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Tax Publishers O.P. Yadav v. DCIT [ITA No. 5523/Del/2018, dt. 10-9-2020] : 2020 TaxPub(DT) 3623 (Del-Trib) Reassessment under section 147 post block assessment under section 158BC *Facts:* Assessee was a sole proprietor concern. Consequential to a search and seizure operations in the premises of the assessee certain incriminating evidences were unearthed whereby bogus/accommodation entries were added in the block period of the assessee but not in this sole-proprietorship concern for the assessment years 1-4-1995 to 7-3-2000 the order of which was passed on 25-3-2004. Subsequent to this based on the investigation wing it was also found out that the assessee proprietorship concern was also in receipt of bogus/accommodation entries and thus the scrutiny assessment case of assessee was reopened under section 147 and additions sustained. This reopening/additions were sustained by lower authorities. Aggrieved assessee went in higher appeal to ITAT claiming that the reopening/reassessment post a block assessment was incorrect and deserved to be quashed - Held against the assessee that the reopening/reassessment was correct and the additions were sustained. The ITAT did take cognizance of the fact that post a block assessment, no reassessment/reopening is possible as the block assessment provisions do exclude section 147/148 once they are invoked. Also because of the fact the concept of block assessment is a clubbed assessment thus outside reopening/reassessment provisions. Besides this principle; reopening in a block case would mean that the additions arising out of the search if reassessed/reopened itself would be read as usurping the powers of the search and its provisions thus it would be incorrect to reopen/reassess a block assessment case under section 147/148. The CBDT circular was also aligned on this. But in this case what was reopened was the normal assessment and not the block assessment due to which the reassessment proceedings were held to be valid thus sustaining the additions. *Editorial Note:* The above principles would hold water even in the new search and seizure block assessment cases.

Tax Publishers

O.P. Yadav v. DCIT [ITA No. 5523/Del/2018, dt. 10-9-2020] : 2020 TaxPub(DT) 3623 (Del-Trib)

Reassessment under section 147 post block assessment under section 158BC

Facts:

Assessee was a sole proprietor concern. Consequential to a search and seizure operations in the premises of the assessee certain incriminating evidences were unearthed whereby bogus/accommodation entries were added in the block period of the assessee but not in this sole-proprietorship concern for the assessment years 1-4-1995 to 7-3-2000 the order of which was passed on 25-3-2004. Subsequent to this based on the investigation wing it was also found out that the assessee proprietorship concern was also in receipt of bogus/accommodation entries and thus the scrutiny assessment case of assessee was reopened under section 147 and additions sustained. This reopening/additions were sustained by lower authorities. Aggrieved assessee went in higher appeal to ITAT claiming that the reopening/reassessment post a block assessment was incorrect and deserved to be quashed -

Held against the assessee that the reopening/reassessment was correct and the additions were sustained.

The ITAT did take cognizance of the fact that post a block assessment, no reassessment/reopening is possible as the block assessment provisions do exclude section 147/148 once they are invoked. Also because of the fact the concept of block assessment is a clubbed assessment thus outside reopening/reassessment provisions. Besides this principle; reopening in a block case would mean that the additions arising out of the search if reassessed/reopened itself would be read as usurping the powers of the search and its provisions thus it would be incorrect to reopen/reassess a block assessment case under section 147/148. The CBDT circular was also aligned on this.

But in this case what was reopened was the normal assessment and not the block assessment due to which the reassessment proceedings were held to be valid thus sustaining the additions.

Editorial Note: The above principles would hold water even in the new search and seizure block assessment cases.