The Deputy Commissioner Of Income-Tax, ... vs M/S. Blueline Foods (India) Pvt. Ltd.,, ... on 7 August, 2024

[Cites 65, Cited by 0]

Income Tax Appellate Tribunal - Bangalore

The Deputy Commissioner Of Income-Tax, ... vs M/S. Blueline Foods (India) Pvt. Ltd.,, ... on 7 August, 2024

IN THE INCOME TAX APPELLATE TRIBUNAL
"B" BENCH : BANGALORE

BEFORE SHRI GEORGE GEORGE K, VICE PRESIDENT AND
SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

ITA Nos.182, 183/Bang/2023
Assessment Years : 2017-18, 2018-19

DCIT, M/s. Blueline Foods (India) Pvt. Ltd.,
Central Circle - 1, Suite # 406, Crystal Arc,
Mangaluru. Vs. Balmatta Road, Balmatta,
Mangaluru - 575 001.
PAN : AACCB 8979 J
APPELLANT RESPONDENT

Assessee by : Shri. B. S. N. Prasad, Advocate
Revenue by : Shri. Saravanan B, CIT(DR), ITAT, Bengaluru.

Date of hearing : 07.08.2024
Date of Pronouncement : 07.08.2024

ORDER

Per George George K, Vice President :

As there was a difference of opinion between Hon'ble Vice President and
Hon'ble Accountant Member in respect of the aforesaid appeals, the following
questions were referred for consideration by a Third Member :

Question raised by Hon'ble Vice President:

"1. Whether on facts and circumstances of the case and in law, there
was a valid search under section 132 of the Act in the case of the
assessee and thus assessment completed under section 153A of the
Act is valid?"
ITA Nos.182, 183/Bang/2023
Page 2 of 123

Questions raised by Hon'ble Accountant Member :

1. Whether in the facts and circumstances of the case, the search
conducted in the light of warrant of authorization issued in the name
of the assessee company and the place of search mentioned in the
warrant is the residence of the director of the assessee company,
would constitute a valid search u/s.132 of the Act in the case of the
assessee company itself, so as to initiate proceedings u/s.153A of the
Act?

2. Consequently, the issue of notice u/s.153A of the Act is a valid notice
and whether in the facts and circumstances of the case, a search was
initiated, executed, completed and panchanamas drawn according to
Form 45 in the case of assessee company for completing assessment
u/s.143(3) r.w.s. 153A of the Act?

3. Whether, in the facts and circumstances of the case, proceedings
u/s.153C of the Act could have been initiated?

2. The Hon'ble President nominated Shri. Mahavir Singh, Hon'ble Vice-
President for a decision as Third Member on the point of difference between
Hon'ble Vice President and Hon'ble Accountant Member constituting the
Division Bench. The Third Member vide his order dated 22.07.2024, by
agreeing with the view taken by the Hon'ble Vice President, decided the issue in
favour of the assessee and against the Revenue as under :

Question raised by Ld. VP(JM) Decision

1. Whether on facts and circumstances of Answered in negative. I
the case and in law, there was a valid search am concurring with Ld.
under section 132 of the Act in the case of VP(JM)
the assessee and thus assessment completed
under section 153A of the Act is valid?
ITA Nos.182, 183/Bang/2023
Page 3 of 123

Questions raised by Ld. AM Decision

1. Whether in the facts and circumstances Answered in negative. I do not
of the case, the search conducted in the light concur with ld. AM
of warrant of authorization issued in the
name of the assessee company and the place
of search mentioned in the warrant is the
residence of the director of the assessee
company, would constitute a valid search
u/s.132 of the Act in the case of the assessee
company itself, so as to initiate proceedings
u/s.153A of the Act?

2. Consequently, the issue of notice Answered in negative. I do not
u/s.153A of the Act is a valid notice and concur with ld. AM
whether in the facts and circumstances of
the case, a search was initiated, executed,
completed and panchanamas drawn
according to Form 45 in the case of
assessee company for completing
assessment u/s.143(3) r.w.s. 153A of the
Act?

3. Whether, in the facts and This question does not arise out
circumstances of the case, of the orders of both ld.VP(JM)
proceedings u/s.153C of the Act could have and ld. AM or that of the
been initiated? Assessing Officer and CIT(A)
and hence, need no answer.

3. In view of the majority opinion, the Order of the CIT(A) is upheld and
the appeals filed by the Revenue are dismissed. It is ordered accordingly.
ITA Nos.182, 183/Bang/2023
Page 4 of 123

4. In the result, appeals filed by the Revenue are dismissed.

Pronounced in the open court on the date mentioned on the caption page.

Sd/- Sd/-
(LAXMI PRASAD SAHU) (GEORGE GEORGE K)
Accountant Member Vice President

Bangalore.
Dated: 07.08.2024.
/NS/*

Copy to:

1. Appellants 2. Respondent
3. CIT 4. CIT(A)
5. DR, ITAT, Bangalore. 6. Guard file

By order

Assistant Registrar,
ITAT, Bangalore.
ITA Nos.182, 183/Bang/2023
Page 5 of 123

आयकर अपील य अ धकरण, 'बी' यायपीठ, बगलु
IN THE INCOME TAX APPELLATE TRIBUNAL
'B' BENCH, BANGALORE

ी महावीर िसंह, उपा य के सम

BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT

आयकर अपील सं./ITA Nos.: 182 & 183/BANG/2023

नधारण वष /Assessment Year: 2017-18 & 2018-19

The DCIT, M/s. Blueline Foods (India)
Central Circle-1, v. Pvt. Ltd.,
Mangaluru Suite #406, Cystal Arc,
Balmatta Road,
Mangaluru - 575 011.

PAN: AACCB 8979J

(अपीलाथ /Appellant) ( यथ /Respondent)

अपीलाथ क ओर से/Appellant by : Shri Saravanan. B, CIT

यथ क ओर से/Respondent by : Shri B.S.N. Prasad, Advocate

सुनवाई क तार ख/Date of Hearing : 03.05.2024

घोषणा क तार ख/Date of Opinion : 22.07.2024
ITA Nos.182, 183/Bang/2023
Page 6 of 123

OPINION U/S 255(4) OF THE INCOME-TAX ACT, 1961

There being difference of opinion between the Ld. Vice

President (Judicial Member) and Ld. Accountant Member (AM)

constituting the above captioned appeals. The President, ITAT vide

U.O. No.F.29-Cent.Jd(AT)/2024 dated 14.03.2024 has

nominated me for adjudicating the difference. The ld. VP (JM)

has referred the following question for referring to third

member:-

1. Whether on facts and circumstances of the case and in law,
there was a valid search under section 132 of the Act in the case of the
assessee and thus assessment completed under section 153A of the Act
is valid?

Further, the ld. AM referred the following three questions:-

1. Whether in the facts and circumstances of the case, the search
conducted in the light of warrant of authorization issued in the name
of the assessee company and the place of search mentioned in the
warrant is the residence of the director of the assessee company, would
constitute a valid search u/s.132 of the Act in the case of the assessee
company itself, so as to initiate proceedings u/s.153A of the Act?

2. Consequently, the issue of notice u/s.153A of the Act is a valid
notice and whether in the facts and circumstances of the case, a search
was initiated, executed, completed and panchanamas drawn according
ITA Nos.182, 183/Bang/2023
Page 7 of 123

to Form 45 in the case of assessee company for completing assessment
u/s.143(3) r.w.s. 153A of the Act?

3. Whether, in the facts and circumstances of the case, proceedings
u/s.153C of the Act could have been initiated?

2. The brief facts are noted by the ld. VP (JM) in his order at

para 3, which are not controverted and even, the ld.AM has not

disputed the same. Hence, there is no need to repeat the same.

The ld. VP (JM) has also noted the fact that the CIT(A) after

considering the relevant provisions and judicial

pronouncements held that, since there is no search u/s.132 of

the Act in the premises of the assessee company, the

precondition for issuance of notice u/s.153A of the Act are not

satisfied, hence the assessment completed pursuant to the

same for the assessment year 2013-14 to 2018-19 were

quashed. The ld. VP (JM) has reproduced the findings recorded

by CIT(A) for the assessment year 2017-18 in para 4. The first

question raised by ld. VP (JM) and ld. AM seems to be identical

and raises issue, which will give the same result. However, for

the sake of clarity, I'm reproducing the question raised by ld.

VP (JM), which reads as under:-
ITA Nos.182, 183/Bang/2023
Page 8 of 123

1. Whether on facts and circumstances of the case and in law, there
was a valid search under section 132 of the Act in the case of the
assessee and thus assessment completed under section 153A of the Act
is valid?

The question raised by ld. AM reads as under:-

2.1 Admittedly, a search u/s.132 of the Act was carried

out on the residential premises of the three Directors of the

assessee company namely, Blueline Foods India Pvt. Ltd., the

present assessee, on 23.01.2019. These above captioned

appeals are arising out of different orders of CIT(A) but the

legal issue and facts are identical in both the assessment years

i.e., 2017-18 & 2018-19. Hence, I will take the facts from

assessment year 2017-18. The assessee before CIT(A) for the

first time raised the jurisdictional issue for assuming
ITA Nos.182, 183/Bang/2023
Page 9 of 123

jurisdiction by the AO for issuance of notice u/s.153A of the

Act, by the following two grounds:-

1. The assessment order passed by the learned Assessing Officer
(AO) in the case of the Appellant for Assessment year 2017-18 under
section 143(3) read with section 153A of Income-Tax Act, 1961 (the
Act) on 25.01.2021 (the impugned order) is erroneous, arbitrary and
opposed to the facts and circumstances of the case and the law.

2. The notice issued to the Appellant under section 153A is void
ab initio and invalid, inasmuch as no search under section 132 was
initiated in its own case and hence, the assessment proceeding
initiated on the basis of an invalid notice and the impugned order
passed in pursuance thereof are not valid in law.

Before me, the ld. CIT-DR Shri B. Saravanan argued on behalf

of Revenue whereas for assessee Dr.B.S.N. Prasad, Advocate

argued.

3. The ld. CIT-DR argued that the search was conducted in

the case of Blueline Foods India Pvt. Ltd. u/s.132 of the Act on

23.01.2019. He argued that the CIT(A) has committed factual

error in his order by stating that no search u/s.132 of the Act

was initiated or conducted in the case of the assessee

company. He referred to the factual mistake in para 4.22 of
ITA Nos.182, 183/Bang/2023
Page 10 of 123

CIT(A)'s order and the relevant para, he drew my attention,

which reads as under:-

"In the present case, the AO is on record admitting that no search
under section 132 was initiated or conducted in the case of the
Appellant company and stating categorically that only a survey under
section 133A was carried out in the case of the company, as a result
of which no Panchanama was drawn in its name."

He argued that the CIT(A) has been factually incorrect in

stating that no search u/s.132 of the Act was initiated and

conducted in the case of the assessee company and no

panchanama was drawn in the name of the company. He filed

copies of three warrants of authorization executed in the case

of Blueline Foods India Pvt. Ltd., to search the residential

premises of Mr. Mohd. Fakir, the residential premises of Mr.

Afthar Mohammed and the residential premises of Mr.

Shawkath Showry and stated that the same have been

submitted at page Nos. 16 to 21 of Departmental paper-book,

as issued in Form No.45. The ld. CIT-DR argued that as could

be seen from the warrants of authorization, the Pr.DIT(Inv.),

Bengaluru, being in possession of information leading to

reasons to believe that Blueline Foods India Pvt. Ltd., is in
ITA Nos.182, 183/Bang/2023
Page 11 of 123

possession of money, bullion, jewellery or other valuable article

or things representing undisclosed income, has issued the

warrants of authorization in Form No.45, front page, the name

of the assessee company, Blueline Foods India Pvt. Ltd., has

been written. He further drew my attention to Form No.45 and

argued that the Pr.DIT(Inv.), Bengaluru being in possession of

information leading to reasons to suspect that such books of

accounts, other documents, money, bullion, jewellery or other

valuable article or things are kept in residential premises of Mr.

Mohd. Fakir, Mr. Afthar Mohammed or Mr. Shawkath Showry,

and consequently issued warrants of authorization to search

residential premises in the case of Blueline Foods India Pvt.

Ltd.

4. Consequently, the ld. CIT-DR argued that a search u/s 132

could be conducted in a case of person by covering multiple

premises wherever there is a suspicion that such books of

accounts, other documents, money, bullion, jewellery or other

valuable article or thing representing undisclosed income are

kept. In the instant case, the Pr. DIT(Inv.) had reasons to

believe that Blueline Foods (India) Pvt Ltd was in possession of
ITA Nos.182, 183/Bang/2023
Page 12 of 123

undisclosed income and assets and therefore authorized the

search in the case of Blueline Foods (India) Pvt Ltd. Further, he

had reasons to suspect that evidences relating to the

unaccounted assets and income of Blueline Foods (India) Pvt

Ltd would be kept at the residential premises of Mr. Mohd.

Fakir, Mr. Afthar Mohammed and Mr. Shawkath Showry and

accordingly, authorized this search at these residential

premises. Thus, as could be seen from all these warrants which

have been executed, the search has been initiated and

conducted in the case of Blueline Foods (India) Pvt Ltd. As

could be seen from above Panchanamas, the following have

been filled up.

Col. No. (A) giving "Warrant in the case of ---- Blueline Foods

(India) Pvt. Ltd

Col. No. (B) giving "Warrants to search

(details and ownership of place of search)" ---- Residence of

Mr. Mohammed Fakir

Thus, from the above Panchanamas, it is very clear that search

has been conducted in the case of Blueline Foods (India) Pvt

Ltd at various premises including the residences of the

directors and hence, the Ld. CITA) has been factually incorrect
ITA Nos.182, 183/Bang/2023
Page 13 of 123

in stating that no search u/s 132 of the Act was initiated and

conducted in the case of the assessee company and no

panchanama was drawn in the name of the company. He

explained the words, "Person" and "premises" and read out

Section 132 of the Act. He argued that this section is person

specific as could be seen from the language of the section as

reproduced below:

"Search and seizure.

132. (1) Where 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 or Additional
Director or Additional Commissioner or Joint Director or
Joint Commissioner in consequence of information in his
possession, has reason to believe that-
(a) any person to whom a summons under sub-section
(1) of section 37 of the Indian Income-tax Act, 1922
(11 of 1922), or under sub-section (1) of section l31 of
this Act, or a notice under sub-section (4) of section 22
of the Indian Income-tax Act, 1922, or under sub-
section (1) of section 142 of this Act was issued to
produce, or cause to be produced, any books of account
or other documents has omitted or failed to produce, or
cause to be produced, such books of account or other
documents as required by such summons or notice, or
ITA Nos.182, 183/Bang/2023
Page 14 of 123

(b) any person to whom a summons or notice as
aforesaid has been or might be issued will not, or would
not, produce or cause to be produced, any books of
account or other documents which will be useful for, or
relevant to, any proceeding under the Indian Income-
tax Act, 1922 (11 of 1922), or under this Act, or
(c) any person is in possession of any money, bullion,
jewellery or other valuable article or thing and such
money, bullion, jewellery or other valuable article or
thing represents either wholly or partly income or
property which has not been, or would not be, disclosed
for the purposes of the Indian Income-tax Act, 1922 (1l
of 1922), or this Act (hereinafter in this section referred
to as the undisclosed income or property), .......
"(Emphasis given)

5. In the instant case, the person on whom the Pr. DIT(Inv.)

had reasons to believe that such person was in possession of

unaccounted income/assets was Blueline Foods (India) Pvt. Ltd.

However, in the case of Blueline Foods (India) Pvt. Ltd, since the

Pr. DIT(Inv.) had reasons to suspect that such person had kept

its unaccounted income and assets in certain identified premises,

such premises were authorized to be searched. He countered the

order of CIT(A) by arguing that he has at various places in his
ITA Nos.182, 183/Bang/2023
Page 15 of 123

order used the terms 'case' and premises' interchangeably.

However, the case searched is different from the premises

searched. In a particular case being searched, multiple premises

can be covered u/s 132 of the Act. He in his written submissions

brought out the differentia "person" and "premises" in tabular

chart as under:-

Income Tax Authority
Authorizing the search Authorisation Person / Premises
has
REASONS TO BELIEVE Search authorized in the Searched person
that a person is in case of the person
possession of
unaccounted income of
assets
REASONS to SUSPECT Warrant issued to search Premises may belong to
that evidences relating to the premises where the any other person
the unaccounted assets unaccounted assets and
and income are kept income are kept.
The search remains to be
in the case of the first
person

From the above, it becomes clear that search has been

authorized in the case of Blueline Foods (India) Pvt. Ltd. and

concluded as evidenced from the warrants of authorization and
ITA Nos.182, 183/Bang/2023
Page 16 of 123

Panchanamas submitted for the kind perusal and consideration

of the Bench. Ld CIT DR also relied on various case laws, which

I will discuss in later part of this order.

6. On the other hand, the ld. Counsel for the assessee argued

that crux of the issue in this appeal of Revenue is that the

preconditions for issuance of notice u/s.153A of the Act are not

met in the present case and hence, the CIT(A) has rightly held

the notices issued by Revenue are ab initio and assessment

proceedings concluded on the basis of such notices are invalid.

The ld. counsel argued that the provisions of section 153A

relates only to cases of search or requisition and cannot be

invoked in non-search or non-requisition cases. The ld. counsel

referred to the provisions of section 153A of the Act and the

expression "in the case of a person where search is initiated

u/s.132 or books of account, other documents or any assets are

requisitioned u/s.132A" used in sub-section (1) of section 153A

of the Act clearly restricts the application of section to cases of

search or requisition only. He argued that the three

panchanamas drawn are enclosed at pages 10 to 15 of revenue's

paper-book in consequence to warrant of authorization issued
ITA Nos.182, 183/Bang/2023
Page 17 of 123

u/s.132 of the Act in the case of Blueline Foods (India) Pvt. Ltd.,

for searching the residence of its directors enclosed at pages 16

to 21 of Revenue's paper-book clearly establishes that in the

case of the assessee company, the Income-tax Department

neither initiated a search u/s.132 of the Act nor made any

requisition u/s.132A of the Act but only a survey was carried out

u/s.133A of the Act. The ld. counsel for the assessee drew our

attention to page Nos.146 & 147 of assessee's paper-book and

argued that this fact is borne out of "record of survey

proceedings", which states in paragraph 1 that authorization for

survey u/s.133A of the Act was issued by the competent

authority. The fact that only a survey u/s.133A of the Act as

opposed to a search u/s.132 or a requisition u/s.132A of the Act

was conducted in the case of the assessee and the same is

manifest from several documents impounded during the course

of survey which includes:-

i. The order of impoundment of documents under section 133A(3)(ia)
(pages 148 to 150)
ii. The inventory of stock prepared under section 133A(3)(ii) (pages 151
to 152);
iii. Statements recorded under sections 131, 131A and 133A(3)(iii) from
various persons (as opposed to statements recorded under section
132(4) (pages 153 to 175)
ITA Nos.182, 183/Bang/2023
Page 18 of 123

iv. The summons issued to the Appellant by the Authorized Officer under
section 131 of the Act (page 176); and
v. Repeated references by the learned AO in different parts of the
impugned orders to the carrying out of the survey (pages 69 to 145).

It is not the case of Revenue also, the ld. counsel for the

assessee argued, that the survey conducted u/s.133A of the Act

in the case of the assessee was subsequently converted into a

search u/s.132 of the Act. He argued that issue of warrant of

authorization by the competent authority is a necessary

precondition for initiation of search u/s.132 of the Act or a

requisition u/s.132A of the Act, the Revenue is precluded from

law by initiating assessment proceedings by issuing notices

u/s.153A of the Act in the absence of such warrant of

authorization. In the present case, the ld. counsel argued that

while it is on record that three separate warrants of authorization

had been issued in the names of the individual directors of

assessee company for searching their residential premises but

there is no evidence of warrant having been executed in the

name of the assessee company or search conducted in the

premises of the assessee company so as to initiate a search

u/s.132 or requisition made u/s.132A of the Act. The ld. counsel

for the assessee made statement at bar that though a warrant
ITA Nos.182, 183/Bang/2023
Page 19 of 123

of authorization u/s.132 of the Act was issued in the name of the

company but the search was conducted in the case of the

director of the assessee company in his individual capacity,

which cannot be used to initiate or issue notice u/s.153A of the

Act in the case of assessee company. Hence, the ld. counsel

argued that Revenue in an effort to make it appear as if a search

was actually carried out in the assessee's company case it has

incorporated entries in the panchanamas prepared in the cases

of the company's directors in individual case during the course

of searches carried out at their residences to the fact that

warrant to initiate search has been issued in the case of the

assessee company. The ld. counsel for the assessee argued that

if it be the case, then a question arises as to why the Revenue

chose to conduct a survey u/s.133A of the Act in the case of

assessee company, it if was, in fact, authorized to carry out a

search u/s.132 of the Act. The ld. counsel for the assessee relied

on various case laws, which I will discuss in later part of this

order.

7. I have heard rival contentions and gone through facts and

circumstances of the case. The respondent is a domestic
ITA Nos.182, 183/Bang/2023
Page 20 of 123

company having its registered office in Mangaluru. Admittedly,

a search u/s.132 of the Act was carried out on the residential

premises of the Directors of the respondent assessee company

named Blueline Foods (India) Pvt. Ltd., on 23.01.2019.

Simultaneous survey u/s.133A of the Act was conducted on the

registered office and the business premises of the respondent

assessee company on 23.01.2019. Searches u/s.132 of the

Act were conducted at three residential premises belonging to

the Directors of the respondent company on the basis of three

warrants containing the name of the company as well as those

of the directors and three panchanamas were drawn in respect

of each of the directors. The following are the panchanamas

drawn to search the residences of the directors u/s.132 of the

Act : -

a) Warrant of authorization in the case of Blueline India

(Foods) Pvt. Ltd., for searching the residence of Mr. Mr.

Mohd. Fakir

b) Warrant of authorization in the case of Blueline India

(Foods) Pvt. Ltd., for searching the residence of Mr.

Afthar Mohammed and
ITA Nos.182, 183/Bang/2023
Page 21 of 123

c) Warrant of authorization in the case of Blueline India

(Foods) Pvt. Ltd., for searching the residence of Mr.

