Dr. Mansukh Kanjibhai Shah, Baroda v. The ACIT., Cent.Circle-2,, Baroda

ITA 2880/AHD/2007 | 2004-2005
Pronouncement Date: 21-05-2010 | Result: Allowed

Appeal Details

RSA Number 288020514 RSA 2007
Assessee PAN AITPS7653L
Bench Ahmedabad
Appeal Number ITA 2880/AHD/2007
Duration Of Justice 2 year(s) 10 month(s) 17 day(s)
Appellant Dr. Mansukh Kanjibhai Shah, Baroda
Respondent The ACIT., Cent.Circle-2,, Baroda
Appeal Type Income Tax Appeal
Pronouncement Date 21-05-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 21-05-2010
Date Of Final Hearing 05-05-2010
Next Hearing Date 05-05-2010
Assessment Year 2004-2005
Appeal Filed On 04-07-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH BEFORE SHRI BHAVNESH SAINI J.M. AND SHRI N. S. SAINI A.M. ITA NO.2878 2879 AND 2880/AHD/2007 A. Y.:2002-03 2003-04 AND 2004-05 DR. MANSUKH KANJIBHAI SHAH 16 UYODOG NAGAR SOCIETY PANIGATE BARODA VS THE A. C. I. T. CENTRAL CIRCLE-2 AAYAKAR BHAVAN RACE COURSE CIRCLE BARODA PAN NO. AITPS 7653 L (APPELLANT) (RESPONDENT) ITA NO.3339/AHD/2007 A. Y.:2005-06 THE A. C. I. T. CENTRAL CIRCLE-2 AAYAKAR BHAVAN RACE COURSE CIRCLE BARODA VS DR. MANSUKH KANJIBHAI SHAH 16 UYODOG NAGAR SOCIETY PANIGATE BARODA PAN NO. AITPS 7653 L (APPELLANT) (RESPONDENT) FOR ASSESSEE: SHRI VIJAY RANJAN AR FOR DEPARTMENT: SHRI ANIL KUMAR DR O R D E R PER SHRI BHAVNESH SAINI J.M . THIS ORDER SHALL DISPOSE OF ALL THE ABOVE APPEALS BASED UPON IDENTICAL FACTS. ITA NO.2878 2879 AND 2880/AHD/2007(ASSESSEES APPE ALS) 2 2. THE APPEALS OF THE ASSESSEE IN ASSESSMENT YEARS 2002-03 2003-04 AND 2004-05 ARE DIRECTED AGAINST DIFFERENT ORDERS OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-IV AHMEDABAD ALL DATED 20 TH MARCH -2007ON THE FOLLOWING COMMON GROUNDS: 1. IN LAW AND IN THE FACTS AND CIRCUMSTANCES OF TH E APPELLANTS CASE THE LEARNED CIT (A) HAS GROSSLY ERRED IN DISM ISSING GROUND OF APPEAL NO.1 OF THE APPELLANTS APPEAL BEF ORE HIM CHALLENGING THE VALIDITY OF THE ASSESSMENT ORDER IM PUGNED BEFORE HIM INTER ALIA FOR T HE REASONS THAT IT HAD BEEN PASSED PURSUANT TO A NOTICE UNDER SECTION 153A WHICH WAS I TSELF ISSUED ON THE ERRONEOUS ASSUMPTION THAT THE APPELLANT HAD BEEN SUBJECT D TO SEARCH UNDER SECTION 132. HE OUGH T TO HAVE APPRECIATED INTER ALIA : (A) THAT IT WAS NOT OPEN TO HIM TO UPHOLD THE VALID ITY OF T HE NOTICE UNDER SECTION 153A AND IN TURN OF THE ASSESSMENT ORDER IMPUGNED BEFORE HIM BY MERELY OBSERVING AS UNDER (EMPHASIS SUPPLIED): 3 . I HAVE CAREFULLY CONSIDERED THE CONTENTIONS OF LD . COUNSEL AS WELL AS GONE THROUGH THE RECORDS. ON PER USAL OF ASSESSMENT ORDER IT HAS BEEN NOTICED THAT SEARCH U NDER SECTION 132 WAS CONDUCTED IN THE NAME OF THE APPELLANT IN THE BANK PREMISES. HENCE NOTICE U/S 153A WAS VALIDLY ISSUED. KEEPING IN VIEW OF ABOVE FACTS AND CIRCUMST ANCES OF THE CASE THERE IS NO INFIRMITY IN THE ASSESSMENT O RDER AND HENCE CONTENTIONS OF LD. COUNSEL ARE HEREBY REJECT ED. THE FIRST GROUND OF APPEAL IS DISMISSED. (B) THAT IT WAS NOT POSSIBLE TO SUGGEST THAT AN ASS ESSEE HAS BEEN SUBJECTED TO PROCEEDINGS UNDER SECTION 132 OF THE INCOME-TAX ACT 1961 EVEN THOUGH HE HAD NOT BEEN SHOWN FAR LESS SERVED WITH ANY WARRANT OF SEARCH . 3. WE HAVE HEARD LEARNED REPRESENTATIVES OF BOTH TH E PARTIES PERUSED THE FINDINGS OF AUTHORITIES BELOW AND CONSI DERED THE MATERIAL AVAILABLE ON RECORD. 3 4. BRIEFLY THE FACTS OF THE CASE ARE THAT IN THIS CASE INITIALLY SURVEY ACTION U/S 133A OF THE IT ACT WAS CARRIED OUT AT TH E PREMISES OF K. M. SHAH CHARITABLE TRUST (IN SHORT TRUST) IN WHICH A SSESSEE IS THE MANAGING TRUSTEE LED TO DETECTION OF UNACCOUNTED B ANK ACCOUNTS. IN THE STATEMENT OF THE ASSESSEE RECORDED DURING SURVE Y ON 28 TH OCTOBER 2004 TOTAL AMOUNT OF RS.1 93 99 865/- WAS ADMITTED AS UNACCOUNTED MONEY. SUBSEQUENTLY ON 29 TH OCTOBER 2004 SEARCH WARRANT WAS ISSUED IN THE NAME OF THE ASSESSEE AND K. M. SHAH CHARITABLE TRUST AND THE ABOVE CASH WERE FOUND AND SEIZED. NOTICE U/S 153A WAS ISSUED TO THE ASSESSEE. RETURN OF INCO ME WAS FILED FOR ALL THE ASSESSMENT YEARS AND REVISED RETURN WAS FIL ED AT THE HIGHER AMOUNT THAN THE INCOME SHOWN IN THE ORIGINAL RETURN FILED. THE RETURNED INCOME WAS ACCEPTED IN THE ASSESSMENT YEAR 2002-03 AND 2003-04. IN ASSESSMENT YEAR 2004-05 THE RETURN OF INCOME FILED U/S 153A OF THE IT ACT WAS ACCEPTED AS IT IS. 5. THE ASSESSEE CHALLENGED THE VALIDITY OF PROCEED INGS U/S 153A OF THE IT ACT IN ALL THE ASSESSMENT YEARS BEFORE LE ARNED CIT (A) AND IT WAS SUBMITTED THAT THE ASSESSEE IS THE MANAGING TRU STEE OF K. M. SHAH CHARITABLE TRUST WHICH WAS SUBJECTED TO SURVEY PROCEEDINGS U/S 133A ON 28-10-2004. AT THE TIME OF SURVEY THE SURV EY PARTY EXTRACTED AN ADMISSION OF THE ASSESSEE TO THE EFF ECT THAT CASH AMOUNTING TO RS.1 93 99 865/- DEPOSITED IN THOSE BA NK ACCOUNTS OF THE TRUST BELONGED TO HIM AND THAT HE WOULD INCLUDE THE INCOME REPRESENTED THEREBY IN HIS RETURN FOR THE PRESENT A SSESSMENT YEARS. LATER ON SEARCH WAS CONDUCTED IN THE BANK PREMISES AND SEARCH WARRANTS WERE ISSUED IN THE NAME OF THE ASSESSEE AN D IN THE NAME OF 4 K. M. SHAH CHARITABLE TRUST. THOSE SEARCH WARRANTS WERE SERVED NOT ON THE ASSESSEE OR ON K. M. SHAH CHARITABLE TRUST I N WHOSE CASE THE PROCEEDINGS U/S. 132 WERE TO BE TAKEN BUT ON THE B ANKS WHERE THE BANK ACCOUNTS OF K. M. SHAH CHARITABLE TRUST WERE OPENED BEFORE THE DATE OF SURVEY CONDUCTED U/S 133A IN AUGUST 2 004. THE SAID SEARCH PROCEEDINGS ALLEGEDLY TAKEN IN THE CASE OF T HE ASSESSEE AND K. M. SHAH CHARITABLE TRUST RESULTED INTO THE SEARC H PARTY CARRYING OUT SEIZURE OF RS.1 93 99 865/- AFTER ENFORCING WIT HDRAWAL OF THE AMOUNTS LYING DEPOSITED IN THE SAID BANK ACCOUNTS O F K. M. SHAH CHARITABLE TRUST. THE ASSESSEE HAD RETRACTING FROM HIS ADMISSION EXTRACTED IN HIS SECOND STATEMENT WHICH WAS RECORDE D ON 24-12-2004 DURING THE POST SURVEY PROCEEDINGS. IT MAY BE NOTIC ED THAT IN ALL THESE YEARS THE INCOME WAS ASSESSED AT THE SAME FIGURE AT WHICH THE RETURN WAS FILED IN RESPONSE TO NOTICE U/S 153A FOR THE RESPECTIVE YEARS. THE ONLY QUESTION THAT ARISES IS VALIDITY OF THE PROCEEDINGS U/S. 153A. THE REASON FOR PROCEEDINGS U/S. 153A IS THAT DURING THE COURSE OF SURVEY AT THE PREMISES OF K. M. SHAH CHARITABLE TRUST IT WAS FOUND THAT DEPOSITS OF RS.193.99 LACS IN THE BANK ACCOUNT S WERE REPRESENTING UNACCOUNTED MONEY. THEREFORE IT IS ST ATED BY THE ASSESSING OFFICER THAT SEARCH PROCEEDINGS WERE CARR IED OUT ON 29 TH OCTOBER 2004. THE SEIZURE OF RS.1 93 99 865/- WAS CARRIED OUT ON 29-10-2004 I.E. ON THE DAY IMMEDIATELY FOLLOWING 28 -10-2004 WHEN THE SURVEY U/S. 133A WAS CONDUCTED THE ASSESSEE W AS INFORMED ABOUT IT BY THE INCOME TAX DEPARTMENT ONLY AFTER MO RE THAN SIX MONTHS I. .E. ON 09-5-2005. THE ASSESSEE WAS PROVID ED WITH COPIES OF PANCHNAMAS AND THEIR ENCLOSURES WHICH MUST HAVE BEEN PREPARED BY THE OFFICIALS ON THEIR VISIT TO THE BANKS BRANC HES. IN VIEW OF THESE 5 FACT THE NOTICE U/S 153A WAS ISSUED ON 15-07-2005 RECEIVED A NOTICE DATED 21-08-2006. THE ASSESSEE