Bombay High Court
Principal Commissioner Of Income-Tax, ... vs R. M. Investment And Trading Co. Pvt. Ltd on 28 January, 2019
Author: Sandeep K. Shinde
Bench: Akil Kureshi, Sandeep K. Shinde
Rane 1/6 ITXA-1193-2016 -GROUP(SR.3)
Monday, 28.1.2019
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
INCOME TAX APPEAL NO. 1193 OF 2016
ALONGWITH
INCOME TAX APPEAL NO. 1202 OF 2016
ALONGWITH
INCOME TAX APPEAL NO. 1052 OF 2016
ALONGWITH
INCOME TAX APPEAL NO. 1194 OF 2016
Principal Commissioner of Income
Tax, Central-I .....Appellant
V/s.
R.M. Investment and Trading Co.
Pvt. Ltd. ....Respondent
****
Mr. Suresh Kumar, Advocate for the appellant.
None for the respondent.
CORAM : AKIL KURESHI, &
SANDEEP K. SHINDE, JJ.
Monday, 28 th January, 2019.
P.C. :
1. These Appeals filed by the Revenue arise in common ::: Uploaded on - 30/01/2019 ::: Downloaded on - 30/01/2019 23:14:30 ::: Rane 2/6 ITXA-1193-2016 -GROUP(SR.3) Monday, 28.1.2019 background. We may record the facts from Income Tax Appeal No. 1193 of 2016. This Appeal arises out of the judgment of the Income Tax Appellate Tribunal ("the Tribunal" for short) dated 18th August, 2015. Following question is presented for our consideration :
"Whether on the facts and circumstances of the case and in law, the Hon'ble Income Tax Appellate Tribunal is correct in narrowing down the scope of assessment u/s. 153C by holding that legislature has not provided for making assessment for all six years and that provisions of section 153C can be invoked only for assessment years in respect of which valuable, books of accounts/documents, etc. have been seized on requisitioned which have a bearing on determination of total income of the assessee ?"
2. The Assessing Officer had initiated assessment proceedings against the respondent under Section 153C of the Income Tax Act, 1961 ("the Act" for short). He also made additions in subject assessment which eventually travelled to the Tribunal. The Tribunal, by the impugned judgment, allowed the assessee's appeal and deleted the ::: Uploaded on - 30/01/2019 ::: Downloaded on - 30/01/2019 23:14:30 ::: Rane 3/6 ITXA-1193-2016 -GROUP(SR.3) Monday, 28.1.2019 additions making the following observations :
"13. We have carefully considered the rival submissions and perused the record. It is not in dispute that during the course of search no incriminating material pertaining to assessment years under consideration, was found. For the purpose of invoking provisions of section 153A of the Act, referable to assessments to be made in the case of an assessee on whom search action was initiated, six years income can be assessed or reassessed, whereas section 153C comes into play only upon proving that during course of search some incriminating material pertaining to a third party is found. In other words section 153A provides for making an assesment in respect of each assessment year falling within six assessment years, upto the date of search, whereas section 153C refers to issuance of notice on such other person only if the Assessing Officer is satisfied that the relevant documents seized or requisitioned have a bearing on determination of total income of such other person for the relevant ::: Uploaded on - 30/01/2019 ::: Downloaded on - 30/01/2019 23:14:30 ::: Rane 4/6 ITXA-1193-2016 -GROUP(SR.3) Monday, 28.1.2019 assessment year/years.
14. Careful perusal of the language employed in section 153C makes it clear that in so far as a third party is concerned, the Legislature has not provided for making the assessments for all six years, in other words, based upon seized material the Assessing Officer has to record his satisfaction that the books of account/documents seized or requisitioned have a bearing on determination of total income of such other person for the relevant assessment year, Further, similar view has also been taken by the Tribunal in Trishul Hi-tech Industries Vs. Dy. CIT (in IT (SS) Nos. 82, 84-86/Kol/2011 dated 24.9.2014). where the years involved were A.Y.s 2004-05 to 2006-97, explaining the amendment to section 153C by Finance (No.2) Act, 2014 to be clarificatory and thus, retrospective.
15. In the instant case, the Special counsel appearing on behalf of the Revenue admitted that there is no incriminating material which has a bearing on ::: Uploaded on - 30/01/2019 ::: Downloaded on - 30/01/2019 23:14:30 ::: Rane 5/6 ITXA-1193-2016 -GROUP(SR.3) Monday, 28.1.2019 determination of total income of the assessee- herein in respect of the assessment years under consideration. We are therefore of the view that the Assessing Officer is not justified in invoking provisions of section 153C of the Act for the assessment years under consideration. As a necessary corollary, assessments made by the Assessing Officer u/s. 153C read with section 144 of the Act are liable to be quashed. We hold accordingly."
3. Perusal of the above portion of the judgment of the Tribunal would show that, besides the other findings, the Tribunal has come to the conclusion that, there was no incriminating material found during the search on the basis of which the additions for any of the years under consideration could have been sustained. In that view of the matter, keeping other conclusions of the Tribunal aside, the additions were correctly deleted. This view is taken by Delhi High Court in the case of Commissioner of Income-
Tax V/s. Kabul Chawla V/s. reported in 2015 Vol. 234 Taxmann 300 (Delhi).
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4. In the circumstances, no question of law arises.
The Income Tax Appeals are dismissed.
(SANDEEP K. SHINDE, J) (AKIL KURESHI, J) ::: Uploaded on - 30/01/2019 ::: Downloaded on - 30/01/2019 23:14:30 :::