Shawkath Showry

The copies of these three warrants of authorization are

enclosed in the paper-book filed by Revenue along with the

submissions of CIT-DR dated 29.08.2023. The details are

being culled out from the first warrant of authorization in the

case of search conducted at the residence of Mr.Shawkath

Showry, which is enclosed at pages 20 & 21. The relevant

portion of warrant of authorization u/s.132 of the Act r.w.Rule

112(1) of the Income Tax Rules, 1962 (hereinafter the 'Rules'),

issued in Form No. 45, reads as under:-

"If summons under sub-section (1) of section 37 of the Indian Income-
tax Act, 1922, or under sub-section (1) of section 131 of the Income-
tax Act, 1961, or a notice under sub-section (4) of section 22 of the
Indian Income-tax Act, 1922, or under subsection (1) of section 142 of
the Income-tax Act, 1961, is issued to M/s. Blueline Foods (India) Pvt.
Ltd., [name of the person] to produce, or cause to be produced, books
of account or other documents which will be useful for, or relevant to,
proceedings under the Indian Income tax Act, 1922, or under the
Income-tax Act, 1961, he would not produce, or cause to be produced,
such books of account or
other documents as required by such summons or notice;
ITA Nos.182, 183/Bang/2023
Page 22 of 123

Sarvashri/Shri/Shrimati M/s. Blueline Foods (India) Pvt. Ltd. are/is in
possession of any money, bullion, jewellery or other valuable article
or thing and such money, bullion, jewellery or other valuable article
or thing
represents either wholly or partly income or property which has not
been, or would not be, disclosed for the purposes of the Indian Income-
tax Act, 1922, or the Income-tax Act, 1961;"

and further, this Form No.45 contains that search was carried

out at the residence of Mr. Shawkath Showry and the details

are recorded in this Form No.45 as under:-

"And whereas I have reason to suspect that such books of account,
other documents, money, bullion, jewellery or other valuable article
or thing have been kept and are to be found in the residence of
Mr.Shawkath Showry Mohammed, Flat No.901/903, Presidency
Flora, Sl Mathias Road, Attavar, Mangaluru, Karnataka - 575 001
(specify particulars of the Building/Place/Vessel/Vehicle/Aircraft).
This is to authorize and require you as per overleaf (name of the
Addl.Director or of the Addl.Commissioner or of the Joint Director of
the Joint Commissioner of the Deputy Director or of the Deputy
Commissioner or of the Assistant Director or of the Income-tax
Officer)."
ITA Nos.182, 183/Bang/2023
Page 23 of 123

Identical warrant of authorization was issued in the name of

other two directors namely Shri Mohd. Fakir and Shri Afthar

Mohammed.

7.1 Consequent to the above search warrants in three

director's cases, the search was conducted on the residences

of three directors and panchanamas were drawn. The relevant

details in panchanamas read as under:-

A) Warrant in the case of M/s. Blueline Foods (India) Party No.BWR1
Private Limited
B) Warrant to search The residence of Mr. Shawkath Showry Mohammed
(Details & Ownership of Flat No.902/903, Presidency Flora, SL Mathias
the search) Road, Attavar, Mangalore, Karnataka - 575 001.
C) (A) and (B) assessed at

5. In the course of the search

a) The following were found and seized

i) Books of account and documents as per annexure 'A' ( 01 sheets)
ii) Bullion i.e., Gold, Silver, etc., as per annexure 'B' ( - sheets)
iii) Cash as per annexure 'C' ( - sheets)
iv) Jewellery, Ornaments etc which have been inventorised separately for
each place from where recovered, as per annexure 'J' ( - sheets)
v) Silver articles and Silverware as per annexure 'S' ( - sheets)
vi) Other valuables, Locker Keys, FDs etc as per ammexure 'O' ( -
sheets)
ITA Nos.182, 183/Bang/2023
Page 24 of 123

vii) Other valuables, stock-in-trade etc. seized under second provision to
Sec.132(1) of the I.T. Act as per annexure 'CS' ( - sheets)

b) The following were found but not seized:-

i) Books of account and documents as per annexure 'A' ( -- sheets)
ii) Bullion i.e., Gold, Silver, etc., as per annexure 'B' ( - sheets)
iii) Cash as per annexure '3' ( a1 sheets)
iv) Jewellery, Ornaments, Silver articles etc. which have been
inventorised separately for each place from where recovered as per
annexure '4' ( 01 sheet)
v) Other valueables, Locket keys, FDs/Stock in trade etc., as per
annexure '5' ( sheets)

8. The search commenced on 23.01.2019 at 8.50 a.m/p.m. The
proceedings were closed on 25.01.2019 at 6.10 a.m/p.m as finally
concluded / as temporarily concluded for the day to be commenced
subsequently for which purpose seals were placed on the entire place
/ on the bedroom of elder son of Mr. Shawkath Sowry Mohammed, Mr.
Mohammed Adnan in the glass cupboard just opposite to the entrance
of the room at Flat No.902/932, Presidency Flora, SL Mathias Road,
ATtavar, Mangaluru, Karnataka - 575 001 in our presence.

9. The order (s) under section 132(3) of the I.T Act 1961 in respect of,
the sealed premises as mentioned above was / were served on Shri /
Smt. Shawkath Sowry Mohammed by the said authorized officers.

7.2 The Revenue's argument before me is that the CIT(A)

is factually incorrect in stating that no search u/s.132 of the

Act was initiated and concluded in the case of the assessee
ITA Nos.182, 183/Bang/2023
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company and no panchanama in the name of the company was

drawn. The argument taken by the ld. CIT-DR is that a search

u/s.132 of the Act can be conducted in the case of a person by

covering multiple premises wherever there is a suspicion that

such books of accounts, other documents, money, bullion,

jewellery or other valuable article or thing representing

undisclosed income are kept and hence, in the present case,

the Pr.DIT(Inv.) had reasons to believe that Blueline Foods

(India) Pvt. Ltd., was in possession of undisclosed income and

assets and therefore, authorized the search in the case of

Blueline Foods (India) Pvt. Ltd. It was argued that he had

reason to suspect that evidences relating to unaccounted

assets and income of Blueline Foods (India) Pvt. Ltd., would be

kept at the residential premises of Mr. Mohd. Fakir, Mr. Afthar

Mohammed and Mr. Shawkath Showry and accordingly,

authorized the search at these residential premises. I have

gone through the three warrants of authorization issued and

executed for searching the residential premises of three

directors of Blueline Foods (India) Pvt. Ltd., and admittedly,

Form No.45 for issuance of warranty of authorization u/s.132

of the Act r.w.s 112(1) of the Rules categorically issued for
ITA Nos.182, 183/Bang/2023
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search of the residential premises of three directors of Blueline

Foods (India) Pvt. Ltd., but only the warrant issued in the name

of Blueline Foods (India) Pvt. Ltd. Actually as per Panchanama

drawn in these three cases, is also on account of search

conducted at the residences of three directors of these

companies. Admittedly, there is a warrant in the case of

Blueline Foods (India) Pvt. Ltd., but search was conducted only

at the residential premises of three directors as is evident from

the panchanamas drawn during the course of search party.

7.3 As pointed out by ld. counsel for the assessee that

the Income-tax Department on 23.01.2019 carried out a

survey u/s.133A of the Act on the respondent assessee's

business and factory premises coinciding with simultaneous

searches conducted u/s.132 of the Act at the residences of its

directors. It means that no search and seizure proceedings

u/s.132 of the Act was carried out in the case of the respondent

assessee. The ld. counsel for the assessee drew my attention

to page 146 of assessee's paper-book, wherein authorization

was issued for conducting survey u/s.133A of the Act and

consequently, survey was conducted on 23.01.2019 and finally
ITA Nos.182, 183/Bang/2023
Page 27 of 123

order u/s.133A(3)(ia) of the Act was issued impounding some

of the books of accounts/documents/digital evidences vide

order 25.01.2019. The entire impounded documents are

detailed out in assessee's paper-book at pages 146 to 176.

7.4 From the above two questions referred by ld. VP(JM)

and ld. AM, there is no dispute about the legal position that

search and seizure provisions u/s.132 of the Act are always in

relation to a person and the competent authority under this

provision can authorize the search of a person at any number

of places. This, in fact, is precisely the point that the

respondent seeks to make in arguing that a company being a

corporate, a distinct legal entity and a taxable person under

the Act cannot be considered to be the same as its directors or

shareholders. I agree that for conducting a search, a warrant

must be issued in the name of the person being searched and

such a warrant must be executed at the place or places

authorized to be searched and a valid panchanama must be

drawn in the name of the person searched at the conclusion of

a search. There is no doubt that panchanama being a critical

document that records the name of the persons searched, the
ITA Nos.182, 183/Bang/2023
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places where the search was conducted and the events that

took place, during the search has evidentiary value. The

argument put forth by LD-CIT DR that the search conducted at

the residences of the directors of the respondent company has

to be considered as search conducted at the company itself and

can describe the directors residence as not more than places

covered as part of search of respondent company and the

panchanamas drawn at those places as those drawn in respect

of respondent company. I cannot agree with the proposition

canvassed by revenue. In such situation and to answer the

above questions referred by ld. VP (JM) and ld. AM, which is

almost indicating same meaning, I have to go through the case

law cited by both the sides.

7.5 The case law cited by assessee in the case of CIT vs.

J.M. Trading Corporation of Hon'ble Bombay High Court in

Income Tax Appeal No.589 of 2009, LD CIT-DR tried to

distinguish on the facts that the premises of the assessee was

let out to one SSKI group but in the present case, accordingly

held that though warrant and panchanama were in the name

of the assessee firm, no search was initiated at the address of
ITA Nos.182, 183/Bang/2023
Page 29 of 123

the assessee, neither books of the assessee were kept nor any

valuables belonging to the assessee were found or seized in the

searched premises. I have noted that in this case, the facts

were that the assessee firm was constituted by three partners

carrying on the business of yarn, fabrics and securities and

commission agent. Search and seizure operation were carried

out u/s.132 of the Act on SSKI group by warrant dated

01.08.2003 and name of the assessee firm was also in the said

search warrant and hence, notice u/s.153A of the Act was

issued to the assessee and assessment was framed u/s.153A

of the Act. The Tribunal vide paras 21 to 24 decided this issue

that when there is no search warrant executed, it cannot be

held that search is initiated. The relevant question decided by

co-ordinate Bench of Mumbai Tribunal in J.M. Trading

Corporation in ITA Nos.1435 to 1438/Mum/2009 vide paras 21,

23 & 24 reads as under:-

21. The question for our determination is whether search was though
initiated against the assessee was conducted on the assessee. The
initiation of search and conduct of the search are two different aspects
of search and seizure proceedings. In the present case, the search was
initiated by issue of warrant of authorization. The conduct of search
proceedings is an elaborated procedure enumerated under section
132 of the Income-tax Act, which in clause 1 categorically authorizes
ITA Nos.182, 183/Bang/2023
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the officer to enter and search any building, place, vessel etc. where
he has a reason to believe that the books of account. monev, bullion.
jewellery or things belonging to the assessee are kept. The perusal of
the panchnama reveals that the search was conducted in respect of
SSKI Group wherein the search warrant was served on Mr.Hitesh M.
Desai, who is the Manager of SSKI Group, his statement was recorded
during the course of search. The books of account as per the Annexure
A-1 and other valuables, locker, FD as per Annexure O-1 belonging
to SsKI Group were found and seized. Other valuable articles
including money as per note in 1, 2, 3, 4 were found but not seized.
The assessee claims that none of his books of account were found or
seized and in respect of the valuables also the assessee clarifies that
none of his valuables were available at the above said address as the
said premises were rented out to SSKI group by the assessee and its
sister concerns. In the body of order under section 143(3) read with
section 153A of the Income-tax Act, the Assessing Officer also
observes that 'there was search and seizure action under section 132
of the Income-tax Act on SSKI Group and by warrant dated 1-8-2003,
the assessee was also covered under the search. The premises whereas
the assessee was found was not searched.

23. The Tribunal though cannot determine the Propriety of search but
the Tribunal has the inherent power to verify that there was a search
on the assessee and Panchnama prepared was legal. The said
principle has also been held by the Special Bench of Bangalore
Tribunal in C. Ramaiah Reddy's case (supra). Applying the ratio of
the decision of Special Bench in C. Ramaiah Reddy's case (supra) to
the facts of the present case, we find that though warrant of
authorization was issued in the name of the assessee proving the fact
ITA Nos.182, 183/Bang/2023
Page 31 of 123

of initiation of search against the assessee. But, in the facts of the
present case, where the assessee is not to be found on the said premises
though owned by the assessee but rented out to a separate concern,
income from which is assessed under the head Property Income,
established that no search was conducted at the premises at which the
assessee is found and available. The word 'conduct' is defined in the
Law Lexicon as Management; Conducting of affair (as conduct of
business); Conduct of a campaign; conduct of sale. It further states
conducting requires most wisdom and knowledge.

24. Section 132 of the Income-tax Act thus provides the acts and deeds
to be carried out by the search team at the premises of the assessee.
The conduct of search includes acts, deeds and things enumerated
under section 132 of the Income-tax Act which an authorized officer
is bound to carry out in order to complete the process of search.
Search is an invasion of Privacy of the assessee and all proceedings
connected with search need to be carried out within the framework of
the provisions of the Act. In case of non-compliance to the provisions
of the Act by the Authorised Officer, such searches are invalid and
illegal. In the present case before us, no search was conducted against
the assessee as the premises occupied by the assessee were not entered
upon and searched by the Authorised Officer. Mere search of the
premises owned by the assessee but rented to another concern does
not by any implication prove the conduct of search against the
assessee in view of the fact that the assessee was not available at the
address searched upon. Mere mentioning of name in the panchnama
does not lead to the conclusion that a valid search was conducted
against the assessee. In the totality of circumstances, where no search
has been conducted against the assessee there is no merit in the issue
ITA Nos.182, 183/Bang/2023
Page 32 of 123

of notice under section 153A of the Income-tax Act under which the
jurisdictional area of operation is six assessment years immediately
preceding the assessment year relevant to the previous year, in which
search was conducted. In case, no search is conducted against a
person, the period of operation to which the provisions of section 153A
would apply, cannot be determined and the invoking of provisions of
section 153A of the Act is baseless. Though the provisions of section
158BC of the Act are not applicable to searches conducted after 31-
5-2003, but the provisions of section 132 of the Income-tax Act are
continuing on the statute implying thereby that the provisions of
section 153A of the Act are only applicable in case valid search is
conducted against the assessee under section 132 of the Act.
Accordingly, we declare the assessments made against the assessee
under the provisions of section 143(3) read with section 153A of the
Income-tax Act are null and void and direct the Assessing Officer to
cancel the same. Thus, the issue related to the validity of search raised
by the assessee is allowed.

This was confirmed by the Hon'ble High Court of Bombay in Tax

Case Appeal No.589 of 2009 dated 29.06.2009 as under:-

"Heard learned Counsel for the parties. The question sought to be
raised in this appeal is relating to the conduct of the search. The
assessment made against the assessee under the provisions of section
143(3) read with section 153A of the Income Tax Act. The Tribunal
has categorically recorded a finding of fact of initiation of the search
that non compliance to the provisions of the Act by the Authorised
Officer, such searches are invalid and illegal. No search was
conducted against the assessee as the premises occupied by the
ITA Nos.182, 183/Bang/2023
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assessee were not entered upon and searched by the Authorised
Officer. Considering the factual aspect which is based on the
appreciation of evidence and no substantial question of law is involved
in the present appeal. In this view of the matter, appeal stands
dismissed in limini for want of substantial question of law with no
order as to costs."

7.6 The other case laws relied on by the assessee in the

case of Regency Mahavir Properties vs. ACIT of ITAT, Mumbai

reported in [2018] 89 taxmann.com 444, ITAT, Delhi in the

case of Aerens Jai Realty Pvt. Ltd., vs. ACIT in ITA Nos.6675,

6676 & 6677/Del/2017, order dated 23.02.2023, Hon'ble

Gujarat High Court in the case of CIT vs. Parmar Builders &

Developers reported in [2015] 62 taxmann.com 20 (Guj),

Hon'ble Madras High Court in the case of Smt. Rajkumar

Chandak vs. ACIT reported in [2015] 63 taxmann.com 10

(Mad) and ITAT, Delhi in the case of ACIT vs. Sarvamangalam

Builders & Developers Pvt. Ltd., in ITA Nos.196 to

198/Del/2011 were not distinguished by the ld. CIT-DR.

7.7 The ld. CIT-DR tried to distinguish another case law

of ITAT, Ahmedabad Bench in the case of Dr. Mansukh
ITA Nos.182, 183/Bang/2023
Page 34 of 123

Kanjibhai Shah vs. ACIT reported in [2011] 129 ITD 376

(Ahd.Trib.) by stating that search warrants were not served on

the assessee in whose case search u/s.132 of the Act was to

be taken. Hence, he stated that warrant was executed but in

the case of respondent assessee Blueline Foods (India) Pvt.

Ltd., as evidenced by signatures of directors on the warrants,

the search was conducted on the respondent assessee

company. I have gone through the decision of Ahmedabad

Tribunal in the case of Dr.Mansukh Kanjibhai, supra and noted

that this squarely fits into the facts of the present case and it

cannot be distinguished. The Tribunal in para 9.3 & 9.5 has

recorded its decision on facts as under:-

9.3. Section 153A would be applicable where a search is initiated
under section 132 or books of accounts or other documents or any
assets are requisitioned under section 132A of the Act after 31st May,
2003. Therefore, before invoking the provisions of section 153A of the
Act it would be necessary to comply with the provisions contained
under section 132(1) of the Act. Salient feature of section 132(1) is
that where the Director General or Director or the Chief
Commissioner or Commissioner, in consequence of information in his
possession has reason to believe that any person failed to produce
books of accounts or other documents in response to summons or that
any person to whom summons have been issued has not or might not
or would not produce any books of accounts or
ITA Nos.182, 183/Bang/2023
Page 35 of 123

documents or that any person is in possession of any money, bullion,
jewellery or other valuable article in his possession, which has not
been or would not be disclosed for the purpose of this Act (hereinafter
referred to as 'undisclosed income' or 'property') then the Director
General, Director or Chief Commissioner or Commissioner, as the
case may be, may authorize any Joint Director, Assistant Director,
Assistant Commissioner of Dy. Commissioner of Income tax, called
the authorized Officer, to enter and search any building, place, vessel,
vehicle or air-craft, etc. where he has reason to suspect that such
books of accounts, other documents, money, bullion, jewellery or other
valuable article or thing are kept, break open the lock of any door,
etc., search any person who is about to go from the above
premises, require any person to account for the books of accounts or
documents, seize any such books of accounts or documents, money,
bullion, jewellery, etc. or things found as a result of such search and
may place mark of identification on any books of accounts or other
documents or take copy thereof and to prepare inventory of the same.
The purpose of section 132 for issue of warrant of authorization is to
unearth, detect and to take possession of the unaccounted/undisclosed
income or property. The mere issue of warrant of authorization
without there being search of the premises mentioned in the warrant
of authorization would be meaningless and would not serve the
purpose of section 132 of the Act. It may be illustrated by taking an
example that if warrant of authorization under section 132 is issued in
the name of "A" after 31.5.2003 but his premises is not searched for
the purpose of executing the warrant of authorization and the warrant
of authorization is kept unexecuted, the question arises whether the
Assessing Officer still should proceed under section 153A of the Act
for the purpose of framing the assessment or reassessment of the six
ITA Nos.182, 183/Bang/2023
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assessment years immediately preceding the assessment years
relevant to the previous year in which such search is initiated or
requisition is made without executing the search warrant. The answer
would be 'No' because it would be a futile exercise. It may be added
here that jurisdiction can be assumed by the Assessing Officer to
initiate assessment proceedings to issue notices once search is
initiated under section 132/requisition made under section 132A. He
gets actual jurisdiction only on issue of notice, which could be issued
under section 153A (unlike section 158BC(a) in block assessment)
with no necessity for inference of escapement of income or under-
assessment as under section 147. Should it mean that a mere search
will enable reassessment proceedings by-passing or ignoring the
requirements of section 147. The only part of procedure dispensed
with under section 153A of IT Act on comparison with section 147 is
that there is no reason for recording reasons and for approval by
higher authorities before issue of notice of reassessment. Further,
there cannot be automatic jurisdiction for 6 back years even for those
entities which may not be in existence for all the six years indicating
that the provision is expected to be reasonably exercised. It should
therefore follow that there should be prima facie inference of liability
for invoking jurisdiction under section 153A of the IT Act. We may add
that in section 153A(b) it is specifically provided that the Assessing
Officer shall assess or reassess the total income of six years
immediately preceding the assessment years relevant to the previous
year in which such search is conducted or requisition is made. It
would, therefore, clarify that not only the warrant of authorization is
to be issued in the name of the assessee but search shall have to be
necessarily conducted or in case of requisition under section 132A,
the requisition is to be made actually. Hon'ble Allahabad High court
ITA Nos.182, 183/Bang/2023
Page 37 of 123

in the case of Chandra Prakash Agrawal v. CIT; 287 ITR 172
considering the definition of requisition under section 132A of the Act
as is referred to in section 158BA of the Act observed that the word
"requisition" means taking of actual possession. The requisition is
complete only when the seized books of accounts and other documents
which have been requisitioned have been delivered to the
requisitioning authority. The provisions of section XIV-B of the Act
would come into play only when the books of accounts or other
documents or assets are actually received by the Assessing Officer
pursuant to the requisition made under section 132A. It was held -

" Held, that no search under section 132 had been conducted by the
Incometax Department. The search, if any, was conducted on June 7/8
of 2001 by the Central Excise Department. The Incometax Department
had sent a requisition on March 27, 2002 under section 132A of the
Act requisitioning the books of accounts and other documents seized
by the Central Excise Department. The record of the proceeding dated
April 18, 2002 showed that the requisition was not fully executed as
all the books of account and other documents had not been delivered
to the requisitioning authority. The proceedings initiated under
section 148 were valid. However in the proceedings for reassessment
under section 148 of the Act, material or evidence relatable to the
documents for which the requisition had been sent under section 132A
could not be taken into consideration."

