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Tax Publishers Search and seizure - whether orders of unabated/completed assessment years can be reopened in the absence of any incriminating evidences under section 153A read with 132 & 132A *Facts:* In a series of batch petitions revenue sought review of the earlier dismissal of SLP petition in the case of Income Tax, Central-III v. Kabul Chawla, (2015) 61 taxmann.com 412 (Delhi) : 2015 TaxPub(DT) 3486 (Del-HC) where in it was held that in the absence of any incriminating evidence arising out of a search/seizure, completed/unabated assessments cannot be disturbed. Plea of the revenue was income tax is a tax on the income and the income has to be complete so the law cannot be envisaged to tax half/part of income and accordingly section 153A cannot be read in a manner to dilute the requirement of taxing full income and thereby unearthing incriminating evidences is not a sine qua non to disturb completed/unabated assessments. Held against the revenue the order of Kabul Chawla does not require any revision. i) that in case of search under section 132 or requisition under section 132A, the AO assumes the jurisdiction for block assessment under section 153A; ii) all pending assessments/reassessments shall stand abated; iii) in case any incriminating material is found/unearthed, even, in case of unabated/completed assessments, the AO would assume the jurisdiction to assess or reassess the total income taking into consideration the incriminating material unearthed during the search and the other material available with the AO including the income declared in the returns; and iv) in case no incriminating material is unearthed during the search, the AO cannot assess or reassess taking into consideration the other material in respect of completed assessments/unabated assessments. Meaning thereby, in respect of completed/unabated assessments, no addition can be made by the AO in absence of any incriminating material found during the course of search under section 132 or requisition under section 132A of the Act, 1961. However, the completed/unabated assessments can be re-opened by the AO in exercise of powers under sections 147/148 of the Act, subject to fulfilment of the conditions as envisaged/mentioned under sections 147/148 of the Act and those powers are saved. *Ed. Note:* The Apex court verdict permitting reopening under section 147 and 148 is not something unheard of as any completed assessment if the conditions of section 147 and 148 are separately met may get reopened. The logic of reopening under section 147 & 148 being tracked/pulled into section 153A is unwarranted is what the Apex court has said. *Case:* Pr. CIT v. Abhisar Buildwell (P.) Ltd. 2023 TaxPub(DT) 2442 (SC)

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Search and seizure - whether orders of unabated/completed assessment years can be reopened in the absence of any incriminating evidences under section 153A read with 132 & 132A

Facts:

In a series of batch petitions revenue sought review of the earlier dismissal of SLP petition in the case of Income Tax, Central-III v. Kabul Chawla, (2015) 61 taxmann.com 412 (Delhi) : 2015 TaxPub(DT) 3486 (Del-HC) where in it was held that in the absence of any incriminating evidence arising out of a search/seizure, completed/unabated assessments cannot be disturbed. Plea of the revenue was income tax is a tax on the income and the income has to be complete so the law cannot be envisaged to tax half/part of income and accordingly section 153A cannot be read in a manner to dilute the requirement of taxing full income and thereby unearthing incriminating evidences is not a sine qua non to disturb completed/unabated assessments.

Held against the revenue the order of Kabul Chawla does not require any revision.

i) that in case of search under section 132 or requisition under section 132A, the AO assumes the jurisdiction for block assessment under section 153A;

ii) all pending assessments/reassessments shall stand abated;

iii) in case any incriminating material is found/unearthed, even, in case of unabated/completed assessments, the AO would assume the jurisdiction to assess or reassess the total income taking into consideration the incriminating material unearthed during the search and the other material available with the AO including the income declared in the returns; and

iv) in case no incriminating material is unearthed during the search, the AO cannot assess or reassess taking into consideration the other material in respect of completed assessments/unabated assessments. Meaning thereby, in respect of completed/unabated assessments, no addition can be made by the AO in absence of any incriminating material found during the course of search under section 132 or requisition under section 132A of the Act, 1961. However, the completed/unabated assessments can be re-opened by the AO in exercise of powers under sections 147/148 of the Act, subject to fulfilment of the conditions as envisaged/mentioned under sections 147/148 of the Act and those powers are saved.

Ed. Note: The Apex court verdict permitting reopening under section 147 and 148 is not something unheard of as any completed assessment if the conditions of section 147 and 148 are separately met may get reopened. The logic of reopening under section 147 & 148 being tracked/pulled into section 153A is unwarranted is what the Apex court has said.

Case: Pr. CIT v. Abhisar Buildwell (P.) Ltd. 2023 TaxPub(DT) 2442 (SC)