TaxTMI 
TaxTMI 
2026 (4) TMI 490
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.... (hereinafter referred to as "the Act" for short) seeking to re-open income tax assessment of the petitioner for the Assessment Year 2014-15 (hereinafter referred to as "the assessment year under consideration" for short) by the Assistant Commissioner of Income Tax, Circle, Gandhinagar (hereinafter referred to as "the respondent" for short). 3.1 The petitioner is a partnership firm and has filed the return of income for the assessment year 2014-15 on 30.11.2014 declaring total income at Rs. 1,69,780/-. The petitioner is part of PSY Group which is engaged in the business of real estate. 3.2 The said PSY group and its associated groups of Gandhinagar including the petitioner were subjected to search action u/s. 132 of the Act on 08.02.2024. The Respondent issued a notice dated 30.03.2025 under Section 148 of the Act for the year under consideration. It is stated therein that a search was initiated under Section 132 of the Act on 08.02.2024 in the case of the Petitioner or in the case of the person in respect of which the Petitioner is assessable under the Act. It was further stated that the Respondent is satisfied, with the approval of Principal Commissioner or Commissioner, th....
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....th explanation - 1 to Section 153A of the Act, and 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 Act. The table showing the calculation was placed before this Court and the same is reproduced as under: Number Assessment Year 1st year Assessment Year 2024-25 2nd year Assessment Year 2023-24 3rd year Assessment Year 2022-23 4th year Assessment Year 2021-22 5th year Assessment Year 2020-21 6th year Assessment Year 2019-20 7th y....
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.... 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 to exclude the search year and it is always six plus four years, and therefore "end" is to be construed as 1st April for going backward. 6.3 An attempt is also made to distinguish the judgment of the Delhi High Court in the case of Ojjus Medicare (supra), by submitting that two methods cannot be adopted for computation of the six-year block period as mentioned in Sections 153A and 153C of the Act and for calculation of the ten-year block period by excluding the previous year from computation of ten years. Thus, it is urged that this Court may take a different view, disagreeing with the judgments of the Delhi High Court as well as the Kerala High Court, and it is urged that the action of the respondent may be upheld for reopening the Assessment Year 2014-15....
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.... of the period of ten years would include the search year. (c) 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. (d) 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 years." The key expression that flows from reading of the section is "six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted" and "for the relevant assessment year or years." is phrased independently, disjointed from earlier phrase. (e) In juxtaposition, the Fourth Pro....
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.... block. (g) 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 six years immediately preceding the search year whereas exceptional extended jurisdiction up to ten years is not a mere arithmetic extension of the six-year model; it is governed by a separately structured computational rule. The Legislature, in its wisdom, has consciously created: • A backward-looking "preceding" model (six years), and • A reckoning "from t....
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....er 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 that a search took place 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 t....
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....ment year itself. In that event, the ten assessment years will be as follows: 1st Year 2019-20 2nd Year 2018-19 3rd Year 2017-18 4th Year 2016-17 5th Year 2015-16 6th Year 2014-15 7th Year 2013-14 8th Year 2012-13 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 there is no scope for looking to the explanatory 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 ....