The Tax Publishers2019 TaxPub(DT) 4420 (Guj-HC) : (2019) 418 ITR 0025 : (2020) 313 CTR 0520

INCOME TAX ACT, 1961

Section 153C Section 153A

In relation to searches carried out till 31-5-2015, it was not permissible for the AO to assume jurisdiction under section 153C as amended with effect from 1-6-2015.

Search and seizure - Proceedings under section 153C - Applicability of amended provisions of section 153C, w.e.f. 1-6-2015 - Search and seizure conducted prior to 1-6-2015

AO had recorded satisfaction in terms of the amended provision of section 153C, which came into force on 1-6-2015. Assessee contended that the amendment dated 1-6-2015 confers a new power on the AO and is, therefore, prospective in effect and hence, could not have been made applicable in the facts of the present case when the amendment was not in force as on the date of the search. The dispute in this case relates to applicability of the provisions of the section 153C which came to be amended with effect from 1-6-2015, to cases where search had been carried out prior to such amendment having come into force.Held: It is the date of search that had been considered to be the relevant date for the purpose of applying the amended provisions of section 153C(1). Even the legislature had considered the initiation of search or making of requisition as the trigger point for applying the provisions of section 153B to assessment under section 153A. Under section 153C also, ultimately, assessment or re-assessment is required to be made in accordance with section 153A. Thus, when the amended provisions of section 153C(1) have been brought into force with effect from 1-6-2015, it had to be construed that such amended provisions would apply to a search initiated under section 132 or in relation to books of account, other documents or any assets requisitioned under section 132A after 31-5-2015. Consequently In relation to searches carried out till 31-5-2015, it was not permissible for the AO to assume jurisdiction under section 153C as amended with effect from 1-6-2015. The legislature had specifically made the amended provisions of section 153C applicable with prospective effect from 1-6-2015. If such amended provisions are made applicable to searches carried out prior to 1-6-2015, they affect the substantive rights of persons who are brought within the ambit of section 153C by virtue of such amendment.

Relied:Pr. CIT v. Vinita Chaurasia (2017) 394 ITR 758 (Del) : 2017 TaxPub(DT) 1684 (Del-HC), Pr. CIT v. Index Securities (P.) Ltd. (2017) 88 Taxmann.com 84 (Del) : 2017 TaxPub(DT) 4496 (Del-HC), Pr. CIT v. Saumya Construction (P) Ltd., (2016) 387 ITR 529 (Guj.) : 2016 TaxPub(DT) 3466 (Guj-HC), C.B. Richards Ellis Mauritius Ltd. v. Asstt. Director of IT (2012) 208 Taxman 322 (Del) : 2012 TaxPub(DT) 2372 (Dedl-HC). Distinguished:Udhna Udyog Nagar Sahkari Sangh Ltd. v. Shailendra Lodha, (2016) 75 Taxmann.com 185 (Guj).

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FAVOUR : In assessee's favour.

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