** *Decided by:* INCOME TAX SETTLEMENT COMMISSION ADDITIONAL BENCH, MUMBAI, In The case of: Varinder K. Arora, In re, Appeal No.: Settlement Application No. MH/MUC-22/008/ 2008-09/IT, Decided on: May 27, 2009 RELEVANT PARAGRAPH
19. The first fundamental issue is whether the Commission has at all jurisdictions to deal with this case which involves search assessments where block assessments are to be completed u/s 158BC. The arguments of thelearned CIT(DR)s appear quite weighty and persuasive. However, the arguments of” the learned AR of the applicant are logical and convincing. The languageof the section is clear. The exclusion proviso to Sec. 245A(b) mentions only sections 153A, 153B and 153C. They nowhere mention about section 15SBC. As rightly rebutted by the learned AR the Explanation to section 245A(b) does not in any way aid the revenue because the word ’search’ has been mentioned here in the context of a search referred to in Section 153A. Similarly, the Explanatory Note to the Finance Act refers only to such searches. It may be noted that the procedure for assessment ofsearch cases underwent a radical change in 2003. In respect of searches initiated upto 31.5.2003, there was separate Chapter -XIVB dealing withsearch assessments. There was the concept of a block period and block assessment and a flat rate of taxation. No interest u/s 234A, 234B or 234C and penalties u/s 271(l)(c) or 271A or 27IB were livable. In other words Chapter XIV-B was a separate code by itself. But in respect of searches initiated after 31.5.2003, the Department reverted to the new system of assessments. Therefore, there is a clear differentiation between the procedures of search assessments under the two systems of assessment as pointed out by the learned AR. Another important distinction may be crucial to decide the issue. Clause (ii) to the proviso to sub section 245AB refer to “a proceeding of assessment or reassessment for an}’of the assessment years referred to in clause (b) of section 153 A in case of a person referred to in section 153 A or section 153C.” A reading of clause (b) of section 153A would show that it relates to assessment or reassessment of total income of six assessment years immediately preceding the assessment year relevant to the previous year in which thesearch was conducted. So here, the number of assessment years is confined to six. On the other hand, proviso to sub section 158B(a) defines the block period as consisting often assessment years in respect of searches initiated before Is day of June, 2001. (Thesearch in the applicant’s case was conducted prior to this date). Thus, even for the purpose of block assessment under Chapter XIV-B the length of block period was ten years and six years in respect of searches conducted before or after the cut of date of Is’ June, 2001. Mad the Legislative intention been to cover the blockassessments, then, they should have provided for ten assessment years at appropriate places instead of six to cover old search assessments. The CIT (DR) was right in observing that the legislature might not have anticipated pendency of such old search cases. Another way of argument would be that it is likely that the Legislature would have deliberately omitted section 158BC from the exclusion proviso to section 245A(b) keeping in view that the impact of such rare cases would be very low on the overall scheme of things. In any case, sincethe language of the statute is very clear, the law is logical and coherent and there is no ambiguity, it would be hazardous to depart from the literal interpretation. It would be appropriate to quote a significant observation of the Supreme Court in this regard. The Hon’ble Supreme Court in the case of Dadi agannadham v. Jammulu Ramulu reported in [2001] AIR 2001 SC 2699 with regard to the principles of interpretation has held as follows (page 2703) : “13. We have considered the submissions made by the parties. The settled principles of interpretation are that the court must proceed on the assumption that the Legislature did not make a mistake and that it did what it intended to do. The court must, as jar as possible, adopt a construction which will carry out the obvious intentionof the Legislature. Undoubtedly, if there is a defect or an omission in the words used by the Legislature, the court would not go to its aid to correct or make up the deficiency. The court could not add words to a statute or read words into it which are not there, especially when the literal reading produces an intelligible result. ‘The court cannot aid the Legislature’s defective phrasing of an Act, or add and mend, and, by construction, make up deficiencies which are there. “ Extracts from the judgment of Karnataka High Court in the case of Secretary CBDT vs. ILK. Sinha [2009, 3091TR 1, I of. In view of the above, we accept the claim of the applicant that the Settlement Commission has jurisdiction over the case under consideration and reject the contention of the revenue in this regard. -- http://finance.groups.yahoo.com/group/aaykarbhavan/ http://groups.google.com/group/aaykarbhavan http://finance.groups.yahoo.com/group/It_law_reported/ http://groups-beta.google.com/group/fun-finder http://finance.groups.yahoo.com/group/le-vech/ http://tech.groups.yahoo.com/group/groups_master/ -- Receive free SMS of finance updates and alert at mobile Cost free ----- aaykarbhavan:News about the aykarbhavan http://labs.google.co.in/smschannels/subscribe/aaykarbhavan ----- Good and Clean funny, informative motivational SMSes http://labs.google.co.in/smschannels/subscribe/rajkumarsms ----- Gandinagar, News about Gandhinagar , Gujarat http://labs.google.co.in/smschannels/subscribe/Gandhinagar ****** Or Join it by sending SMS go to write messge in your mobile type "on aaykarbhavan" / "on rajkumarsms" and sen it to 9870807070 Me on net : > >>>>>>>>>>>>>>>>>>>>> http://rajkumaratthenet.blogspot.com/ http://itronline.blogspot.com/ Virus Warning: Although the I have taken reasonable precautions to ensure no viruses are present in his email, sender (I) cannot accept responsibility for any loss or damage arising from the use of this email or attachment." -- You received this message because you are subscribed to the Google Groups "Skorydov MyTaxAssistant Member Group" group. 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