By TIOL News Service

NEW DELHI, SEPT 10, 2015: THE bone of contention before the Bench is - Whether assessment proceedings could have been initiated against the assessee u/s 153A even if the search warrant in terms of Section 132 read with Rule 112 of the Income Tax Rules 1962, was issued in the name of her father and not the assessee. NO is the answer.

Facts of the case

The assessee is an Individual. A search warrant notice u/s 132 was issued against Mr. Raj Kumar Singhania, the father of assessee who was unmarried at the relevant time. The Court had been shown a copy of the panchnama drawn on the date of the search, which showed that the warrant was issued in the name of Mr. Raj Kumar Singhania and the place to be searched indicated as 104, New Rajdhani Enclave, Delhi. The search commenced at 8.15 am and concluded at 5.15 pm on that very date. During the course of the search, certain keys of bank lockers were found in the said residential premises. One of the keys pertained to locker No.111, Canara Bank, Laxmi Nagar, Delhi in the name of assessee. On that date itself the said locker was not opened by the raiding party Thereafter on 7th July 2006, the Department in the presence of both Mr. Raj Kumar Singhania and assessee opened the said locker and drew up a panchnama. This panchnama showed that the warrant was in the case of "Raj Kumar Singhania and Priyanka Singhania, locker No. 111, Canara Bank, Laxmi Nagar, Delhi." The panchnama, drawn contains the signatures of assessee with the date of 7th July 2006, stating that she had received a copy thereof along with key of the locker which by then had been opened. It was also stated in the panchnama in an endorsement across the page that "locker found vacant/empty". Therefore, nothing was found in the locker belonging to assessee.On appeal, both the CIT(A) and the Tribunal held that this issue was specifically raised by the assessee throughout the proceedings. It was for this reason that on the previous date, the HC held that the contention of the counsel for the assessee was that in terms of Section 153A read with Rule 112 it was incumbent on the Revenue to demonstrate, by producing the relevant file that there was a separate search warrant issued in the name of Assessee u/s 132. Assessee submitted that it was not sufficient that only a Panchnama showing the name of assessee along with the name of her father, in whose name the search warrant was issued was produced.

Held that,

++ on the first date of hearing, the Revenue had produced a copy of the panchnama drawn on 7th July 2006 and not the warrant of search, if any issued in the name of assessee. The Court therefore proceeds on the basis that there is no search warrant issued in the name of assessee. It is evident from Rule 112 read with Form 45 that the search warrant has to be issued in the name of the person. The search warrant will also have to indicate the place of search. The documents placed on record by assessee shows that while there was search warrant in the name of Mr. Raj Kumar Singhania, the father of assessee, there was no separate search warrant in his name. The panchnama dated 7th July 2006 with reference to search of locker No. 111 of the assessee, refers to the said proceedings being in continuation of the earlier search proceedings which took place on 23rd June 2006. The search proceedings on 23rd June 2006 was on the basis of the search warrant issued in the name of the father of assessee and not the assessee. As already noted, the Revenue has been unable to produce till date any record to show that there was any search warrant issued in the name of assessee. HC is of the view that the assessee's contention is correct that with the Department not having proceeded to search the locker No. 111 on 23rd June 2006 itself and having completed the search proceedings on that date by 5.15 pm, if it thereafter proposed to search locker No. 111 belonging to assessee, it ought to had issued a separate search warrant in her name, specifying the place of search that was undertaken on 7th July 2006. Alternatively, if the Department wanted to continue with the search warrant issued on 23rd June 2006 in the name of Mr. Raj Kumar Singhania and proceed to open locker No.111, then they could not have instituted separate proceedings against the assessee u/s 153A without there being any separate search warrant in her name. It is another matter that if anything incriminating had been found against the assessee when the locker was opened on 7th July 2006, the proceedings could have been initiated against her u/s 153C. However, there was no occasion in the present case to do so since nothing was found in the locker. Consequently, the Court is satisfied that apart from other reasons mentioned in the impugned order of the ITAT, the proceedings u/s 153A against the assessee was itself without the authority of law. No substantial question of law arises from the impugned order of the ITAT. The appeal is dismissed.

(See 2015-TIOL-2083-HC-DEL-IT)