GRISHMA MUKESH SHETH vs. ASST. COMMISSIONER OF THE INCOME TAX CIRCLE 2 (1)

Facts

The petitioner, Grishma Mukesh Sheth, filed a writ application challenging notices issued under Section 153C of the Income Tax Act, 1961, for assessment years 2009-10 to 2015-16. The respondent is the Assistant Commissioner of Income Tax. This case is identical to a batch of writ applications previously decided by a coordinate bench on April 2, 2019. The coordinate bench had addressed four questions concerning the maintainability of petitions, the applicability of amended Section 153C provisions, the limitation period for notices, and the relevant assessment years under Section 153A. The present petition seeks to quash the impugned notices and stay further assessment proceedings.

Held

The Tribunal held that the writ applications were maintainable. Regarding the applicability of the amended Section 153C, it was held that the amended provisions apply prospectively from June 1, 2015, and their retrospective application to searches conducted prior to that date would affect substantive rights. On the issue of limitation, the court held that if the statute provides an alternative period of limitation, the notices are not barred merely because the period under the first part has elapsed. Concerning the relevant assessment years under Section 153A, the court clarified that the six assessment years preceding the assessment year relevant to the previous year of the search are to be considered. For a search on September 4, 2013, the relevant assessment years are 2013-14 to 2008-09. For searches on December 4, 2014, and March 13, 2015, the relevant assessment years are 2014-15 to 2009-10. Notices issued for assessment years beyond these six years were held to be without jurisdiction. Consequently, the impugned notices and any consequential assessment orders were quashed and set aside.

Key Issues

1. Whether the writ applications challenging notices under Section 153C of the Income Tax Act, 1961, are maintainable? 2. Whether Section 153C of the Act, as amended effective from June 1, 2015, is applicable to cases where the search was initiated prior to that date? 3. Whether the notices issued under Section 153C of the Act were barred by limitation? 4. What are the relevant Assessment Years contemplated under Section 153A of the Act in relation to a search? Assessee's Contentions: The judgment does not explicitly record the assessee's specific arguments for each issue, but the reliefs sought indicate a challenge to the validity and legality of the Section 153C notices, including grounds of limitation and jurisdiction. Revenue's Contentions: The judgment does not explicitly record the revenue's specific arguments for each issue.