The learned Departmental Representative filed copies of warrant of
authorization under section 132 of the Act dated 29-10-2004 which
are issued in the name of K. M. Shah Charitable Trust, Mansukhbhai
K. Shah, with the direction to find valuable articles or things in Indian
ITA Nos.182, 183/Bang/2023
Page 38 of 123

Overseas Bank at different branches. In the said warrant of
authorization also, the authorized Officer was directed to enter and
search the building, etc. persons and to seize books of accounts,
documents, money, bullion, jewellery, etc. as are provided under
section 132 of the Act noted above. According to Section 132(14),
execution of an authorization shall have same meaning assigned in
Explanation 2 to Section 158BE, which provides authorization is
deemed to have been executed on conclusion of search as recorded in
Panchnama. Therefore, actual search shall have to be carried out
necessarily before proceeding u/s 153A. Rule 112 of IT Rules is also
not satisfied in case of assessee. Service of warrant on Bank Manager
of Trust is not service on assessee in individual case of assessee.

9.4 .............

name of the assessee being Managing Trustee of the Trust, but it is
admitted fact that no search operation was conducted in the premises
of the assessee. Even in the warrant of authorization, the address of
the place to be searched is not the address of the assessee individual.
Admittedly, no Panchnama is also drawn in pursuance with the
warrant of authorization in the case of the assessee. No documents
were seized or impounded as such during the course of search from
the assessee. The warrant of authorization dated 29.10.2004 in the
name of the Trust and the assessee stands unexecuted in the case of
assessee individual. Since in this case only survey operation under
section 133A is conducted in the premises of the assessee's Trust, it
would not satisfy the requirements of section 153A of the Act. As such,
the Assessing Officer was not justified in initiating proceedings or
assuming valid jurisdiction under section 153A of the Act against the
assessee. In view of the above discussions, we do not find these to be
the fit cases for initiating the proceedings u/s 153A of the IT Act
against the assessee in his individual status. We accordingly hold that
the proceedings u/s153A of the IT Act are invalid and bad in law,
resultantly, the orders of the authorities below are set aside and
quashed.

I do not agree with ld. CIT-DR that the facts in the present

case can be distinguished from the facts of Dr. Mansukh

Kanjibhai Shah, supra. In the case of Dr.Mansukh Kanjibhai,

supra, the facts are that though warrant of authorization issued

in the name of assessee being managing trustee of the trust

but it is admitted fact that no search was conducted in the
ITA Nos.182, 183/Bang/2023
Page 40 of 123

premises of the Trust assessee and even in the warrant of

authorization, the address of the place to be searched is not

the address of the assessee individual but was of the Trust.

Admittedly no panchanama is drawn in pursuance of the

warrant of authorization in the case of the assessee. In the

present case before us, the facts are clear that no panchanama

was drawn in the case of Blueline Foods (India) Pvt. Ltd., the

respondent assessee company, but only drawn in the case of

three directors of the respondent assessee company in their

individual capacity. There is no search material or seized

material relating to the respondent assessee company from the

search conducted on the three directors.

7.8 Similarly, the ld. CIT-DR also tried to distinguish the

judgment of Hon'ble Bombay High Court in the case of CIT vs.

Tirupati Oil Corporation reported in [2001] 248 ITR 194 (Bom),

Hon'ble Orissa High Court in the case of Siksha "O" Anusandhan

vs. CIT reported in [2012] 336 ITR 112 and Co-ordinate Bench

of Mumbai Tribunal in the case of Unique Star Developers vs.

DCIT reported in [2017] 83 taxmann.com 83.
ITA Nos.182, 183/Bang/2023
Page 41 of 123

8. I have considered the arguments of ld. CIT-DR and

gone through one more fact that there is a remand report from

the AO submitted vide F.No.RemandR/DCIT/CC-

1/MNG/Blueline/2022-23 dated 21.09.2022 wherein the AO

has categorically admitted that only survey was conducted on

the respondent assessee namely Blueline Foods (India) Pvt.

Ltd., and the comments of the AO in regard to search warrant

and panchanama reads as under:-

"AO's Comments - Search Warrant & Panchnama

In the instant case, search action u/s132 was carried out at the
residences of its directors, namely:
Mr. Mohammed Shawkath Showry, Managing Director
Mr. Mohammed Fakir, Director
Mr. Mohammed Afthar, Director

Simultaneously, survey u/s 133A was carried out at three places,
namely

The head office premises of M/s Blueline Foods (India) Pvt. Ltd.
4th Floor, Suite No.406, Crystal Arc, Balmatta Road,
Hampankatta, Mangalore, Karnatka

Factory #1 of M/s. Blueline Foods (India) Pvt. Ltd.
Azad Nagar, Ullal, Mangauru, Karnataka
ITA Nos.182, 183/Bang/2023
Page 42 of 123

Factory #2 of M/s. Blueline Foods (India) Pvt. Ltd.
Mudupi Road, Phajeer, Mangaluru, Karnataka

It is pertinent to note here that the Warrant of Authorisation u/s 132
was in the name of M/s Blueline Foods (India) Pvt. Ltd. but the
premises searched were the residences of the Directors of the said
company. Such a Warrant acts as a source of power for both Surveys
and Searches. The office and factory of M/s Blueline Foods (India)
Pvt. Ltd. happen to be its "business premises", therefore a Survey was
considered as sufficient

Since, search-action u/s 132 was carried out at the residences of the
Directors of the company, search warrant and Panchnama exists for
these. Copies of the Panchanamas, Search warrants and Survey
authorizations are attached herewith as proof (Annexure A)

A Panchnama is to be executed only in case of a search action. Since,
only survey was conducted Panchnama need not be executed and
hence it does not exist w.r.t the office/factory premises of M/s Blueline
Foods (India) Pvt. Ltd.

I noted from the arguments of both the sides and facts of the

case that it is not the case of Revenue that any books of

accounts, other documents or any asset pertaining to the

respondent company was requisitioned u/s.132A of the Act so

as to attract the provisions of section 132A of the Act.

Admittedly, there is warrant of authorization to search the
ITA Nos.182, 183/Bang/2023
Page 43 of 123

residences of the directors of the assessee company, which

were executed and only name is mentioned on the search

warrants authorizing the department to conduct the searches

at the residential premises of the directors. Admittedly, there

is no search warrant on the respondent assessee executed or

search initiate u/s.132 of the Act. As the Revenue is not in a

position to establish existence of warrant of authorization

executed and consequent initiation of search in the respondent

assessee company, the inescapable conclusion has to be that

no warrant of authorization seems to have ever been executed

in the case of the respondent assessee company, either to

conduct a search u/s.132 of the Act or to make a requisition

u/s.132A of the Act nor was any search or requisition initiated

against it. For this proposition, I'm relying on the decision cited

by ld. counsel for the assessee of Hon'ble Bombay High Court

in the case of Bansilal B. Raisoni & Sons vs. ACIT reported in

[2019] 101 taxmann.com 20 (Bom), wherein it is held that in

order to issue a notice u/s.153A of the Act, there must be

initiation of search u/s.132 of the Act and mere search

authorization would not be sufficient. The Hon'ble Bombay

High Court considered this issue as under:-
ITA Nos.182, 183/Bang/2023
Page 44 of 123

6. As noted above, the broad facts before us are that the search
authorization was issued against the petitioner partnership firm, one
of its partners and another person. Actual search was carried, as
pointed 4 of 10 Uday S. Jagtap 13391-18-WP-904=.doc out by the
petitioner, at three different locations namely at the residential
premises of one of the partners and two other residential premises,
one of them belonging to the brother of the partner of the partnership
firm. In the context of such broad facts, if we refer to Section 153A of
the Act, we notice that in sub-section (1) thereof, notwithstanding
anything contained in Sections 139, 147, 148, 149, 151 and 153 of the
Act, in case of a person where search is initiated under Section 132 or
books of accounts, other documents are requisitioned under Section
132A, the Assessing Officer would have the authority to issue notice
to such person, requiring him to furnish the return of income in respect
of each assessment year falling within six assessment years and
thereafter carry out the assessments accordingly. In the present case,
we have no hesitation in accepting the petitioner's contention that in
order to issue notice under sub-section (1) of section 153A, there must
be initiation of search in case of the noticee. Mere search
authorization would not be sufficient. There is clear distinction
between search authorization and conduct of the search. In sub-
section (1) of Section 153A of the Act, therefore, the legislature has
advisably used expression "where a search is initiated under Section
132".

8.1 Even this issue is covered by the decision of Hon'ble

Karnataka High Court in the case of Canara Housing

Development Co. Vs. DCIT reported in [2014] 49 taxmann.com
ITA Nos.182, 183/Bang/2023
Page 45 of 123

98 (Kar) wherein exactly on identical facts the Hon'ble High

Court held that the condition precedent for application for

section 153A of the Act, there must be a search u/s.132 of the

Act. The Hon'ble High court in para 10 in middle lines has noted

as under:

"The condition precedent for application of Section 153A is there
should be a search under section 132. Initiation of proceedings under
Section 153A is not dependent on any undisclosed income being
unearthed during such search."

8.2 I also got strength from the decision of Hon'ble

Gujarat High Court wherein the Hon'ble High Court in the case

of CIT vs. Ramesh D Patel reported in [2014] 42 taxmann.com

540 (Guj) held as under:-

In the present case, the Tribunal came to a factual finding that no
search authorization was produced. This was necessary because the
Assessing Officer had made contradictory references to the assessee
being subjected to search or not. In absence of a search authorization,
the Tribunal correctly held that assessment orders under section 153A
could not have been passed. Reliance of the Revenue to section 124(3)
of the Act would be of no avail. Section 124 pertains to jurisdiction of
the Assessing Officers. Sub-section (1) thereof concerns the situation
where, by virtue of any order or direction under sub-sections (1) or
(2) of O/TAXAP/347/2013 ORDER section 120, the Assessing Officer
ITA Nos.182, 183/Bang/2023
Page 46 of 123

has been vested with jurisdiction over any area within the limits of
such area. Sub-section (2) of section 124 provides, inter alia, that
where a question arises under the said section as to whether an
Assessing Officer has jurisdiction to assess any person, the question
shall be determined by the Director General or the Chief
Commissioner, etc. Sub-section (3) thereof provides as under:

"(3) No person shall be entitled to call in question the jurisdiction
of an Assessing Officer -

(a) Where he has made a return under sub-section (1) of section
115WD or under sub-section (1) of section 139, after the expiry
of one month from the date on which he was served with a notice
under sub-section (1) of section 142 or sub-section (2) of section
115WE or sub-section (2) of section 143 or after the completion
of the assessment whichever is earlier;

(b) where he has made no such return, after the expiry of the time
allowed by the notice under sub-section (2) of section 115WD or
sub-section (1) of section 142 or under sub-section ()1) of section
115WH or under section 148 for making of the return or by the
notice under the first proviso to section 115WF or under the first
proviso to section 144 to show cause why the assessment should
not be completed to the best of the judgment of the Assessing
Officer, whichever is earlier."

Thus, section 124 of the Act pertains to territorial jurisdiction of an
Assessing Officer vested under sub-section (1) or (2) of section 120.
An objection to such jurisdiction can be raised in terms of section
ITA Nos.182, 183/Bang/2023
Page 47 of 123

124(2). In terms of sub-section (3) of section 124, right to raise such
objection shall be foregone beyond the stages mentioned therein. The
said provisions are clearly concerning with the dispute of the assessee
with respect to the territorial jurisdiction of the Assessing Officer and
has no relevance in so far as the inherent jurisdiction for passing an
order of assessment under section 153A of the Act is concerned, when
no search O/TAXAP/347/2013 ORDER authorization under section
132 was issued or requisition under section 132A of the Act was made.

8.3 Further, the Hon'ble Rajasthan High Court

considering that search u/s.132 of the Act has to be person

specific and held in the case of CIT vs. Smt. Umlesh Goel

reported in [2016] 74 taxmann.com 37 (Raj) as under:-

6.3 Since by the exercise of the power a serious invasion is made upon
the rights, privacy and freedom of the taxpayer, the power must be
exercised strictly in accordance with law and only for the purposes for
which the law authorises it to be exercised. If the action of the officer
issuing the authorisation or of the designated officer is challenged, the
officer concerned must satisfy the court about the correctness of his
action. Therefore, in our considered view a search under Section
132(1) has to be "person specific". The Authority authorising search
has to have information in his possession in respect of a person and
such a person should be specifically named in search warrant and
since names of the assessees having not figured in the authorisation of
warrant as having been proved on the basis of Form 45 which has
been reproduced by us in para 16 hereinbefore, the AO has exceeded
its jurisdiction in issuing the notice under Section 158-BC and
ITA Nos.182, 183/Bang/2023
Page 48 of 123

initiation of the proceedings being invalid, all subsequent action of
A.O. including order of assessment is not sustainable in law.

8.4 In similar circumstances, the Hon'ble High Court of

Madras in the case of Smt. Rajkumari Chandak vs. ACIT

reported in [2015] 63 taxmann.com 10 (Mad) has held as

under:-

17. The above document, which is undisputed and forms part of
the Court records, makes it clear that the confusion has
apparently happened because search under Section 132 of the
Act commenced in the case of other assessees as well and,
therefore, all similarly placed persons were clubbed together and
assessment orders were passed. However, neither in the course
of passing the assessment order nor during the appeal
proceedings before the Tribunal or this Court, attention was
drawn to the survey proceedings under Section 133A of the Act,
insofar as the present assessee is concerned. Since all the cases
were taken up together as one lot and assessment orders were
passed, the error could have happened. Since the earlier order of
the Tribunal dated 12.4.99 does not deal with each one of the
assessee, but based on a common order passed by the Tribunal,
the error in the present case is apparent on the face of the record.
This error was also not brought to the notice of this Court in the
earlier round of litigation. The typed set of documents filed in the
earlier round of litigation by the assessee in TCA Nos.240 and
241/2000 shows that it is a case of only survey u/s 133A and
ITA Nos.182, 183/Bang/2023
Page 49 of 123

search has been clearly deleted. There is no dispute on this fact,
as the same is borne out by document. If it is a case of survey
under Section 133A of the Act, as is evident from the document,
the block assessment, invoking the provisions of Sections 158BC
does not arise, as there is no search in terms of Section 132 of the
Act. In view of the above, the 2nd substantial question of law, on
the question of jurisdiction, is answered in favour of the
appellant/assessee and against the respondent/Revenue.

8.5 I have considered the facts and noted the arguments of

Ld. CIT-DR that there is no need to establish that any search

was actually conducted on the assessee because section 153A

of the Act uses the word `initiation' of search. Pointing out a

distinction between the initiation and actual conduct of the

search, the ld. CIT-DR relied on the order passed by the

Jodhpur Bench in Suraj Prasad Soni vs. ACIT (2007) 106 ITD

321 (Jodhpur), in which the meaning of the word `initiation of

search' has been dealt with. We fully agree with the ld. CIT-DR

that, firstly, what is significant for the issue of notice u/s 153A

of the Act is the initiation of search and secondly, there is a

marked distinction between `initiation' and `commencement'

of search. In common parlance, 'Initiation' means the

beginning of a process or, in other words, a first step in the
ITA Nos.182, 183/Bang/2023
Page 50 of 123

entire process. Search commences with the issue of

authorization by the competent authority. Thus, the 'initiation'

of search commences with the issue of authorization by the

DIT. 'Execution' of search warrant, which is a step after the

initiation of search, takes place later on, which leads to the

actual conduct of the search at the premises of the person

searched. Going by the contention of the ld. CIT-DR, seen in

the context of section 153A of the Act, there remains no doubt

that notice u/s 153A of the Act can be issued where a search

is initiated u/s 132 of the Act or, in other words, a warrant of

authorization is issued. Per contra, in the absence of a warrant

of authorization on the assessee, no notice u/s 153A of the Act

can follow. I have gone through the copy of Warrant of

authorization in this case, from which it is apparent that

although the assessee is named therein but it is addressed to

the directors of the assessee respondent. Even, there is no

mention of any permanent account number of the assessee in

that.

8.6 On going through the mandate of the judgment of

the Hon'ble Supreme Court, it becomes evident that the
ITA Nos.182, 183/Bang/2023
Page 51 of 123

challenge before it was to the notice u/s 158BD of the Act,

being the notice for assessment of income of any person other

than the person searched. Whereas section 158BC of the Act

in the earlier provisions of assessment of search cases under

Chapter XIV-B dealt with the assessment of a person searched,

section 158BD of the Act dealt with the assessment of `any

other person'. In the successor provisions, dealing with search,

introduced w.e.f. 1.6.2003, section 153A of the Act deals with

the assessment of a person searched and section 153C of the

Act with the assessment of `any other person'. In other words,

section 153A of the Act is a parallel of section 158BC of the Act

and section 153C of the Act is a parallel of section 158BD of

the Act. In the instant case, it is the assessment of person

allegedly searched, which is disputed before me, unlike the

notice issued for the assessment of `other person' before the

Hon'ble Supreme Court. Even otherwise, the issue of invalidity

of the search warrant in that case was not raised at any point

of time prior to the notice under section 158BD of the Act. On

the contrary, the assessee contested the validity of search

before the AO at the very threshold, immediately on receipt of

notice u/s 153A of the Act. Moreover, in that case, a search
ITA Nos.182, 183/Bang/2023
Page 52 of 123

operation actually took place and the defect, if any, claimed

was in the warrant of authorization. In the impugnation, the

Revenue has failed to demonstrate that any search action was,

in fact, taken on the assessee. I am reminded of the celebrated

judgment of the Hon'ble Supreme Court in Pooran Mal vs.

Director of Inspection (1974) 93 ITR 505 (SC) laying down that

the material seized in an illegal search can be validly used by

the income-tax authorities. The judgment in Gunjan Girishbhai

Mehta (supra) is reiteration of almost the same view, when it

held that `the information discovered in the course of the

search, if capable of generating the satisfaction for issuing a

notice under Section 158BD of the Act, cannot altogether

become irrelevant for further action under Section 158BD of

the Act.' What to talk of some `information discovered in the

course of search' in the case under consideration, the Revenue

has not proved the basic fact that the assessee was subjected

to any search.

8.7 In view of the aforesaid discussion, provisions of the

Act, precedents cited above and facts of the case, I'm of the

view that the provisions of section 153A of the Act makes it
ITA Nos.182, 183/Bang/2023
Page 53 of 123

clear that only in the case of a person on whom a search is

initiated and conducted u/s.132 of the Act or books of accounts

or other documents or any assets or requisition u/s.132A of the

Act, the AO shall after issuing notice u/s.153A of the Act assess

or reassess the total income of such person for six assessment

years immediately preceeding the assessment year relevant to

the previous year in which such search is conducted or

requisition is made. I'm of the view that the legislative intent

is very clear from the use of the expression "such person" in

section 153A(1)(a) of the Act. The expression clearly relates

to a person in respect of whom search u/s.132 of the Act has

been initiated and conducted as provided in section 153A of the

Act. In the present case before me, in view of the aforesaid

discussion and facts noted, there is no search conducted

u/s.132 of the Act in the case of respondent assessee company

Blueline Foods (India) Pvt. Ltd. In view of the foregoing

discussion, it is clear beyond any shadow of doubt that the

notice u/s 153A of the Act was issued without any jurisdiction.

The natural corollary, which therefore, follows is that all the

proceedings flowing from such invalid notice, including the
ITA Nos.182, 183/Bang/2023
Page 54 of 123

resultant assessment order, are bad in law and hence,

quashed.

8.8 In term of the above, I agree with the ld.VP (JM)

upholding the order of CIT(A) quashing the assessment framed

u/s.153A of the Act by the AO. Hence, I answer this question

framed by ld.VP(JM) in the negative and concurring with him.

AS regards to the question framed by ld.AM, the same is also

answered in negative and do not concur with him.

8.9 The second question framed by ld.AM is answered in

negative and do not concur with him.

8.10 The third question framed by ld.AM is not arising out

of the facts of the case and orders, hence need no answer.

9. To sum up:

Question raised by Ld. VP(JM) Decision
1. Whether on facts and
circumstances of the case and in law,
there was a valid search under section
ITA Nos.182, 183/Bang/2023
Page 55 of 123

132 of the Act in the case of the Answered in negative. I
assessee and thus assessment am concurring with Ld.
completed under section 153A of the VP(JM)
Act is valid?

Questions raised by Ld. AM Decision

1. Whether in the facts and
circumstances of the case, the search
conducted in the light of warrant of Answered in negative. I
authorization issued in the name of the do not concur with ld. AM
assessee company and the place of
search mentioned in the warrant is the
residence of the director of the
assessee company, would constitute a
valid search u/s.132 of the Act in the
case of the assessee company itself, so
as to initiate proceedings u/s.153A of Answered in negative. I
the Act? do not concur with ld. AM

2. Consequently, the issue of notice
u/s.153A of the Act is a valid notice and
whether in the facts and circumstances
of the case, a search was initiated, This question does not
executed, completed and arise out of the orders of
ITA Nos.182, 183/Bang/2023
Page 56 of 123

panchanamas drawn according to Form both ld.VP(JM) and ld. AM
45 in the case of assessee company for or that of the Assessing
completing assessment u/s.143(3) Officer and CIT(A) and
r.w.s. 153A of the Act? hence, need no answer.

3. Whether, in the facts and
circumstances of the case, proceedings
u/s.153C of the Act could have been
initiated?

10. Accordingly, the reference is decided as indicated above.

In the light of the above, the matter may now be placed before

the regular bench for an appropriate order, in accordance with

law.

Sd/-
(महावीर संह )

(MAHAVIR SINGH)

उपा य /VICE PRESIDENT

चे नई/Chennai,

दनांक/Dated, the 22nd July, 2024

RSR
ITA Nos.182, 183/Bang/2023
Page 57 of 123

IN THE INCOME TAX APPELLATE TRIBUNAL
"B" BENCH : BANGALORE

BEFORE SHRI GEORGE GEORGE K, VICE PRESIDENT AND
SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

ITA Nos.182, 183/Bang/2023
Assessment Years : 2017-18, 2018-19

DCIT, M/s. Blueline Foods (India) Pvt. Ltd.,
Central Circle - 1, Suite # 406, Crystal Acr,
Mangaluru. Vs. Balmatta Road,
Mangaluru - 575 001.
PAN : AACCB 8979 J
APPELLANT RESPONDENT

Assessee by : Shri. B. S. N. Prasad, Advocate
Revenue by : Dr. G. Manoj Kumar, CIT(DR), ITAT, Bengaluru.