SUBMITTED THAT THE R ETURN IN RESPONSE TO THE NOTICE U/S 153A WAS FILED UNDER PRO TEST. THE SEARCH WARRANT WAS ISSUED IN CASE OF K. M. SHAH CHARITABL E TRUST MANSUKHBHAI K. SHAH NEITHER THE TRUST NOR MANSUKH BHAI K. SHAH WHETHER IN INDIVIDUAL CAPACITY OR IN THE CAPACITY O F THE MANAGING TRUSTEE OF THE TRUST WAS SERVED WITH OR EVEN SHOWN ANY SEARCH WARRANT. IN THIS REGARD IT WAS SUBMITTED THAT THE NOTICE U/S 153A COULD BE ISSUED ONLY WHERE A SEARCH IS INITIATED U/ S 132 OF THE IT ACT 1961. HOWEVER IN THE CASE OF THE ASSESSEE NO SUCH SEARCH OR REQUISITION HAS TAKEN PLACE. THEREFORE THE NOTICE ISSUED U/S 153A OF THE IT ACT 1961 IS VOID AB INITIO. IT WAS SUBMITTE D THAT THUS THE SEARCH WARRANT HAVING NOT BEEN SERVED UPON THE ASSESSEE T HERE WAS NO PROCEEDINGS U/S 132 OR U/S 132A IN THE ASSESSEES C ASE AND HENCE THERE WAS NO QUESTION OF INVOKING SECTION 153A OF T HE IT ACT. ACCORDINGLY THE NOTICE ISSUED U/S 153A AND CONSEQU ENT ORDER OF THE ASSESSMENT IS NOT VALID FOR EACH OF THE ABOVE YEARS . FURTHER IT IS OBVIOUS FROM THE MANNER IN WHICH THE PANCHNAMAS DESCRIBED THE PERSON IN WHOSE CASE THE WARRANT FOR SEARCH U/S. 13 2 WAS ISSUED THAT EVEN THE SEARCH WARRANTS MUST HAVE DESCRIBED THE PE RSON IN WHOSE CASE THE SEARCH WAS TO BE CONDUCTED IN THE SAME AMB IGUOUS MANNER AS K. M. SHAH CHARITABLE TRUST MANSUKHBHAI K. SHA H AND WHICH CLEARLY SHOWED THAT EVEN AT THE TIME OF ISSUING SEA RCH WARRANT THE DEPARTMENT HAD NOT MADE UP ITS MIND AS TO WHETHER I T WAS CARRYING OUT THE SEARCH IN THE CASE OF THIS TRUST OR IN THE CASE OF SHRI MANSUKHBHAI K. SHAH IN HIS INDIVIDUAL CAPACITY. IT IS EVIDENT FROM THE FACT THAT SEPARATE ORDERS WERE PASSED ON 27-12-2004 U/S. 210 BY THE 6 INCOME TAX OFFICER WARD-5(3) BARODA CALLING UPON NOT ONLY THE TRUST BUT ALSO SHRI MANSUKHBHAI K. SHAH IN HIS INDIVIDUA L CAPACITY TO PAY ADVANCE TAX AMOUNTING TO RS.64 89 235/- ON THE SAME AMOUNT OF ESTIMATED INCOME OF RS.1 93 99 865/- THAT BEING THE AMOUNT WHICH WAS SEIZED BY THE DEPARTMENT FROM THIS TRUST BANK A CCOUNTS IN THE INDIAN OVERSEAS BANK. 6. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) AF TER CONSIDERING THE MATERIALS ON RECORD AND THE SUBMISS IONS OF THE ASSESSEE DISMISSED THE APPEAL OF THE ASSESSEE ON TH IS ISSUE. HIS FINDINGS IN PARA 3 ARE REPRODUCED AS UNDER: 3. I HAVE CAREFULLY CONSIDERED THE CONTENTIONS OF THE LD. COUNSEL AS WELL AS GONE THE ROUGH THE RECORDS. ON P ERUSAL OF ASSESSMENT ORDER IT HAS BEEN NOTICED THAT SEARCH U NDER SECTION 132 WAS CONDUCTED IN THE NAME OF THE APPELL ANT IN THE BANK PREMISES. HENCE NOTICE U/S 153A WAS VALIDLY I SSUED. KEEPING IN VIEW OF ABOVE FACTS AND CIRCUMSTANCES OF THE CASE THERE IS NO INFIRMITY IN THE ASSESSMENT ORDER AND H ENCE CONTENTIONS OF LD. COUNSEL ARE HEREBY REJECTED. THE FIRST GROUND OF APPEAL IS DISMISSED. 7. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW. HE H AS SUBMITTED THAT NO SEARCH WAS CONDUCTED IN THE INDIVIDUAL CASE OF THE ASSESSEE. THE ORDER U/S 143(3) WAS PASSED IN THE CASE OF THE TRUST DATED 29-12-2006 FOR ASSESSMENT YEAR 2005-06 IN WHICH IT WAS GRANTED EXEMPTION U/S 11 OF THE IT ACT BEING REGISTERED U/S 12A OF THE IT ACT. HOWEVER PROTECTIVE ADDITION WAS MADE IN A SUM OF R S.1 93 99 865/-. THE ASSESSING OFFICER PASSED THE ORDER U/S 154 OF 7 THE IT ACT IN THE CASE OF THE TRUST AND THE AMOUNT LYING IN THE PD ACCOUNT WAS ADJUSTED AS ADVANCE TAX IN THE CASE OF THE TRUST. THE TRUST WAS GRANTED REFUND AGAINST THE DEMAND. COPIES OF 154 ORDER TAX COMPUTATION FORM AND INCOME TAX REFUND IN THE C ASE OF THE TRUST ARE FILED IN THE PAPER BOOK. HE HAS FURTHER SUBMITT ED THAT APPEAL OF THE TRUST FOR THE SAME ASSESSMENT YEAR BEFORE THE L EARNED CIT (A) WAS NOT PRESSED BECAUSE THE TAX WAS APPROPRIATED IN THE CASE OF T HE TRUST OUT OF THE ABOVE AMOUNTS LYING IN VARIOUS BAN KS IN THE NAME OF THE TRUST WHICH WERE SEIZED BY THE REVENUE AUTHORIT IES SUBSEQUENTLY AND CONVERTED INTO PD ACCOUNT. HE HAS SUBMITTED THA T THE AMOUNT IN QUESTION LYING IN VARIOUS BANK ACCOUNTS OF INDIAN O VERSEAS BANK IN THE NAME OF THE TRUST THEREFORE DOES NOT BELONG T O THE ASSESSEE INDIVIDUAL AND ULTIMATELY REVENUE DEPARTMENT CONFIR MED THE ADDITION ON SUBSTANTIVE BASIS IN THE CASE OF THE TRUST OF TH E AMOUNTS LYING IN THE BANK ACCOUNTS OF THE TRUST. THE ASSESSEE IS MA NAGING TRUSTEE OF THE TRUST. RS.5.47 CRORES WERE DEPOSITED IN ALL THE 15 BANK ACCOUNTS OF THE TRUST BETWEEN 12-08-2004 TO 18-08-2 004 BUT RS.1.93 CRORES WAS NOT ENTERED IN THE BOOKS OF THE TRUST IN THE YEAR UNDER CONSIDERATION. SINCE THE AMOUNT LYING IN THE BANK A CCOUNTS WAS IN THE NAME OF THE TRUST THEREFORE NO SEARCH WAS CONDUCT ED IN THE INDIVIDUAL NAME OF THE ASSESSEE. HE HAS REFERRED TO STATEMENT OF THE ASSESSEE RECORDED ON 28-10-2004 IN WHICH HE HAS EXP LAINED THE BANK ACCOUNTS OF THE TRUST OUT OF WHICH SOME ARE RE FLECTED IN THE BOOKS OF ACCOUNT OF THE TRUST AND SOME NOT REFLECTE D IN THE BOOKS OF THE TRUST. HE HAS SUBMITTED THAT THOUGH HE HAS ADMI TTED THE AMOUNT TO BE HIS PERSONAL MONEY BUT IN ANSWER TO QUESTION NO.36 IN THE SAME STATEMENT THE ASSESSEE HAS EXPLAINED THAT HIS PERSONAL BOOKS 8 ARE NOT WRITTEN COMPLETELY THEREFORE HE WILL FURN ISH THE EVIDENCE OF THE SOURCE BY FILING THE RETURN OF INCOME IF AVAILA BLE. HE HAS SUBMITTED THAT THE ASSESSEE IN HIS LATER STATEMENT DATED 24-1 2-2004 FURTHER EXPLAINED BEFORE THE AO THAT THE AMOUNT LYING IN TH E BANK BELONG TO THE TRUST. THEREFORE IT WOULD AMOUNT TO RETRACTION FROM THE EARLIER STATEMENT. HE HAS SUBMITTED THAT WARRANT OF AUTHORI ZATION DATED 29-10-2004 WERE ISSUED IN RESPECT OF VARIOUS BRANCH ES OF THE INDIAN OVERSEAS BANK THROUGH WHICH THE AMOUNT LYING IN THE BANK WERE CONVERTED INTO PD ACCOUNT OF THE DEBARMENT WHICH WE RE IN THE NAME OF THE TRUST. HE HAS SUBMITTED THAT THE PANCHNAMAS OF THE BANK WERE GIVEN TO THE ASSESSEE BEING THE MANAGING TRUSTEE ON LY ON 09-05-2005 ON WHICH ENDORSEMENT IS MADE IN RESPECT OF BANK ACCOUNTS OF THE TRUST. COPIES ARE FILED IN THE PAPE R BOOK. THUS RULE 112 (3) OF THE IT RULES IS NOT SATISFIED IN THIS CA SE. HE HAS THEREFORE SUBMITTED THAT NO WARRANT OF AUTHORIZATION U/S 132 WAS ISSUED IN THE INDIVIDUAL NAME OF THE ASSESSEE AND NO WARRANT OF A UTHORIZATION WAS EXECUTED IN THE INDIVIDUAL NAME OF THE ASSESSEE. NO SEARCH IS CONDUCTED IN THE INDIVIDUAL CASE OF THE ASSESSEE. THE A O WAS THEREFORE NOT JUSTIFIED IN TREATING THE SERVICE OF THE WARRANT OF AUTHORIZATION ON THE BANK MANAGER OF THE TRUST AS S ERVICE ON ASSESSEE. HE HAS RELIED UPON DECISION OF THE HON'BL E SUPREME COURT IN THE CASE OF K. C. C. SOFTWARE LTD. AND OTHERS VS DIT (INVESTIGATION) 298 ITR 1 IN WHICH IT WAS HELD THAT THE CASH IN BAN K WAS CONCEPTUALLY DIFFERENT FROM CASH ON HAND AND IT WAS NOT PERMISSI BLE FOR THE DEPARTMENT TO CONVERT ASSETS TO CASH AND THEREAFTER IMPOUNDED. IT WAS FURTHER HELD WHEN MONIES ARE DEPOSITED IN A BAN K RELATIONSHIP BETWEEN THE BANKER AND THE CUSTOMER IS ONE OF DEBTO R AND CREDITOR 9 AND NOT TRUSTEE AND