TaxTMI 
TaxTMI 
2026 (3) TMI 957
X X X X Extracts X X X X
X X X X Extracts X X X X
....endered by learned Senior Standing Counsel Mr. Patel is taken on record. 4. By this petition under Article 226 of the Constitution of India, the petitioners challenges the Notice dated 26.03.2025 issued under Section 148 of the Income Tax Act, 1961 (for short "the Act") seeking to re-open income tax assessment of the petitioners for the Assessment Year 2014-15 (for short "the assessment year under consideration") by the Deputy Commissioner of Income Tax, Central Circle 2(2), Ahmedabad (for short "the respondent"). 4.1 For the sake of relevance, the facts are recorded from Special Civil Application No.2403 of 2026, which shall be treated as a lead matter. 4.2 The petitioner is an individual who filed his return of income for the assessment year 2014-15 on 31.07.2014 declaring total income at Rs. 6,89,070/-. The petitioner is part of PSY Group which is engaged in the business of real estate. The said PSY group and its associated groups of Gandhinagar including the petitioner were subjected to search action under Section 132 of the Act on 08.02.2024. The Respondent issued a notice dated 26.03.2025 under Section 148 of the Act for the year under consideration. It is stated the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....evant to the previous year in which search is carried out or requisition is made, which falls beyond six assessment years but not later than ten assessment years from the "end of the assessment year relevant to the previous year in which search is conducted". 5.2 Reference is also made to the provisions of Section 149 of the Act, more particularly the proviso to Section 149 read with explanation - 1 to Section 153A of the Act. It is submitted that so far as the limitation is concerned, for reopening of the assessment, the same is pari materia to Section 153C of the Act. 5.3 It is submitted that in the instant case, the search action was carried out in the case of third party on 08.02.2024 i.e. during the Financial Year 2023-24, and hence relevant assessment year to the previous year in which the search was undertaken under Section 132 of the Act is Assessment Year 2024-25. It is further submitted that the Notice under Section 148 of the Act for the Assessment Year 2014-15 would be time-barred, as the period of ten years would end at the Assessment Year 2015-16, since the Assessment Year 2024-25 will become the first assessment year as per the provisions of Section 153A of the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... found that the income of Rs.50 lakhs has escaped, for calculating ten years, the first assessment year has to be ignored. It is submitted that the expression "from the end of the assessment year" as mentioned in Explanation (1) to Section 153A of the Act would mean that it would commence from 1st April, and if we go backwards, in the present case, the reopening of the assessment for the year 2014-15 would get encompassed within a period of ten years. 6.2 While placing reliance on the notes of the legislature relating to the provisions of Section 153A and Explanation (1) to Section 153A of the Act, it is contended that the word "end" is missing, and hence it is submitted that the intention of the legislature was to exclude the word "end" from the statute. It is further submitted that if appropriate calculation is made, the calculation of ten years of assessment years under Explanation (1) to Section 153A of the Act would include the previous year as per the provisions of Section 153A(1)(b) of the Act. It is submitted that considering the memorandum and explanatory note of the Finance Act, 2017, the intention of the legislature, even for the purpose of calculating ten years, is t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....enue and the petitioner is the inclusion or exclusion of the search year. Revenue contends that while calculating the period of ten years, search year is to be excluded and the calculation starts from assessment year immediately preceding the previous year relevant to the assessment year in which search is conducted whereas the petitioner's contention is that the calculation of the period of ten years would include the search year. 9. The short controversy turns upon whether, while computing the ten-year block, the assessment year relevant to the previous year in which search is conducted (hereinafter "the search assessment year") is to be included in the reckoning, unlike the computation of six assessment years which expressly excludes it. 10. With reference to the relevant assessment year, it is necessary to refer to the provisions of Section 153A(1)(b) of the Act which reads as under: "Section 153A(1)(b) : (The Assessing Officer shall) assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made and for the relevant assessment year or yea....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ssment year relevant to the previous year of search. Thus, the assessment year relevant to the previous year of search becomes the reference year and the ten-year period is counted from the end of that assessment year. This necessarily includes the search assessment year within the ten-year framework and resultantly, the search year becomes the first year in the reckoning of the ten-year block. 12.2 If Parliament intended identical computation for both six and ten years, it would have used identical language. Instead, it has consciously used different phraseology, for six years "immediately preceding" and for ten years "from the end of the assessment year". Legally, it is well settled that while interpreting plain language of a Statute, the Court must give meaning to every word used by the Legislature. To compute ten years by excluding the search year (as is done for six years) would render the phrase "from the end of the assessment year" otiose and merge two distinct statutory schemes into one that would violate settled principles of statutory interpretation. The scheme of Section 153A reflects calibrated expansion in as much as ordinary search assessment would be computed as s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rch under Sections 132 / 132A of the Act. We may, at this stage, mention that the Delhi High Court as well as the Madras High Court has already considered the implications of Explanation (1) to Section 153A of the Act to the limitation and the expression "relevant assessment year" used therein in Explanation (1) to Section 153A of the Act. The Delhi High Court, in the case of Ojjus Medicare (P.) Ltd. (supra), after considering an array of judgments of other High Courts as well as of the Supreme Court and upon a threadbare consideration and analysis of the statutory provisions of Sections 153A, 148 and 149 of the Act, has held thus: "88 Section 153A replicates the basis on which the six AYs' are to be identified and computed with the solitary distinction being that in the case of the searched person, the six AYs' are liable to be computed from the AY pertaining to the FY in which the search was conducted. The starting point for the purpose of identifying the six AYs' in the case of section 153A would thus turn upon the year of search as opposed to the handover of material which is spoken of in the First Proviso to section 153C. If one were to therefore assume th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... It is the end of the assessment year relevant to the previous year in which search is conducted or requisition is made. There cannot be any doubt that since search was made in this case on 10.04.2018, the assessment year is 2019-20. The end of the assessment year 2019-20 is 31.03.2020. The computation of ten years has to run backwards from the said date i.e. 31.03.2020. The first year will of course be the search assessment year itself. In that event, the ten assessment years will be as follows: 1st Year 2019-2020 2nd Year 2018-2019 3rd Year 2017-2018 4th Year 2016-2017 5th Year 2015-2016 6th Year 2014-2015 7th Year 2013-2014 8th Year 2012-2013 9th Year 2011-2012 10th Year 2010-2011 The case on hand pertains to AY 2009-10. It is obviously beyond the ten year outer ceiling limit prescribed by the statute. The terminal point is the tenth year calculated from the end of the assessment year relevant to the previous year in which search is conducted. The long arm of the law can go up to this terminal point and not one day beyond. When the statute is clear and admits of no ambiguity, it has to be strictly construed and....