High Court invalidates Section 153C assessments under Income Tax Act for multiple years.

The High Court upheld the decision of the ITAT, ruling that the assessments under Section 153C of the Income Tax Act for the assessment years 2008-09, 2010-11, and 2011-12 were invalid. The Court found that the documents recovered during the search did not belong to the Assessee but only pertained to them, as per the revised language in the law effective from June 1, 2015. Therefore, the initiation of proceedings under Section 153C was deemed invalid, resulting in the dismissal of the appeals for the mentioned assessment years.

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Issues:
Validity of assessment under Section 153C of the Income Tax Act for assessment years 2008-09, 2010-11, and 2011-12.

Analysis:
The High Court addressed the issue of the validity of assessments under Section 153C of the Income Tax Act for the mentioned assessment years. The Court referred to a previous case concerning the same search block assessments and the question of whether the ITAT erred in holding the assessments invalid. In the previous case, a search was conducted in the 'Amprapali group' leading to assessments under Section 153C. The Assessing Officer made additions on account of bogus purchases and notional interest on interest-free loans. The Commissioner of Income Tax (Appeal) rejected the challenge to the assessment's validity but deleted the additions. The ITAT, however, held that certain documents recovered during the search did not belong to the Assessee and, therefore, the initiation of proceedings under Section 153C was invalid based on previous court decisions.

The Revenue argued that the recovered documents should be considered to belong to the Assessee as part of the 'Amrapali Group.' However, the Assessee pointed out that the documents were noted to "pertain" to the Assessee and not belong to it, highlighting a change in the law regarding the language used from "belong or belongs to" to "pertain or pertains to" effective from June 1, 2015, while the search and notice in this case occurred before that date. The Court agreed with the ITAT's decision, stating that the assessment was unsustainable in law due to the discrepancy in the language used in the relevant sections. As a result, no substantial question of law was found to arise, leading to the dismissal of the appeals for the mentioned assessment years.

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