Date of hearing : 27.09.2023
Date of Pronouncement : 06.10.2023

ORDER
Per George George K, Vice President :

These appeals at the instance of the Revenue are directed against two
Orders of CIT(A) (orders of the CIT(A) are dated 16.12.2022), passed under
section 250 of the Income Tax Act, 1961 (hereinafter called 'the Act'). The
relevant Assessment Years are 2017-18 and 2018-19.

2. Common issues are raised in these appeals; hence, they were heard
together and are being disposed off by this consolidated order. Identical grounds
are raised for both the Assessment Years. The grounds raised read as follows:

1. Whether on the facts and circumstances of the case and in law the
Ld.CIT(A) erred in allowing the appeal of the assessee on technical
ITA Nos.182, 183/Bang/2023
Page 58 of 123

ground without appreciating the fact that there was a valid search
initiated u/s 132 of the IT Act in the case of the assessee and thus
notices issued u/s 153A of the Act were valid?

2. Whether on the facts and circumstances of the case and in law the
Ld.CIT(A) erred in not considering the facts that the search
assessments were rightly initiated u/s 153A of the IT Act, since the
warrant of authorization was in the name of the assessee-company.

3. Whether on the facts and circumstances of the case and in law the
Ld. CIT(A) erred in not considering the fact that the assessee had
complied with the notices issued u/s 153A of the Act and had
declared the undisclosed income admitted?

4. Whether on the facts and circumstances of the case the order of
CIT(A) is perverse as he has failed to note that warrant executed
at the residence of the directors was in the case of the assessee
company and duly executed?

5. Whether on the facts and circumstances of the case in law the
Ld.CIT(A) erred in not considering the fact that the search warrant
is in the name of M/s Blueline Foods(India) Pvt.Ltd. and
panchanama was drawn in the course of search proceeding of M/s
Blueline Foods (India) Pvt Ltd. At the residence of the Directors of
the company?

6. Whether on the facts and circumstances of the case and in law the
Ld. CIT(A) failed to appreciate the fact that as per the Warrant of
Authorisation i.e. Form No.45, the search was initiated in the name
of assessee-company?

7. Whether on the facts and circumstances of the case and in law the
Ld. CIT(A) erred in not appreciating the fact that the jurisdiction
under section 153A of the Act is conferred on the AO immediately
on initiation of search u/s 132 of the Act and thus notices issued
u/s 153A of the Act and consequent returns of income filed are
valid?

8. Whether on the facts and circumstances of the case and in law the
Ld. CIT(A) failed to appreciate that there is no requirement in law
that the business premises of the assessee should also be searched
for purpose of invoking provision of Section 153A of the Act?
ITA Nos.182, 183/Bang/2023
Page 59 of 123

9. Whether on the facts and circumstances of the case and in aw the
order of CIT(A) is perverse in holding that the search warrant in
name of assessee-company was never executed although the same
was duly executed and panchanama was drawn at the premises
searched, being residence of directors?

10. For the above grounds and any additional that may be urged
during the course of hearing it is prayed that the order of the Ld.
CIT(A)-2, Panaji may be quashed and that of the AO restored.

3. Brief facts of the case are as follows:

Assessee is a company engaged in the business of manufacturing,
processing and trading of dry fish, fish meal and fish oil. A survey under section
133A of the Act was carried out at the business premises of the assessee on
23.01.2019. Simultaneously, on the same day, a search under section 132 of the
Act was carried out at the residential premises of the Directors of the assessee.
It is pertinent to note that warrant of authorization under section 132 of the Act,
dated 21.01.2019 were issued in the name of the assessee and the premises to
search in the said warrants were the residents of the Directors of the assessee.
On the above basis, the Revenue issued notice under section 153A of the Act
dated 06.01.2020 for Assessment Years 2013-14 to 2018-19. The assessee filed
the returns of income for the respective Assessment Years in response to the
notices under section 153A of the Act. The assessee raised an objection against
initiation of proceedings under section 153A of the Act on the ground that no
search under section 132 of the Act has been carried out in its own case. The AO
passed the Assessment Order under section 143(3) r.w.s. 153A of the Act for the
aforesaid years on 25.01.2021.

4. Assessee filed appeals before the First Appellate Authority [CIT(A),
Panaji]. The CIT(A) agreeing with the objections raised by the assessee, passed
the orders for Assessment Years 2013-14 to 2018-19 on 16.12.2022 quashing the
ITA Nos.182, 183/Bang/2023
Page 60 of 123

Assessment Orders passed under section 153A of the Act. The CIT(A), after
considering the relevant provisions and the judicial pronouncements, held that
since there is no search under section 132 of the Act in the premises of the
assessee company, the precondition for issuance of notice under section 153A of
the Act are not satisfied and the Assessment Orders completed pursuant to the
same were quashed. The issues raised on merits were not adjudicated by the
CIT(A) since the legal issue was decided in favour of the assessee. The relevant
finding of the CIT(A) for the Assessment Year 2017-18 reads as follows:

"4.68 In the light of the above, respectfully following the binding
judgments of the Hon'ble Supreme Court, the Hon'ble jurisdictional High
Court of Karnataka and the Hon'ble Special Benches of the ITAT and
those of the various other Hon'ble Courts discussed in the preceding
paragraphs, it is held that the preconditions for issue of notices under
section 153A of the Act are not satisfied in the present case and therefore,
the impugned notices issued to the Appellant company under section 153A
of the Act are void ab initio and without jurisdiction. As the returns of
income filed in response to the invalid notices under section 153A of the
Act are non -est in the eyes of the law, the finality of the intimations issued
under section 143(1) or the regular assessment orders passed under
section 143(3) of the Act, as the case may be, in respect of the original
returns filed by the company prior to the initiation of the survey under
section 133A of the Act cannot be disturbed and is hereby restored.
Accordingly, the impugned assessment order passed under section 153A
for the Assessment Year under consideration, in pursuance of the invalid
notices issued under that section is held to be bad in law and stands
annulled.

4.69 Ground 2 is accordingly allowed. In light of this, the other grounds
of appeal raised by the Appellant are rendered infructuous and it is not
deemed necessary adjudicate the same."

5. Aggrieved by the orders passed by the CIT(A), Revenue has preferred the
appeals against Assessment Years 2017-18 and 2018-19. For the other
Assessment Years, the Revenue was prevented from filing appeals considering
the tax effect being lower than the limit prescribed by the CBDT.
ITA Nos.182, 183/Bang/2023
Page 61 of 123

6. The learned DR submitted that there is no doubt that warranty of
authorization has been issued in the name of the assessee company. The learned
DR submitted that the Department has various tools such as search, survey, etc.,
to unearth the income which is not disclosed to the Revenue. It was submitted
that such warrants acts as a source of power for both surveys and searches and it
is not necessary to search the premises of the assessee when Department has
knowledge that there is no incriminating material in the premises of the assessee.
However, based on the warranty of authorization issued in the name of the
assessee and in pursuance of the same, the Directors of the assessee company
were admittedly searched under section 132 of the Act. The learned DR has filed
a brief written submission. The same reads as follows:

"The Ld. CIT(A) has held that preconditions for issue of notice under section
153A of the Act are not satisfied in this case as there has been no valid search
in the case of the Assessee company and in the absence thereof, the
provisions of section 153A of the Act could not have been validly invoked in
this case. The Ld. CIT(A) has also incorrectly claimed in Para 4.48 at page
of 51 of the appellate order that Panchanamas were duly drawn in the cases
of Managing Director and Directors of the assessee company. The Ld. AR
had also raised a number of points such as Panchnamas were not drawn in
the name of the assesse company, the warrants cannot be said to be in the
name of the assesse company, business premises were covered under survey
therefore it is not a case of search against the assesse company, in the
Remand Reports the Ld. AO had accepted that no search had taken place in
the name of the assesse company and so forth. These assertions and
conclusions are baseless for the reasons listed below:

The scheme of search and seizure provisions prescribed under section 132
of the Act envisages the concept of a "person" who is searched and a "place"
that is searched. For ready reference the section is reproduced hereunder:

" Search and seizure.

132. (1) Where the Principal Director General or Diretor General or Principal
Director or Director or the Principal Chief Commissioner or Chief
Commissioner or Principal Commissioner or Commissioner or Additional
Director or Additional Commissioner or Joint Director or Joint
ITA Nos.182, 183/Bang/2023
Page 62 of 123

Commissioner in consequence of information in his possession, has reason
to believe that--

(a) any person to whom a summons under sub-section (1) of section 37 of
the Indian income-tax Act, 1922 (11 of 1922), or under sub-section (1)
of section 131 of this Act, or a notice under sub-section (4) of section 22
of the Indian Income-tax Act, 1922, or under sub-section (1) of section
142 of this Act was issued to produce, or cause to be produced, any books
of account or other documents has omitted or failed to produce, or cause
to be produced, such books of account or other documents as required by
such summons or notice, or
(b) any person to Is hom a summons or notice as aforesaid has been or might
be issued will not, or would not, produce or cause to be produced, any
books of account or other documents which will be useful for, or
relevant to, any proceeding under the Indian Income-tax Act, 1922 (11
of 1922), or under this Act, or
(c) any person is in possession of any money, bullion, jewellery or other
valuable article or thing and such money, bullion, jewellery or other
valuable article or thing represents either wholly or partly income or
property which has not been, or would not be, disclosed for the purposes
of the Indian Income-tax Act, 1922 (11 of 1922), or this Act (hereinafter
in this section referred to as the undisclosed income or property),

then,--

(A) the Principal Director General or DirectIr General or Principal
Director or Director or the Principal Chief Commissioner or Chief
Commissioner or Principal Commissioner or Commissioner, as the case
may be, may authorise any Additional Director or Additional
Commissioner or Joint Director, Joint Commissioner, Assistant Director
or Deputy Director, Assistant Commissioner or Deputy Commissioner or
Income-tax Officer, or
(B)such Additional Director or Additional Commissioner or Joint Director,
or Joint Commissioner, as the case may be, may authorise any Assistant
Director or Deputy Director, Assistant Commissioner or Deputy
Commissioner or Income-tax Officer, (the officer so authorised in all
cases being hereinafter referred to as the authorised officer) to--

(i) enter and search any building, place, vessel, vehicle or aircraft
where he has reason to suspect that such books of account, other
documents, money, bullion, jewellery or other valuable article or
thing are kept;.........."
A perusal of the above provisions reveals that search is always carried out
in the case of a person and in connection with his case any place where
ITA Nos.182, 183/Bang/2023
Page 63 of 123

certain documents, valuables etc. are kept may be entered and searched.
Nowhere in the section is it mentioned that the place being searched has to
belong to the person being searched, or his business premises have to be
compulsorily covered under search. Thus, for a search to be a valid search
under the Act, a Warrant must be issued in the name of the person being
searched. This warrant must be executed at any place or places where there
is a suspicion that the above referred documents or articles are kept.
Thereafter, a valid Panchnama is drawn in the case of the person who was
searched after the search has been conducted. The Panchnama is a critical
document that records in whose case the search was conducted, the place
where the search was conducted and the events that took place during the
search. It has a very high evidentiary value.

In the present case all three ingredients are present. The warrants of search
that were issued in the case were in the name of the assesse company. The
warrants were executed at the residence of Directors and Managing
Director as it was suspected that at these places relevant documents and
articles could be found. Panchnamas were drawn in the name of the assesse
company and not Directors of the company. The copy of Warrants and
Panchnamas have already been placed before the Bench and the Ld. AR.
The Warrants are mentioning the name of the assesse company alone and
place that is to be searched arc mentioned as the residential addresses of
the Directors of the Company. it has been informed by the Ld. AR that the
Directors were assessed under section 153C of the Act.

The business premises were not covered under search under section 132
because there was no need to cover them under search. Search and Surveys
are two different tools that are used to gather
information/documents/material. At a place where only survey is required,
the use of a drastic tool of search may be considered as unnecessary. It is
not necessary that all premises are covered under search or the business
premises have to be covered under search. As long as there is a warrant in
the case of the assesse and it has been Duly executed at any place referred
in the preceding paras and a valid Panchnama exists in the name of the
assesse, then a valid search is said to have taken place in the case of that
assesse and proceedings under section 153A must necessarily follow.

A case was also sought to be made out that Assessing Officer has admitted
in his Remand Reports submitted to Ld. CIT(Appeals) that no search was
conducted in the case of the Assessee company. This is not correct. All that
the Assessing Officer is stating is that the business premises of the assesse
company were covered under survey and since no search action has been
conducted at the business premises therefore no Panchnama was drawn at
ITA Nos.182, 183/Bang/2023
Page 64 of 123

those places. He has also clearly mentioned that Warrants of Authorisation
were in the name of the Assessee company and the premises that were
searched under those warrants were the residential premises of the
Directors of the Assessee Company. The Remand Report of the Assessing
Officer gives no support to the Respondent. In any case when the Warrants
and Panchnamas have already been placed on record, the facts of the case
have become crystal clear and subjective interpretation of the Remand
Report is unnecessary.

In view of the above it is kindly requested that the order of Ld. CIT(A)-2,
Panaji may be quashed and that of the AO restored."

7. The learned AR, on the other hand, strongly supported the finding of the
CIT(A). In response to the learned DR's written submissions, the learned AR
filed reply and same reads as follows:

"1. The Respondent in the above case submits for kind consideration of
the Hon'ble Tribunal the following rejoinder to the written
submissions filed by the Appellant on 29.08.2023:

2. There is no dispute about the fact that search and seizure provisions
enshrined in section 132 of Income-Tax Act, 1961 (the Act) are always
in relation to a person and that the competent authority under this
provision can authorize the search of a person at any number of
places. This, in fact, is precisely the point that the Respondent seeks
to make in arguing that a company - being a body corporate, a
distinct legal entity and a taxable person under the Act - cannot be
considered to be the same as its directors or shareholders.

3. The learned Departmental Representative (DR) is only stating the
obvious in declaring that for a valid search, a warrant must be issued
in the name of the person being searched, such a warrant must be
'executed' at the place or places authorized to be searched and a valid
Panchanama must be drawn in the name of the person searched at the
conclusion of a search. There is also no doubt that a Panchanama,
being a critical document that records the name of the person
searched, the place where the search was conducted and the events
that took place, during the search, has high evidentiary value.
ITA Nos.182, 183/Bang/2023
Page 65 of 123

4. The dispute arises where the learned DR attempts to portray the
searches conducted at the residences of the directors of the
Respondent company as searches conducted in the case of the
company itself and describes the directors' residences as no more
than places covered as part of a search of the company and the
panchanamas drawn at those places as those drawn in respect of the
company.

5. Merely because the name of the Respondent company is mentioned in
the warrants of authorization issued to search the residential
premises of the company's directors, those searches cannot be held to
constitute initiation of a valid search in the company's own case, as
held by the Hon'ble Mumbai Tribunal in Unique Star Developers v.
DCIT [2017] 83 taxmann.com 83 (Mum. Trib.), where it has been held
that:
"... In the present case before us search has been initiated as the
name of the assessee's AOP appear on the warrant of authorization
issued u/s 132(1) besides mentioning the names of the members of
assessee AOP at all but the search was not conducted on the
premises of the AOP, whereas the search was conducted on the
members of AOP with no incriminating material relating to
assessee was found in the premises searched belonging to the
members of the assessee AOP. Finally, the search was concluded
in the name of the members of AOP where authorization was drawn
duly but no authorization was drawn in the name of the assessee -
AOP and therefore, the limbs and contents to be satisfied for
assessment of jurisdiction u/s 153A were not satisfied."

(Paragraph 9)

"...search at the residence of the members of the appellant AOP
would not fulfill the prescribed conditions to authorize search and
the assessment order u/s 153A of the Act. It is therefore, very clear
that where no authorization has been drawn it can be presumed
that no search has taken place to provide a legal basis for search
and consequent assessment under section 153A of the Act and it
would be totally illegal to assume that once the warrant has been
signed there is initiation of proceedings u/s 153A of the Act. We,
therefore are not in agreement with the conclusion drawn by the ld.
CIT(A) that once the warrant issued in the name of the assessee
and authorization was drawn though the assessee's name was not
there in the panchnama, there was a proper execution of search
ITA Nos.182, 183/Bang/2023
Page 66 of 123

justifying the action u/s 153A of the Act."
(Paragraph 10)

"...in order to initiate assessment proceedings u/s 153A of the Act,
the premises of the appellant has to be searched and authorization
has to be specifically drawn in the name of the assessee but in the
present case before us no search was carried out at the business
premises of the assessee and so much so that no incriminating
documents were found and seized from premises searched of others
and no authorization was drawn in the name of the assessee..."
(Paragraph 11)

6. Further, the mere fact of issue of warrants of authorization in the
name of a company cannot by itself be considered as initiation of a
search in its case, as held in the following judgments:
(i) CIT v. Wipro Finance Ltd. [2009] 323 ITR 467 (Kar.):

"...we may safely assign to the expression 'search initiated'; the
meaning 'search taken' or 'search commenced' or 'making
beginning of the search'. If this is meant by the expression 'search
initiated' it cannot be held that the only signing of the
authorisations by the DIT, Bangalore, on 30-12-1996 to make a
search in the premises of the respective assessees would amount to
'initiation of search'. The 'signing of the authorisations' would at
best amount to 'taking of the decision by the said authority to
initiate search' in the premises of respective assessees but not
initiation of search itself."
(Paragraph 24)

"...the expression 'search initiated' has to be interpreted to mean
the commencement and conducting of the 'initial search' i.e., the
first search in the case..."
(Paragraph 26)

(ii) Promain Ltd. V. DCIT [2005] 95 ITD 489 (Del. Trib.)(SB):

"...the Legislature has used two words 'initiated' and
'conducted' with reference to the search under section 132. The
word 'initiated' is understood in legal sense as 'commenced' while
the word 'conduct' is understood as 'carry on'. If these words are
read together, it would mean commencement of search, the actual
carrying on/execution of search and completion of search.
Therefore, validity of search referred to for consideration of the
ITA Nos.182, 183/Bang/2023
Page 67 of 123

Special Bench has to be understood with reference to the
authorizon/commencement of the search, actual conducting of
search and final execution of search vis-a-vis the
powers/functions/duties of the Assessing Officer under the
provisions of Chapter XIV-B." (Paragraph 48)

"...A search is a physical act of the party making search and
therefore, a search can be said to have begun or commenced when
the first act to enter the premises is taken by the search
party..." (Paragraph 52)

"...the Assessing Officer is only required to see that search has
been initiated and conducted and nothing more..."
(Para 53)

"...the Assessing Officer gets the jurisdiction to proceed under
section 158BC merely on the basis of the factum of the initiation of
search by virtue of section 158BA, and once the fact of search is
established, he gets authority to proceed under Chapter XIV-B to
complete the assessment under section 158BC..."
(Para 71)

(iii) Dr. Mansukh Kanjibhai Shah v. ACIT [2011] 129 ITD 376 (Ahd.
Trib.):
"...if warrant of authorization under section 132 is issued in the
name of "A" after 31-5-2003 but his premises is not searched for
the purpose of executing the warrant of authorization and the
warrant of authorization is kept unexecuted, the question arises
whether the Assessing Officer still should proceed under section
153A of the Act for the purpose of framing the assessment or
reassessment of the six assessment years immediately preceding the
assessment years relevant to the previous year in which such
search is initiated or requisition is made without executing the
search warrant. The answer would be 'No' because it would be a
futile exercise. It may be added here that jurisdiction can be
assumed by the Assessing Officer to initiate assessment
proceedings to issue notices once search is initiated under section
132/requisition made under section 132A...in section 153A(b) it is
specifically provided that the Assessing Officer shall assess or
reassess the total income of six years immediately preceding the
assessment years relevant to the previous year in which such
search is conducted or requisition is made. It would, therefore,
clarify that not only the warrant of authorization is to be issued in
ITA Nos.182, 183/Bang/2023
Page 68 of 123

the name of the assessee but search shall have to be necessarily
conducted..."
(Paragraph 9.3)

7. The expression "in the case of a person where a search is initiated
under section 132 or books of account, other documents or any
assets are requisitioned under section 132A" used in sub-section (1)
of section 153A, read with the provisions of section 132, means that
both sections 132 and 153A are person-specific and not premises-
specific and, although several warrants of authorization may be
issued under section 132 to search different premises in relation to a
person, a single assessment order is required to be passed under
section 153A in respect of the person who is searched and not multiple
orders in respect of each premise searched. Reliance is placed in this
context on the following judgments:
(i) Siksha "O" Anusandhan v. CIT [2012] 336 ITR 112 (Ori.):

"...to exercise powers under section 153A in the case of a person
the mandatory requirement is that there must be initiation of a
search as contemplated under section 132 or requisition under
section 132A of the Income-tax Act, 1961 in respect of such person.
In a case where there is no initiation of search as contemplated
under section 132, the basic condition for issuance of notice under
section 153A does not exist. In order to assume jurisdiction to
assess a person under section 153A, there must be initiation of a
valid search in respect of such person under section 132 of the
Income-tax Act, 1961. The word "person" appearing in section 132
and in section 153A of the Income-tax Act, 1961, is one and the
same person. Thus the person, in respect of whom search under
section 132 is initiated, is the same person against whom notice
under section 153A is to be issued for making
assessment/reassessment under that section." (Paragraph 13)

(ii) CIT v. Tirupati Oil Corporation [2001] 248 ITR 194 (Bom.):
"The facts of this appeal are as follows: A search operation under
section 132 of the Act was carried out at the residences of the
partner pursuant to which notice under section 158BC of the
Income-tax Act was issued to the firm on August 5, 1996, requiring
the assessee-firm to furnish its return of income for the block period
in question. The Assessing Officer came to the conclusion that since
a partnership firm is not a legal entity the assessee-firm was liable
with regard to the material detected at the residence of its partner.
The Tribunal in appeal, however, rightly came to the conclusion
ITA Nos.182, 183/Bang/2023
Page 69 of 123

that under the Income-tax Act, a registered firm is a taxable unit
and if the Assessing Officer wanted to proceed under Chapter XIV-
B of the Income-tax Act with regard to the undisclosed income of
the partner for the purposes of making block assessment on the
assessee-firm, then the Assessing Officer was required to invoke
section 158BD which has not been done in the present case and,
therefore, the block assessment made on the firm without following
the procedure under section 158BD was bad in law. We do not find
any error of law in the judgment of the Tribunal."

