TaxTMI 
TaxTMI 
2023 (5) TMI 788
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....32 of the I.T. Act, 1961 was carried out in case of the assessee on 20.11.2019. In response to notice u/s. 153A issued on 08.06.2021 which was duly served on the assessee to file return of income for the impugned assessment year, the assessee did not file any return of income. However, in response to notice u/s. 143(2) and 142(1), the AR of the assessee appeared before the AO and filed relevant details. After due verification and examination of the seized/impounded material and information furnished by the assessee during assessment proceedings, the AO accepted the income originally returned at Rs. 29,35,780/-. 2.2 Subsequently, the AO noted that the assessment was completed u/s. 143(3) for AY 2016-17 on 06.12.2018 wherein the income was determined at Rs.2,32,42,684/- and demand of Rs.66,75,521/- was raised. The AO, therefore, issued a notice u/s. 154 of the Act proposing to rectify the assessment. Since the assessee did not respond to the notice issued u/s. 154 of the Act, the AO in the order passed u/s. 154, determine the assessed income at Rs. 2,32,42,684/-. 3. Before the ld.CIT(A), the assessee stated that the AO passed the order u/s. 154 of the Act bringing into taxation....
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....ct Taxes with regard to Finance Act, 2003, in which it was stated as under: "65.5 The Assessing Officer shall assess or reassess the total income of each of these six assessment years. Assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years pending on the date of initiation of the search under section 132 or requisition under section 132, as the case may be, shall abate. It is clarified that the appeal, revision or rectification proceedings pending on the date of initiation of search under section 132 or requisition shall not abate. Save as otherwise provided in the proposed section 153A, section 153B and section 153C, all other provisions of this Act shall apply to the assessment or reassessment made under section 153A. It is also clarified that assessment or reassessment made under section 153A shall be subject to interest penalty and prosecution, if applicable. In the assessment or reassessment made in respect of an assessment year under this section, the tax shall be chargeable at the rate or rates as applicable to such assessment year." The 143(3) proceedings are independent proceedings and the tax....
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....3. The Appellate Commissioner erred in confirming the rectification order of the A.O, when in fact the original Assessment Order passed u/s.153A on 22.09.2021, which was competed after due verification and was not a mistake apparent from record. 4. The Appellate Commissioner erred in confirming the rectification order passed u/s.154 , when the order rectifying and adding an amount of Rs.2, 03, 06, 904/-, tantamount to change of opinion and thus is to be struck down. 5. Any other grounds which the Assessee may urge either before or at the time of the hearing. 6. The ld.counsel for the assessee referring to page 1 of the paper book, drew the attention of the Bench to the return filed on 16.10.2016 declaring total income at Rs. 29,45,778/-. Referring to the computation statement filed along with return of income, copy of which is placed at page 2 to 4 of the paper book, he drew the attention of the Bench to page 3 of the paper book and submitted that as per Clause 6, the assessee has declared long term capital gain at 'nil' after claiming the amount of Rs. 1,60,00,000/- deposited in the long term capital gain scheme in Andhra Bank on 21.04.2016 out of the long ter....
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....bmitted that once the AO has made the addition in AY 2018-19, passing the order u/s. 154 to bring the same amount to tax in AY 2016-17 is not justified. He accordingly submitted that the order passed u/s. 154 of the Act by the AO and upheld by the ld.CIT(A) is not justified. 7. The ld.DR on the other hand heavily relied on the order of the ld.CIT(A). He submitted that the AO passed the original assessment order determining the total income at Rs. 2,32,42,684/- against the returned income of Rs. 29,35,780/-. The assessee is in appeal before the ld.CIT(A) challenging the additions made in AY 2016-17 in the original proceedings. Therefore, when the search took place and the AO completed the assessment u/s. 143(3) r.w.s. 153A, he should have brought to tax the original amount determined. Since in the order passed u/s. 143(3) r.w.s. 153A, the AO had accepted the returned income without rectifying the figure of the assessed income, there was an apparent mistake in the order and therefore, the ld.CIT(A) was fully justified in upholding the rectification order passed by the AO. 8. We have considered the rival arguments made by both the sides, perused the orders of the AO and Ld.CIT(A....
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....in account scheme" before the due date of filing return of income and the deposits should be for 3 years. However in the instant case as the assessee had violated the provisions of section 54 by depositing the sale consideration on 21.10.2017 which is beyond the due date of filing return of income and pre-closing the "Capital Gain Deposits Scheme" on 23.01.2018 before 3 years i.e, the deposit should be from 26.10.2015 to 26.10.2018 without investing the same subsequently in the purchase/construction of new asset, the assessee was given opportunity to show cause as to why not the claim made by the assessee u/s. 54 be denied and added back to the total income of the assessee and taxed as per provisions of Income tax Act, 1961 vide letter No. ITBA/AST/F/17/2018- 19/1013801565(1) dated 26.11.2018. In response to the same, the AR filed letter dated 27.11.2018 stating that the deposits were originally made on 21.04.2016 and was being renew3ed without encashment and thus were with the bank in designated account as capital gains deposits from 21.04.2016 till they were withdrawn on 23.01.2018. Thus the deposits were made within time limit as given in the Act and well before due date for fur....