PRINCIPAL COMMISSIONER OF INCOME TAX CENTRAL 2 KOLKATA vs. SHRI RAMESH CHANDRA KANAIYALAL SHAH

OD–11 IN THE HIGH COURT AT CALCUTTA SPECIAL JURISDICTION [INCOME TAX] ORIGINAL SIDE ITA/84/2022 PRINCIPAL COMMISSIONER OF INCOME TAX, CENTRAL-2, KOLKATA VS. M/S. RAMESH CHANDRA K SHAH BEFORE : THE HON’BLE ACTING CHIEF JUSTICE T.S. SIVAGNANAM And THE HON’BLE JUSTICE HIRANMAY BHATTACHARYYA Date : 26th April, 2023 Appearance : Mr. Soumen Bhattacharyya, Adv. … for appellant The Court : This appeal has been filed by the revenue challenging the order passed by the Income Tax Appellate Tribunal. The legal issue involved in the instant case is the scope of assessment under Section 153A of the Income Tax Act. The legal issue which has been raised by the revenue has been answered by the Hon’ble Supreme Court in the case of Principal Commissioner of Income Tax, Central-3 vs. Abhisar Buildwell [P] Ltd. reported in [2023] 149 taxmann.com 399 [SC]. The Hon’ble Supreme Court has summarised the legal position in paragraph 11 of the judgment and in paragraph 13 the Hon’ble Supreme Court has held that it is an agreement with a view taken by the Delhi High Court in the case of Commissioner of Income Tax [Central]-III vs. Kabul Chawla reported in [2016] 380 ITR 573 [Delhi] and that of the High Court of Gujarat in the case of Principal Commissioner of Income Tax-4 vs. Saumya

2 Construction reported in [2016] 387 ITR 529 [Gujarat]. In the penultimate paragraph of the judgment namely, in paragraph 14 the conclusion has been recorded, which is as follows : “14. In view of the above and for the reasons stated above, it is concluded as under: 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.

3 The question involved in the present set of appeals and review petition is answered accordingly in terms of the above and the appeals and review petition preferred by the Revenue are hereby dismissed. No costs. “ In the light of the above decision, the appeal stands disposed of in terms of the order passed by the Hon’ble Supreme Court and the question of law stands answered accordingly. (T.S. SIVAGNANAM, J.) ACTING CHIEF JUSTICE

(HIRANMAY BHATTACHARYYA, J.) pkd/SN. AR(CR)