BENEFICIARY. IT WOULD THEREFOR E SHOW THAT NO SEARCH WAS CONDUCTED IN THE CASE OF THE ASSESSEE. H E HAS RELIED UPON DECISION OF HON'BLE ALLAHABAD HIGH COURT IN TH E CASE OF CIT VS SMT. VANDABA VERMA IN ITA NO.21/ALL/2009 DATED 09-1 0-2009 (COPY FILED IN THE PAPER BOOK). IN THIS CASE THE WARRANT OF AUTHORIZATION WAS IN JOINT NAME OF MR. MUDIT VERMA AND MRS. VANDANA V ERMA TO ENTER AND SEARCH THE RESIDENCE AT LUCKNOW. THE A O IN THI S CASE ISSUED NOTICE U/S 158BC OF THE IT ACT IN THE NAME OF MRS. VANDANA VERMA AND COMPUTED THE UNDISCLOSED INCOME IN HER NAME. TH E ASSESSEE TOOK PRELIMINARY OBJECTION BEFORE THE TRIBUNAL WITH REGARD TO FRAMING OF THE ASSESSMENT IN INDIVIDUAL CAPACITY AND SUBMIT TED THAT AS THE SEARCH WARRANT WAS IN JOINT NAME THEREFORE ASSESSM ENT CANNOT BE FRAMED IN INDIVIDUAL CAPACITY. THE OBJECTION WAS UP HELD BY THE TRIBUNAL AND APPEAL OF THE ASSESSEE WAS ALLOWED ON THE PRELIMINARY POINT ITSELF. HON'BLE HIGH COURT CONSIDERING THE IS SUE IN DETAIL DISMISSED THE DEPARTMENTAL APPEAL. THE OPERATIVE FI NDINGS ARE REPRODUCED AS UNDER: IN VIEW OF THE ABOVE IN OUR OPINION THE WARRANT OF AUTHORIZATION MUST BE ISSUED INDIVIDUALLY BY THE DIRECTOR/COMMISSIONER AT THE TIME OF ISSUING THE SA ME. IF THE SAME IS NOT ISSUED INDIVIDUALLY THEN ASSESSMEN T CANNOT BE MADE IN AN INDIVIDUAL CAPACITY AS DONE BY THE ASSESSING OFFICER IN THE INSTANT CASE. THE WARRANT WAS ISSUED JOINTLY AS STATED HEREINABOVE SO THE ASSES SMENT WILL HAVE TO BE MADE COLLECTIVELY IN THE NAME OF BO TH THE PERSONS IN THE STATUS OF AOP/BOI. THUS THE TRIBUNA L HAS RIGHTLY HELD THAT ASSESSMENT COULD NOT BE FRAMED IN AN INDIVIDUAL CAPACITY BUT IT SHOULD BE FRAMED EITHER AS ASSOCIATION OF PERSON OR AS BODY OF INDIVIDUAL. 10 IN THE LIGHT OF THE ABOVE DISCUSSIONS AND BY CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTA NCES OF THE CASE WE UPHOLD THE IMPUGNED ORDER PASSED BY TH E TRIBUNAL WHO HAS RIGHTLY SET-ASIDE THE ASSESSMENT ORDERS WHICH WERE PASSED IN INDIVIDUAL CAPACITY OF THE ASS ESSEE. HOWEVER IT WILL BE OPEN TO THE ASSESSING AUTHORITY TO PROCEED AND PASS FRESH ASSESSMENT ORDER IN ACCORDAN CE WITH LAW IF SO DESIRE. THE APPEAL IS THEREFORE DISMISSED. LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT THERE IS NO UNDISCLOSED INCOME DETECTED IN THE INDIVIDUAL CASE OF THE ASSESSEE. THE RETURNED INCOME IS ACCEPTED IN THE INDIVIDUAL A SSESSMENTS. THE ASSESSEE DENIED MONEY LYING IN THE BANK ACCOUNT IN THE NAME OF TRUST BELONGING TO HIM. HE HAS SUBMITTED THAT SEARC HES ARE NOT CONDUCTED ON PREPONDERANCE OF PROBABILITIES. NO MAT ERIAL WAS FOUND AGAINST THE ASSESSEE AT ANY POINT OF TIME. ADDITION CANNOT BE MADE ON THE BASIS OF STATEMENT OF THE ASSESSEE ONLY. HE HAS SUBMITTED THAT IT IS WELL SETTLED THAT WHENEVER THERE IS A RETRACT ION FROM THE ASSESSEE THE DEPARTMENT NEEDS TO BRING ENOUGH MATERIAL ON RE CORD TO PROVE THE EXISTENCE OF UNDISCLOSED INCOME. HE HAS FILED COPIE S OF SEVERAL DECISIONS OF VARIOUS HIGH COURTS AND THE TRIBUNAL I N THE PAPER BOOK IN SUPPORT OF THIS CONTENTION. HE HAS ALSO RELIED U PON DECISION OF MADRAS HIGH COURT IN THE CASE OF CIT VS S. KHADER K HAN SON 300 ITR 157 IN WHICH IT WAS HELD SECTION 133A DOES NOT EMPOWER ANY ITO TO EXAMINE ANY PERSON ON OATH SO STATEMENT RECORDE D U/S 133A HAS NO EVIDENTIARY VALUE AND ANY ADMISSION MADE DURING SUCH STATEMENT CANNOT BE MADE BASIS OF ADDITION. HE HAS ALSO RELI ED UPON ORDER OF ITAT CALCUTTA BENCH IN THE CASE OF L.M. J. INTERNAT IONAL LTD. 22 SOT 11 315 IN WHICH IT WAS HELD THAT THE ITEMS OF REGULAR ASSESSMENT CANNOT BE ADDED IN THE PROCEEDINGS U/S 153C OF THE IT ACT. LEARNED COUNSEL FOR THE ASSESSEE ACCORDINGLY SUBMITTED THAT SINCE N O SEARCH WARRANT WAS ISSUED IN THE INDIVIDUAL NAME OF THE ASSESSEE A ND NO SEARCH WAS CONDUCTED IN THE INDIVIDUAL CASE OF THE ASSESSEE AN D NO UNDISCLOSED INCOME WAS FOUND IN THE INDIVIDUAL CASE OF THE ASSE SSEE THEREFORE PROCEEDINGS U/S 153A IN THE INDIVIDUAL CASE OF THE ASSESSEE ARE INVALID AND BAD IN LAW AND SHALL HAVE TO BE QUASHED . NO ADDITION CAN BE MADE ON MERIT ALSO. 8. ON THE OTHER HAND LEARNED DEPARTMENTAL REPRESENTAT IVE RELIED UPON THE ORDERS OF AUTHORITIES BELOW. LEARNED DEPAR TMENTAL REPRESENTATIVE SUBMITTED THAT SURVEY WAS CONDUCTED IN THE CASE OF THE TRUST IN WHICH STATEMENT OF ASSESSEE WAS RECORD ED WHEREIN ASSESSEE ADMITTED THAT THE AMOUNT DEPOSITED IN THE BANK ACCOUNT OF THE TRUST IS HIS PERSONAL MONEY FOR WHICH ASSESSEE HAS FAILED TO EXPLAIN THE SOURCE. THE LEARNED DEPARTMENTAL REPRES ENTATIVE SUBMITTED THAT THERE WERE 15 BANK ACCOUNTS FOUND IN THE NAME OF THE TRUST OUT OF WHICH 6 BANK ACCOUNTS REMAINED UNACCOU NTED. HE HAS THEREFORE SUBMITTED THAT SINCE THE ASSESSEE IS MAN AGING TRUSTEE OF THE TRUST THEREFORE THE PRINCIPLE OF PREPONDERANCE OF PROBABILITY APPLY IN THE CASE AS IS HELD BY HONBLE SUPREME CO URT IN THE CASES OF SUMATI DAYAL 214 ITR 801 AND DURGA PRASAD MORE 8 2 ITR 540. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED T HAT THE AMOUNT BELONG TO THE ASSESSEE IN HIS INDIVIDUAL CAPACITY. HE HAS SUBMITTED THAT ONCE THE WARRANT OF AUTHORISATION HAS BEEN SER VED UPON BANK THERE IS SUFFICIENT COMPLIANCE OF SERVICE OF SEARCH WARRANT UPON ASSESSEE. THERE IS NO NEED OF SERVICE OF SEARCH WAR RANT UPON 12 ASSESSEE. HE HAS SUBMITTED THAT FOR PROCEEDINGS U/S 153A INITIATION OF THE SEARCH PROCEEDINGS U/S 132 IS ENOUGH. ASSES SING OFFICER WAS THEREFORE JUSTIFIED IN PROCEEDING AGAINST THE ASSE SSEE U/S 153A OF THE IT ACT BECAUSE WARRANT OF AUTHORIZATION WAS ISS UED IN THE NAME OF THE TRUST AND THE ASSESSEE U/S 132 OF THE IT ACT IN THE FOLLOWING NAME K. M. SHAH CHARITABLE TRUST MANSUKHBHAI K. S HAH. HE HAS SUBMITTED THAT JOINT SEARCH WARRANT IS VALID UNDER THE LAW AND RELIED UPON DECISION OF ALLAHABAD HIGH COURT IN THE CASE O F RAGHURAJ PRATAP SINGH AND OTHERS VS ACIT 307 ITR 450 IN WHICH IT WA S HELD COMMON AUTHORIZATION IN RESPECT OF MORE THAN ONE PERSON PE RMISSIBLE. HE HAS SUBMITTED THAT IN THE CASE OF SMT. VANDANA VERM A DECIDED BY HONBLE ALLAHABAD HIGH COURT (SUPRA) THE WARRANT WA S IN THE JOINT NAMES OF MR. MUDIT VERMA AND MRS. VANDANA VERMA WHI CH WAS CONSIDERED IN THE NAME OF SINGLE PERSON BUT IN THE CASE OF THE ASSESSEE AND IS NOT USED IN THE WARRANT OF AUTHORIZATION BECAUSE IT IS COMA ( ) BEING IN THE NAME OF TRUST AND THE ASSESSE E. THEREFORE DECISION IN THE CASE OF VANDANA VERMA (SUPRA) WOULD NOT APPLY. LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT ASSESSEE DID NOT FILE RETURN OF INCOME ON TIME. ASSESSEE HAS NOT MADE OUT A CASE OF COERCIVE METHOD USED WHILE RECORDING HIS STATEME NT DURING SURVEY. AT LEAST ONE OF THE STATEMENTS OF THE ASSESSEE DATE D 28-10-2004 OR 24-12-2004 IS WRONG AND NOT TRUE. HE HAS SUBMITTED THAT THE STATEMENT RECORDED DURING THE SURVEY SHALL BE DEEME D TO BE STATEMENT GIVEN BEFORE THE CIVIL COURT AND THUS CA NNOT BE RETRACTED. HE HAS RELIED UPON DECISION OF CALCUTTA HIGH COURT IN THE CASE OF JHABARMALL AGARWAL VS KASHIRAM AGARWAL AND OTHERS 7 1 ITR 269 IN WHICH IT WAS HELD THAT U/S 131 OF THE IT ACT READ W ITH ORDER XIII RULE 13 10 OF C.P.C. ITO HAS POWER TO CALL FOR RECORDS IN THE CUSTODY OF THE COURT. LEARNED DEPARTMENTAL REPRESENTATIVE THEREFOR E SUBMITTED THAT ASSESSING OFFICER WAS JUSTIFIED IN INITIATING THE PROCEEDINGS U/S 153A OF THE IT ACT AGAINST THE ASSESSEE IN THREE YE ARS. HE HAS FURTHER SUBMITTED THAT THE RETRACTION IN THE CASE O F THE ASSESSEE IS AFTER THOUGHT AS OBSERVED BY ASSESSING OFFICER. PD ACCOUNT IS IN THE NAME OF THE CIT. TRIAL BALANCE WAS IN THE SURVEY AN D RELIED UPON 96 ITD 344 (AHMEDABAD). THE ADDITION ON MERIT WAS RIGH TLY MADE BY THE A O IN THE CASE OF ASSESSEE. