TaxTMI 
TaxTMI 
2016 (7) TMI 1211
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....153A proceeding ?" [C] "Whether on the fact and circumstances of the case and in law the ITAT erred in not discussing the issue on merit in respect of disallowance of deduction claimed u/s 80IA( 4) in view of the Explanation to section 80IA inserted in 2009 retrospectively w.e.f. 01.04.2000 ?" [D] "Whether on the fact and circumstances of the case and in law the ITAT erred in not appreciating the ratio laid down by High Court of Karnataka at Banglore in the case of M/s Canara Housing Development Company (ITA No 38/2014), Delhi High Court in the case of Anil Bhatia (2012)24Taxmann.com 98(Delhi) ?" 2. Though as many as four questions are framed, it would be necessary for us to focus only on first question since if the Revenue fails to clear the first hurdle, it would not be necessary to examine the other three questions which are either element of the first question or consequential to it. 3. The respondent assessee was subjected to search operations, pursuant to which, the Assessing Officer proceeded to frame assessment under section 153A of the Income Tax Act, during which he made disallowance of Rs. 61.82 lacs (rounded off) and Rs. 47.42 lacs (rounded off) for the asse....
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....relevant to the previous year in which the search is conducted or requisition is made and thereafter assess or reassess the total income for those assessment years. The second proviso to Section 153A provides for abatement of assessment/reassessment proceedings which are pending on the date of search/ requisition. Section 153A (2) provides that when the assessment made under Section 153(A)(1)is annulled, the assessment or reassessment that stood abated shall stand revived. 10) Thus on a plain reading of Section 153A of the Incometax Act, it becomes clear that on initiation of the proceedings under Section 153A, it is only the SRP 25/61 ::: Downloaded on 0705/2015 20:55:36 ::: ITXA523.13.doc assessment / reassessment proceedings that are pending on the date of conducting search under Section 132 or making requisition under Section 132A of the Act stand abated and not the assessments/reassessments already finalised for those assessment years covered under Section 153A of the Act. By a circular No. 8 of 2003 dated 1892003 (See 263 ITR (St) 61 at 107) the CBDT has clarified that on initiation of proceedings under Section 153A, the proceedings pending in appeal, revision or rectifica....
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....tions are made in passing or that they are not binding on us because the essential controversy before the Bench was somewhat different. He urges that was only in relation to the legality and validity of the order of the Commissioner under section 263 of the IT Act. Had that been the case, the Division Bench was not required to trace out the history of section 153A of the IT Act and the power that is conferred thereunder. When the Revenue argued before the Division Bench that the power under section 153A can be invoked and exercised even in cases where the second proviso to subsection (1) is not applicable SRP 27/61 ::: Downloaded on 07/ 05/2015 20:55:36 ::: ITXA523.13.doc that the Division Bench was required to express a specific opinion. The provision deals with those cases where assessment or reassessment, if any, relating to the assessment years falling within the period of six assessment years referred to in subsection (1) of section 153A were pending. If they were pending on the date of the initiation of the search under section 132 or making of requisition under section 132A, as the case may be, they abate. It is only pending proceedings that would abate and not where ther....
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.... 3 of the judgment which reads as under: "3. Mr. Nitin Mehta, learned senior standing counsel for the appellant, submitted that the Tribunal has grossly erred in holding that addition can be made under section 153A only if incriminating material is found during the course of the search, that too, in relation to each of the six assessment years and that in respect of any assessment year, if no incriminating material is found, addition cannot be made under section 153A of the Act. It was argued that there is no condition in section 153A that additions should be made strictly on the basis of the evidence found during the course of search or other post search material or information available with the Assessing Officer, related to the evidence found. It was submitted that section 153A of the Act has two trigger points after which there is a mandate on the Assessing Officer to issue notice for assessment in each of the six years prior to the date of the search. It was submitted that the Tribunal, while holding that the addition should be based upon the incriminating material, found during the search under the new procedure provided under section 153A, failed to appreciate that the ne....
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....quisition stands abated and the total income of the assessee is required to be determined under section 153A of the Act. Similarly, subsection (2) provides for revival of any assessment or reassessment which stood abated, if any proceeding or any order of assessment or reassessment made under section 153A of the Act is annulled in appeal or any other proceeding. 16. Section 153A bears the heading Assessment in case of search or requisition. It is well settled as held by the Supreme Court in a catena of decisions that the heading of the section can be regarded as a key to the interpretation of the operative portion of the section and if there is no ambiguity in the language or if it is plain and clear, then the heading used in the section strengthens that meaning. From the heading of section 153, the intention of the legislature is clear viz., to provide for assessment in case of search and requisition. When the very purpose of the provision is to make assessment in case of search or requisition, it goes without saying that the assessment has to have relation to the search or requisition. In other words, the assessment should be connected with something found during the search or....