Smt. Pavithra Sugichandran Vs Office of the DCIT (Madras High Court)
The Madras High Court considered six writ petitions challenging assessment orders for Assessment Years (AYs) 2015-16 to 2020-21. The petitioner’s husband, a director of Gateway Office Parks Limited (GOPL), faced allegations of siphoning company funds, leading to a search and seizure operation. Materials allegedly relating to the petitioner were handed over to the jurisdictional Assessing Officer on 20.11.2021. Earlier assessments under Section 153A for AYs 2018-19 to 2020-21 had been quashed, after which fresh satisfaction notes were recorded on 24.02.2023, notices under Section 153C were issued, and fresh assessment orders followed. While the returned income for AYs 2015-16 to 2017-18 was accepted, additions were made for AYs 2018-19 to 2020-21 based on unexplained bank credits.
Petitioner’s Principal Contentions
- Assessment orders were barred by limitation because the seized materials were transferred to the jurisdictional Assessing Officer about eight months after expiry of the 60-day period prescribed under Section 132(9A). The petitioner argued that the Department should not benefit from its own delay and that the limitation period under Section 153B should not be extended due to such delayed transfer.
- Proceedings under Section 153C lacked jurisdiction because they were not based on incriminating material discovered during the search. The petitioner contended that neither the panchnamas nor the satisfaction notes referred to seized bank statements or explained how the alleged materials related to the additions made.
- The satisfaction notes were inadequate, as they did not explain how the seized material related to the petitioner or affected determination of her income. It was also argued that notices under Section 153C should have been confined only to assessment years to which the seized material actually pertained and that the satisfaction notes were recorded mechanically and belatedly.
- The transfer order under Section 127 was challenged on jurisdictional grounds, with the petitioner alleging that the transfer of assessment was made without the required consultation or consent of the competent authorities.
- The additions under Section 69 read with Section 115BBE were questioned, with the petitioner arguing that bank credits could not be treated as unexplained investments taxable under those provisions.
Revenue’s Stand