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MA TERIAL AVAILABLE ON RECORD. SECTION 153A OF THE ACT PROVID ES 153A. NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139 SECTION 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 DOCUMENTS OR ANY ASSETS ARE REQUISITIONED UND ER SECTION 132A AFTER THE 31ST DAY OF MAY 2003 THE ASSESSING OFFICER SH ALL ( A )ISSUE NOTICE TO SUCH PERSON REQUIRING HIM TO FURNI SH WITHIN SUCH PERIOD AS MAY BE SPECIFIED IN THE NOTICE THE RETURN OF INCOM E IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN SIX ASSESSMENT YEARS REFERRED TO IN CLAUSE ( B ) IN THE PRESCRIBED FORM AND VERIFIED IN THE PRESC RIBED MANNER AND SETTING FORTH SUCH OTHER PARTICULARS AS MAY BE PRESCRIBED A ND THE PROVISIONS OF THIS ACT SHALL SO FAR AS MAY BE APPLY ACCORDINGLY AS I F SUCH RETURN WERE A RETURN REQUIRED TO BE FURNISHED UNDER SECTION 139 ; ( B ) ASSESS OR REASSESS THE TOTAL INCOME OF SIX ASSESS MENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED OR REQUISITION IS MADE : PROVIDED THAT THE ASSESSING OFFICER SHALL ASSESS OR REASSESS THE TOTAL INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING W ITHIN SUCH SIX ASSESSMENT YEARS: PROVIDED FURTHER THAT ASSESSMENT OR REASSESSMENT IF ANY RELATING T O ANY ASSESSMENT YEAR FALLING WITHIN THE PERIOD OF SIX AS SESSMENT YEARS REFERRED TO IN THIS SECTION PENDING ON THE DATE OF INITIATIO N OF THE SEARCH UNDER 14 SECTION 132 OR MAKING OF REQUISITION UNDER SECTION 132A AS THE CASE MAY BE SHALL ABATE. 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 T HE 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 CHARGEABL E AT THE RATE OR RATES AS APPLICABLE TO SUCH ASSESSMENT YEAR. SECTION 132 OF THE ACT PROVIDES - 132. (1) WHERE THE DIRECTOR GENERAL OR DIRECTOR] OR THE [CHIEF COMMISSIONER OR COMMISSIONER] [OR ANY SUCH [JOINT D IRECTOR] OR [JOINT COMMISSIONER] AS MAY BE EMPOWERED IN THIS BEHALF BY THE BOARD] IN CONSEQUENCE OF INFORMATION IN HIS POSSESSION HAS R EASON 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) O R UNDER SUB OR A NOTICE UNDER SUB-SECTION (4) OF SECTION 22 OF THE INDIAN INCOME TAX ACT 1922 OR UNDER SUBSE CTION (1) OF SECTION 142 OF THIS ACT WAS ISSUED TO BE PRODUCED ANY BOOKS OF ACCOUNT OR OTHER DOCUMENT S HAS OMITTED OR FAILED TO PRODUCE OR CAUSE TO BE PRODUCED SUCH BOOK BY SUCH SUMMONS OR NOTICE OR ( B ) ANY PERSON TO WHOM A SUMMONS OR NO TICE AS AFORESAID HAS BEEN OR MIGHT BE ISSUED WILL NOT OR WOULD NOT PRODUCE OR CAUS OTHER DOCUMENTS WHICH WILL BE USEFUL FOR OR RELEVA NT TO ANY PROCEEDING UNDER THE INDIAN INCOMETAX AC T 1922 (11 OF 1922) OR UN SECTION ( C ) ANY PERSON IS IN POSSESSION OF ANY MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING S REPRESENTS EITHER AND SUCH MONEY BU REPRESENTS EITHER [WHICH HAS NOT BEEN OR WOULD NOT BE DISCLOSED 69 ] FOR THE PURPOSES OF THE INDIAN INCOME- TAX ACT 1922 (11 OF 1922) OR THIS A UNDISCLOSED INCOME OR PROPERTY) [THEN ( A ) THE [DIRECTOR GENERAL OR DIRECTOR] OR THE [CHIEF COMMISSIONER OR COMMISSIONER] AS THE CASE MAY BE MAY AUTHORISE AN Y [JOINT DIRECTOR] JOINT COMMISSIONER] [ASSISTANT DIRECTOR [OR DEPUT Y DIRECTOR]] ASSISTANT COMMISSIONER [OR DEPUTY COMMISSIONER] OR INCOME-TAX OFFICER] OR ( B ) SUCH [JOINT DIRECTOR] OR [JOINT COMMISSIONER] AS THE CASE MAY BE MAY AUTHORISE ANY [ASSISTANT DIRECTOR [OR DEPUTY D IRECTOR]] [ASSISTANT COMMISSIONER [OR DEPUTY COMMISSIONER ] OR INCOME-TAX OFFICER] (THE OFFICER SO AUTHORISED IN ALL CASES BEING HEREI NAFTER REFERRED TO AS THE AUTHORISED OFFICER) TO] 15 ( I ) ENTER AND SEARCH ANY [BUILDING PLACE VESSEL VE HICLE 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; ( II ) BREAK OPEN THE LOCK OF ANY DOOR BOX LOCKER SAF E ALMIRAH OR OTHER RECEPTACLE FOR EXERCISING THE POWERS CONFERRED BY C LAUSE ( I ) WHERE THE KEYS THEREOF ARE NOT AVAILABLE; [( IIA ) SEARCH ANY PERSON WHO HAS GOT OUT OF OR IS ABOUT TO GET INTO OR IS IN THE BUILDING PLACE VESSEL VEHICLE OR AIRCRAFT I F 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 OF ANY BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN T HE 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 TO INSPEC T SUCH BOOKS OF ACCOUNT OR OTHER DOCUMENTS;] ( III ) SEIZE ANY SUCH BOOKS OF ACCOUNT OTHER DOCUMENTS MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING FOUND AS A RESULT OF SUCH SEARCH: [ PROVIDED THAT BULLION JEWELLERY OR OTHER VALUABLE ARTICLE O R THING BEING STOCK-IN-TRADE OF THE BUSINESS FOUND AS A RESULT O F SUCH SEARCH SHALL NOT BE SEIZED BUT THE AUTHORISED OFFICER SHALL MAKE A N OTE OR INVENTORY OF SUCH STOCK-IN-TRADE OF THE BUSINESS;] ( IV ) PLACE MARKS OF IDENTIFICATION ON ANY BOOKS OF ACC OUNT OR OTHER DOCUMENTS OR MAKE OR CAUSE TO BE MADE EXTRACTS OR C OPIES THEREFROM; ( V ) MAKE A NOTE OR AN INVENTORY OF ANY SUCH MONEY BU LLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING : [ PROVIDED THAT WHERE ANY BUILDING PLACE VESSEL VEHICLE OR AIRCRAFT REFERRED TO IN CLAUSE ( I ) IS WITHIN THE AREA OF JURISDICTION OF ANY 87 [CHIEF COMMISSIONER OR COMMISSIONER] BUT SUCH [CHIEF COMMISSIONER OR COMM ISSIONER] HAS NO JURISDICTION OVER THE PERSON REFERRED TO IN CLAUSE ( A ) OR CLAUSE ( B ) OR CLAUSE ( C ) THEN NOTWITHSTANDING ANYTHING CONTAINED IN SECTION [120] IT SHALL BE COMPETENT FOR HIM TO EXERCISE THE POWERS UNDER THIS SUB-SECTI ON IN ALL CASES WHERE HE HAS REASON TO BELIEVE THAT ANY DELAY IN GETTING THE AUT HORISATION FROM THE [CHIEF COMMISSIONER OR COMMISSIONER] HAVING JURISDICTION O VER SUCH PERSON MAY BE PREJUDICIAL TO THE INTERESTS OF THE REVENUE :] 16 [ PROVIDED FURTHER THAT WHERE IT IS NOT POSSIBLE OR PRACTICABLE TO TA KE PHYSICAL POSSESSION OF ANY VALUABLE ARTICLE OR THING AND REM OVE IT TO A SAFE PLACE DUE TO ITS VOLUME WEIGHT OR OTHER PHYSICAL CHARACTERISTIC S 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 CONTRO L 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 A UTHORISED OFFICER SHALL BE DEEMED TO BE SEIZURE OF SUCH VALUABLE ARTICLE OR TH ING UNDER CLAUSE ( III ):] [PROVIDED ALSO THAT NOTHING CONTAINED IN THE SECOND PROVISO SHALL APPLY IN CASE OF ANY VALUABLE ARTICLE OR THING BEING STOCK- IN-TRADE OF THE BUSINESS.] [(1A) WHERE ANY (CHIEF COMMISSIONER OR COMMISSIONE R] IN CONSEQUENCE OF INFORMATION IN HIS POSSESSION HAS REASON TO SUSPEC