Commissioner Of Income Tax (Central) Ludhiana v. Sh.girdhari Lal Bassi

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. ITA No. 130 of 2005 Date of decision: 4.8.2010 Commissioner of Income Tax (Central) Ludhiana -----Appellant Vs. Sh.Girdhari Lal Bassi ----Respondent CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOELHON’BLE MR. JUSTICE AJAY KUMAR MITTAL Present:-Mr. Krishan Kumar Mehta, Advocate for the revenue. Mr. Pankaj Jain, Advocate for the respondent-assessee.Adarsh Kumar Goel,J. 1.This order will dispose of ITA Nos.130 and 133 of 2005 ascommon question of law is involved. Facts have been taken from ITANo.130 of 2005. 2. This appeal has been preferred by the revenue under section260A of the Income Tax Act, 1961 (for short, ‘the Act’) against order dated5.10.2004 passed by the Income Tax Appellate Tribunal, Chandigarh Bench‘B’, Chandigarh in ITA No.1065/Chandi/96 for the block period 1.4.1985 to11.8.1995, proposing to raise following substantial questions of law:- “Whether on facts and in the circumstances of the case, theITAT was correct in law in cancelling the order passedunder section 158BC holding that there was no warrantunder section 132(1) of the IT Act ignoring the fact that theorder was passed by invoking the provisions of section158BD for which execution of warrant was not a per-requisite?” The assessee is Karta of HUF. Search and seizure operationwas conducted at the premises of the assessee on 11.8.1995. From the materials seized, it was found that the assessee had made a deposit of Rs.10lacs on 20.3.1995 in his bank account. The assessee filed return for theblock period from 1.4.1985 to 11.8.1995 declaring nil income. On beingconfronted with the undisclosed deposit in the bank account, the assessee inhis statement dated 14.8.1996 surrendered the amount for being taxed.Accordingly, the Assessing Officer assessed the amount as undisclosedincome. On appeal, addition was deleted, inter-alia, on the ground thatthere being no search warrant in the name of the assessee, provisions ofsection 158BC of the Act were not attracted. 3.We have heard learned counsel for the parties and perused the record. 4.Learned counsel for the revenue challenges the findingrecorded by the Tribunal as erroneous in law by submitting that order undersection 158BC was justified even in absence of search warrants being in thename of the assessee. From the material found during the search, liability ofthe assessee was clearly established. Learned counsel relies upon judgmentof the Hon’ble Supreme Court in Manish Maheshwari v. AssistantCommissioner of Income Tax and another, (2007) 289 ITR 341. 5.Learned counsel for the assessee relies upon judgment ofBombay High Court in CIT v. Tirupati Oil Corporation, (2001) 248 ITR194 and judgment of Delhi High Court in CIT v. Pushpa Rani, (2007) 289ITR 328. 6.It is not disputed by learned counsel for the assessee thatsatisfaction in terms of Section 158BD was duly recorded beforecompletion of assessment i.e. on 14.9.1995 which fact has been omitted bythe Tribunal from consideration as stated in para 3 of the memo of appeal.The Assessing Officer, was thus, justified in proceeding under section158BD, even though the said section has not been mentioned in the order of assessment. The judgments relied upon by learned counsel for the assesseeare distinguishable as therein satisfaction was not recorded in terms ofsection 158BD of the Act. In Manish Maheshwari, it has been held that ifsatisfaction is duly recorded, the person other than searched person can alsobe proceeded against under Section 158BD of the Act. Accordingly, thequestion has to be answered in favour of the revenue and against theassessee. Ordered accordingly. 7.The appeal is allowed and order of the Tribunal is set aside. (Adarsh Kumar Goel) Judge August 4, 2010‘gs’ (Ajay Kumar Mittal) Judge