TaxTMI 
TaxTMI 
2016 (7) TMI 817
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....facts of the case are that a search action u/s. 132 of the Act was carried out in the group cases of Komal Group on 06.08.2009. Notice u/s. 153A were issued and served upon the assessees and the assessees filed return of income accordingly. Statutory notices u/s. 143(2) and 142(1) of the Act were subsequently issued and served upon the assessee. 5. During the course of the assessment proceedings, gifts received by the assessees were examined. The assessee was asked to explain the genuineness of the gifts. Assessees filed detailed reply in the light of the provisions of Section 68 of the Act, identities of the donor, genuineness of the transaction and creditworthiness were explained. The detailed reply of the assessee did not find favour with the A.O. The A.O. was of the firm belief that there exists no relationship between the donors and the donees and, therefore, treated the gifts in all these cases as unexplained cash credit and made additions in the respective hands. 6. Assessee carried the matter before the ld. CIT(A) but without any success. 7. Having heard the rival submissions, we have carefully perused the orders of the authorities below. We have given a thoughtful consi....
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.... proceedings, the AO while passing order u/s. 153A r.w.s. 143(3) cannot disturb the assessment order." 10.2. The Hon'ble High Court had an occasion to consider the following questions of law: "1. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT is correct in narrowing down the scope of assessment u/s. 153A in respect of completed assessments by holding that only undisclosed income and undisclosed assets detected during search could be brought to tax? 2. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT is correct in law in holding that the scope of Sec. 153A is limited to assessing only search related income, thereby denying Revenue the opportunity of taxing other escaped income, that comes to the notice of the AO.? 3. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT was right in limiting the scope of Sec. 153A only to undisclosed income when as per the section the AO has to assess the total income of the six assessment years?"- and the Hon'ble High Court of Bombay finally held as under:- "We, therefore, dismiss the Revenue's appeal and answer the substantial question of law ag....
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....ons of section 153A of the Act. 9. In our considered opinion, section 153A referred to "pending" "assessment" or "reassessment" and not "assessment orders". The assessment may not be pending even though there is no formal order u/s I43(1)(a). The moment return is filed and acknowledgement or intimation issued, the proceedings initiated by filing the return are closed, unless they are again triggered by issuing notice u/s 143(2) of the IT Act. In the case under consideration, the period for issuing the notice u/s 143(2) elapsed. The process has attained the finality which can only be assailed u/s 148 or 263 of the IT Act. Such proceedings can never be initiated u/s 143(2) when the time period for issuing notice u/s 143(2) has expired. Hon'ble ITAT, Mumbai C Bench in the case of ACIT Vs. Pratibha Industrialist Ltd. reported in 23 ITR Tribunal 766 Mumbai has also held as under :- "Although by proceedings initiated under section 153A all six years shall become subject matter of assessment under section 153A the Assessing Officer shall have a free-hand, through abatement, only on the proceedings that are pending, to frame the assessments afresh. But in a case where the proceedi....
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....der this Section only on the basis of seized material." v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessments can be interfered with by the AO while making the assessment under section 153A only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in the course of original assessment. 12. The aforementioned ratio laid down by the Hon'ble High Court of Delhi has been followed by....