T THAT ANY BOOKS OF ACCOUNT OTHER DOCUMENTS MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING IN RESPECT OF WHICH AN OFFICER HAS BEEN AUTHO RISED BY THE [DIRECTOR GENERAL OR DIRECTOR] OR ANY OTHER [CHIEF COMMISSION ER OR COMMISSIONER] OR ANY SUCH [JOINT DIRECTOR] OR [JOINT COMMISSIONER] A S MAY BE EMPOWERED IN THIS BEHALF BY THE BOARD 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 [CHIEF CO MMISSIONER OR COMMISSIONER] MAY NOTWITHSTANDING ANYTHING CONTAIN ED IN SECTION [120] AUTHORISE THE SAID OFFICER TO TAKE ACTION UNDER ANY OF THE CLAUSES AFORESAID IN RESPECT OF SUCH BUILDING PLACE VESSEL VEHICLE OR AIRCRAFT.] (2) THE AUTHORISED OFFICER MAY REQUISITION THE SER VICES OF ANY POLICE OFFICER OR OF ANY OFFICER OF THE CENTRAL GOVERNMENT OR OF BOT H TO ASSIST HIM FOR ALL OR ANY OF THE PURPOSES SPECIFIED IN SUB-SECTION (1) [OR SU B-SECTION (1A)] AND IT SHALL BE THE DUTY OF EVERY SUCH OFFICER TO COMPLY WITH SUCH REQUISITION. (3) THE AUTHORISED OFFICER MAY WHERE IT IS NOT PR ACTICABLE TO SEIZE ANY SUCH BOOKS OF ACCOUNT OTHER DOCUMENTS MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING [FOR REASONS OTHER THAN THOSE MEN TIONED IN THE SECOND PROVISO TO SUB-SECTION (1) ] SERVE AN ORDER ON THE OWNER OR THE PERSON WHO IS IN IMMEDIATE POSSESSION OR CONTROL THEREOF THAT HE SHA LL NOT REMOVE PART WITH OR OTHERWISE DEAL WITH IT EXCEPT WITH THE PREVIOUS PER MISSION OF SUCH OFFICER AND SUCH OFFICER MAY TAKE SUCH STEPS AS MAY BE NECESSAR Y FOR ENSURING COMPLIANCE WITH THIS SUB-SECTION. [ EXPLANATION. FOR THE REMOVAL OF DOUBTS IT IS HEREBY DECLARED T HAT SERVING OF AN ORDER AS AFORESAID UNDER THIS SUB-SECTION SHA LL 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 O F THE SEARCH OR SEIZURE EXAMINE ON OATH ANY PERSON WHO IS FOUND TO BE IN PO SSESSION OR CONTROL OF ANY 17 BOOKS OF ACCOUNT DOCUMENTS MONEY BULLION JEWELL ERY OR OTHER VALUABLE ARTICLE OR THING AND ANY STATEMENT MADE BY SUCH PER SON DURING SUCH EXAMINATION MAY THEREAFTER BE USED IN EVIDENCE IN A NY PROCEEDING UNDER THE INDIAN INCOME-TAX ACT 1922 (11 OF 1922) OR UNDER THIS ACT. [ EXPLANATION. FOR THE REMOVAL OF DOUBTS IT IS HEREBY DECLARED T HAT THE EXAMINATION OF ANY PERSON UNDER THIS SUB-SECTION MA Y 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 T HE INDIAN INCOME-TAX ACT 1922 (11 OF 1922) OR UNDER THIS ACT.] [(4A) WHERE ANY BOOKS OF ACCOUNT OTHER DOCUMENTS MONEY BULLION 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 MONE Y BULLION JEWELLERY OR OTHER VALUABLE ARTICLE OR THING BELONG OR BELONG S TO SUCH PERSON ; ( II ) THAT THE CONTENTS OF SUCH BOOKS OF ACCOUNT AND OT HER DOCUMENTS ARE TRUE ; AND ( III ) THAT THE SIGNATURE AND EVERY OTHER PART OF SUCH B OOKS OF ACCOUNT AND OTHER DOCUMENTS WHICH PURPORT TO BE IN THE HANDWRIT ING OF ANY PARTICULAR PERSON OR WHICH MAY REASONABLY BE ASSUMED TO HAVE B EEN SIGNED BY OR TO BE IN THE HANDWRITING OF ANY PARTICULAR PERS ON ARE IN THAT PERSONS 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) [***] (6) [***] (7) [***] (8) THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS SEIZED UNDER SUB-SECTION (1) [OR SUB-SECTION (1A)] SHALL NOT BE RETAINED BY THE AUTH ORISED OFFICER FOR A PERIOD EXCEEDING [THIRTY DAYS FROM THE DATE OF THE ORDER O F ASSESSMENT UNDER [ SECTION 153A OR] CLAUSE ( C ) OF SECTION 158BC ] UNLESS THE REASONS FOR RETAINING THE SAME ARE RECORDED BY HIM IN WRITING AND THE APPROVAL OF THE [CHIEF COMMISSIONER COMMISSIONER DIRECTOR GENERAL OR DIRECTOR] FOR SUC H RETENTION IS OBTAINED : PROVIDED THAT THE [CHIEF COMMISSIONER COMMISSIONER DIRECT OR GENERAL OR DIRECTOR] SHALL NOT AUTHORISE THE RETENTION 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 A CT IN RESPECT OF THE YEARS FOR WHICH THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS ARE R ELEVANT ARE COMPLETED. [(8A) AN ORDER UNDER SUB-SECTION (3) SHALL NOT BE IN FORCE FOR A PERIOD EXCEEDING SIXTY DAYS FROM THE DATE OF THE ORDER.] 18 (9) THE PERSON FROM WHOSE CUSTODY ANY BOOKS OF ACCO UNT OR OTHER DOCUMENTS ARE SEIZED UNDER SUB-SECTION (1) [OR SUB-SECTION (1 A)] 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 PLA CE AND TIME AS THE AUTHORISED OFFICER MAY APPOINT IN THIS BEHALF. [(9A) WHERE THE AUTHORISED OFFICER HAS NO JURISDIC TION OVER THE 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 JEWELLER Y 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 HAND ED OVER BY THE AUTHORISED OFFICER TO THE ASSESSING OFFICER HAVING JURISDICTIO N OVER SUCH PERSON WITHIN A PERIOD OF SIXTY DAYS FROM THE DATE ON WHICH THE LAS T OF THE AUTHORISATIONS FOR SEARCH WAS EXECUTED AND THEREUPON THE POWERS EXERCI SABLE BY THE AUTHORISED OFFICER UNDER SUB-SECTION (8) OR SUB-SECTION (9) SH ALL BE EXERCISABLE BY SUCH ASSESSING OFFICER.] (10) IF A PERSON LEGALLY ENTITLED TO THE BOOKS OF A CCOUNT OR OTHER DOCUMENTS SEIZED UNDER SUB-SECTION (1) [OR SUB-SECTION (1A)] OBJECTS FOR ANY REASON TO THE APPROVAL GIVEN BY THE [CHIEF COMMISSIONER COMMISSI ONER DIRECTOR GENERAL OR DIRECTOR] UNDER SUB-SECTION (8) HE MAY MAKE AN APP LICATION TO THE BOARD STATING THEREIN THE REASONS FOR SUCH OBJECTION AND REQUESTI NG FOR THE RETURN OF THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS [AND THE BOARD MAY A FTER GIVING THE APPLICANT AN OPPORTUNITY OF BEING HEARD PASS SUCH ORDERS AS IT THINKS FIT]. (11) [***] (11A) [***] (12) ***] [(13) THE PROVISIONS OF THE CODE OF CRIMINAL PROC EDURE 1973 (2 OF 1974) RELATING TO SEARCHES AND SEIZURE SHALL APPLY SO FA R 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 UNDER THIS SECTION ; IN PARTICULAR AND WITHOUT PREJUDICE TO T HE 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 AIRCRAFT] TO BE SEARCHED WHERE FREE INGRESS THERETO IS NOT AV AILABLE ; ( II ) FOR ENSURING SAFE CUSTODY OF ANY BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR ASSETS SEIZED. [ EXPLANATION 1. FOR THE PURPOSES OF SUB-SECTION (9A) EXECUTION OF AN AUTHORISATION FOR SEARCH SHALL HAVE THE SAME MEANI NG AS ASSIGNED TO IT IN EXPLANATION 2 TO SECTION 158BE .] EXPLANATION 2. IN THIS SECTION THE WORD PROCEEDING MEANS ANY PR OCEEDING IN RESPECT OF ANY YEAR WHETHER UNDER THE INDIAN IN COME-TAX ACT 1922 (11 OF 1922) OR THIS ACT WHICH MAY BE PENDING ON THE DAT E ON WHICH A SEARCH IS AUTHORISED UNDER THIS SECTION OR WHICH MAY HAVE BEE N COMPLETED ON OR BEFORE 19 SUCH DATE AND INCLUDES ALSO ALL PROCEEDINGS UNDER T HIS ACT WHICH MAY BE COMMENCED AFTER SUCH DATE IN RESPECT OF ANY YEAR.] 9.1 SECTION 153A OF THE IT ACT STARTS WITH THE WOR D NOTWITHSTANDING ANYTHING CONTAINED IT IS NON-OBS TANTE CLAUSE. FOR APPLICABILITY OF ABOVE PROVISION THE INITIATION OF SEARCH IS NECESSARY. ONCE A WARRANT OF AUTHORIZATION OR REQUISITION IS I SSUED AND SEARCH IS CONDUCTED AND PANCHNAMA IS DRAWN THE COMPLETED ASS ESSMENTS FOR THE ALL THE RELEVANT YEARS WOULD GET REOPENED IRRES PECTIVE OF WHETHER ANY INCRIMINATING MATERIAL IS FOUND OR NOT IN RELAT ION TO A PARTICULAR AY. IN OTHER WORDS EVEN IF THE