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Detention of the assets has been provided and permitted only so long as there is some outstanding demand of tax and penalty against an assessee or expected liability of such tax or penalty; obviously to safeguard the interest of Revenue for the realization or recovery of such demand of tax, interest and penalty.
In the instant case, after the search was conducted on 23rd February 2006, it was found that for the assessment year 1995-96, the respondent-assessee had not filed its return of income by the due date. It is only when block assessment proceedings were initiated by the assessing officer, that the assessee filed its return for the said assessment year on 11th July, 1996 under Section 158BC of the Act, showing its total income as Rs.7,02,768/-.
Passing of an order under Section 158BC rests on the previous approval of the Commissioner. On a reading of Section 158BG, particularly the proviso, reveal the mandatory nature of such an approval, that the proviso reads as ‘provided that no such order shall be passed without the previous approval of the Commissioner …’. In the background of the above-said provisions, in keeping the law declared by the Apex Court in Sahara India (Firm)’s case (supra) that with civil consequences flowing out of such an approval, we have no hesitation in accepting the plea of the assessee that in the face of such an approval granted to the order passed under Section 158BC, there can be no assumption of jurisdiction by an authority of the same rank under Section 263 of the Act.
AO had made assessment on the information/material available in the return of income. The information regarding the gift was available in the return of income as capital account had been credited by the assessee by the amount of gift. Similar was the position in relation to addition under section 2(22)(e). T
Circular No. 10/2012-Income Tax As per provisions contained in section 153A and 153C of the Income Tax Act, 1961, the Assessing Officer is required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made.
No material is produced before us to prove that the AO in the case of person searched was satisfied that any money, bullion, jewellery or other valuable articles or things or books accounts or documents seized or requisitioned belongs to or belong to a person other than the person referred to in sec. 153A. No material is produced before us to show if any satisfaction was recorded by the AO in that case that the seized material belongs to any person other than the person with respect to whom search was made u/s 132 of the Act.
In the present case, the revenue authorities, sought to apply the statutory presumptions, as contemplated under section 132(4A) to the facts of the present case, without establishing the factum that the assessee was found in possession or control of any books of account, other documents, money, bullion, jewellery or other valuable article or thing etc. In this specific context, it is inconceivable and incomprehensible, as to how the provisions of section 132(4A) are applicable to the facts of the case, without showing satisfaction of the statutory conditions precedent contained therein.
The Income tax Department conducts search and seizure operations based on the credible companies, association of ‘persons’ which includes individuals, hindu undivided families (HUFs), firms, companies, association of persons (AoPs), body of individuals (BoIs), local authorities and any artificial juridical person who are in possession of any money, bullion, jewellery, documents or any other valuable article or thing which represents undisclosed income of the person.
From the perusal of the aforesaid provisions, it is apparent that after the assessment order is passed, the assessee is entitled not only for the refund but also simple interest on the amount as has been provided under sub-section 4(a) and (b) of the Act. Sub-section 4(b) provides that such interest shall run from the date immediately following the expiry of the period of one hundred and twenty days from the date on which the last of the authorisations for search under section 132 was executed to the date of completion of the assessment.
Section 132(1)(iii) empowers the authorized officer to seize any such books of account, other documents, money, bullion, jewellery or other valuable article or thing found as a result of such search which represent either wholly or partly undisclosed income or property of the person. However, the proviso carves out an exception.
