Assessments cannot be made U/S 153A in case no incriminating evidence is found during search
Supreme Court Case-
PCIT Vs. Abhisar Buildwell P. Ltd. (Supreme Court); Civil Appeal No. 6580 Of 2021
Core issue involved in the appeals is the scope of assessment u/s 153A. question posed for consideration is, as to whether in respect of completed assessments/unabated assessments, whether the jurisdiction of AO to make assessment is confined to incriminating material found during the course of search u/s 132 or requisition u/s 132A or not
Observations of the Hon Supreme Court on the issue:
- In case of search u/s 132 or requisition u/s 132A, the AO assumes the jurisdiction for block assessment u/s 153A.
- All pending assessments/reassessments shall stand abated.
- 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.
- 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.
- 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 u/s 132 or requisition under Section 132A.
- However, the completed/unabated assessments can be re-opened by the AO in exercise of powers u/s 147/148, subject to fulfilment of the conditions as envisaged/mentioned u/s 147/148 and those powers are saved.
The copy of the order is as under: