TaxTMI 
TaxTMI 
2026 (2) TMI 92
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....sh and set aside the notice issued under Section 148 of the Income Tax Act, 1961 and consequent Assessment Order passed under Section 147 read with Section 143(3) of the Income Act, 1961 dated 18.05.2025 for the Assessment Year 2012-13. 4. The brief facts giving rise to the filing of the present writ petition are that the petitioner is engaged in the business of real estate and financing under the name and style of 'Mahavir Developers'. The petitioner had filed its return of income for the Assessment Year 2012-13 on 28.09.2012 declaring a total income of Rs. 15,57,960/-. It is the case of the petitioner that additionally the petitioner falls under the purview of tax audit under Section 44AB of the Income Tax Act, 1961 (for short "the Act") and has submitted the audit report in Form 3CB-3CD. The petitioner thereafter filed its revised return of income on 19.03.2014 declaring total income of Rs. 64,93,660/-. 4.1. It is further the case of the petitioner that initially the petitioner was selected for scrutiny through Computer Assisted Scrutiny Selection (CASS), pursuant to which an Assessment Order under Section 143(3) of the Act was passed on 12.03.2015 by accepting the return ....
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....ition of Rs. 1,18,66,323 should not be made on the ground that the opening balance reflected in the cash book which was prepared on the basis of the data. The petitioner filed a detailed reply on 15.05.2025. However, without considering the reply filed by the petitioner, the respondent passed an order under Section 147 read with Section 143(3) of the Act on 18.05.2025 determining the assessed income of Rs. 1,83,59,983/- after making addition of Rs. 1,10,61,645/- on account of unexplained expenditure under Section 69C of the Act and Rs. 8,04,678/- on account of undisclosed income. Hence, the petitioner is constrained to approach this Court by way of this petition. 5. Learned advocate Mr. Hardik Vora for the petitioner submitted that in the present case the year under consideration is Assessment Year 2012-13 which precedes the date of 01.04.2021, when significant changes to the provisions concerning reassessment came into effect. It is further submitted that for the reassessment proceedings relating to Assessment Years before the implementation of the Finance Act, 2021, the specific proviso to Section 149(1) (b) of the Act applies. As per the said proviso, no notice under Section ....
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....rit petition is opposed by the learned Senior Standing Counsel Mr. Maunil Yajnik for the respondent and has submitted that the impugned notice as well as the Assessment Order do not require interference looking to the incriminating material found during the course of search action on the assessee on 11.11.2022. It is submitted that the petitioner was unable to prove the genuineness of opening cash balance by producing supporting documentary evidence. Thus, it is urged that in view of the gross concealment of the income and also unaccounted cash payment for expenditure, the action of the respondent in reopening the assessment does not call for any interference. 6.1. At this juncture, learned Senior Standing Counsel Mr. Maunil Yagnik has submitted that for the first time before this Court, the issue of limitation is raised even though the petitioner had an opportunity to raise the same before the concerned authority as he had participated in the proceedings. Hence, it is urged that the present writ petition may not be entertained. 7. We have heard the learned advocates appearing for the respective parties at length. The writ petition deserves to be allowed only on the sole reas....
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.... which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more:] Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if a notice under section 148 or section 153A or section 153C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of this section or section 153A or section 153C, as the case may be, as they stood immediately before the commencement of the Finance Act, 2021: Provided further that the provisions of this sub-section shall not apply in a case, where a notice under Section 153-A, or Section 153-C read with Section 153-A, is required to be issued in relation to a search initiated under Section 132 or books of account, other documents or any assets requisitioned under Section 132-A, on or before the 31st day of March, 2021." 7.1 Section 149(1)(b) of the Act refers to the limitation period of ten years, which has elapsed from the end of the "relevant assessment year". The relevant assessment year in the present case i....
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....r or years): Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years and for the relevant assessment year or years referred to in this sub-section pending on the date of initiation of the search under section 132 or making of requisition under section 132A, as the case may be, shall abate Provided also that the Central Government may by rules made by it and published in the Official Gazette (except in cases where any assessment or reassessment has abated under the second proviso j, specify the class or classes of cases in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and for the relevant assessment year or years Provided also that no notice for assessment reassessment shall be issued by the Assessing Officer for the relevant assessment year or years unless- (a) the Assessing Officer has in his possession books of account or other documents or evidence w....
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....lace on a person between 01 April 2021 to 31 March 2022, the pertinent AY would become AY 2022-23 and the corresponding six AYs' would by as follows: Computation of the six-year block period as provided under section 153C of the Act No of years AY 2021-22 1 AY 2020-21 2 AY 2019-20 3 AY 2018-19 4 AY 2017-18 5 AY 2016-17 6 89. That takes us then to the issue of identifying the "relevant assessment year" for the purposes of computing the ten year block. Explanation 1 to section 153A specifies the manner in which the entire ten AY period is to be computed. While the computation of six AYs follows the position as enunciated and identified above, Explanation I prescribes that the ten AYs' would have to be computed from the end of the AY relevant to the FY in which the search was conducted or requisition made The ten AY period consequently is to be reckoned from the end of the AY pertaining to the previous year in which the search was conducted as distinct from the preceding year which is spoken of in the case of the six relevant AYs. 90. Viewed in that light, and while keeping the period of 01 April 2021 to 31 March 2022 as ....
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....planatory notes appended to statute or circular issued by the department. 10. In the case on hand, the statute has prescribed one mode of computing the six years and another mode for computing the ten years. Section 153A(1)(b) states that the assessing officer shall assess or reassess the total income of six years immediately preceding the assessment year relevant to the previous year in which search is conducted. Applying this yardstick, the six years would go up to 2013-14. The search assessment year, namely, 2019-20 has to be excluded. This is because, the statute talks of the six years preceding the search assessment year. But, while computing the ten assessment years, the starting point has to be the end of the search assessment year. In other words, search assessment year has to be including in the latter case. It is not for me to fathom the wisdom of the parliament. I cannot assume that the amendment introduced by the Finance Act, 2017 intended to bring in four more years over and above the six years already provided within the scope of the provision. When the law has prescribed a particular length, it is not for the court to stretch it. Plasticity is the new mantra....