(iii) Dorf Ketal Chemicals LLC v. DCIT [2017] 167 ITD 25 (Mum.
Trib.):

"...it is clear that for the purpose of assumption and
exercise of powers u/s 153A of the Act in case of a person, the
initiation of search in terms of section 132 of the Act or 132A of the
Act on the said persons is mandatory and therefore whether there
is no initiation of search as contemplated u/s 132 of the Act, the
fundamental conditions for issuance of notice u/s 153A is not
fulfilled. Thus, the person in respect of whom the search is initiated
u/s 132 of the Act is the same persons against whom the notice is
to be issued u/s 153A of the Act..."
(Paragraph 9)

(iv) Dr. Mansukh Kanjibhai Shah v. ACIT [2011] 129 ITD 376 (Ahd.
Trib.):
"...it is undisputed fact that though warrant of authorization is
issued in the name of the assessee being Managing Trustee of the
Trust, but it is admitted fact that no search operation was
conducted in the premises of the assessee. Even in the warrant of
authorization, the address of the place to be searched is not the
address of the assessee individual. Admittedly, no Panchnama is
also drawn in pursuance with the warrant of authorization in the
case of the assessee. No documents were seized or impounded as
such during the course of search from the assessee. The warrant of
authorization dated 29-10-2004 in the name of the Trust and the
assessee stands unexecuted in the case of assessee individual..."
(Paragraph 9.5)

(v) Unique Star Developers v. DCIT [2017] 83 taxmann.com 83 (Mum.
Trib.):
ITA Nos.182, 183/Bang/2023
Page 70 of 123

"..though the warrant of authorisation was prepared in the
name of the assessee, yet there was no commencement or initiation
of search in pursuance of the said warrant. When there is no
commencement of search at all, the question of invoking the
provisions of sec. 153A shall not arise..."
(Paragraph 10)

8. Even if, for the sake of argument, searches carried out under section
132 in the residential premises of the directors of the Respondent
company were to be regarded as searches conducted "in connection
with" or "in relation to" or "in the case of" the company for the
reason that the company's name is mentioned at item (A) of the
Panchanamas drawn in those premises, entries at item B immediately
below item (A) under the caption "Warrant to search (details and
ownership of the search)" clearly show that the "persons searched"
in pursuance of the warrants issued in the name of the company were
individuals and the premises searched were their personal residences.
There is thus no merit in the learned DR's allegation that the learned
CIT(A) HAD incorrectly claimed in paragraph 4.48 at page 51 of his
orders that Panchanamas were duly drawn in the cases of the
individuals (who happened to be managing director and directors of
the assessee company).

9. Contrary to what the learned DR's claim, there is no mention in these
Panchanamas of the searched individuals being directors of the
Respondent company. Further, as the AO has completed separate
search assessments of these individuals on the basis of searches
carried out on the basis of the same warrants of authorization and
Panchanamas, it cannot be argued that the searches conducted at the
directors' residences represented a search of the company.

10. As regards invoking of section 153C in the cases of the individual
assessees, the assessees concerned had challenged the same before
the learned CIT(A) on the ground that the assessment proceedings
concluded in their cases under section 143(3)/144 read with section
153C were void ab initio and invalid, inasmuch as no notices under
section 153A had been issued to them even though a search under
section 132 was initiated in their own cases and the notices issued to
them under section 153C could not be sustained in law for the reason
that such notices could be issued only to persons other than persons
referred to in section 153A.
ITA Nos.182, 183/Bang/2023
Page 71 of 123

11. Though the learned CIT(A) dismissed these grounds holding that no
prejudice had been caused to the assessees by issue of a notice under
the wrong section, he has clearly stated that it was an undisputed fact
that there was a search warrant in the name of the assessee and that
jurisdiction for framing the impugned assessment orders had been
wrongly issued under section 153C of the Act instead of section 153A
of the Act. As the learned CIT(A) invoked section 292B of the Act to
prevent invalidation of these notices and the revenue effects of the
additions sustained in the appeals were relatively low, the assessees
chose not to proceed with further appeals in their cases. Copies of the
appellate orders passed by the learned CIT(A) in these appeals are
enclosed at pages 17 to 28.

12. The next argument put forth by the learned DR is a clear admission
on his part that the business premises of the company were not
covered under section 132 because there was no need to cover them
under search. While it is for the department to decide what action is
called for in any particular case, what is ironic is that, even as he
himself admits to the fact of there being no search under section 132
in the case of the Respondent company, the learned DR finds fault
with the AO for stating that no search under section 132 had taken
place in the name of the company and what had been carried out was
only a survey under section 133A.

13. What is even more strange is that, despite the existence of
documentary evidence proving that a survey under section 133A was
carried out in the case of the company, the learned DR dubs the AO's
factual statement as "baseless" and finds fault with the learned
CIT(A) for "seeking to make out that Assessing Officer has admitted
in his Remand Reports that no search was conducted in the case of
the assessee company.

14. The learned DR then goes on to state that since the warrants of
authorization were in the name of the company and the premises that
were searched under those warrants were the residential premises of
the directors of the company, the Remand Reports of the Assessing
Officer gave no support to the Respondent. Apart from being wholly
contradictory to his own stand that use of the drastic tool of search
was considered unnecessary where only a survey was required and it
was for this reason the business premises of the company were not
covered under search action under section 132, this statement of the
learned DR begs the question as to how a search assessment could be
ITA Nos.182, 183/Bang/2023
Page 72 of 123

passed in consequence of a survey action carried out under section
133A.

15. As it is on record that only a survey under section 133A was carried
out at the business and factory premises of the company that are listed
in the learned AO's Remand Report dated 21.09.2022 and there is no
material on record to suggest that such survey was ever converted
into a search under section 132, it would be instructive to go through
the following judgments that hold that proceedings under section
153A can be initiated only in the case of a search and not that of a
survey:
(i) Union of India v. Ajit Jain [2003] 129 Taxman 74 (SC):

"...the respondent being a regular assessee in New Delhi, survey
operation under section 133A having been conducted by the
authorities at Delhi and the entire action of the search ultimately
culminating in the block assessment under Chapter XIV-B by the
Assessing Officer based in New Delhi, not only form a part of cause
of action but substantial cause of action arose within the territorial
jurisdiction of the Delhi High Court; accordingly, that objection
was rejected. Hence, the impugned authorization issued under
section 132 and all further actions/proceedings in consequence
thereof, including the block assessment, were quashed. We see no
reason to interfere with the decision of the Delhi High Court in Ajit
Jain v. Union of India [2000] 242 ITR 302. Accordingly, the civil
appeal is dismissed. There shall be no order as to costs."

(ii) CIT v. Parmar Builders & Developers [2015] 62
taxmann.com 20 (Guj.):

:...it was a case of survey and there was no search of the premises
of the assessee under Section 132 of the Income Tax Act. Whatever
the material was collected, was/were during the course of survey
at the site office of the Parmar Builders and Developers, Emperor
Building, Vapi. Under the circumstances, the material used for
framing assessment under Section 158BC was collected during the
survey and not search proceedings under Section 132 of the Income
Tax Act. In view of the above, it cannot be said that the learned
Tribunal has committed any error in holding the assessment
proceedings under Section 158BC of the Act has invalid. The
learned Tribunal has rightly quashed and set aside the assessment
under Section 158BC of the Act on the ground that material
ITA Nos.182, 183/Bang/2023
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collector during the survey was used while framing the assessment
under Section 158BC of the Act..."
(Paragraph 3)

(iii) Smt. Rajkumari Chandak v. ACIT [2015] 382 ITR 312 (Mad.):

"... If it is a case of survey under Section 133A of the Act, as is
evident from the document, the block assessment, invoking the
provisions of Sections 158BC does not arise, as there is no search
in terms of Section 132 of the Act..."
(Paragraph 17)

(iv) Dr. Mansukh Kanjibhai Shah v. ACIT [2011] 129 ITD 376
(Ahd. Trib.):
"...The warrant of authorization dated 29-10-2004 in the
name of the Trust and the assessee stands unexecuted in the case
of assessee individual. Since in this case only survey operation
under section 133A is conducted in the premises of the assessee's
Trust, it would not satisfy the requirements of section 153A of the
Act. As such, the Assessing Officer was not justified in initiating
proceedings or assuming valid jurisdiction under section 153A of
the Act against the assessee. In view of the above discussions, we
do not find these to be the fit cases for initiating the proceedings
under section 153A of the Income-tax Act against the assessee in
his individual status. We accordingly hold that the proceedings
under section153A of the Income-tax Act are invalid and bad in
law, resultantly, the orders of the authorities below are set aside
and quashed."
(Paragraph 9.5)

16. The next contention of the learned DR is that there is no requirement
in law that a business premises of a person have to be compulsorily
covered under a search. If this contention were to be accepted, it
would mean that a search of a company can only be accomplished by
carrying out searches at the residences of its directors or
shareholders, given that a company, as a body corporate, would only
have business premises.

17. Apart from being bizarre, this argument is in violation of the following
decision of the Mumbai Tribunal reported in J.M. Trading Corpn. V.
ACIT [2008] 20 SOT 489 (Mum. Trib.)], which was upheld by the
Hon'ble Bombay High Court in CIT v. J.M. Trading Corporation
ITA Nos.182, 183/Bang/2023
Page 74 of 123

[2009] ITA No. 276/2009 (Bom.) and endorsed by the Hon'ble
Supreme Court in CIT v. J.M. Trading Corporation [2010] CC No.
19194/2010 (SC):

"Mere mentioning of name in the panchnama does not lead to the
conclusion that a valid search was conducted against the
assessee."
(Paragraph 24)

18. The learned DR has assailed the orders of the learned CIT(A) on the
ground that he had held that the preconditions for issue of notices
under section 153A were not satisfied in this case, as there had been
no valid search in the case of the assessee company and in the absence
thereof, the provisions of section 153A of the Act could not have been
validly invoked in this case. However, the learned CIT(A) could have
reached no other conclusion, given that the AO has clearly and
categorically communicated in both his Remand Reports that no
search under section 132 was conducted, nor was any Panchanama
drawn, at any of the premises of the company.

19. The facts ascertained by the learned CIT(A) from the AO are also
stated in the latter's letter dated 01.06.2023 addressed to the ITO
attached to the learned DR himself (enclosed at page ). Clause (ii)
of this letter states that "...It is pertinent to note here that there was
no Warrant u/s 132 executed at the premise (as discussed in the
remand report briefly)" (sic).

20. Moreover, the learned CIT(A)'s conclusion about the absence of a
search under section 132 in the case of the Respondent company is
vindicated by the following judgments:

(i) Manish Maheshwari v. ACIT [2007] 159 Taxman 258
(SC):

"Condition precedent for invoking a block assessment is that a
search has been conducted under section 132, or documents or
assets have been requisitioned under section 132A...The
provisions contained in Chapter XIV-B are drastic in nature. It
has draconian consequences. Such a proceeding can be initiated,
it would bear repetition to state, only if a raid is conducted..."
(Paragraph 7)
ITA Nos.182, 183/Bang/2023
Page 75 of 123

(ii) Canara Housing Development Co. v. DCIT [2014] 274
ITR 122 (Kar.):

"...The condition precedent for application of Section 153A is
there should be a search under Section 132..."
(Paragraph 10)

(iii) C. Ramaiah Reddy v. ACIT [2003] 87 ITD 439 (Beng.
Trib.)(SB):

"...The jurisdictional fact that needs to be satisfied before the
Assessing Officer can issue notice under section 158BC is that a
search under section 132 should have been conducted on the
assessee. The ITAT, therefore, needs to satisfy itself that a search
was indeed conducted with reference to the assessee in question.
We note that the search should not merely have been initiated, but
conducted. Hence, the ITAT is required to verify whether the
jurisdictional facts exist before notice can be issued under section
158BC. Further, it is also necessary for the ITAT to scrutinize the
Panchnamas and connected documents in order to ensure that the
assessment order passed is not barred by limitation as provided
for under section 158BE of the Act..."
(Paragraph 6.3)

"...An order under section 158BC(c) can be passed in case of a
person in whose case action under section 132 has been
conducted. Thus it is pre-supposed that there should be action
under section 132..."
(Paragraph 6.5)

"...There is no right of appeal to the Tribunal against search
proceedings under section 132 and therefore questioning before
the Tribunal cannot arise regarding the validity of authorization
issued under section 132 or even the mode of conduct of search
pursuant to authorization including impugning the validity of
prohibitory order issued under section 132(3), except to the extent
of those aspects of search as are necessary to adjudicate the point
of limitation, including as to whether the search was actually
conducted on the named person or whether the authorization was
actually issued in the assessee's name or whether the last
panchnama was issued as per legal requirements such as whether
the authorized officer has signed it or whether specified number
of witnesses signed it and the like." (Paragraph 20.2)
ITA Nos.182, 183/Bang/2023
Page 76 of 123

(iv) Promain Ltd. v. DCIT [2005] 95 ITD 489 (Del. Trib.)(SB):

"...the scheme of Chapter XIV-B requires the Assessing
Officer to examine such aspects at three stages. The first stage is
when the Assessing Officer has to issue notice under section
158BC. At this stage, he is required to satisfy himself that search
has been initiated and carried out in the case of an assessee on
whom such notice is to be served. In this connection he should see
the authorization issued under section 132(1) and the panchnama
prepared by the search party so as to satisfy himself that search
was initiated and carried out in the case of the person on whom
notice under section 158BC is to be served. The scope of
examination is very limited, i.e., to ascertain that search
operation was carried out in the case of such person and nothing
more. If the Assessing Officer does not satisfy himself in this
regard, then the assessee has the right to object to the validity of
the assessment before the appellate authority on the ground that
no search was initiated/conducted in the case of the
appellant..."
(Para 72)

"...A search can be said to be executed when it is concluded in
terms of section 132...Finally, the panchnama has to be prepared
which can be considered as an evidence for concluding the
search. Though there is no specific mention of preparation of
panchnama in section 132, it can be logically inferred from
Explanation 1 after section 132(14). This Explanation provides
that 'execution of an authorization for search' shall have the same
meaning as assigned to it in Explanation 2 to section 158BE. The
later Explanation provides that authorization of search shall be
deemed to have been executed when the last panchnama is drawn
in relation to a person in whose case warrant of authorization is
issued. The above discussion shows that search comes to an end
when the last panchnama is drawn with reference to the last of
the authorizations. It is the date of such panchnama which is
relevant for determining the period of limitation for passing the
order under section 158BC by the Assessing Officer..."
(Paragraph 74)

(v) Bansilal B. Raisoni & Sons v. ACIT [2019] 101
taxmann.com 20 (Bom.):
ITA Nos.182, 183/Bang/2023
Page 77 of 123

"...the broad facts before us are that the search authorization was
issued against the petitioner partnership firm, one of its partners
and another person. Actual search was carried, as pointed out by
the petitioner, at three different locations namely at the
residential premises of one of the partners and two other
residential premises, one of them belonging to the brother of the
partner of the partnership firm...In the present case, we have no
hesitation in accepting the petitioner's contention that in order to
issue notice under sub-section (1) of section 153A, there must be
initiation of search in case of the notice. Mere search
authorization would not be sufficient. There is clear distinction
between search authorization and conduct of the search. In sub-
section (1) of Section 153A of the Act, therefore, the legislature
has advisably used expression "where a search is initiated under
Section 132".
(Paragraph 6)

"We are also in agreement with the contention of the Counsel for
the petitioner that the petitioner's objection to the jurisdiction of
the Assessing Officer on the ground that if no search was initiated,
notice under Section 153A of the Act could not have been
issued..."
(Paragraph 7)

(vi) ACIT v. K.G. Finvest (P.) Ltd. [2017] 88 taxmann.com 627 (Del.
Trib.):

"...initiation of search u/s 132 is a pre-requisite for issuing notice
u/s 153A, though assessment has to be made of the total income
of six assessment years immediately preceding the assessment
year relevant to the previous year in which such search is
'conducted'. In other words, unless a searched is initiated on a
person u/s 132, the Assessing Officer cannot acquire jurisdiction
for issuing notice u/s 153A of the Act. The case of the assessee
before us is that no search was initiated on it and hence notice u/s
153A of the Act is bad in law."
(Paragraph 4)

"Not being searched, a person cannot suffer the consequences of
an 'intended search', which is not initiated."
(Paragraph 5)
ITA Nos.182, 183/Bang/2023
Page 78 of 123

(vii) Indo Pacific Finlease Ltd. v. ACIT [2017] 83 taxmann.com 265
(Chd. Trib.):

"The undisputed facts in the present case are that there was no
search conducted at the assessee's premises, no one from the
Department visited it to execute any search and seizure
proceedings and no panchnama in assessee's name was ever
drawn. On top of that the Department itself has admitted the fact
that no search warrant in the name of the assessee was issued. In
view of the same, the notice issued by the Assessing Officer under
section 153A of the Act and subsequent proceedings are held to
be void ab initio and is hereby quashed."
(Paragraph 14)

(viii) Regency Mahavir Properties v. ACIT [2018] 64 ITR(T) 628 (Mum.
Trib.):

"...the provisions of section 153A of the Act come into play only
after search has been conducted. The provisions of section 153B
of the Act provides that authorization of warrant shall be deemed
to be executed upon the conclusion of search as recorded in the
last panchnama drawn in relation to the persons in whose case
the warrant or authorization has been issued. So, in all the
sections the term used is important that fresh panchnama drawn
in relation to any person. Thus, in order to complete the search
there is a initiation of proceedings u/s 132(1) of the Act,
conduction of search in terms of search warrant issued which
includes search in the premises of the assessee and other places
and also the last stage panchnama which is conclusive proof of
conclusion of search from which the period of limitation will be
calculated as provided u/s 153B of the Act. The provisions of Act
very clearly and unambiguously provide for initiation of search,
conduct of search and conclusion of search and only then the
Assessing Officer can assume jurisdiction u/s 153A of the Act. In
the present case before us, we noted that the search has been
initiated in the name of the assessee along with other assessees
appearing on the warrant of authorization issued u/s 132(1) but
did not mention the address of the premises from where the
assessee conducts business. No incriminating material relating to
the assessee was found in the premises where the search was
carried out. The search was concluded but no panchnama was
drawn in the name of the assessee. Therefore, the conditions as
stipulated for assuming the jurisdiction u/s. 153A, in our view,
ITA Nos.182, 183/Bang/2023
Page 79 of 123

have not been satisfied...In view of these facts, we are of the
opinion that the conditions stipulated u/s. 153A, for the issue of
notice, are not satisfied. Until and unless the Assessing Officer
assumes the valid jurisdiction u/s. 153A the assessment made in
consequence of the notice issued u/s. 153A, in our view is invalid
and void ab initio. We accordingly quash the assessment made by
the Assessing Officer."
(Paragraph 7)

(ix) Dr. Mansukh Kanjibhai Shah v. ACIT [2011] 129 ITD 376 (Ahd.
Trib.):

"...the warrant of authorization shall have to be executed by the
authorized Officer in order to justify invoking of the jurisdiction
by the Assessing Officer under section 153A of the Act.
Considering section 153A particularly read with sub-clause (b),
it is clear that not only initiation of search is mandatory but
conduct of the search is also material...it is undisputed fact that
though warrant of authorization is issued in the name of the
assessee being Managing Trustee of the Trust, but it is admitted
fact that no search operation was conducted in the premises of the
assessee. Even in the warrant of authorization, the address of the
place to be searched is not the address of the assessee individual.
Admittedly, no Panchnama is also drawn in pursuance with the
warrant of authorization in the case of the assessee. No
documents were seized or impounded as such during the course
of search from the assessee."
(Paragraph 9.5)

21. In conclusion, the Respondent submits that the learned DR's
contentions are contrary to the facts of the case, the relevant
provisions of the law and the vast number of judicial pronouncements
cited in support of the learned CIT(A)'s order and are thus totally
devoid of merit. It is therefore requested that the learned CIT(A)'s
order may kindly be upheld and the appeals filed by the Department
may be dismissed, for the reasons summarized below:
(1) Pre-conditions for invoking section 153A are not satisfied in
the case;
(3) Mere issue of a warrant of authorization cannot be equated
with initiation of search;
ITA Nos.182, 183/Bang/2023
Page 80 of 123

(4) Searches conducted at the residential premises of individual
directors of the company cannot be deemed to be searches
conducted on the company itself;

(5) This is a case of survey u/s 133A and not a search u/s 132;

(6) Assessee's actions subsequent to survey cannot be cited as
justification for initiation and conduct of unlawful proceedings.

(7) Sections 292B and 292BB do not confer jurisdiction that does
not otherwise inhere in the AO and cannot be invoked to justify
the impugned assessments; and

(8) The impugned assessments could not be completed even u/s
153C or u/s 143(3), as no incriminating documents belonging to
the company were seized from the residences of its directors, nor
were notices u/s 143(2) issued subsequent to the conduct of the
survey u/s 133A.

8. The learned AR, on conclusion of the hearing, had given a written
summary of the oral arguments which reads as follows:

 The Respondent is a domestic company having its registered office in
Mangaluru.

 A survey u/s 133A was conducted at the business premises of the
Respondent on 23.01.2019.

 Searches u/s 132 were conducted at three residential premises belonging
to the directors of the company on the basis of three warrants containing
the name of the company as well as those of the directors and three
Panchanamas were drawn in respect of each director.

 No warrant was issued for search of the business premises of the
company, nor was any Panchanama drawn at those premises.

 Respondent's contention is that a search at the residential premises of
the directors of a company cannot be deemed to be a search of the
company itself merely because the name of the company is mentioned
in the warrants and the Panchanama, for the following reasons:
ITA Nos.182, 183/Bang/2023
Page 81 of 123

(1) The warrants and the Panchanamas contain the names of the
individuals who are separate taxable entities distinct from the
company and the premises searched belonged to such individuals
and not the company;

(2) A company can have only business premises and when no
authorization was issued for search of such premises, no search u/s
132 was initiated and no Panchanama was drawn at such premises,
execution of warrants of authorization at the residences of the
individuals cannot be held to be execution of warrant in the case of
the company.

 CIT(A) has held (in para 4.35, p. 41-42) that there was no initiation and
conduct of search and hence no execution of warrant in the case of the
company and the AO could not issue notices u/s 153A to it.

