Income-Tax Act, 1961 – Section 153C – Limitation, Jurisdiction & Incriminating Material – Writ Petition Not Maintainable

The writ petition was not maintainable, as disputed factual issues must be examined by the assessing officer and appellate authorities. The Court refused to exercise its discretionary jurisdiction, emphasizing the availability of alternate remedies. Limitation under Section 153B(1)(ii) involved mixed questions of law and fact, requiring adjudication before appropriate authorities. Existence of incriminating material could not be determined in writ jurisdiction. DIN generation was not belated and did not render the notice invalid. Petitioner relegated to raise all contentions before the appellate authority. (Paras: 10-21)

Acts & Sections Discussed:

Constitution of India – Article 226 – Writ jurisdiction – Scope – Availability of alternate remedy.
Income-Tax Act, 1961 – Section 132, Section 153A, Section 153B, Section 153C – Search and seizure – Assessment of persons other than searched persons – Limitation – Requirement of incriminating material.

Subjects:

Section 153C notice – Jurisdiction – Incriminating material – Limitation – Search and seizure – Accommodation entries – Alternate remedy – Appellate jurisdiction – Discretionary jurisdiction – Principle of judicial restraint.

Issues:

a) Whether the writ petition challenging a notice under Section 153C is maintainable when an alternate remedy is available?
b) Whether the assessment proceedings were time-barred under clause (ii) to the third proviso to Section 153B(1) of the Income-Tax Act, 1961?
c) Whether there existed incriminating material to justify proceedings under Section 153C?
d) Whether the satisfaction note was valid and properly correlated to the relevant assessment years?
e) Whether the delayed generation of Document Identification Number (DIN) invalidated the notice?

Submissions:

Petitioner:
Contended that the proceedings were time-barred under Section 153B(1)(ii) and that no incriminating material existed.
Challenged the delay in preparing the satisfaction note and the belated generation of DIN.
Argued that the assessment proceedings were initiated beyond the permissible period.
Asserted that no proper opportunity was given to challenge the satisfaction note.

Respondents:
Defended the validity of the Section 153C notice and satisfaction note, asserting that the matter required factual investigation.
Maintained that limitation must be computed based on the date of receipt of books of accounts by the Assessing Officer (AO).
Submitted that the issue of accommodation entries and unexplained income warranted scrutiny under the assessment proceedings.