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TMI Blog2020 (2) TMI 146X X X X Extracts X X X X X X X X Extracts X X X X ..... e are search assessments. The assessee's grounds states that the Principal condition is that there should have been seized material and only then assessment can be framed under section 153A of the Act. The facts and circumstances are identical in these three years. The first ground raised as under: - "2003-04 1. On the facts and circumstances of the appellant's case and in the law the Ld. CIT(A) erred in confirming the additions made by the AO despite the fact that the additions are not based on any seized material. 2005-06 1. On the facts and circumstances of the appellant's case and in the law the Ld. CIT(A) erred in confirming the additions made by the AO despite the fact that the additions are not based on any seized material. 2006-07 1. On the facts and circumstances of the appellant's case and in the law the Ld. CIT(A) erred in confirming the additions made by the AO despite the fact that the additions are not based on any seized material. 3. The learned Counsel for the assessee stated that in AY 2003-04, the addition was on account of salary and professional fee amounting to Rs.7,63,537/- and claimed in the profit and loss account and disclosed in the regular as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nding on the date of initiation of the search or requisition shall abate. We find that there is no divergence of views in so far as the provision contained in section 153A till the 1st proviso. The divergence starts from the second proviso which states that pending assessment or reassessment on the date of initiation of search shall abate. This means that an assessment or reassessment pending on the date of initiation of search shall cease to exist and no further action shall be taken thereon. The assessment shall now be made u/s 153A. The case of Ld. Counsel for the assessee is that necessary corollary to this provision is that completed assessment shall not abate. These assessments become final except in so far and to the extent as undisclosed income is found in the course of search. On the other hand, it has been argued by the Ld. Standing Counsel that abatement of pending assessment is only for the purpose of avoiding two assessments for the same year, one being regular assessment and the other being assessment u/s 153A. In other words these two assessments coalesce into one assessment. The second proviso does not contain any word or words to the effect that no reassessment sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 132 (1) empowers the officer to issue a warrant of search of the premises of a person where any one or more of conditions mentioned therein is or are satisfied, i.e. - a) summons or notice has been issued to produce books of account or other documents but such books of account or documents have not been produced, b) summons or notice has been or might be issued, he will not produce the books of account or other documents mentioned therein, or c) he is in possession of any money or bullion etc. which represents wholly or partly the income or property which has not been and which would not be disclosed for the purpose of assessment, called as undisclosed income or property. We find that the provision in section 132 (1) does not use the word "incriminating document". Clauses (a) and (b) of section 132(1) employ the words "books of account or other documents". For harmonious interpretation of this provision with provision contained in section 153A, all the three conditions on satisfaction of which a warrant of search can be issued will have to be taken into account. Having held so, an assessment or reassessment u/s 153A arises only when a search has been initiated and conducted. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t or reassessment of total income under the aforesaid provision. Similar position will obtain in a case where undisclosed income or undisclosed property has been found as a consequence of search. In other words, harmonious interpretation will produce the following results: - a) In so far as pending assessments are concerned, the jurisdiction to make original assessment and assessment u/s 153A merge into one and only one assessment for each assessment year shall be made separately on the basis of the findings of the search and any other material existing or brought on the record of the AO, (b) in respect of non-abated assessments, the assessment will be made on the basis of books of account or other documents not produced in the course of original assessment but found in the course of search, and undisclosed income or undisclosed property discovered in the course of search." 5. The learned Counsel for the assessee has filed the details as on the date of search by the department under section 132 of the Act dated 24.04.2008 and filing of returns in regular course vis-à-vis returns filed under section 153A of the Act, which read as under: - 2003-04 2005-06 2006- ..... 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