MATERIAL FOUND SHOWS TH E CONCEALMENT IN ONLY ONE YEAR ALL THE COMPLETED ASSESSMENTS FALLIN G IN THE PERIOD OF SIX AYS PRECEDING THE YEAR OF SEARCH WILL GET REOPE N. THERE WAS AN IDENTICAL PROVISION CONTAINED IN CHAPTER XIV-B OF T HE ACT WHICH PROVIDES THAT WHERE AFTER 30 TH JUNE 1995 A SEARCH IS INITIATED U/S 132 OR BOOKS ACCOUNTS ETC. ARE REQUISITIONED U/S 132A THE AO SHALL PROCEED TO ASSESS UNDISCLOSED INCOME IN ACCORDANCE WITH PROVISIONS OF CHAPTER XIV-B FOR MAKING ASSESSMENT FOR BLOCK PE RIOD BUT IN THE BLOCK ASSESSMENTS THE QUESTION OF ASSESSING AN UND ISCLOSED INCOME IN RELATION TO ANY AY WAS RESTRICTED TO THE INCRIMI NATING MATERIAL ON UNDISCLOSED ASSETS DISCOVERED DURING THE COURSE OF SEARCH AND 20 SEIZURE OR IN THE POST SEARCH INQUIRY THE MATERIAL WAS RELATABLE TO SUCH EVIDENCE DISCOVERED IN SEARCH. THE INCOME ASSE SSED IN THE REGULAR ASSESSMENTS WAS NOT TO BE CONSIDERED IN THE BLOCK ASSESSMENTS. HOWEVER IN THE PRESENT PROVISIONS U/S 153A THERE IS NO SUCH PROVISION PROVIDED IN THE ACT. ONCE WARRANT OF AUTHORIZATION IS ISSUED AND THE SEARCH IS CONDUCTED AND PANCHNAMA IS DRAWN THE ASSESSMENTS FOR ALL THE SEVEN YEARS INCLUDING THE C URRENT YEAR HAVE TO BE COMPLETED U/S 153A 153B AND 153C. EVEN THE A SSESSMENTS WHICH ARE COMPLETED BEFORE THE DATE OF SEARCH SHALL GET REOPENED AND THOSE ASSESSMENTS WHERE THE PROCEEDINGS ARE PEN DING AT THE TIME OF SEARCH SHALL ABATE. THE AO THEREFORE SHAL L ASSESS OR REASSESS SUCH INCOME FOR ALL THESE YEARS. 9.2 THE ABOVE PROVISION THEREFORE PROVIDES FOR R EOPENING OF THE COMPLETED ASSESSMENT OR ABATEMENT OR THE PENDING AS SESSMENTS TAKES PLACE IRRESPECTIVE OF WHETHER ANY INCRIMINATI NG MATERIAL IS FOUND DURING THE COURSE OF SEARCH OR NOT. IT CAN BE ILLU STRATED BY TAKING AN EXAMPLE THAT IF DURING THE COURSE OF SEARCH AND SEI ZURE PROCEEDINGS CERTAIN UNACCOUNTED VALUABLES OR MONEY IS FOUND AT THE TIME OF SEARCH WITHOUT THERE BEING INCRIMINATING MATERIAL O R DOCUMENT FOR ANY OTHER YEAR OR YEARS EVEN THEN ALL THE SIX ASSESSME NTS PRECEDING THE 21 ASSESSMENT YEAR IN WHICH SEARCH TOOK PLACE SHALL GE T REOPENED. SIMILARLY IF REQUISITION IS MADE THEN IRRESPECTIV E OF WHETHER THERE IS ANYTHING INCRIMINATING FOUND AGAINST HIM IN RELATIO N TO OTHER YEAR OR YEARS OR NOT THE ASSESSEE HAS TO UNDERGO THE RIGO R OF THE ASSESSMENT PROCEEDINGS FOR ALL THE SIX YEARS AS WEL L AS THE YEAR UNDER SEARCH. 9.3. SECTION 153A WOULD BE APPLICABLE WHERE A SEARC H IS INITIATED UNDER SECTION 132 OR BOOKS OF ACCOUNTS OR OTHER DOC UMENTS OR ANY ASSETS ARE REQUISITIONED UNDER SECTION 132A OF THE ACT AFTER 31 ST MAY 2003. THEREFORE BEFORE INVOKING THE PROVISIONS O F SECTION 153A OF THE ACT IT WOULD BE NECESSARY TO COMPLY WITH THE PR OVISIONS CONTAINED UNDER SECTION 132(1) OF THE ACT. SALIENT FEATURE O F SECTION 132(1) IS THAT WHERE THE DIRECTOR GENERAL OR DIRECTOR OR THE CHIEF COMMISSIONER OR COMMISSIONER IN CONSEQUENCE OF IN FORMATION IN HIS POSSESSION HAS REASON TO BELIEVE THAT ANY PERSO N FAILED TO PRODUCE BOOKS OF ACCOUNTS OR OTHER DOCUMENTS IN RES PONSE TO SUMMONS OR THAT ANY PERSON TO WHOM SUMMONS HAVE BEE N ISSUED HAS NOT OR MIGHT NOT OR WOULD NOT PRODUCE ANY BOOKS OF ACCOUNTS OR DOCUMENTS OR THAT ANY PERSON IS IN POSSESSION OF AN Y MONEY BULLION 22 JEWELLERY OR OTHER VALUABLE ARTICLE IN HIS POSSESSI ON WHICH HAS NOT BEEN OR WOULD NOT BE DISCLOSED FOR THE PURPOSE OF T HIS ACT (HEREINAFTER REFERRED TO AS UNDISCLOSED INCOME OR PROPERTY) THEN THE DIRECTOR GENERAL DIRECTOR OR CHIEF COMMISSIONER OR COMMISS IONER AS THE CASE MAY BE MAY AUTHORIZE ANY JOINT DIRECTOR ASS ISTANT DIRECTOR ASSISTANT COMMISSIONER OF DY. COMMISSIONER OF INCO METAX CALLED THE AUTHORIZED OFFICER TO ENTER AND SEARCH ANY BUI LDING PLACE VESSEL VEHICLE OR AIR-CRAFT ETC. WHERE HE HAS REA SON TO SUSPECT THAT SUCH BOOKS OF ACCOUNTS OTHER DOCUMENTS MONEY BUL LION 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 FR OM THE ABOVE PREMISES REQUIRE ANY PERSON TO ACCOUNT FOR THE BOO KS OF ACCOUNTS OR DOCUMENTS SEIZE ANY SUCH BOOKS OF ACCOUNTS OR DOCU MENTS MONEY BULLION JEWELLERY ETC. OR THINGS FOUND AS A RESUL T OF SUCH SEARCH AND MAY PLACE MARK OF IDENTIFICATION ON ANY BOOKS OF AC COUNTS OR OTHER DOCUMENTS OR TAKE COPY THEREOF AND TO PREPARE INVEN TORY OF THE SAME. THE PURPOSE OF SECTION 132 FOR ISSUE OF WARR ANT OF AUTHORIZATION IS TO UNEARTH DETECT AND TO TAKE POS SESSION OF THE UNACCOUNTED/UNDISCLOSED INCOME OR PROPERTY. THE ME RE ISSUE OF WARRANT OF AUTHORIZATION WITHOUT THERE BEING SEARCH OF THE PREMISES 23 MENTIONED IN THE WARRANT OF AUTHORIZATION WOULD BE MEANINGLESS AND WOULD NOT SERVE THE PURPOSE OF SECTION 132 OF THE A CT. 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 EXECUTI NG THE WARRANT OF AUTHORIZATION AND THE WARRANT OF AUTHORIZATION IS K EPT UNEXECUTED THE QUESTION ARISES WHETHER THE ASSESSING OFFICER STIL L SHOULD PROCEED UNDER SECTION 153A OF THE ACT FOR THE PURPOSE OF FR AMING THE ASSESSMENT OR REASSESSMENT OF THE SIX ASSESSMENT YE ARS IMMEDIATELY PRECEDING THE ASSESSMENT YEARS RELEVANT TO THE PREVIOUS YEAR IN WHICH SUCH SEARCH IS INITIATED OR REQUISITI ON IS MADE WITHOUT EXECUTING THE SEARCH WARRANT. THE ANSWER WOULD BE NO BECAUSE IT WOULD BE A FUTILE EXERCISE. IT MAY BE ADDED HERE TH AT JURISDICTION CAN BE ASSUMED BY THE ASSESSING OFFICER TO INITIATE ASS ESSMENT PROCEEDINGS TO ISSUE NOTICES ONCE SEARCH IS INITIAT ED UNDER SECTION 132/REQUISITION MADE UNDER SECTION 132A. HE GETS A CTUAL JURISDICTION ONLY ON ISSUE OF NOTICE WHICH COULD BE ISSUED UNDE R SECTION 153A (UNLIKE SECTION 158BC(A) IN BLOCK ASSESSMENT) WITH NO NECESSITY FOR INFERENCE OF ESCAPEMENT OF INCOME OR UNDER-ASSESSME NT AS UNDER SECTION 147. SHOULD IT MEAN THAT A MERE SEARCH WIL L ENABLE 24 REASSESSMENT PROCEEDINGS BY-PASSING OR IGNORING THE REQUIREMENTS OF SECTION 147. THE ONLY PART OF PROCEDURE DISPENSE D WITH UNDER SECTION 153A OF IT ACT ON COMPARISON WITH SECTION 1 47 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 E VEN FOR THOSE ENTITIES WHICH MAY NOT BE IN EXISTENCE FOR ALL THE SIX YEARS INDICATING THAT THE PROVISION IS EXPECTED TO BE REASONABLY EXE RCISED. IT SHOULD THEREFORE FOLLOW THAT THERE SHOULD BE PRIMA FACIE I NFERENCE OF LIABILITY FOR INVOKING JURISDICTION UNDER SECTION 153A OF THE IT ACT. WE MAY ADD THAT IN SECTION 153A(B) IT IS SPECIFICALLY PROV IDED THAT THE ASSESSING OFFICER SHALL ASSESS OR REASSESS THE TOTA L INCOME OF SIX YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEARS RE LEVANT TO THE PREVIOUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED OR REQUISITION IS MADE. IT WOULD THEREFORE CLARIFY THAT NOT ONLY T HE WARRANT OF AUTHORIZATION IS TO BE ISSUED IN THE NAME OF THE AS SESSEE BUT SEARCH SHALL HAVE TO BE NECESSARILY CONDUCTED OR IN CASE O F REQUISITION UNDER SECTION 132A THE REQUISITION IS TO BE MADE ACTUALL Y. HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CHANDRA PRAKASH AGRAWAL V. CIT; 287 ITR 172 CONSIDERING THE DEFINITION OF REQUISITI ON