN IN FORM 2B ON 16.2.1999. THEREAFTER THE ASSESSMENTS WERE FRAMED U/S 158BC/143(3) ON 30 TH MARCH 1999 IN THE CASES OF BOTH THE ASSESSES WHICH WAS SET ASIDE BY T HE TRIBUNAL VIDE ORDER DATED 26.4.2004. AS PER THE LE ARNED COUNSEL FOR THE ASSESSEE AFTER THE ORDER OF THE AS SESSING OFFICER WAS SET ASIDE BY THE TRIBUNAL VIDE ITS ORDE R DATED 26.4.2004 THE FIRST DATE OF HEARING BY THE ASSESSI NG OFFICER AFTER THE MATTER WAS SET ASIDE BY THE TRIBU NAL WAS FIXED BY THE ASSESSING OFFICER ON 27.1.2006. THUS IT WAS 5 CONTENDED THAT THE FIRST NOTICE WAS ISSUED AFTER ON E YEAR AND 10 MONTHS OF THE SET ASIDE PROCEEDINGS. AS PER THE LEARNED COUNSEL FOR THE ASSESSEE THE TRIBUNAL HAS GIVEN THE DIRECTION TO THE ASSESSING OFFICER FOR GIVING F ULL OPPORTUNITY TO THE ASSESSEE BUT THE ASSESSING OFFIC ER HAS NOT GIVEN OPPORTUNITY AND CONCLUDED THE ASSESSMENT ON THE SAME INCOME AFTER HAVING MADE THE FOLLOWING OBSERVATIONS :- IT IS ALSO WORTHMENTIONING THAT DUE OPPORTUNITIES WERE ALLOWED TO THE ASSESSEE IN THE ORIGINAL BLOCK ASSESSMENT PROCEEDING AS EVIDENT FROM THE DATE-WISE ORDER SHEET ENTRIES AVAILABLE IN THE CASE RECORD. FURTHER EVEN DURING THE INSTANT BLOCK ASSESSMENT PROCEEDINGS THE ASSESSEE HAS BEEN GIVEN ADEQUATE OPPORTUNITY OF HEARING AND ON THE FINAL HEARING DATE I.E. 24.03.06 THE ASSESSEE HAS CLEARLY STATED THAT HE DID NOT WISH TO MAKE ANY FURTHER SUBMISSIONS. 4. IN VIEW OF THE ABOVE THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE WAS THAT IN SPITE OF THE TRIBUNAL S DIRECTIONS THE LEARNED ASSESSING OFFICER DID NOT T AKE ANY ACTION FOR NEARLY ONE YEAR AND TEN MONTHS OUT OF TW O 6 YEARS TIME AVAILABLE FOR COMPLETION OF SET ASIDE PROCEEDINGS. 5. ON MERITS THE CONTENTION OF THE LEARNED COUNSEL FO R THE ASSESSEE WAS THAT NO BANK ACCOUNT WAS FOUND IN THE SEARCH AND THE BANK BALANCE AS ON 31.3.1986 IN THE CASE OF SHRI KUMAR DHIRENDRA WAS RS. 23 923/- WHICH WAS OUT OF OPENING BALANCE AND INCOME AS SHOWN IN THE DETAILS FILED BEFORE THE TRIBUNAL. OUR ATTENTION W AS DRAWN TO THE DETAILED SUBMISSIONS MADE BY THE ASSES SEE WITH REGARD TO VARIOUS ADDITIONS MADE IN THE ASSESS MENTS AND THE EXPLANATIONS FILED BY THE ASSESSEE TO JUSTI FY THE RETURN OF INCOME AS PER THE BLOCK RETURN FILED IN F ORM 2B IN VARIOUS ASSESSMENT YEARS FALLING IN THE BLOCK PE RIOD. 6. LEGAL ARGUMENT OF THE LEARNED COUNSEL FOR THE ASSES SEE WAS ALSO THAT NO PROPER SATISFACTION WAS RECORDED B Y THE ASSESSING OFFICER OF THE SEARCHED PERSON IN TERMS O F SATISFACTION REQUIRED U/S 158BD OF THE ACT. IT WAS ALSO SUBMITTED THAT THE NOTICE U/S 158BD OF THE ACT WAS ISSUED ONLY AFTER THE ORDER OF SHRI CHHUTTAN PRASAD (THE PERSON SEARCHED) WAS PASSED. THEREFORE THE NOTICE ISSUED WAS BARRED BY LIMITATION. IT WAS ALSO CONTE NDED THAT THERE WAS NO FINDING OF SATISFACTION GIVEN BY THE ASSESSING OFFICER TO THE EFFECT THAT THERE IS UNDI SCLOSED 7 INCOME OF THE ASSESSEE. AS PER THE LEARNED COUNSE L FOR THE ASSESSEE SINCE THERE IS NO FINDING IN THE SATIS FACTION THAT CERTAIN UNDISCLOSED INCOME RELATING TO THE ASS ESSEE WAS FOUND DURING THE COURSE OF SEARCH OF THE PERSO N SEARCHED JURISDICTION U/S 158BD OF THE ACT CAN BE ASSUMED ONLY AFTER THE ASSESSING OFFICER OF THE PER SON SEARCHED IS SATISFIED THAT THERE IS UNDISCLOSED IN COME OF SOME OTHER PERSON AGAINST WHOM PROCEEDINGS ARE REQUIRED TO BE UNDERTAKEN U/S 158BD OF THE ACT. AS PER THE LEARNED COUNSEL FOR THE ASSESSEE SATISFACTION U/S 158BD OF THE ACT SHOULD