75th Founding Day Lecture Meeting on “India@2030” Know More

March 2015

Block assessment- Assessment of third person: Section 158BD- Limitation- Notice to third person to be issued immediately after completion of assessment of persons in respect of whom search was conducted- Notice issued to third person more than a year after completion of assessments of persons in respect of whom search was conducted- Notice not valid-

By K. B. Bhujle Advocate
Reading Time 1 mins
fiogf49gjkf0d
CIT vs. Bharat Bhushan Jain; 370 ITR 695 (Del):

The respondent assessee is a third party who was issued notice u/s. 158BD, pursuant to search proceedings in case of M group. The satisfaction note was record almost a year after the assessment proceedings in the case of M group ware completed. The Tribunal held that notice u/s. 158BD was not valid.

On appeal by the Revenue, the Delhi High Court upheld the decision of the Tribunal and held as under:

“i) Revenue has to be vigilant in issuing notice to the third party u/s. 158BD, immediately after completion of assessment of the person in respect of whom search was conducted.

ii) Notice was not issued in conformity with the requirements of section 158BD and were unduly delayed. Tax appeal is dismissed.”

Download PDF

You May Also Like

Assessment- Amalgamation of companies- Sections 170, 176 and 292B- A. Ys. 2003-04 to 2008-09- Amalgamating company ceases to exist- After amalgamation assessment to be done on the amalgamated company- Order of assessment on amalgamating company is not valid-

Business expenditure- Disallowance u/s. 40(a) (ia) r/w. s. 194H- A. Y. 2009-10- Bank providing swiping machine to assessee- Amount punched in swiping machine credited to account of retailer by bank- Bank providing banking services in form of payment and subsequently collection of payment- Bank does not act as agent- No obligation to deduct tax at source- Disallowance u/s. 40(a)(ia) is not warranted-