Madras High Court
Sakthivel Bankers, Rana Investments, ... vs Assistant Commissioner on 23 August, 2001
Equivalent citations: [2002]255ITR144(MAD)
Author: R. Jayasimha Babu
Bench: R. Jayasimha Babu, C. Nagappan
JUDGMENT R. Jayasimha Babu, J.
1. We have heard learned counsel for the assessee at considerable length. But we are not persuaded to hold that the order made by the Tribunal, directing remand of the matter to the Assessing Officer calls for any interference.
2. Admittedly, the search was conducted in the premises of one Lakshmanan and certain documents were recovered during that search, which included documents pertaining to eight firms in which Lakshmanan and his wife were partners and also certain documents concerning his wife. Lakshmanan gave a statement, offering a sum of Rs. 125 lakhs as undisclosed income and pleaded inability to furnish the names of persons in whose favour credits have been entered in the books of account of those firms and of his wife. Notices were issued simultaneously to Lakshmanan, to his wife and to the eight firms. Lakshmanan had no doubt whatsoever as to the purpose for which the notice was issued and he being the person, who apparently was in control of the affairs of the firm of which he was a partner, the firms as also his wife were not in doubt as to the purpose for which the notice was issued or the source of the authority of the officer issuing the notice. In fact, in response to the notices returns were filed by all of them. Absence of mention of the provision in the notice was, therefore, not a circumstance which could be said to vitiate the ultimate order.
3. The fact that notice was issued to the eight firms and to the wife of Laksh-manan, even though the search warrant was not issued against them, is of no consequence, having regard to Section 158BD, which reads as follows :
"Where the Assessing Officer is satisfied that any undisclosed income belongs to any person, other than the person with respect to whom search was made under Section 132 or whose books of account or other documents or any assets were requisitioned under Section 132A, then, the books of account, other documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against such other person and the provisions of this Chapter shall apply accordingly."
4. It has been rightly found by the Tribunal that the notices issued by the Assessing Officer, to whom the records of the persons against whom notices had been issued, had been transferred, were perfectly valid and the application of the provisions of Chapter XIV-B was equally valid in their cases as well.
5. Learned counsel next contended that the ultimate order of the Tribunal remanding the case to the Assessing Officer has the effect of stretching the period of limitation prescribed under Section 158BE and that such enlargement of the period of limitation is wholly impermissible. We have, in the case of Latehmi Jewellary v. Deputy CIT (T. C. No. 408 of 2000), wherein a similar argument was advanced before us, held that the limitation prescribed under Section 158BE is only for the purpose of making the initial order and that it does not impose any fetters on the appellate authority to direct the original authority to redo the matter by reason of defects having been found in the original order made by the appellate authority. Section 158BE does not also impose any fetters on the power of the appellate authority to remand the matter and to require the original authority to make a fresh order.
6. It was last contended that under Section 158BG, the Commissioner is under a duty to issue notice to the assessee before approving the order proposed to be made by the Assessing Officer. We have already rejected a similar argument advanced before us at the instance of another assessee in Lakshmi Jewellary v. Deputy CIT (T. C. No. 408 of 2000). Section 158BG nowhere provides for the issuance of such a notice to the assessee by the Commissioner. That Section only requires the Assessing Officer to secure the approval of the Commissioner before making the order of assessment. Admittedly, such approval has been obtained. There was, therefore, no defect of such gravity as to render the initial order void ab initio. There is no merit in this appeal and the same is accordingly dismissed. No costs.