UNAMBIGUOUSLY MENTION THAT THERE IS UNDISCLOSED INCOME. RELIANCE WAS PLACED ON THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN MA NOJ AGRAWAL; 117 TTJ 145; P MAHENDER REDDY V. ACIT; 2 S OT 696; TAHIL RAM M.; 115 TTJ 692; SAROJ NURSING HOME; 116 ITD 311 AND THE DECISION OF THE CHANDIGARH BENC H IN THE CASE OF KISHORE; 17 SOT 380 IN SUPPORT OF THE CONTENTION THAT THERE WAS ABNORMAL DELAY IN ISSUE O F NOTICE U/S 158BD OF THE ACT AFTER COMPLETION OF ASSESSMENT OF SEARCHED PERSON WHICH RENDERS THE ASSESSMENT FRAMED U/S 158BD AS NULL AND VOID. 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND ALS O 8 DELIBERATED ON THE VARIOUS CASE LAWS CITED BY THE L EARNED COUNSEL FOR THE ASSESSEE AND THE LEARNED CIT DR DUR ING THE COURSE OF HEARING BEFORE US WITH REGARD TO THE LEGAL ISSUE REGARDING THE ISSUE OF NOTICE U/S 158BD OF TH E ACT AND RECORDING OF SATISFACTION IN THE CASE OF SEARCH ED PERSON BEFORE ISSUING NOTICE U/S 158BD OF THE ACT. THE LEARNED CIT DR ALSO PRODUCED THE ASSESSMENT RECORDS AND OUR ATTENTION WAS DRAWN TO THE RELEVANT OBSERVA TION MADE BY THE ASSESSING OFFICER WHEREIN KUMAR DHIREND RA APPEARED DURING THE COURSE OF PROCEEDINGS OF HIS FA THER CHHUTTANPRASAD AND VARIOUS INCRIMINATING DOCUMENTS WERE REFERRED TO BY THE ASSESSING OFFICER FOR INITI ATING PROCEEDINGS U/S 158BD OF THE ACT IN CASE OF KUMAR DHIRENDRA AND SMT. GEETADEVI. AFTER GOING THROUGH THE ASSESSMENT RECORD WE FIND THAT PROPER SATISFACTION WAS THERE FOR INITIATING PROCEEDINGS U/S 158BD IN THE C ASE OF CONCERNED ASSESSEE BEFORE US. KEEPING IN VIEW THE PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE WE AL SO FIND THAT ON THE BASIS OF ALLEGATION THAT NOTICE U/S 158 BD WAS ISSUED BELATEDLY THE ASSESSMENT FRAMED U/S 158BC/143(3) OF THE ACT CANNOT BE SAID TO BE NULL A ND VOID. SO FAR AS THE REPETITION OF THE SAME UNDISCL OSED 9 INCOME BY THE ASSESSING OFFICER IS CONCERNED IN THE ASSESSMENT FRAMED U/S 158BD/143(3)/SET ASIDE MATTER VIDE ORDER DATED 31.3.2006 WE FIND THAT THE DETAIL ED SUBMISSIONS FILED BY THE ASSESSEE IN THE COURSE OF FIRST ROUND BEFORE THE TRIBUNAL AS WELL AS FILED BEFORE U S WHICH WAS ALLEGED TO BE FILED BEFORE THE ASSESSING OFFICE R WERE NOT CONSIDERED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER. THE ASSESSING OFFICER HAS MERELY REPEATED THE ASSESSED INCOME AS WAS DETERMINED IN T HE ORIGINAL ASSESSMENT ORDER INSPITE OF THE DIRECTION OF THE TRIBUNAL THAT FULL OPPORTUNITY SHOULD BE GIVEN TO T HE ASSESSEE AND DOCUMENTS PLACED ON RECORD BY THE ASSE SSEE WERE DIRECTED TO BE CONSIDERED BY THE ASSESSING OFF ICER IN THE SET ASIDE PROCEEDINGS. IN THE INTEREST OF JUST ICE AND FAIR PLAY WE AGAIN RESTORE THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO CONSIDE R ELABORATELY THE SUBMISSIONS OF THE ASSESSEE WITH RE SPECT TO THE ADDITIONS MADE IN VARIOUS YEARS AND AFTER CONSIDERING THE SAME ASSESSMENT SHOULD BE FRAMED D E NOVO. KEEPING IN VIEW THE PECULIAR FACTS WE ALSO DIRECT THE ASSESSEE TO COOPERATE WITH THE ASSESSING OFFICE R AND TO AGAIN FURNISH ALL THESE DETAILS IN A COMPILED FO RM 10 BEFORE THE ASSESSING OFFICER FOR HIS CONSIDERATION AND NECESSARY ACTION. 8. IN THE RESULT BOTH THE APPEALS ARE DISPOSED OF IN TERMS INDICATED HEREINABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 17 FEBRU ARY 2011. (JOGINDER SINGH) (R.C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER FEBRUARY 17 2011 COPY TO : APPELLANT RESPONDENT CIT CIT(A) DR