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TMI BlogDecoding the Interplay of Sections 153A and 153C in Search Assessments: Limitation and Reassessment DynamicsX X X X Extracts X X X X X X X X Extracts X X X X ..... H COURT Here is a detailed article analyzing the key legal issues and court's reasoning in the case: INTRODUCTION This case dealt with the core legal question of determining the relevant assessment years that can be reopened for reassessment of a non-searched entity u/s 153C of the Income Tax Act, 1961 pursuant to a search action. The context involved a search conducted on 07.04.2016, with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from recording satisfaction (i.e. AY 2012-13) would be barred by limitation. Reliance was placed on the proviso in Section 153A restricting the 10-year period to searches post 01.04.2017. COURT DISCUSSIONS AND FINDINGS The Court examined the interplay between Sections 153A and 153C , noting the latter's dependence on the former for procedure. Analyzing the proviso to Section 153A(1) , it held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h physical transmission being only a machinery provision. ANALYSIS AND DECISION The Court concluded that for a common AO, the commencement point would be the date of recording satisfaction regarding the non-searched entity's income, not the search date. Even without physical handover, this date would be crucial for initiating action u/s 153C . Applying this principle, the Court held that reass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpact the rights of assessees. It upholds the legislative intent behind the 2017 amendment, which aimed to extend the reassessment period for serious cases while protecting assessees' rights through the proviso . The ruling clarifies the interplay between Sections 153A and 153C , emphasizing that the latter's operation is contingent on the former's conditions, including the proviso . I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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