UNDER SECTION 25 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 ACC OUNTS OR OTHER DOCUMENTS OR ASSETS ARE ACTUALLY RECEIVED BY THE AS SESSING 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 E XCISE DEPARTMENT. THE INCOMETAX DEPARTMENT HAD SENT A REQ UISITION ON MARCH 27 2002 UNDER SECTION 132A OF THE ACT REQ UISITIONING THE BOOKS OF ACCOUNTS AND OTHER DOCUMENTS SEIZED BY THE CENTRAL EXCISE DEPARTMENT. THE RECORD OF THE PROCE EDING DATED APRIL 18 2002 SHOWED THAT THE REQUISITION WA S NOT FULLY EXECUTED AS ALL THE BOOKS OF ACCOUNT AND OTHER DOCU MENTS 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 COPIE S 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 TRU ST MANSUKHBHAI K. SHAH WITH THE DIRECTION TO FIND VALUABLE ARTIC LES OR THINGS IN INDIAN 26 OVERSEAS BANK AT DIFFERENT BRANCHES. IN THE SAID W ARRANT OF AUTHORIZATION ALSO THE AUTHORIZED OFFICER WAS DIRE CTED TO ENTER AND SEARCH THE BUILDING ETC. PERSONS AND TO SEIZE BOOK S OF ACCOUNTS DOCUMENTS MONEY BULLION JEWELLERY ETC. AS ARE P ROVIDED UNDER SECTION 132 OF THE ACT NOTED ABOVE. ACCORDING TO SE CTION 132(14) EXECUTION OF AN AUTHORIZATION SHALL HAVE SAME MEANI NG ASSIGNED IN EXPLANATION 2 TO SECTION 158BE WHICH PROVIDES AUTH ORIZATION IS DEEMED TO HAVE BEEN EXECUTED ON CONCLUSION OF SEARC H AS RECORDED IN PANCHNAMA. THEREFORE ACTUAL SEARCH SHALL HAVE T O BE CARRIED OUT NECESSARILY BEFORE PROCEEDING U/S 153A. RULE 112 OF IT RULES IS ALSO NOT SATISFIED IN CASE OF ASSESSEE. SERVICE OF WARRA NT ON BANK MANAGER OF TRUST IS NOT SERVICE ON ASSESSEE IN INDI VIDUAL CASE OF ASSESSEE. 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 RECOR DED ON OATH UNDER SURVEY IN THE PREMISES OF THE TRUST. THE DETA ILS OF THE TRUST WERE CALLED FOR IN THE STATEMENT OF THE ASSESSEE. C ERTAIN BANK ACCOUNTS IN THE NAME OF THE TRUST WERE FOUND DURING THE COURSE OF 27 SURVEY WHICH WAS NOT REFLECTED IN THE BOOKS OF ACCO UNT OF THE TRUST. THE ASSESSEE ADMITTED THE AMOUNT DEPOSITED IN THE A CCOUNTS AS HIS PERSONAL MONEY BUT IN THE LATER PORTION OF THE STA TEMENT HE HAS EXPLAINED THAT SINCE HIS PERSONAL BOOKS OF ACCOUNT FOR THE CURRENT YEAR ARE NOT WRITTEN THEREFORE IT CANNOT BE EXPLA INED AND ASSESSEE FURTHER STATED THAT HE WILL FURNISH THE SAME DETAIL S IF AVAILABLE. ADMITTEDLY IT IS A FACT THAT ALL THE BANK ACCOUNTS WHETHER DISCLOSED OR NOT REFLECTED IN THE BOOKS OF THE TRUST ARE BELONGI NG TO THE TRUST ONLY. NO UNDISCLOSED INCOME IN THE NAME OF THE ASSESSEE W AS FOUND EITHER DURING THE COURSE OF SURVEY OR THE SEARCH. NO INDEP ENDENT OR CORROBORATIVE EVIDENCE WAS FOUND AGAINST THE ASSESS EE THAT THE MONEY DEPOSITED IN THE BANK ACCOUNT OF THE TRUST BE LONGS TO ASSESSEE IN HIS INDIVIDUAL CAPACITY. THE ASSESSEE I N HIS LATER STATEMENT RECORDED BEFORE ASSESSING OFFICER ON 24-1 2-2004 RETRACTED FROM HIS EARLIER STATEMENT AND EXPLAINED THAT THE A MOUNT SEIZED FROM THE BANK ACCOUNTS OF T HE TRUST DID NOT BELONG TO H IM 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 MONE Y DEPOSITED IN THE BANK ACCOUNT OF THE TRUST BELONG TO THE ASSESSEE I N HIS INDIVIDUAL 28 CAPACITY. IT IS WELL SETTLED THAT ADMISSIONS ARE NO T 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 S EEN UNDER WHICH SAME ARE MADE. IT CAN BE WITHDRAWN UNLESS IT IS EST OPPELS AND CONCLUSIVE. HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF KISHANLAL SHIVCHAND 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 PRODUCT CO. LTD. 91 ITR 18 HELD THAT ASSESSEE SHOULD BE GIVEN OPPORTUNITY TO SHOW THAT ADMISSION IS INCORRECT OR DOES NOT SHOW CORRECT STA TE OF FACTS . HON'BLE MADRAS HIGH COURT IN THE CASE OF S. KHADERK HAN SON (SUPRA) HELD SECTION 133A DOES NOT EMPOWER ANY ITO TO EXAM INE ANY PERSON ON OATH SO STATEMENT RECORDED U/S 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 O N RECORD TO SHOW THAT THE AMOUNT DEPOSITED IN THE BANK ACCOUNT OF TH E TRUST BELONG TO THE ASSESSEE IN HIS INDIVIDUAL CAPACITY. THE ASSESS EE HAS BEEN ABLE TO EXPLAIN THAT HIS ADMISSION WAS IN FACT INCORRECT OR NOT TRUE. THE 29 STATEMENT OF THE ASSESSEE RECORDED BEING MANAGING T RUSTEE OF THE TRUST ON OATH ON DATED 28-10-2004 THUS CANNOT BE RE LIED UPON TO PROCEED AGAINST THE ASSESSEE U/S 153A IN HIS INDIVI DUAL CAPACITY. WE MAY ALSO NOTE HERE THAT THE AMOUNT LYING IN THE BAN K ACCOUNTS OF THE TRUST WERE CONVERTED INTO PD ACCOUNT OF THE DEPARTM ENT 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 U/S 11 READ WITH SECTION 12A OF THE IT ACT. THE AMOUNT LYING IN PD ACCOUNT OUT OF THE BANK ACCO UNT OF THE TRUST WAS APPROPRIATED BY THE ASSESSING OFFICER AGAINST T HE DEMAND RAISED IN THE CASE OF THE TRUST U/S 154 OF THE IT ACT. LAT ER 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 D EPARTMENT ACCEPTED SUBSTANTIVE ASSESSMENT IN CASE OF TRUST AN D THAT THE AMOUNT DEPOSITED IN THE BANK ACCOUNTS OF THE TRUST WHICH WERE NOT REFLECTED IN THE ACCOUNTS OF THE TRUST BELONGS TO T HE TRUST ONLY. CONSIDERING THE FACTS OF THE CASE AND THE WARRANT O F AUTHORIZATION AND THE PANCHNAMA PRODUCED BEFORE US IT IS CLEAR THAT THE WARRANT OF AUTHORIZATION WAS ISSUED IN THE NAME OF THE TRUST A ND THE ASSESSEE BEING THE MANAGING TRUSTEE OF THE TRUST. THE WARRA NT OF 30 AUTHORIZATION WAS ALSO EXECUTED UPON THE BANK MANAG ER OF INDIAN OVERSEAS BANK IN RESPECT OF SEVERAL BANK ACCOUNTS O F THE TRUST. THUS NO WARRANT OF AUTHORIZATION ISSUED IN THE NAM E OF ASSESSEE IN HIS INDIVIDUAL CAPACITY AND NO WARRANT OF AUTHORIZA TION 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 AUTHO RIZATION 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 CIRCU MSTANCES OF THE CASE THAT NAME OF THE ASSESSEE WAS ADDED IN THE WAR RANT OF AUTHORIZATION AND IN THE PANCHNAMA BEING THE ASSESS EE MANAGING TRUSTEE OF THE TRUST. THUS ASSESSEE HAS NO INDIVID UAL LIABILITY IN THE AFORESAID CASE. WE MAY ALSO NOTE HERE THAT LEARNED DEPARTMENTAL REPRESENTATIVE RELIED UPON DECISION OF ALLAHABAD HI GH COURT IN THE CASE OF RAGHURAJ PRATAP SINGH AND OTHERS (SUPRA) WH ICH WAS DELIVERED ON 14-07-2006. HOWEVER LEARNED COUNSEL F OR THE ASSESSEE RELIED UPON ANOTHER DECISION OF HON'BLE ALLAHABAD H IGH COURT IN THE CASE OF CIT VS SMT. VANDANA VERMA (SUPRA) WHICH WAS DELIVERED ON 09-10-2009. THE LATTER DECISION IS BINDING FOR CONS IDERATION. MOREOVER THE LATTER DECISION IN THE CASE OF SMT. V ANDANA VERMA 31 (SUPRA) IS DIRECTLY ON THE POINT IN ISSUE BECAUSE W HEN 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 ASS ESSEE WHICH IS DONE IN THE PRESENT CASE. THE PROCEEDINGS U/S 153A OF TH E IT 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 OBSERV ATION OF THE ASSESSING OFFICER THAT IN THESE THREE YEARS ASSESSI NG OFFICER ACCEPTED THE RETURNED INCOME MEANING THEREBY THAT T HERE WAS NO UNDISCLOSED INCOME BELONGS TO THE ASSESSEE IN THE A SSESSMENT YEARS UNDER APPEAL. 