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TMI Blog2015 (6) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... 2015 - Shri G. C. Gupta And Shri T. S. Kapoor,JJ. For the Appellant : Shri Sanat Kapoor, Adv. For the Respondent : Shri P Dam Kanunjha, Sr. DR ORDER Per T. S. Kapoor, AM: This is an appeal filed by assessee against the order of Ld. CIT(A) dated 13.01.2012. The assessee has raised various grounds of appeal challenging the validity of assessment made u/s 148 of the Act. Ground NO.2 of appeal relates to the challenge that the A.O. had proceeded to reassess the income u/s 148 which was already considered in block assessment and, therefore, no notice u/s 148 could have been issued again to assess/reassess the income which has already been assessed. The grounds of appeal taken by assessee are reproduced below: 1. That the notice issued U/s 148 and reassessment order passed by the assessing officer are illegal, bad in law, without jurisdiction and against the principle of natural justice. 2. That in view of the facts and circumstances of the case and in law the Ld. CIT(A) has erred in ignoring the fact that AO has already included the reassessed income in the block assessment order and notice U/s 148 cannot be issued to again assess I reassess the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ials available on record have not been properly considered and judiciously interpreted, hence the Addition / disallowance made is illegal and uncalled for. 13. That interest U/s 234A, 234B and 234C of the Income Tax Act, 1961 has been wrongly and illegally charged and has been wrongly worked out. 2. The assessee in various grounds of appeal has challenged the assessment completed u/s 148 on various legal issues. The brief facts of the case are that the notice u/s 148 was issued on 15.03.2004 and the assessee was asked to file return of income for the Assessment Year 1998-99 on 13.04.2004. After serving the notice u/s 143(2), the A.O. show cause the assessee that as to why addition of ₹ 27,60,000/- be not made to the income of the assessee. However, the assessee did not reply and, therefore, the A.O. made the addition on the basis of material available on record and passed the order u/s148 of the Act. Ld. CIT(A) also dismissed the appeal of assessee and assessee contested the matter before ITAT. ITAT restored the mater back to the office of Ld. CIT(A) with the direction to re-adjudicate the issue on merits. Ld. CIT(A) again dismissed the appeal of assessee after adjudic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowing the above, the appeal of assessee in the year under consideration be also allowed. 4. Ld. D.R. on the other hand heavily placed his reliance on the orders of authorities below and submitted that ITAT had allowed relief to the assessee on legal issue and the merits of the case were not discussed and, therefore, the action for making assessment of escaped income was justified. 5. We have heard rival parties and have gone through the material placed on record. We find that an order u/s 158BC dated 29.05.2001 placed at paper book pages 39-63 was passed as block assessment wherein the income of the assessee proposed to be assessed by issuing notice u/s 148, was already assessed to tax vide that order. The Hon ble Tribunal had allowed relief holding that the order passed u/s 158BC was time barred. The appeal filed by Revenue is pending before Hon'ble High Court. However, the question has been admitted vide Hon'ble Delhi High Court order dated 24.03.2008. From the reasons recorded and placed at paper book page 333, we find that the A.O. proposed to reassess the income of the assessee by holding that since ITAT had quashed the block assessment order, and standing couns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;s appeal before High Court on the same income is pending for disposal. When there was no income that had escaped assessment, there is no question of issuing notice U/S 148. 3.1.8 It is also relevant to examine the provision of sec. 158BA which is a charging section for income unearthed due to search u/s 132 of ITAT Act. Section 158BA begins with a non obstante clause and states that the undisclosed income resulting from action u/s 132 and 132A shall be assessed only in accordance with the provisions of chapter XIV -B. (Special procedure for assessment of search cases). Sec. 158BA(2) provides for taxing the undisclosed income at the rate specified u/s 113 as income of the block period. Thus, there is a, statutory mandate to assess the income discovered during search u/s 132 only as per provisions of chapter XIV -B. There is a higher rate of tax applicable to such income u/s 113. There are provisions for not charging (sec 158BF) certain kinds of interests (234A, 234B 234C) otherwise chargeable in the normal course. Further, penalty u/s 271 (l)(c) is also not leviable (as per sec. 158BF) to income assessable under the chapter. Therefore income unearthed during action u/s 132 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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