 The department argues that since the warrants and the Panchanamas
executed in the residential premises of the directors contain the name of
the company, there was no need to search the business premises of the
company and therefore, the notices issued u/s 153A are valid.

 CIT(A) has held (in para 4.50, p. 51-52) that searches conducted at the
residences of the directors of the company and not at its own business
premises cannot form the basis for issue of notices u/s 153A to the
company, where a search was neither initiated, nor conducted, nor a
Panchanama drawn, as a company is a distinct and separate person.

1. CIT v. J.M. Trading Corporation (SC)

Para 24 on page 4 of Digest of Case Laws filed earlier:
Section 132 of the Income-tax Act thus provides the acts and deeds
to be carried out by the search team at the premises of the assessee.
In the present case before us, no search was conducted against the
assessee as the premises occupied by the assessee were not entered
upon and searched by the Authorised Officer. Mere search of the
premises owned by the assessee but rented to another concern does
not by any implication prove the conduct of search against the
assessee in view of the fact that the assessee was not available at the
address searched upon. Mere mentioning of name in the
Panchanama does not lead to the conclusion that a valid search was
conducted against the assessee.
ITA Nos.182, 183/Bang/2023
Page 82 of 123

(2) Dr. Mansukh Kanjibhai Shah (Ahmedabad Tribunal).

Para 9.5 on page 24 of Digest of case Laws filed earlier:
The mere issue of warrant of authorization without there being
search of the premises would be meaningless and would not serve the
purpose of section 132. If warrant of authorization is issued in the
name of 'A' but his premises is not searched for the purpose of
executing the warrant and the warrant is kept unexecuted, the
question arises whether the AO should still proceed u/s 153A for the
purpose of framing the assessment. The answer would be 'No'
because it would be a futile exercise.
It is undisputed fact that though warrant of authorization is issued in
the name of the assessee but it is admitted fact that no search
operation was conducted in the premises of the assessee. Even in the
warrant of authorization, the address of the place to be searched is
not the address of the assessee. Admittedly, no Panchanama was
drawn in pursuance of the warrant of authorization in the case of the
assessee.

(3) Aerens Jai Realty (Delhi Tribunal)

Para 14 on page 15 of this submission:
From the copies of the warrant of authorization u/s 132 of the Act
dated 16.08.2011 and panchnama drawn on the conclusion of search
and seizure operation on 18.08.2011, we note that though the name
of the assessee has been mentioned along with two other entities, but,
the address mentioned in the said warrant of authorization and
panchnama does not belong to the assessee and, neither any officer
bearer or staff member participated in the said search and seizure
operation which was concluded on 18.08.2011.

Para 15 on page 15 of this submission:
Therefore, as per the scheme of the Act and provisions of section
153A of the Act, the AO assumes valid jurisdiction to issue notice u/s
133A of the Act and to frame assessment order u/s 153 r.w.s. 143(3)
of the Act only on the entity on which the search u/s 132(4) was
initiated, conducted and concluded. In the present case from the
warrant of authorization and panchnama although it seems that the
name of the assessee has been mentioned therein, but, the address is
different and, at the time of initiation of search, during the course of
search and on conclusion of the search neither any office bearer nor
any staff member of the assessee company participated and the
ITA Nos.182, 183/Bang/2023
Page 83 of 123

search team did not visit the actual business premises of the assessee
situated at 1411, Chiranjivi Tower and 1603, Chiranjivi Tower, 43,
Nehru Place, New Delhi. Therefore, when there was no search and
seizure operation on the assessee, then, the AO was not validly
entitled and empowered to issue notice u/s 153A of the Act and to
frame assessment u/s 153A r.w.s. 143(3) of the Act on the assessee
on the strength of such irrelevant warrant of authorization and
Panchnama.

(4) Sarvmangalam Builders (Delhi Tribunal)

Para 11 on page 26 of this submission:
Undisputedly, the premises searched does not belong to the assessee.
The department's appeal in the case of JM Trading Corporation was
dismissed in limine for want of substantial question of law by the
Hon'ble High Court of Bombay. While doing so, the finding of the
Tribunal to the effect that non-compliance of the provisions of the
Income-tax Act by the authorized officer renders a search invalid and
illegal. The Hon'ble Supreme Court has also dismissed the SLP filed
by the department.

Para 13 on page 26 of this submission:
Since no search was conducted on the premises of the assessee and
the search conducted was conducted on a premises not owned by the
assessee, the proceedings u/s 153A of the Act are invalid and bad in
law. Accordingly, the orders of the authorities below are set aside
and quashed.

(5) Indore Construction (Indore Tribunal)

Para 17 on page 39 of this submission:
That no search was carried out at the business premises of Indore
Construction Co. (P.) Ltd. is contrary to what has been stated by the
AO in the opening paragraph of the assessment order.
As admitted by the revenue before us that no search was conducted
at the business premises of the assessee-company on 21.11.1995, the
question of seizure of incriminating account books and documents
from the business premises of the assessee company on 21.11.1995
does not arise at all.

Para 18 on pages 39-40 of this submission:
Search u/s 132(1) in the case of the company's director R.B.
Maheshwari and his wife and survey u/s 133A at the business
ITA Nos.182, 183/Bang/2023
Page 84 of 123

premises of the company at 380, Jawahar Marg, Indore. Nonetheless,
the AO exercised jurisdiction over Shri R.B. Maheshwari, Director
in the company as also over Indore Construction (P.) Ltd.

The AO had entertained erroneous impression that a search was
conducted in the business premises of the assessee-company and
accordingly proceeded to frame the assessment in the case of the
company under section 158BC of the Act. This he could not do in the
absence of warrant of authorisation in the case of the company to
search its business premises and the categorical admittance now by
the revenue that no search had, in fact, been conducted at the
business premises of the company on 21-11-1995. Framing of
assessment by issuing notice under section 158BC without search
warrant and without conduct of search in the case of the company is
void for want of jurisdiction. In taking this view, we are supported by
the decision of Madras Bench of the Tribunal in Urmila Chandak's
case (supra).

Para 19 on page 40 of this submission:
Right from the beginning, he proceeded against the assessee-
company as if search had been conducted in its case and it was in
this background that he issued notice to the Company under section
158BC clearly mentioning in the notice itself that the search had been
conducted in the month of November, 1995.
If the Assessing Officer intended to proceed against the assessee-
company in whose case search warrant was not issued nor search
had taken place at its business premises, then he should have framed
the assessment under section 143(3) read with 158BD. This has not
been done.

Para 29 on page 42 of this submission:
The assessee, thus, succeeds in its preliminary grounds. We,
therefore, do not propose to deal with the ground Nos. 4 to 14
assailing the impugned additions made on the basis of the reports of
the Valuation Cell and certain presumptions made by the Assessing
Officer which are beyond the scope of Chapter XIV-B.

(6) Unique Star Developers (Mumbai Tribunal)

Para 9 on page 32 of Digest of Case Laws filed earlier:
In the present case before us, search has been initiated in the name
of the assessee's AOP appear on the warrant of authorization issued
ITA Nos.182, 183/Bang/2023
Page 85 of 123

u/s 132(1) besides mentioning the names of the members of assessee
AOP, but the search was not conducted on the premises of the AOP
at all, whereas the search was conducted on the members of the AOP
with no incriminating material relating to assessee was found in the
premises searched belonging to the members of the assessee AOP.
Finally, the search was concluded in the names of the members of the
AOP where Panchanamas was drawn duly but no Panchanama was
drawn in the name of the assessee AOP and therefore, the limbs and
contents to be satisfied for assessment of jurisdiction u/s 153A were
not satisfied.

Para 10 on page 33 of Digest of Case Laws filed earlier:
It is very surprising that according to the AO and FAA, the search
was conducted on the assessee but the business premises of the
assessee were spared from proceedings u/s 132(1) and even no
incriminating material was found and seized from the premises of the
members of the AOP assessee. In view of the fact that there was no
search conducted in the premises of the assessee and no Panchanama
was drawn up, the assessment proceedings u/s 153A were without
valid jurisdiction. The case of the assessee also finds support from
the decision in the case of J M Trading Corpn.

Para 11 on page 33 of Digest of Case Laws filed earlier:

In Order to initiate assessment proceedings u/s 153A of the Act, the
premises of the appellant has to be searched and Panchanama has
to be specifically drawn in the name of the assessee, but in the present
case before us, no search was carried out at the business premises of
the assessee and so much so that no incriminating documents were
found and seized from premises searched of others and no
Panchanama was drawn in the name of the assessee.

(7) Siksha O Anusandhan (Ori.)

Para 13 on page 21 of Digest of Case Laws filed earlier:
The word "person" appearing in section 132 and 153A is one and
the same person. Thus the person in respect of whom search u/s 132
is initiated is the same person against whom notice u/s 153A is to be
issued for making assessment under that section.

(8) Regency Mahavir Properties (Mumbai Tribunal)
ITA Nos.182, 183/Bang/2023
Page 86 of 123

Para 7 on page 30 of Digest of Case Laws filed earlier:
In order to complete the search there is initiation of proceedings u/s
132(1), conduction of search in terms of search warrant issued which
includes the search in the premises of the assessee and other places
and also the last stage Panchanama which is conclusive proof of
conclusion of search.

(9) Dorf Ketal Chemicals (Mumbai Tribunal)

Para 9 on page 31 of Digest of Case Laws filed earlier:
The person in respect of whom the search is initiated u/s 132 is the
same person against whom the notice is to be issued u/s 153A.

(10) Bansilal B. Raisoni & Sons (Bom.)

Para 6 on pages 19-20 of Digest of Case Laws filed earlier:
...the broad facts before us are that the search authorization was
issued against the petitioner partnership firm, one of its partners and
another person. Actual search was carried, as pointed out by the
petitioner, at three different locations namely at the residential
premises of one of the partners and two other residential premises,
one of them belonging to the brother of the partner of the partnership
firm...
In the present case, we have no hesitation in accepting the
petitioner's contention that in order to issue notice under sub-section
(1) of section 153A, there must be initiation of search in case of the
noticee. Mere search authorization would not be sufficient. There is
clear distinction between search authorization and conduct of the
search. In sub-section (1) of Section 153A of the Act, therefore, the
legislature has advisably used expression "where a search is initiated
under Section 132".

Para 7 on page 20 of Digest of Case Laws filed earlier:
We are also in agreement with the contention of the Counsel for the
petitioner that the petitioner's objection to the jurisdiction of the
Assessing Officer on the ground that if no search was initiated, notice
under Section 153A of the Act could not have been issued.
ITA Nos.182, 183/Bang/2023
Page 87 of 123

 As the premises of the company were covered under a Survey u/s
133A, assessment proceedings u/s 153A could not be initiated in its
case, for the following reasons:

(1) the survey was not converted into a search by issue of a
consequential warrant; and

(2) a case cannot be covered both under search and survey at the
same time, as provisions for assessment of search and non-
search cases are mutually exclusive and cannot be applied
interchangeably.

 CIT(A) has held (in para 4.55, p. 53) that section 153A cannot be
invoked in cases where only a survey u/s 133A is carried out.

(1) Smt. Rajkumari Chandak (Mad.)

Para 17 on page 20 of Digest of Case Laws filed earlier:
If it is a case of survey u/s 133A of the Act, as is evident from
the document, the block assessment, invoking the provisions
of section 158BC, does not arise, as there is no search in
terms of section 132 of the Act.

(2) Dr. Mansukh Kanjibhai Shah (Ahmedabad Tribunal)

Para 9.5 on page 24 of Digest of Case Laws filed earlier
Since in this case only survey operation u/s 133A is
conducted in the premises of the assessee Trust, it would not
satisfy the requirements of section 153A of the Act. As such,
the AO was not justified in initiating proceedings u/s 153A
against the assessee.

(3) Parmar Builders (Guj.)

Para 3 on page 46 of this submission:
It was a case of survey and there was no search of the
premises of the assessee under Section 132 of the Income Tax
Act. Whatever the material was collected, was/were during
the course of survey at the site office of the Parmar Builders
and Developers, Emperor Building, Vapi. Under the
circumstances, the material used for framing assessment
under Section 158BC was collected during the survey and
not search proceedings under Section 132 of the Income Tax
ITA Nos.182, 183/Bang/2023
Page 88 of 123

Act. In view of the above, it cannot be said that the learned
Tribunal has committed any error in holding the assessment
proceedings under Section 158BC of the Act has invalid. The
learned Tribunal has rightly quashed and set aside the
assessment under Section 158BC of the Act on the ground
that material collector during the survey was used while
framing the assessment under Section 158BC of the Act. No
substantial question of law arises in the present appeals. On
the contrary, we affirm the view taken by the learned
Tribunal. Consequently, both these appeals deserve to be
dismissed and are accordingly dismissed.

9. We have heard the rival submissions and perused the material on record.
The CIT(A), in the impugned order, had elaborately deliberated the facts and the
law involved in this matter, for reaching his conclusions. We deem it appropriate
to highlight the touchstones of his order to decide the appeal. The CIT(A)
initially sought for a remand report seeking clarification from the AO on whether
search was conducted in assessee's case. The AO, in the remand report dated
21.09.2022, had stated as under:

'In the instant case, search -action u/s 132 was carried out at the
residences of its directors, namely:
 Mr. Mohammed Shawkath Showry, Managing Director
 Mr. Mohammed Fakir, Director
 Mr. Mohammed Afthar, Director

Simultaneously, survey u/s 133A was carried out at three places,
namely:
 The head office premises of M/s Blueline Foods (India) Pvt.
Ltd., 4th Floor, Suite No. 406, Crystal Arc, Balmatta Road,
Hampankatta, Mangalore, Karnataka
 Factory #1 of 10/s Blueline Foods India) Pvt. Ltd.
 Azad Nagar, Ullal, Mangaluru, Karnataka
 Factory #2 of M/s Blueline Foods (India) Pvt. Ltd.
 Mudupi Road, Phajeer, Mangaluru, Karnataka

It is pertinent to note here that the Warrant of Authorization u/s 132
ITA Nos.182, 183/Bang/2023
Page 89 of 123

was in the name of M/s Blueline Foods (India) Pvt. Ltd. but the
premises searched were the residences of the Directors of the said
company. Such a Warrant acts as a source of power for both Surveys and
Searches. The office and factory of M/s BluelineFoods (India) Pvt. Ltd.
happen to be its business premises therefore a Survey was considered as
sufficient.

o Since, search -action u/s 132 was carried out at the residences of the
Directors of the company, search warrant and Panchnama exists for these.
Copies of the Panchanamas, Search warrants and Survey authorisations
are attached herewith as proof (Annexure A).

o A Panchanama is to be executed only in case of a search - action.
Since, only survey was conducted, Panchanama need not be executed and
hence, it does not exist w.r.t. the office/factory premises of M/s Blueline
Foods (India) Pvt. Ltd."

10. The CIT(A), not being satisfied with the above report, sought for another
report specifically asking whether a search under section 132 of the Act was
conducted in the case of the assessee. The AO, in the second remand report dated
11.10.2022, clarified as under:

o The Warrant of Authorisation u/s 132 was drawn in the name of the
appellant company M/s Blueline Foods (India) Pvt. Ltd.

o The premise of the appellant company i.e., M/s Blueline Foods (India)
Pvt. Ltd. has not been searched u/s 132 of the Income -tax Act, 1961.
Instead, a survey u/s 133A was conducted in the said premises.

o Assessment order in the case of the appellant company M/s Blueline
Foods (India) Pvt. Ltd. was passed u/s 153A because the Warrant of
Authorisation u/s 132 was in the name of the said appellant company,
as stated above.

11. In the first remand report, the AO has stated that the warrant of
authorization under section 132 of the Act, acts as a source of power for both
survey and search actions. During the course of hearing, we had directed the
learned DR to produce the relevant authorization obtained in both survey and
ITA Nos.182, 183/Bang/2023
Page 90 of 123

search actions. Upon perusal of the documents produced, it is evident that the
authorizations were distinct and separate for both survey and search actions
conducted. Keeping this apart, it is an undisputed fact from the admission of the
AO that there was no search carried out in the business premises of the assessee
company. This then raises a question on the validity of assessment order passed
by the AO under section 153A of the Act. The CIT(A), in his order, has answered
the aforesaid question by deliberating on the following key questions: i)warrant
of authorization; ii) absence of valid search; iii) execution of warrant of
authorization; iv) absence of panchnama; v) search at other premises; vi)
assessment of non-search cases; vii) absence of inherent jurisdiction; viii)
operation of sections 292B and 292BB of the Act.

12. The first relevant issue considered by the CIT(A) is whether a warrant of
authorization without a search being carried out is sufficient to invoke the
provisions of section 153A of the Act. The crux of this discussion, in his order,
is summarized as below.

13. Section 153A of the Act enables the AO to assess or reassess the total
income of a person in whose case a search is initiated and conducted under
section 132 of the Act. The Special Bench of the Tribunal in Promain Ltd v DCIT
(2005) 95 ITD 489 [Del. Trib. (SB)] held that the word 'initiated' is understood
in legal sense as 'commenced', while the word 'conduct' is understood as 'carry
on'. It was further held that when those words are read together, it would mean
commencement of search, the actual carrying on/execution of search and
completion of search.

14. Section 153B of the Act states that the order of assessment or
reassessment in respect of each year falling within six assessment years referred
to in section 153A(1)(b), shall be made within a period of twenty -one months
ITA Nos.182, 183/Bang/2023
Page 91 of 123

from the end of the financial year in which the last of the authorizations for search
under section 132 was executed. Sub-section (2) of the said section states that the
authorization shall be deemed to have been executed, in the case of search, on
the conclusion of search as recorded in the last panchnama drawn in relation to a
person in whose case the warrant of authorization has been issued.

15. In the present case, the AO in his remand report, has clarified that only a
survey and not a search was conducted in the assessee's case and thereby no
panchnama was drawn in its name. In other words, there was neither the initiation
of search, nor the actual carrying on and the completion of the same. The case of
the Revenue hinges entirely on the aspect that the warrant of authorization was
issued in the assessee's name. The Hon'ble Bombay High Court in the case of
Bansilal B. Raisoni and Sons Vs. ACIT [2019] 101 taxmann.com 20 held that in
order to issue a notice under section 153A(1) of the Act, there must be initiation
of search and a mere search authorization would not be sufficient. The Hon'ble
High Court noted that there is a clear distinction between search authorization
and conduct of the search. The condition precedent for application of section
153A of the Act is that there should be a search conducted under section 132 of
the Act [refer Canara Housing Development Co v DCIT (2014) 247 ITR 122];
Siksha "O" Anusandhan Vs. CIT (2011) 336 ITR 112 (Orissa)].

16. Relying on the above judicial pronouncements, the CIT(A) has held that
the action of authorizing search is altogether different from the act of search. The
assessee in its submissions, has additionally relied upon the following case laws
which support the view concluded by the CIT(A):
i) ACIT v K.G. Finvest (P.) Ltd. [2017] 88 taxmann.com 627 (Del.
Trib.) -- "Not being searched, a person cannot suffer the
consequences of an 'intended search', which is not initiated."

ii) Indo Pacific Finlease Ltd. v ACIT [2017] 83 taxmann.com 265
(Chd. Trib.) -- "The undisputed facts in the present case are that
ITA Nos.182, 183/Bang/2023
Page 92 of 123

there was no search conducted at the assessees premises, no one
from the Department visited it to execute any search and seizure
proceedings and no panchnama in assessees case name was ever
drawn. On top pf that the Department itself has admitted the fact
that no search warrant in the name of the assessee was issued. In
view of the same, the notice by the Assessing Officer under section
153A of the Act and the subsequent proceedings are held to be void
ab initio and is hereby quashed."

iii) CIT v Wipro Finance Ltd [2009] 323 ITR 467 (Kar) -- "we may
safely assign to the expression 'search initiated'; the meaning
`search taken' or 'search commenced' or `making beginning of the
search'. If this is meant by the expression 'search initiated', it
cannot be held that the only signing of the authorisations by the
DIT Bangalore, on 30-12-1996 to make a search in the premises
of the respective assessees would amount to 'initiation of search'.
The 'signing of the authorisations' would at best amount to 'taking
of the decision by the said authority to initiate search' in the
premises of respective assessees but not initiation of search itself"

iv) J.M. Trading Corporation [2008] 20 SOT 489 (Mum. Trib.) --
"Mere mentioning of name in the panchnama does not lead to the
conclusion that a valid search was conducted against the
assessee." [Decision approved by the High Court of Bombay in CIT
v J.M. Trading Corporation [2009] ITA No. 276/2009 and special
leave petition against the same is dismissed by the Supreme Court
in CIT v J.M. Trading Corporation [2010] CC No. 19194/2010
(SC)]

17. The next relevant issue considered by the CIT(A) (point 5 in CIT(A)'s
order at page 51) is whether the search conducted at the residence of the director
of the of the assessee-company, would constitute the search of the company
itself. The CIT(A) held that a company is a distinct and separate person under
section 2(31) of the Act. Thus, the searches at the residences of the directors of
the company and not at its own business premises, cannot form the basis for issue
of notice under section 153A of the Act, to the company. The CIT(A) relied on
the decision in the case of Dr. Mansukh Kanjibhai Shah v. ACIT [2011] 129 ITD
ITA Nos.182, 183/Bang/2023
Page 93 of 123

376 (Ahd. Trib.) wherein the facts were identical to the present case. The relevant
observations of the Tribunal are as follows:

"As is noted above, it is undisputed fact that though warrant of
authorization is issued in the name of the assessee being Managing Trustee
of the Trust, but it is admitted fact that no search operation was conducted
in the premises of the assessee. Even in the warrant of authorization, the
address of the place to be searched is not the address of the assessee
individual. Admittedly, no Panchnama is also drawn in pursuance with the
warrant of authorization in the case of the assessee. No documents were
seized or impounded as such during the course of search from the assessee.
The warrant of authorization dated 29-10-2004 in the name of the Trust and
the assessee stands unexecuted in the case of assessee individual. Since in
this case only survey operation under section 133A is conducted in the
premises of the assessee Trust, it would not satisfy the requirements of
section 153A of the Act. As such, the Assessing Officer was not justified in
initiating proceedings or assuming valid jurisdiction under section 153A of
the Act against the assessee."