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 ISSU ED AND SEARCH IS ACTUALLY CONDUCTED PANCHNAMA IS DRAWN THE COMPLET ED ASSESSMENTS FOR ALL THE RELEVANT YEARS WOULD GET RE OPENED IRRESPECTIVE OF WHETHER ANY INCRIMINATING MATERIAL IS FOUND OR NOT IN 32 RELATION TO A PARTICULAR ASSESSMENT YEAR. HOWEVER THE WARRANT OF AUTHORIZATION SHALL HAVE TO BE EXECUTED BY THE AUTH ORIZED OFFICER IN ORDER TO JUSTIFY INVOKING OF THE JURISDICTION BY TH E ASSESSING OFFICER UNDER SECTION 153A OF THE ACT. CONSIDERING SECTIO N 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 MATERIA L. THE DECISION OF THE ALLAHABAD HIGH COURT NOTED ABOVE ALSO SUPPORTS THE ABOVE FINDINGS. AS IS NOTED ABOVE IT IS UNDISPUTED FAC T THAT THOUGH WARRANT OF AUTHORIZATION IS ISSUED IN THE NAME OF THE ASSES SEE BEING MANAGING TRUSTEE OF THE TRUST BUT IT IS ADMITTED F ACT THAT NO SEARCH OPERATION WAS CONDUCTED IN THE PREMISES OF THE ASSE SSEE. EVEN IN THE WARRANT OF AUTHORIZATION THE ADDRESS OF THE PL ACE TO BE SEARCHED IS NOT THE ADDRESS OF THE ASSESSEE INDIVIDUAL. ADM ITTEDLY NO PANCHNAMA IS ALSO DRAWN IN PURSUANCE WITH THE WARRA NT OF AUTHORIZATION IN THE CASE OF THE ASSESSEE. NO DOCUM ENTS WERE SEIZED OR IMPOUNDED AS SUCH DURING THE COURSE OF SEARCH FR OM THE ASSESSEE. THE WARRANT OF AUTHORIZATION DATED 29.10 .2004 IN THE NAME OF THE TRUST AND THE ASSESSEE STANDS UNEXECUTE D IN THE CASE OF ASSESSEE INDIVIDUAL. SINCE IN THIS CASE ONLY SURVE Y OPERATION UNDER SECTION 133A IS CONDUCTED IN THE PREMISES OF THE AS SESSEES TRUST IT 33 WOULD NOT SATISFY THE REQUIREMENTS OF SECTION 153A OF THE ACT. AS SUCH THE ASSESSING OFFICER WAS NOT JUSTIFIED IN IN ITIATING PROCEEDINGS OR ASSUMING VALID JURISDICTION UNDER SECTION 153A O F 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 A CCORDINGLY HOLD THAT THE PROCEEDINGS U/S153A OF THE IT ACT ARE INVA LID AND BAD IN LAW RESULTANTLY THE ORDERS OF THE AUTHORITIES BELOW AR E SET ASIDE AND QUASHED. 10. AS A RESULT ALL THE APPEALS OF THE ASSESSEE IN ITA NO.2878 2879 AND 2880/AHD/2007 ARE ALLOWED. ITA NO.3339/AHD/2007 (DEPARTMENTAL APPEAL) A Y (2005-06) 11. THIS APPEAL BY REVENUE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IV A HMEDABAD DATED 20-03-2007 FOR ASSESSMENT YEAR 2005-06 ON THE FOLLOWING GROUNDS: 1. THE LEARNED CIT (A) ERRED IN LAW AND ON FACTS I N DELETING THE ADDITION OF RS.1 93 99 865/- MADE ON ACCOUNT OF UNDISCLOSED INCOME FOUND AND SEIZED DURING THE COURSE OF SURVEY/SEARCH BY WAY OF CASH DEPOSITS IN THE BANK ACCOUNTS. 34 2. THE LEARNED CIT (A) FAILED TO TAKE NOTE OF THE STATEMENT RECORDED ON OATH ON 28-10-2004 ADMITTING THAT THE AMOUNT WAS PERSONAL MONEY OF THE ASSESSEE AND DOES NOT BELONG TO THE TRUST. 3. THE CIT (A) FAILED TO TAKE NOTE OF THE FACT THAT NO SOURCE OF INCOME WAS DISCLOSED DURING THE STATEMENT ON OATH RECORDED ON 28.10.2004. 4. THE CIT (A) FAILED TO APPRECIATE THE FACT THAT ATTRIBUTING THE RECEIPTS TO M/S. K. M. SHAH CHARITABLE TRUST WAS ON AFTERTHOUGHT ON THE PART OF THE ASSESSEE TO PRE-EMPT THE DEPARTMENT FROM OTHER PROCEEDINGS. 12. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) CONSIDERING THE SUBMISSIONS ON MERIT AS NOTED ABOVE HELD IN PARA 5 WHILE DELETING THE ADDITION OF RS.1 93 99 865/- AS UNDER 5. I HAVE CAREFULLY CONSIDERED THE CONTENTIONS OF LD. COUNSEL AS WELL AS GONE THROUGH THE RECORD. ON PERU SAL OF ASSESSMENT ORDER IT HAS BEEN NOTICED THAT STATE MENT OF THE APPELLANT WAS RECORDED UNDER SECTION 133A (1 )/131 AS PER PARA-2 OF THE ASSESSMENT ORDER. HOWEVER AS MENTIONED IN THE ASSESSMENT ORDER A SURVEY U/S 133 A WAS CARRIED OUT AT THE PREMISES OF THE M/S. K. M. S HAH CHARITABLE TRUST IN WHICH SHRI M. K. SHAH WAS THE MANAGING TRUSTEE WHOSE STATEMENT WAS RECORDED ON 28.10.2004 I.E. ON THE DAY OF SURVEY WHICH LED TO DETECTION OF UNACCOUNTED BANK ACCOUNTS. ON THE BASI S OF SURVEY PROCEEDINGS THE DEPARTMENT HAD CARRIED OUT SEARCH U/S 132 ON THE NEXT FOLLOWING DAY I.E. O N 29.10.2004 AT THE BANK PREMISES AND AMOUNT OF RS.1 93 99 865/- LYING IN THE BANK ACCOUNTS WAS SEI ZED ON 29.10.2004 WHICH WAS KEPT IN THE P. D. ACCOUNT O F THE TRUST MANAGED BY THE APPELLANT DR. MANSUKH KANJIBHA I 35 SHAH. FURTHER THE AMOUNT SEIZED FROM THE BANK ACCO UNT WAS ADJUSTED TOWARDS ADVANCE TAX LIABILITY OF THE T RUST ONLY AND NOT OF THE INDIVIDUAL LIABILITY OF THE APP ELLANT. IT MAY ALSO BE MENTIONED HERE THAT PROCEEDINGS FOR CANCELLATION OF REGISTRATION WERE INITIATED UNDER S ECTION 12AA(3) OF INCOME TAX ACT 9161 ON 12.05.2005 BUT N O ORDER FOR CANCELLATION WAS RECEIVED BY THE TRUST. F URTHER THE EXEMPTION WAS GRANTED U/S 11 BY THE ASSESSING OFFICER EVEN AFTER PROCEEDINGS FOR CANCELLATION OF REGISTRATION WERE INITIATED WHICH STRENGTHENED THE FACT OF CONTINUATION OF THE REGISTRATION OF THE TRUST AND I TS BONAFIDE ACTIVITIES. SINCE AMOUNT SEIZED WAS ADJUST ED TOWARDS ADVANCE TAX LIABILITY OF THE TRUST THEREFO RE IT CAN BE INFERRED THAT THE AMOUNT SEIZED FROM THE BANK AC COUNT OF THE TRUST DOES NOT BELONG TO THE APPELLANT IN HI S INDIVIDUAL CAPACITY. KEEPING IN VIEW OF ABOVE FACTS AND CIRCUMSTANCES OF THE CASE IT IS EVIDENT THAT THE A MOUNTS SEIZED BELONG TO THE TRUST AND THE APPELLANT WAS MANAGING THE AFFAIRS OF TRUST AS MANAGING TRUSTEE. HENCE THE AMOUNT SEIZED DOES NOT BELONG TO THE APPELLANT IN HIS INDIVIDUAL CAPACITY. HENCE THE SE COND GROUND OF APPEAL IS ALLOWED. 13. LEARNED REPRESENTATIVES OF BOTH THE PARTIES SUB MITTED THAT FACTS ARE SAME AS CONSIDERED ABOVE IN APPEALS OF THE ASSE SSEE. THEY HAVE SUBMITTED THAT THEIR SUBMISSIONS ARE SAME AS A RGUED ABOVE AND FINDINGS MAY BE FOLLOWED ACCORDINGLY. 14. ON CONSIDERATION OF THE ABOVE FACTS IN THE LIGH T OF FINDINGS OF LEARNED CIT (A) WE ARE OF THE VIEW THAT THE ISSUE IS SAME ON MERIT AS IS CONSIDERED WHILE CONSIDERING THE APPEALS OF THE ASSESSEE. THE A O MADE ADDITION OF RS.1 93 99 865/- IN THE ASSESSMENT YEARS IN QUESTION IN RESPECT OF THE SAME BANK ACCOUNTS IN TH E NAME OF THE TRUST. WE HAVE HELD ABOVE THAT THE BANK ACCOUNTS BE LONG TO THE TRUST AND THE AMOUNT LYING IN THE BANK ACCOUNTS OF THE TRUST IS 36 ALREADY CONSIDERED IN THE CASE OF THE TRUST BY THE DEPARTMENT AND EVEN REFUND HAS BEEN GRANTED TO THE TRUST. WE HAVE ALSO HELD THAT THERE IS NO EVIDENCE ON RECORD TO PROVE THAT THE AM OUNT LYING IN THE BANK ACCOUNT OF THE TRUST BELONG TO THE ASSESSEE. B Y FOLLOWING THE REASONS FOR DECISION IN THE APPEALS OF THE ASSESSEE WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT (A) I N DELETING THE ADDITION ON MERIT IN THE INDIVIDUAL CASE OF THE ASSESSEE. WE ACCORDINGLY DO NOT FIND ANY MERIT IN THE DEPARTMENTAL APPEAL. THE SAME IS ACCORDINGLY DISMISSED. 15 AS A RESULT DEPARTMENTAL APPEAL IN ITA NO.3339/ AHD/2007 IS DISMISSED. 16. IN VIEW OF THE ABOVE FINDING THE APPEALS OF TH E ASSESSEE ARE ALLOWED AND THE DEPARTMENTAL APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 -05- 2010 . SS SD/- SD/- (N. S. SAINI) ACCOUNTANT MEMBER (BHAVNESH SAINI) JUDICIAL MEMBER DATE : 21 /05/2010 LAKSHMIKANT/- 37 COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) CONCERNED 5. THE DR ITAT 6. GUARD FILE BY ORDER //TRUE COPY// DY.R/AR ITAT AHMEDABAD