Section 153A of the Income Tax Act
The decision most relied on for Section 153A is National Thermal Power Co. Ltd. v. CIT (229 ITR 383), cited in 5,796 of the 5,131 judgments on BharatTax that turn on this section.
Leading authorities on Section 153A
An appellate authority can admit additional grounds of appeal, even if not raised before, if they are purely legal in nature and all relevant facts for their adjudication are already on record. These grounds can include challenging jurisdictional issues.
In a search assessment under Section 153A, additions can only be made for completed or non-abated assessment years if incriminating material relevant to those years is found during the search, although notice under Section 153A(1) is mandatorily issued for six assessment years preceding the search.
When two equally plausible interpretations of a taxing provision are possible, or when conflicting views exist from non-jurisdictional High Courts, the interpretation that favors the assessee must be adopted.
A penalty notice issued under section 274 read with section 271(1)(c) is invalid if it fails to specify whether the penalty proceedings are initiated for concealment of income or for furnishing inaccurate particulars of income. This non-specification vitiates the penalty proceedings.
An assessee cannot raise a new claim or a claim not made in the original or revised return of income for the first time directly before the Assessing Officer during assessment proceedings.
In Section 153A proceedings, the scope of assessment extends to abated proceedings, enabling an assessee to raise fresh legal claims that could have been made in regular assessment proceedings.
The principle of consistency dictates that if the facts and circumstances remain unchanged across assessment years, the revenue cannot adopt a divergent or adverse position on an issue that was previously allowed after due deliberation.
For assessments under Section 153C, a notice is legally unsustainable if there is no incriminating material correlated to the specific assessment years for which reassessment is sought.
The Commissioner of Income Tax (Appeals) possesses co-terminus powers with the Assessing Officer and can direct the Assessing Officer to perform actions he failed to do, but cannot introduce a new source of income in the assessment. The appellate assessment must be confined to the items of income that were the subject matter of the original assessment.
An adverse finding based on third-party statements or documents is unsustainable if the assessee is denied the opportunity to cross-examine the witnesses. The denial of cross-examination violates natural justice and renders the statements unusable against the assessee.
Judgments on Section 153A
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