TaxTMI 
TaxTMI 
2025 (2) TMI 1929
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..... The Assessing Officer erred in making disallowance of Rs. 4,76,76,469/- on account of various expenses/purchases observing that the same were paid in cash and remained unverifiable. The disallowance made by AO is arbitrary, illegal, baseless and not justified. 3. The Assessing Officer erred in making disallowance of Rs. 6,71,136/- on account of interest expenses observing that the same were paid in cash and remained unverifiable. The disallowance is arbitrary, illegal, baseless and not justified. 4. The notice issued by AO u/s 148 is illegal, ab initio void. There was no material before the AO for formation of belief of escapement. The AO reopened the assessment without application of mind and reassessment was initiated only on the basis of Report of DDIT (Inv.), Kolkata. The reassessment proceeding was illegal and not sustainable. 5. The reassessment order passed by the AO is illegal, ab initio void, inasmuch as it has been passed contrary to mandatory requirements of law. The reassessment order is illegal, not sustainable and is liable to be quashed. 6. The appellant reserves the right to add, amend or alter any ground/s of appeal. 3. The ....
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....ppeal in ITA No. 431/RPR/2024 have submitted that the order passed by Ld. AO u/s 143(3) r.w.s. 147 is illegal, bad in law and liable to be quashed. It was the submission that the case of assessee was reopened on 30.03.2019, while the reopening assessment was under process and finally completed on 31.12.2019, there was a Search & Seizure action u/s 132 of the Act conducted in the business and residential premises of the Sarthak Group of cases along with premises of the assessee on 26.11.2019. After referring to the aforesaid dates of events, Ld. AR submitted that as per provisions of 2nd proviso to subsection (1) of section 153A, the assessment or re-assessment, if any, relating to any assessment year falling within the period of 6 assessment 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. With such assertions, it was the submission by Ld. AR that in case of an assessee, who was subjected to search operations u/s 132 of the Act, if any assessment or re-assessment is undergoing when the search proceedings are initiated, the assessment or reassessment....
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....fied in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139; (b) 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 : Provided that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years: Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment 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. [(2) If any proceeding initiated or any order of assessment or reassessment made under sub-section (1) has been annulled in appeal or any other legal proceeding, then, notwithstanding anything contained in sub-section (1) or section 153, the assessment o....
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....eassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words, there will be only one assessment order in respect of each of the six AYs "in which both the disclosed and the undisclosed income would be brought to tax". (Emphasis supplied by us) iv. Although Section 153A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment "can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material." v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the ....