TaxTMI 
TaxTMI 
2018 (9) TMI 1774
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.... 2. The assessee craves to amend, alter and modify any of the grounds of appeal. 3. The appropriate cost be awarded to the assessee. 2. The assessee is a company and engaged in the execution of Government contracts. The assessee filed its return of income on 27th September, 2012 declaring total income of Rs. 36,37,320/-. A search and seizure action was carried out at the residential and various business premises of the assessee on 10.10.2014. Subsequently, the AO issued notice under section 153A on 22.12.2014. In response to the notice, the assessee filed return of income declaring total income of Rs. 36,37,320/- as declared in the original return of income. In the assessment framed under section 153A, the AO made disallowance of Rs. 3,16,194/- on account of the expenditure incurred on increase of authorized capital. The assessee in the present appeal has challenged the addition made by the AO and also raised a legal issue in ground no. 1.1 of the grounds of appeal. The ld. A/R of the assessee has submitted that the time limit for issuing the notice under section 143(2) was expired on 30th September, 2014 prior to the date of search under section 132 on 10.10.2014.....
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....epted by the department and the SLPs against the decisions of Hon'ble Bombay High Court in the case of M/s. All Cargo Global Logistics as well as in case of Continental Warehousing Corporation have been admitted by the Hon'ble Supreme Court. Similar SLP in the case of Kabul Chawla has also been filed by the revenue which has been admitted by the Hon'ble Supreme Court. When the expenditure which is not an allowable claim being incurred for increase in share capital then the disallowance of same is justified by framing the assessment under section 153A of the Act. The ld. D/R has further submitted that there is no original assessment under section 143(3) in the case of the assessee, therefore, the assessment framed under section 153A is the only assessment in this case. 4. We have considered the rival submissions as well as the relevant material on record. There is no dispute that the time limit for issuing notice under section 143(2) on the return of income filed by the assessee under section 139(1) was expired on 30th September, 2014. Therefore, on the date of search on 10.10.2014 the assessment on the original return of income was not pending. Hence it is a case of reassessment....
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....dgment reads as under:- "19. Under the provisions of Section 153A, as we have already noticed, the Assessing Officer is bound to issue notice to the assessee to furnish returns for each assessment year falling within the six assessment years immediately preceding the assessment year relevant to the previous year in which the search or requisition was made. Another significant feature of this Section is that the Assessing Officer is empowered to assess or reassess the "total income" of the aforesaid years. This is a significant departure from the earlier block assessment scheme in which the block assessment roped in only the undisclosed income and the regular assessment proceedings were preserved, resulting in multiple assessments. Under Section 153A, however, the Assessing Officer has been given the power to assess or reassess the 'total income' of the six assessment years in question in separate assessment orders. This means that there can be only one assessment order in respect of each of the six assessment years, in which both the disclosed and the undisclosed income would be brought to tax. 20. A question may arise as to how this is sought to be achiev....
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.... state of affairs namely, that in respect of the six assessment years preceding the assessment year relevant to the year in which the search took place there is only one determination of the total income, it has been provided in the second proviso of sub-Section (1) of Section 153A that any proceedings for assessment or reassessment of the assessee which are pending on the date of initiation of the search or making requisition "shall abate". Once those proceedings abate, the decks are cleared, for the Assessing Officer to pass assessment orders for each of those six years determining the total income of the assessee which would include both the income declared in the returns, if any, furnished by the assessee as well as the undisclosed income, if any, unearthed during the search or requisition. The position thus emerging is that the search is initiated or requisition is made, they will abate making way for the Assessing Officer to determine the total income of the assessee in which the undisclosed income would also be included, but in case where the assessment or reassessment proceedings have already been completed and assessment orders have been passed determining the assessee'....
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....and/or requisition. The provisions of Sections 153A to 153C cannot be interpreted to be a further innings for the AO and/or assessee beyond provisions of Sections 139 (return of income), 139(5) (revised return of income), 147 (income escaping assessment) and 263 (revision of orders) of the Act. 26. The plea raised on behalf of the assessee that as the first proviso provides for assessment or reassessment of the total income in respect of each assessment year falling within the six assessment years, is merely reading the said provision in isolation and not in the context of the entire section. The words 'assess' or 'reassess' have been used at more than one place in the Section and a harmonious construction of the entire provision would lead to an irresistible conclusion that the word 'assess' has been used in the context of an abated proceedings and reassess has been used for completed assessment proceedings, which would not abate as they are not pending on the date of initiation of the search or making of requisition and which would also necessarily support the interpretation that for the completed assessments, the same can be tinkered only based o....