18. Similarly, the Tribunal in Unique Star Developers v DCIT [2017] 83
taxmann.com 83 (Mumbai -Trib.), considered a case wherein a joint warrant of
search was issued in the name of assessee-AOP and its members. In this case, the
search was carried out at residential premises of a member and not at the business
premise of the AOP. The challenge was against initiation of proceedings under
section 153A of the Act in the case of AOP. The Tribunal held as follows:

"9. ...........The provisions of Act very clearly and unambiguously provide
for initiation of search, conduct of search and conclusion of search and
only then the AO can assume jurisdiction u/s 153A of the Act. In the
present case, before us search has been initiated as the name of the
assessee's AOP appear on the warrant of authorization issued u/s 132(1)
besides mentioning the names of the members of assessee AOP at all but
the search was not conducted on the premises of the AOP, whereas the
search was conducted on the members of AOP with no incriminating
material relating to assessee was found in the premises searched
belonging to the members of the assessee AOP. Finally, the search was
concluded in the name of the members of AOP where panchanama was
drawn duly but no panchanama was drawn in the name of the assessee -
ITA Nos.182, 183/Bang/2023
Page 94 of 123

AOP and therefore, the limbs and contents to be satisfied for assessment
of jurisdiction u/s 153A were not satisfied.

10. From the above discussion, we are of the view that in order to initiate
assessment proceedings, u/s 153A of the Act, the premises of the appellant
has to be searched and panchanama has to be specifically drawn in the
name of the assessee but in the present case before us no search was
carried out at the business premises of the assessee and so much so that
no incriminating documents were found and seized from premises
searched of others and no panchanama was drawn in the name of the
assessee....... We are therefore of the considered view that no search has
been conducted in the case of the assessee in view of the discussion
hereinabove and accordingly, we are of the considered view that the order
of the ld. CIT(A) deserved to be set aside and accordingly, we hold that
the proceedings under section 153A of the Act is without any valid
jurisdiction so is the consequent assessment order also passed u/s 143(3)
rw.s.153(A) of the Act and hence quashed."

19. Relying on the above, the CIT(A) held that in the absence of a search
at the premises of the assessee, the initiation of proceedings under section
153A of the Act in assessee's case is invalid. The learned AR, in his
submissions, has additionally relied upon the decision in CIT Vs. Tirupati Oil
Corporation [2001] 284 ITR 194 (Bom), which held as follows:

"The facts of this appeal are as follows: A search operation under section
132 of the Act was carried out at the residences of the partner pursuant
to which notice under section 158BC of the Income-tax Act was issued to
the firm on August 5, 1996, requiring the assessee firm to furnish its return
of income for the block period in question. The Assessing Officer came to
the conclusion that since a partnership firm is not a legal entity the
assessee-firm was liable with regard to the material detected at the
residence of its partner. The Tribunal in appeal, however, rightly came to
the conclusion that under the Income-tax Act, a registered firm is a
taxable unit and if the Assessing Officer wanted to proceed under Chapter
XIV-B of the Income-tax Act with regard to the undisclosed income of the
partner for the purposes of making block assessment on the assessee-firm.
then the Assessing Officer was required to invoke section 158BD which
has not been done in the present case and therefore, the block assessment
made on the firm without following the procedure under section 158BD
was bad in law. We do not find any error of law in the judgement of the
Tribunal."
ITA Nos.182, 183/Bang/2023
Page 95 of 123

20. Relying on the above decision, the learned AR submitted that at best, a
proceeding under section 153C of the Act could have been initiated in its case.
We agree that since the assessee company being a separate legal entity, a search
in the premises of its directors does not translate to a search in the case of assessee
company.

21. The next issue considered by the CIT(A) (point 6 at Page 52 of CIT(A)'s
order) was whether section 153A of the Act could be invoked for making a non-
search assessment, i.e., in the case of a survey under section 133A of the Act. In
this connection, the CIT(A) relied on the judgment of the Hon'ble Madras High
Court in Smt. Rajkumari Chandak Vs. ACIT (2016) 382 ITR 312 (Mad.). In this
case, the Hon'ble High Court held that if it is a case of survey under section 133A
of the Act, without a search in terms of section 132 of the Act, invoking
provisions of section 158BC of the Act, does not arise. The Tribunal in Dr.
Mansukh Kanjibhai Shah's case (supra) also held that where only a survey was
conducted, it would not satisfy the requirement under section 153A. The CIT(A)
thus concluded that section 153A of the Act, being a special provision enacted
for making assessments in search cases it cannot be invoked in cases where only
a survey under section 133A of the Act, is carried out. The learned AR had
additionally relied on the judgment of the Hon'ble Supreme Court in the case of
Union of India v Ajit Jain reported in 260 ITR 80 (SC) which held that provisions
of Chapter XIV-B could not be invoked in the absence of a valid search.

22. The last issue addressed by the CIT(A) is whether the participation of the
assessee company in the proceedings initiated under section 153A of the Act,
would prevent it from questioning the validity of the said proceedings. The
CIT(A) held that mere participation of the assessee in the proceeding under
section 153A of the Act, would not bestow jurisdiction which otherwise is not
legally inherent in the hands of the AO. The CIT(A) placed reliance in the case
of ACIT Vs. K.G. Finvest (P.) Ltd [2017] 88 taxmann.com 627 (Delhi - Trib.).
In this case, the Tribunal held as follows: "It goes without saying that if no search
is initiated or carried out, a simple participation by the assessee pursuant to
notice of assessment, and that too, after registering a protest against ad
ITA Nos.182, 183/Bang/2023
Page 96 of 123

proceedings, cannot validate the jurisdiction of AO, if such jurisdiction is, in fact,
absent."

23. The CIT(A) also considered the applicability of sections 292B and 292BB
of the Act, in the present case. The CIT(A) held that section 292B of the Act
protects only procedural errors of omission or commission, but does not
contemplate extrapolation of section 153A of the Act, so as to bring within its
ambit non-search cases. It was further held that the said section cannot be used
as a tool to bypass the conditions precedent to the operation of section 153 of the
Act; viz., the execution of a warrant of authorization issued under section 132 of
the Act, by initiation of a search and drawing up a panchnama in the case of the
person in whose name warrant might have been issued. Reliance in this regard
was placed on the judgments in the case of PCIT Vs. Maruti Suzuki India Ltd
(2019) 107 taxmann.com 375 (SC); Mrs. Vanitha Gopal Shetty Vs. ACIT (2021)
129 taxmann.com 163 (Karnataka); and PCIT Vs. Cherian Abraham (2022) 444
ITR 420 (Karnataka). In the context of section 292BB of the Act, it was held that
the said section only deals with the limited aspect of service of a notice. It was
thus held that the section 292BB of the Act, does not confer the AO with any
kind of jurisdiction where it legally does not exist.

24. For all the aforesaid reasons and discussion, the CIT(A) quashed the
assessment orders passed under section 153A of the Act. We are in complete
agreement with the reasoning and the conclusion drawn thereon by the CIT(A).

25. In the result, appeals filed by the Revenue are dismissed.

Pronounced in the open court on the date mentioned on the caption page.

Sd/- Sd/-
(LAXMI PRASAD SAHU) (GEORGE GEORGE K)
Accountant Member Vice President

Bangalore.
Dated: 06.10.2023.
/NS/*
ITA Nos.182, 183/Bang/2023
Page 97 of 123

Copy to:

1. Appellants 2. Respondent
3. CIT 4. CIT(A)
5. DR, ITAT, Bangalore. 6. Guard file

By order

Assistant Registrar,
ITAT, Bangalore.
ITA Nos.182, 183/Bang/2023
Page 98 of 123

Per Laxmi Prasad Sahu, Accountant Member

I have gone through the order of the Hon'ble Vice President dismissing the appeals of the revenue and I am not in agreement with the views expressed by the Hon'ble Vice President on certain issues and deal with the same as follows.

The facts of the case, submissions and arguments of both the parties are narrated in paras 1 to 8 of the order of the Hon'ble Vice President. Heard the rival submissions and perusal of the material on record. The CIT(Appeals) first took up the legal issue raised by the assessee that notices issued to the assessee u/s. 153A were void ab initio and invalid as no search u/s. 132 was initiated in its case and hence the assessment proceedings on the basis of such invalid notices were not valid in law. In this regard, the CIT(Appeals) called for a remand report from the AO seeking clarification on whether search was conducted in the assessee's case. The remand report of the AO dated 21.09.2022 is extracted at para 9 of the Hon'ble Vice President's order and not reproduced again. The assessee filed rejoinder to the remand report. However, the CIT(Appeals) noted that the remand report dated 21.09.2022 did not answer the specific query as to whether the premises of the assessee was searched u/s. 132 of the Act. In the light of the judgment of the jurisdictional High Court in the case of Canara Housing Development Co. v. DCIT [2014] 49 taxmann.com 98, the CIT(A) further directed the AO vide letter dated 3.10.2022 to clarify whether a search u/s 132 was conducted in the case of assessee and whether the aforesaid judgment was overruled subsequently. Accordingly, the AO filed his second remand report dated 11.10.2022 as follows:-

"SURVEY u/s. 133A ITA Nos.182, 183/Bang/2023 Page 99 of 123  The Warrant of Authorisation u/s 132 was drawn in the name of the appellant company M/s Blueline Foods (India) Pvt. Ltd.  The premise of the appellant company i.e., M/s Blueline Foods (India) Pvt. Ltd. has not been searched u/s 132 of the Income -tax Act, 1961. Instead, a survey u/s 133A was conducted in the said premises.

 Assessment order in the case of the appellant company M/s Blueline Foods (India) Pvt. Ltd. was passed u/s 153A because the Warrant of Authorisation u/s 132 was in the name of the said appellant company, as stated above.

CANARA HOUSING DEVELOPMENT CO. vs DCIT (2014) In the knowledge of the undersigned, no judgment has been discovered that overrules the verdict given by the Hon'ble High Court of Karnataka w.r.t. the condition that the precedent for application of section 153A is that there should be a search u/s.

132."

In response to this remand report, the assessee filed the rejoinder on 13.10.2022. On consideration of the rival submissions and arguments, the CIT(Appeals) noted that although a warrant of authorization u/s. 132 was issued in the name of assessee company, only survey u/s. 133A has been carried out in the business premises of the assessee and searches were conducted in pursuance of the warrant only at the residences of the three directors of the company. The CIT(A) observed, according to the AO, given that the company's business premises were covered under a survey u/s. 133A, no search was initiated there and therefore there was no need to draw a Panchanama in the case of assessee and consequently no such Panchanama exists. The CIT(A) observed that in the case of assessee survey u/s. 133A was carried out in the case of assessee and not a search u/s. 132 of the Act which is corroborated by documents contained at pages 146 to 176 of assessee's PB. The CIT(A) noted that neither any search u/s. 132 was initiated nor any Panchanama was drawn in the case of assessee company and drew up essential questions for adjudication as follows:-

ITA Nos.182, 183/Bang/2023 Page 100 of 123 "(1) Whether the issue of a warrant of authorisation would automatically mean its execution;

(2) Whether section 153A can be invoked in the absence of a valid search;

(3) Whether "execution" of a warrant of authorization under section would 132 imply the actual initiation and conduct of search;

(4) Whether the absence of a Panchanama in the name of the assessee would render section 153A unworkable;

(5) Whether a search conducted at the residence of the director of a company would constitute the search of the company;

(6) Whether section 153A can be invoked for making a non-

search assessment, as in the case of a survey under section 133A;

(7) Whether, in the absence of inherent legal jurisdiction under section 153A, the mere participation of the assessee in assessment proceedings would confer jurisdiction on the AO to issue notice and frame assessment orders under that section; and (8) Whether the provisions of sections 292B and 292BB would save notices and assessments which are otherwise invalid."

The CIT(Appeals) after discussing the above issues in detail and after relying on various case laws concluded that there was no valid search in the case of assessee and the AO had no jurisdiction for invoking section 153A of the Act, therefore the entire assessment proceedings are invalid. This issue was allowed in favour ITA Nos.182, 183/Bang/2023 Page 101 of 123 of the assessee. In view of this, the CIT(A) did not adjudicate the other grounds as infructuous.

During the course of hearing, the ld. DR was asked to produce the warrant of authorization and panchanama drawn relating to the search proceedings which all three were produced. One of the Warrants dated 21.1.2019 issued in the case of assessee is reproduced below:-

ITA Nos.182, 183/Bang/2023 Page 102 of 123 ITA Nos.182, 183/Bang/2023 Page 103 of 123 A Panchanama dated 25.1.2019 in the case of assessee is as below:-

ITA Nos.182, 183/Bang/2023 Page 104 of 123 ITA Nos.182, 183/Bang/2023 Page 105 of 123 ITA Nos.182, 183/Bang/2023 Page 106 of 123 From the above warrant of authorization, it is clear that the name is mentioned as M/s. Blueline Foods (India) Pvt. Ltd. (assessee), the warrant to search is "The residence of Mr. Shawkath Showry Mohammed" and the Pr. DIT (Inv) has reason to suspect that such books of account, other documents, money, bullion, jewellery or other valuable article or thing have been kept and found in the residence of Mr. Shawkath Showry Mohammed as per Annexure A to Panchanama and the address of residence of Mr. Shawkath Showry Mohammed, Flat No.902/903, Presidency Flora, SL Mathias Road, Attavar, Mangalore, Karnataka - 575001 was authorized in the Warrant of search along with other two authorisations as per Form 45 dated 21.01.2019. I also note that the Panchanama is in the case of M/s. Blueline Foods (India) Pvt. Ltd. [assessee] and the place of search is the residence of Mr. Shawkath Showry Mohammed, Mangalore which is clearly mentioned in the warrant of authorization to search. The Panchanama has been drawn by the authorized officer on 25.01.2019 and the items found are as per Annexure-A to Panchanama consisting of books of account and document, cash, jewellery, ornaments, etc.. The two other Panchanamas are also drawn in the name of the assessee but the address are the different which are placed in the P.B.183 to 194 & Form No. 45 were also issued which are placed in the P.B. of DR.. In the light of this fact, I note that the CIT(Appeals) has wrongly observed that no search has been initiated and concluded and no Panchanama has been drawn in the case of assessee. Section 153A starts with a non-obstante clause which is reproduced below:- Assessment in case of search or requisition. 19 153A. [(1)] Notwithstanding anything contained in section 139, section 21 147, section 148, section 149, section 151 and section 153, in the case of a person where a search is initiated under section 132 or books of account, other 22 documents or any assets are requisitioned under section 132A after the 31st day of May, 2003, the Assessing Officer shall--

(a) issue notice to such person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect of each assessment year falling within six assessment years [and for the relevant 23 assessment year or years] referred to in clause (b), in the prescribed form ITA Nos.182, 183/Bang/2023 Page 107 of 123 and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so 22 far as may be, apply accordingly as if such return were a return required to be furnished under section 139;

(b) assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made [and for the relevant 23 assessment year or years] :

Provided that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years [and 23 for the relevant assessment year or years] :

Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years [and for the 23 relevant assessment year or years] referred to in this [sub-section] pending on 24 25 the date of initiation of the search under section 132 or making of requisition under section 132A, as the case may be, shall abate : 25 [Provided also that the Central Government may by rules made by it and 26 27 published in the Official Gazette (except in cases where any assessment or reassessment has abated under the second proviso), specify the class or classes of cases in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made [and for the relevant assessment year or 28 years]:] [Provided also that no notice for assessment or reassessment shall be issued by 28 the Assessing Officer for the relevant assessment year or years unless--

(a) the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more in the relevant assessment year or in aggregate in the relevant assessment years;

(b) the income referred to in clause (a) or part thereof has escaped assessment for such year or years; and

(c) the search under section 132 is initiated or requisition under section 132A is made on or after the 1st day of April, 2017.

Explanation 1.--For the purposes of this sub-section, the expression "relevant assessment year" shall mean an assessment year preceding the assessment year relevant to the previous year in which search is conducted or requisition is made which falls beyond six assessment years but not later than ten assessment years from the end of the assessment year ITA Nos.182, 183/Bang/2023 Page 108 of 123 relevant to the previous year in which search is conducted or requisition is made.

Explanation 2.--For the purposes of the fourth proviso, "asset" shall include immovable property being land or building or both, shares and securities, loans and advances, deposits in bank account.] [(2) If any proceeding initiated or any order of assessment or 29 reassessment made under sub-section (1) has been annulled in appeal or any other legal proceeding, then, notwithstanding anything contained in sub-section (1) or section 153, the assessment or reassessment relating to any assessment year which has abated under the second proviso to sub- section (1), shall stand revived with effect from the date of receipt of the order of such annulment by the [Principal Commissioner or] 30 Commissioner:

Provided that such revival shall cease to have effect, if such order of annulment is set aside.] Explanation.--For the removal of doubts, it is hereby declared that,--

(i) save as otherwise provided in this section, section 153B and section 153C, all other provisions of this Act shall apply to the assessment made under this section;

(ii) in an assessment or reassessment made in respect of an assessment year under this section, the tax shall be chargeable at the rate or rates as applicable to such assessment year.

It is clear from the above section that once a search is completed, then the AO gets jurisdiction to issue notice u/s. 153A and accordingly the AO has issued the notice and completed the assessment u/s. 153A on the basis of various incriminating material found and seized during the course of search. The authorisations of search have been executed in terms of section 153B(2) of the Act.

During the course of search, books of accounts and documents and other items were found and seized at the address provided in warrant of authorization and panchanama was drawn. The ld. AR strongly contended that no search was conducted in the case of assessee and it was conducted in the residence of directors which are not valid in the eyes of law and in support of his argument he ITA Nos.182, 183/Bang/2023 Page 109 of 123 relied on various judgments. These judgments relied by the ld. AR do not support the case of the assessee because in these cases the facts are that the books of accounts were found at the addresses provided in Form 45 which were required to be searched.

The provisions of section 132 are as follows:-

[Search and seizure . 93

132. (1) Where the [ [Principal Director General or] Director 94 95 96 97 General or [Principal Director or] Director] or the [ [Principal Chief 97 98 99 Commissioner or] Chief Commissioner or [Principal Commissioner 99 or] Commissioner] [or Additional Director or Additional 1 Commissioner] [or Joint Director or Joint Commissioner] in 2 consequence of information in his possession, has reason to3 believe that--

(a) any person to whom a summons under sub-section (1) of section 37 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 131 of this Act, or a notice under sub-section (4) of section 22 of the Indian Income-tax Act, 1922, or under sub-section (1) of section 142 of this Act was issued to produce, or cause to be produced, any books of account or other documents has omitted or failed to produce, or cause to be produced, such books of account or other documents as required by such summons or notice, or

(b) any person to whom a summons or notice as aforesaid has been or might be issued will not, or would not, produce or cause to be produced, any books of account or other documents which will be useful for, or relevant to, any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act, or

(c) any person is in possession of any money, bullion, jewellery 4 or other valuable article or thing and such money, bullion, 4 jewellery or other valuable article or thing represents either wholly or partly income or property [which has not been, or 5 would not be, disclosed ] for the purposes of the Indian 4 Income-tax Act, 1922 (11 of 1922), or this Act (hereinafter in this section referred to as the undisclosed income or property), [then,--

(A) the [ [Principal Director General or] Director General 7 8 or [Principal Director or] Director] or the [ [Principal Chief 8 9 10 Commissioner or] Chief Commissioner or [Principal 10 Commissioner or] Commissioner], as the case may be, may ITA Nos.182, 183/Bang/2023 Page 110 of 123 authorise any [Additional11 Director or Additional Commissioner or] [Joint Director], [Joint 12 13 Commissioner], [Assistant14 Director [or Deputy 15 Director]], [Assistant 16 Commissioner [or Deputy 15 Commissioner] or Income-tax Officer], or (B) such [Additional Director or Additional Commissioner 11 or] [Joint Director], or [Joint Commissioner], as the case may 12 13 be, may authorise any [Assistant Director [or Deputy 14 15 Director]], [Assistant 16 Commissioner [or Deputy 15 Commissioner] or Income-tax Officer], (the officer so authorised in all cases being hereinafter referred to as the authorised officer) to--]

(i) enter and search any [building, place, vessel, vehicle or 17 18 aircraft] where he has reason to suspect that such books of account, other documents, money, bullion, jewellery or other valuable article or thing are kept;

(ii) break open the lock of any door, box, locker, safe, almirah or other receptacle for exercising the powers conferred by clause

(i) where the keys thereof are not available;

[(iia) search any person who has got out of, or is about to get into, or 19 is in, the building, place, vessel, vehicle or aircraft, if the authorised officer has reason to suspect that such person has secreted about his person any such books of account, other documents, money, bullion, jewellery or other valuable article or thing;] [(iib) require any person who is found to be in possession or control 20 of any books of account or other documents maintained in the form of electronic record as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000) , to afford the authorised officer the necessary facility 21 to inspect such books of account or other documents;]

(iii) seize any such books of account, other documents, money, 22 22 bullion, jewellery or other valuable article or thing found as a result of such search:

[Provided that bullion, jewellery or other valuable article or thing, being stock-in-trade of the business, found as a result of such search shall not be seized but the authorised officer shall make a note or inventory of such stock-in-trade of the business;]

(iv) place marks of identification on any books of account or other documents or make or cause to be made extracts or copies therefrom;

ITA Nos.182, 183/Bang/2023 Page 111 of 123

(v) make a note or an inventory of any such money, bullion, jewellery or other valuable article or thing :

[Provided that where any building, place, vessel, vehicle or aircraft 24 referred to in clause (i) is within the area of jurisdiction of any [ [Principal Chief Commissioner or] Chief Commissioner 25 26 or [Principal 26 Commissioner or] Commissioner], but such [ [Principal Chief Commissioner or] Chief Commissioner 25 26 or [Principal Commissioner or] Commissioner] has no jurisdiction 26 over the person referred to in clause (a) or clause (b) or clause (c), then, notwithstanding anything contained in section [120], it shall be 27 competent for him to exercise the powers under this sub-section in all cases where he has reason to believe that any delay in getting the authorisation from the [ [Principal Chief Commissioner or] Chief 28 29 Commissioner or [Principal Commissioner or] Commissioner] 29 having jurisdiction over such person may be prejudicial to the interests of the revenue :] [Provided further that where it is not possible or practicable to take 30 physical possession of any valuable article or thing and remove it to a safe place due to its volume, weight or other physical characteristics or due to its being of a dangerous nature, the authorised officer may serve an order on the owner or the person who is in immediate possession or control thereof that he shall not remove, part with or otherwise deal with it, except with the previous permission of such authorised officer and such action of the authorised officer shall be deemed to be seizure of such valuable article or thing under clause

(iii):] [Provided also that nothing contained in the second proviso shall 31 apply in case of any valuable article or thing, being stock-in-trade of the business:] [Provided also that no authorisation shall be issued by the 32 Additional Director or Additional Commissioner or Joint Director or Joint Commissioner on or after the 1st day of October, 2009 unless he has been empowered by the Board to do so .] 33 [Explanation.--For the removal of doubts, it is hereby declared that 34 the reason to believe, as recorded by the income-tax authority under this sub-section, shall not be disclosed to any person or any authority or the Appellate Tribunal.] [(1A) Where any [ [Principal Chief Commissioner or] Chief 35 36 37 Commissioner or [Principal Commissioner or] Commissioner], in 37 consequence of information in his possession, has reason to suspect that any books of account, other documents, money, bullion, jewellery or other valuable article or thing in respect of which an officer has been authorised by the [ [Principal Director General or] 38 39 ITA Nos.182, 183/Bang/2023 Page 112 of 123 Director General or [Principal Director or] Director] or any 39 other [ [Principal Chief Commissioner or] Chief Commissioner 40 41 or [Principal Commissioner or] Commissioner] or [Additional 41 42 Director or Additional Commissioner] [or Joint Director or Joint 43 Commissioner] to take action under clauses (i) to (v) of sub-section (1) are or is kept in any building, place, vessel, vehicle or aircraft not mentioned in the authorisation under sub-section (1), such [ [Principal Chief Commissioner or] Chief Commissioner 44 45 or [Principal 45 Commissioner or] Commissioner] may, notwithstanding anything contained in section [120], authorise the 46 said officer to take action under any of the clauses aforesaid in respect of such building, place, vessel, vehicle or aircraft.] [Explanation.--For the removal of doubts, it is hereby declared that 47 the reason to suspect, as recorded by the income-tax authority under this sub-section, shall not be disclosed to any person or any authority or the Appellate Tribunal.] (2) The authorised officer may requisition the services of any police officer or of any officer of the Central Government, or of both, to assist him for all or any of the purposes specified in sub-section (1) [or sub-section (1A)] and it shall be the duty of every such officer 48 to comply with such requisition.

