The main legal point established in the judgment is the requirement for the tribunal to adequately consider the factual findings and evidence presented by the Assessing Officer in the block assessment order.

Sanjiv Khanna, J.

1. Having heard counsel for the parties, we frame the following two substantial questions of law :

“(1) Whether the Income Tax Appellate Tribunal was right in recording that the name of the respondent-assessee Promain Ltd. was not mentioned in the warrant of authorization issued under Section 132 of the Income Tax Act, 1961 read with Rule 112 (2)(a) of the Income Tax Rules, 1962?

(2) Whether the Income Tax Appellate Tribunal was right in recording the finding that no addition could have been made in the block assessment proceedings as the Assessing Officer has not relied upon any material collected/seized during the course of search?”

2. We have heard counsel for the parties and proceed to dictate our decision on the aforesaid questions.

3. Search under Section 132 of the Income Tax Act, 1961 („Act?, for short) was conducted on 21.11.1996 pursuant to the warrant of authorization. Thereafter, the block assessment order dated 28.11.1997 under Section 158BC of the Act for the period ending 21.11.1996 was passed in the case of the respondent-assessee. One of the grounds raised by the respondent-assessee before the Income Tax Appellate Tribunal („Tribunal?, for short) was that the warrant of authorization did not include and mention the name of the respondent-assessee and therefore, the block assessment proceedings under Section 158BC were invalid and illegal for the want of jurisdiction as only the assessee who has been searched can be subjected to the said procedure. For other persons, the procedure under Section 158 BD has to be adopted and the said procedure was not followed in the present case.

4. In paras 10 to 14 of the impugned order, the Tribunal has recorded and observed as under :

“10. The learned counsel for the assessee Shri C.S. Aggarwal, Sr. Advocate insisted for production of search warrant by submitting that there was no authorization of search against the assessee. In this regard he made reference to the direction of the Bench dated 29-8-05 through which the DR was directed to produce – (1) warrant of authorization; (2) Panchnama in the name of the assessee company, if any; and (3) His satisfaction note. He further submitted that in absence of any warrant of authorization the block assessment in the case of the assessee cannot be held to be valid. Another argument of the learned counsel for the assessee was that even if there was any search warrant for the group of cases or group of companies then it is to be seen as to whether the authorization was specifically in the name of the assessee, and whether the same was executed upon the assessee.

11. As against this, the learned DR opposing the arguments of the learned counsel for the assessee submitted that a common warrant of authorization in the case of group companies including the assessee was issued and in consequence to such search a common panchnama dated 21-11-1996 was also prepared. The learned DR produced warrants of authorization which were in the names of General Engineering Works; Jai Commercial Co.; and Cynedes & Chemicals Ltd.

12. She also produced copy of panchnama which mentions as under:

(1) General Engineering Works;

(2) Jai Commercial Co.;

(3) Cynedes & Chemicals Ltd.; and

(4) Promain Ltd.

13. A copy of this panchnama has been kept on record. It may be observed that in clause 6 of the panchnama it is mentioned that statements of Shri R.P. Modi, A.K. Mehta, S.K. Gupta and Shri H.K. Aggarwal and Joti Massani etc. were recorded in the course of search by the authorized officer. A copy of panchnama had also been received and signatures of receipts are appearing on the last page.

14. From the above facts and documents produced before the Bench and back ground of the case it is clear that despite direction by the Bench the Department has not been able to produce any authorization for conducting search specifically in the name of the assessee. On perusal of panchnama also it is not clear that it was received by any authorized