(3) The authorised officer may, where it is not practicable to seize 49 any such books of account, other documents, money, bullion, jewellery or other valuable article or thing, [for reasons other than 50 those mentioned in the second proviso to sub-section (1),] serve an order on the owner or the person who is in immediate possession or 49 control thereof that he shall not remove, part with or otherwise deal with it except with the previous permission of such officer and such officer may take such steps as may be necessary for ensuring compliance with this sub-section.

[Explanation.--For the removal of doubts, it is hereby declared that 51 serving of an order as aforesaid under this sub-section shall not be deemed to be seizure of such books of account, other documents, money, bullion, jewellery or other valuable article or thing under clause (iii) of sub-section (1).] (4) The authorised officer may, during the course of the search or seizure, examine on oath any person who is found to be in possession or control of any books of account, documents, money, bullion, jewellery or other valuable article or thing and any statement made by such person during such examination may thereafter be used in evidence in any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act.

ITA Nos.182, 183/Bang/2023 Page 113 of 123 [Explanation.--For the removal of doubts, it is hereby declared that 52 the exami-nation of any person under this sub-section may be not merely in respect of any books of account, other documents or assets found as a result of the search, but also in respect of all matters relevant for the purposes of any investigation connected with any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act.] [(4A) Where any books of account, other documents, money, bullion, 53 jewellery or other valuable article or thing are or is found in the possession or control of any person in the course of a search, it may be presumed--

(i) that such books of account, other documents, money, bullion, jewellery or other valuable article or thing belong or belongs to such person;

(ii) that the contents of such books of account and other documents are true ; and

(iii) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person or which may reasonably be assumed to have been signed by, or to be in the handwriting of, any particular person, are in that person's handwriting, and in the case of a document stamped, executed or attested, that it was duly stamped and executed or attested by the person by whom it purports to have been so executed or attested.] (5) [***] 54 (6) [***] 55 (7) [***] 56 (8) The books of account or other documents seized under sub-section (1) [or sub-section (1A)] shall not be retained by the authorised 57 officer for a period exceeding [thirty days from the date of the order 58 of assessment under [section 153A or] clause (c) of section 158BC ] 59 unless the reasons for retaining the same are recorded by him in writing and the approval of the [ [Principal Chief Commissioner or] 60 61 Chief Commissioner, [Principal 61 Commissioner or] Commissioner, [Principal Director General or] Director General 61 or [Principal Director or] Director] for such retention is obtained:

Provided that the [ [Principal Chief Commissioner or] Chief 60 61 Commissioner, [Principal 61 Commissioner or] Commissioner, [Principal Director General or] Director General 61 or [Principal Director or] Director] shall not authorise the retention 61 of the books of account and other documents for a period exceeding thirty days after all the proceedings under the Indian Income-tax Act, 1922 (11 of 1922), or this Act in respect of the years for which the books of account or other documents are relevant are completed.

ITA Nos.182, 183/Bang/2023 Page 114 of 123 [(8A) An order under sub-section (3) shall not be in force for a period 62 exceeding sixty days from the date of the order.] (9) The person from whose custody any books of account or other documents are seized under sub-section (1) [or sub-section (1A)] 63 may make copies thereof, or take extracts therefrom, in the presence of the authorised officer or any other person empowered by him in this behalf, at such place and time as the authorised officer may appoint in this behalf.

[(9A) Where the authorised officer has no jurisdiction over the 64 person referred to in clause (a) or clause (b) or clause (c) of sub- section (1), the books of account or other documents, or any money, bullion, jewellery or other valuable article or thing (hereafter in this section and in sections 132A and 132B referred to as the assets) seized under that sub-section shall be handed over by the authorised officer to the Assessing Officer having jurisdiction over such person within a period of sixty days from the date on which the last of the authorisations for search was executed and thereupon the powers exercisable by the authorised officer under sub-section (8) or sub- section (9) shall be exercisable by such Assessing Officer.] [(9B) Where, during the course of the search or seizure or within a 65 period of sixty days from the date on which the last of the authorisations for search was executed, the authorised officer, for reasons to be recorded in writing, is satisfied that for the purpose of protecting the interest of revenue, it is necessary so to do, he may with the previous approval of the Principal Director General or Director General or the Principal Director or Director, by order in writing, attach provisionally any property belonging to the assessee, and for the said purposes, the provisions of the Second Schedule shall, mutatis mutandis, apply.

(9C) Every provisional attachment made under sub-section (9B) shall cease to have effect after the expiry of a period of six months from the date of the order referred to in sub-section (9B). (9D) The authorised officer may, during the course of the search or seizure or within a period of sixty days from the date on which the last of the authorisations for search was executed, make a reference to a Valuation Officer referred to in section 142A , who shall estimate the fair market value of the property in the manner provided under that section and submit a report of the estimate to the said officer within a period of sixty days from the date of receipt of such reference.] (10) If a person legally entitled to the books of account or other documents seized under sub-section (1) [or sub-section (1A)] objects 66 for any reason to the approval given by the [ [Principal Chief 67 68 ITA Nos.182, 183/Bang/2023 Page 115 of 123 Commissioner or] Chief Commissioner, [Principal Commissioner 68 or] Commissioner, [Principal Director General or] Director General 68 or [Principal Director or] Director] under sub-section (8), he may 68 make an application to the Board stating therein the reasons for such objection and requesting for the return of the books of account or other documents [and the Board may, after giving the applicant an 69 opportunity of being heard, pass such orders as it thinks fit].

       (11) [***]70



       (11A) [***]    71



       (12) [***]72

[(13) The provisions of the Code of Criminal Procedure, 1973 (2 of 73 1974), relating to searches and seizure shall apply, so far as may be, to searches and seizure under sub-section (1) or sub-section (1A).] (14) The Board may make rules in relation to any search or seizure 74 under this section ; in particular, and without prejudice to the generality of the foregoing power, such rules may provide for the procedure to be followed by the authorised officer--

(i) for obtaining ingress into [any building, place, vessel, vehicle or 75 aircraft] to be searched where free ingress thereto is not available ;

(ii) for ensuring safe custody of any books of account or other documents or assets seized.

[Explanation 1.--For the purposes of sub-sections (9A), (9B) and 76 (9D), with respect to "execution of an authorisation for search", the provisions of sub-section (2) of section 153B shall apply.] Explanation 2.--In this section, the word "proceeding" means any proceeding in respect of any year, whether under the Indian Income- tax Act, 1922 (11 of 1922), or this Act, which may be pending on the date on which a search is authorised under this section or which may have been completed on or before such date and includes also all proceedings under this Act which may be commenced after such date in respect of any year.] As per the above provisions, it is clear that the authorized officer is authorized to enter and search any building, place, etc. where he has reason to suspect that such books of account, other documents, money, bullion, jewellery or other documents or other valuable article are kept. It is clear that the various documents, cash and jewellery were found in the address provided in the warrant. Section 2(12A) of the I.T. Act defines "books of accounts" which were found and seized. Hence it clearly shows that there was valid search in the case of assessee and it is not necessary to search only the business premises of the ITA Nos.182, 183/Bang/2023 Page 116 of 123 assessee, search can be conducted anywhere as per section 132 of the I. T. Act. 1961. It is also not disputed that in the remand report the AO has categorically stated that survey u/s. 133A has been conducted in the business premises of the assessee and search was conducted in the residence of the directors of the assessee company. The warrant of authorization has been executed and at the end of search Panchanama has been drawn in the name of the assessee on 25.01.2019, during the course search the statements have been recorded of various persons and books of accounts were found and seized which were utilized for the purpose of assessments by the AOu/s 153A of the Act., therefore, there was a valid search initiated and concluded. The case laws relied on by the ld.AR for the assessee & mentioned at para 16 of the Hon'ble VP's order are not applicable to the present case on hand.

The CIT(Appeals) has further considered at page 51 para 4.49 & 4.53 whether a search conducted at the residence of the director of a company would constitute the search of the company itself and relying on the decision of Dr. Mansukh Kanjibhai Shah v. ACIT, [2011] 129 ITD 376 (Ahd. Trib) held that company is a distinct and separate person and search conducted at the residence of directors of the company and not at assessee's own business premises cannot form the basis for issue of notices u/s. 153A. The relevant portion of this decision is as follows:-

"9.4 It is undisputed fact that assessee is Managing Trustee of the Trust. The survey was conducted in the case of the Trust on 28-10- 2004. The statement of the assessee was recorded on oath under survey in the premises of the Trust. The details of the Trust were called for in the statement of the assessee. Certain bank accounts in the name of the Trust were found during the course of survey which was not reflected in the books of account of the Trust. The assessee admitted the amount deposited in the accounts as his personal money, but in the later portion of the statement he has explained that since his personal books of account for the current year are not written, therefore, it cannot be explained and assessee further stated that he will furnish the same details if available. Admittedly, it is a fact that ITA Nos.182, 183/Bang/2023 Page 117 of 123 all the bank accounts whether disclosed or not reflected in the books of the Trust are belonging to the Trust only. No undisclosed income in the name of the assessee was found either during the course of survey or the search. No independent or corroborative evidence was found against the assessee that the money deposited in the bank account of the Trust belongs to assessee in his individual capacity. The assessee in his later statement recorded before Assessing Officer on 24-12-2004 retracted from his earlier statement and explained that the amount seized from the bank accounts of the Trust did not belong to him because the same belong to the Trust only. Except the statement recorded on oath during the course of survey, there is no other material or evidence available on record to prove that the money deposited in the bank account of the Trust belong to the assessee in his individual capacity. It is well-settled that admissions are not conclusive proof of matter. They may be shown to be untrue or have been made under mistake of facts or law. Circumstances have to be seen under which same are made. It can be withdrawn unless it is estoppel and conclusive. Hon'ble Punjab & Haryana High Court in the case of Kishan Lal Shiv Chand Rai v. CIT [1973] 88 ITR 293 held "It is an established principle of law that a party is entitled to show and prove that an admission made by him was in fact not correct and true." Hon'ble Supreme Court of India in the case of Pullangode Rubber Produce Co. Ltd. v. State of Kerala [1973] 91 ITR 18 held that "assessee should be given opportunity to show that admission is incorrect or does not show correct state of facts". Hon'ble Madras High Court in the case of S. Khader Khan Son (supra), held "section 133A does not empower any ITO to examine any person on oath, so statement recorded under section 133A has no evidentiary value and any admission made during such statement cannot be made basis of addition". Considering the above discussion it is clear that there is no incriminating evidence available on record to show that the amount deposited in the bank account of the Trust belong to the assessee in his individual capacity. The assessee has been able to explain that his admission was in fact incorrect or not true. The statement of the assessee recorded being Managing Trustee of the Trust on oath on dated 28-10-2004 thus cannot be relied upon to proceed against the assessee under section 153A in his individual capacity. We may also note here that the amount lying in the bank accounts of the Trust were converted into PD account of the Department and admittedly in the case of the Trust addition of Rs. 1,93,99,865 was made on protective basis in assessment year 2005-06 and Trust was given benefit of exemption under section 11 read with section 12A of the Income-tax Act. The amount lying in PD account out of the bank account of the ITA Nos.182, 183/Bang/2023 Page 118 of 123 Trust was appropriated by the Assessing Officer against the demand raised in the case of the Trust under section 154 of the Income-tax Act. Later on, refund was also granted out of the same amount in the case of the Trust. These facts thus would show that ultimately the revenue Department accepted substantive assessment in case of Trust and that the amount deposited in the bank accounts of the Trust which were not reflected in the accounts of the Trust belongs to the Trust only. Considering the facts of the case and the warrant of authorization and the Panchnama produced before us, it is clear that the warrant of authorization was issued in the name of the Trust and the assessee being the Managing Trustee of the Trust. The warrant of authorization was also executed upon the bank manager of Indian Overseas Bank in respect of several bank accounts of the Trust. Thus, no warrant of authorization issued in the name of assessee in his individual capacity and no warrant of authorization is executed in the individual case of the assessee. No material is produced before us if any search is conducted against the assessee in his individual capacity. It is admitted fact that warrant of authorization is issued in the name of the Trust and the assessee. Even if it is issued in joint (two) names but it appears from the facts and circumstances of the case that name of the assessee was added in the warrant of authorization and in the Panchnama being the assessee Managing Trustee of the Trust. Thus, assessee has no individual liability in the aforesaid case. We may also note here that learned Departmental Representative relied upon decision of Allahabad High Court in the case of Raghu Raj Pratap Singh (supra) which was delivered on 14-

7-2006. However, learned Counsel for the assessee relied upon another decision of Hon'ble Allahabad High Court in the case of Smt. Vandana Verma (supra) which was delivered on 9-10-2009. The latter decision is binding for consideration. Moreover, the latter decision in the case of Smt. Vandana Verma (supra) is directly on the point in issue because when the warrant is issued in joint names in the case of the Trust and the assessee, then as per the above decision the assessments could not have been framed in the individual capacity/status of the assessee which is done in the present case. The proceedings under section 153A of the Income-tax Act against the assessee in his individual capacity/status are, therefore, clearly invalid and bad in law on the basis of joint search warrant so issued. The above findings are also supported by the observation of the Assessing Officer that in these three years Assessing Officer accepted the returned income meaning thereby that there was no undisclosed income belongs to the assessee in the assessment years under appeal.

ITA Nos.182, 183/Bang/2023 Page 119 of 123 In view of the above, there is no need to discuss other decisions relied upon by the learned Counsel for the assessee.

9.5 Considering the above provisions as noted above in the light of the provisions of section 153A of the Act, it would be clear that once the warrant of authorization or requisition is issued and search is actually conducted, Panchnama is drawn, the completed assessments for all the relevant years would get reopened irrespective of whether any incriminating material is found or not in relation to a particular assessment year. However the warrant of authorization shall have to be executed by the authorized Officer in order to justify invoking of the jurisdiction by the Assessing Officer under section 153A of the Act. Considering section 153A particularly read with sub-clause (b), it is clear that not only initiation of search is mandatory but conduct of the search is also material. The decision of the Allahabad High Court noted above also supports the above findings. As is noted above, it is undisputed fact that though warrant of authorization is issued in the name of the assessee being Managing Trustee of the Trust, but it is admitted fact that no search operation was conducted in the premises of the assessee. Even in the warrant of authorization, the address of the place to be searched is not the address of the assessee individual. Admittedly, no Panchnama is also drawn in pursuance with the warrant of authorization in the case of the assessee. No documents were seized or impounded as such during the course of search from the assessee. The warrant of authorization dated 29-10-2004 in the name of the Trust and the assessee stands unexecuted in the case of assessee individual. Since in this case only survey operation under section 133A is conducted in the premises of the assessee's Trust, it would not satisfy the requirements of section 153A of the Act. As such, the Assessing Officer was not justified in initiating proceedings or assuming valid jurisdiction under section 153A of the Act against the assessee. In view of the above discussions, we do not find these to be the fit cases for initiating the proceedings under section 153A of the Income-tax Act against the assessee in his individual status. We accordingly hold that the proceedings under section153A of the Income-tax Act are invalid and bad in law, resultantly, the orders of the authorities below are set aside and quashed."

From the above decision, it is very much clear that the facts are that the warrant of authorization was issued in the joint names, the search was not conducted in the case of the assessee and panchanama was also not drawn in the case of that ITA Nos.182, 183/Bang/2023 Page 120 of 123 assessee. Further the warrant of authorization was issued on bank manager which was not served on the assessee. Therefore the facts are distinguishable from the present case. Similarly the reliance placed on the decision of coordinate Bench in the case of Unique Stars Developers v. CIT [2017] 83 taxmann.com 83 (Mum Trib.) is also not applicable, since in this case warrant of authorization was issued on the joint names and business premises of AOP was not searched, the para No. 10 of this judgement is very much clear that the facts are different from the present case which reads as under:-

"10. From the above discussion, we are of the view that in order to initiate assessment proceedings, u/s 153A of the Act, the premises of the appellant has to be searched and panchanama has to be specifically drawn in the name of the assessee but in the present case before us no search was carried out at the business premises of the assessee and so much so that no incriminating documents were found and seized from premises searched of others and no panchanama was drawn in the name of the assessee. The case law relied upon by the ld. DR in the case of Devesh Singh (supra), we find that the facts of the case in hand and that of relied upon by the ld. DR are clearly distinguishable as in the said case panchanama was drawn jointly in the name of all parties and there was no doubt as to conduct of the search on various parties. However, no search has actually been taken place on assessee-AOP and the name of the assessee did not appear on the panchanama neither the business premises of the assessee searched nor were there any incriminating documents found and seized from the premises of members of assessee AOP. Similarly, in the case of MDLR Resorts (P.) (supra), the findings was also distinguishable on facts as in the said case there was no dispute with regard to search and seizure conducted and it has not been denied by the assessee. No panchanama was drawn in the name of the assessee, however, documents seized relating to the assessee were mentioned in the annexed to the panchanama and therefore there was no dispute regarding the question of time of completion of assessment u/s 153A of the Act. Whereas in the case of the assessee no search has taken place and no incriminating material was found and seized from the premises subjected to search which belonged to member of AOP Shri Harshad P Doshi, and the assessee has been denying the fact that the search has ever been conducted on the premises of the assessee. In other words, when the name of the assessee does not appear in the panchanama and no material is seized with respect to the assessee ITA Nos.182, 183/Bang/2023 Page 121 of 123 from business premises of membership of AOP searched it could not be taken as omission on the part of the search party of mentioning the name but it is clear proof and conclusive proof that no search was at all conducted. We are therefore of the considered view that no search has been conducted in the case of the assessee in view of the discussion hereinabove and accordingly, we are of the considered view that the order of the ld. CIT(A) deserved to be set aside and accordingly, we hold that the proceedings under section 153A of the Act is without any valid jurisdiction so is the consequent assessment order also passed u/s 143(3) r.w.s.153(A) of the Act and hence quashed. The ground of appeal is allowed."

Here in this case, warrant was issued in the name of assessee company and the place has been searched as mentioned in the similar three warrant of authorization which was the residence of the director of the assessee company and similar three Panchanama have also been drawn and documents were found and seized . Hence, the search was completed as per Section 132 accordingly notices were issued correctly u/s 153A of the I.T. Act.

In the case of Tirupati Oil Corporation relied on by the Hon'ble V.P. at para 19, it is not clear that in whose name the search warrant was issued and the place of search is also not clear in that case, whereas in the case on hand everything is clear as noted supra . The Panchanama has also been drawn, therefore, this decision is not applicable to present case. Therefore, I do not agree with para 20 of the order. The search was conducted/executed/concluded under section 132 r.w.s 153B(2) in the case of the assessee. But in the case of director there was no warrant of authorization brought to our notice by both the sides, authorization was only in the name of assessee company. Therefore, no assessment can be made u/s. 153C of the Act in the case of assessee company. Similarly all other decisions relied on by the ld. AR and referred to by the CIT(Appeals) are not applicable to the facts of the present case.

ITA Nos.182, 183/Bang/2023 Page 122 of 123 Further, there is no requirement in law that business premises of the assessee should be searched for the purpose of invoking section 153A of the Act. The authorised officer has to decide the place/places to be searched and after search is completed, section 153A is automatically triggered. The AO is bound to complete assessment u/s 153A/153C after completion of search and in this case the AO has rightly issued notice u/s. 153A and completed assessment u/s. 143(3) r.w.s. 153A of the Act. Therefore, the grounds raised by the revenue are allowed.

Since the CIT(Appeals) has decided only on technical issue without going into the merits and since it is held that there was a valid search in the case in terms of section 132 of the I. T. Act, therefore the appeals are remitted to the CIT(Appeals) to decide the issue on merits.

In the result, the appeals of the revenue are allowed for statistical purposes.

Pronounced in the open court on this ..... day of October, 2023.

Sd/-

(LAXMI PRASAD SAHU ) ACCOUNTANT MEMBER Bangalore, Dated, the 31st October, 2023.

/Desai S Murthy / Copy to:

1. Appellant 2. Respondent 3. CIT 4. CIT(A)

5. DR, ITAT, Bangalore.

By order ITA Nos.182, 183/Bang/2023 Page 123 of 123 Assistant Registrar ITAT, Bangalore.

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