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2007 (2) TMI 169 - HC - Income TaxValidity Of assessment proceeding - Non-compliance with the provisions of section 153A - search and seizure u/s 132 - whether the assessment proceeding for the year 2004-05 and the final order passed in the said assessment proceeding is vitiated in law for non-compliance with the provisions of section 153A of the Act? - HELD THAT:- The second proviso to section 153A makes it clear that assessment or reassessment relating to any assessment year falling within the period of six assessment years pending on the date of initiation of the search u/s 132 or requisition u/s 132A shall abate. In other words, if on the date of initiation of search or requisition u/s 132 or section 132A any assessment or reassessment proceeding is initiated relating to any assessment year falling within the period of six assessment years, it shall stand abated and the assessing authority cannot and shall not proceed with such pending assessment after initiation of search or requisition as contemplated hereinabove. The search and seizure was initiated by the respondents on August 24, 2006, which was carried out by various authorised officials. Thereafter, as admitted by the respondents in their counter affidavit, no notice as required u/s 153A was issued to the petitioner for the six assessment years, i.e., from 2001-02 to 2006-07. It has not been disputed by the respondents that the date on which the search was initiated the assessment proceeding was pending on the basis of the return furnished by the petitioner. Consequently, therefore, the pending assessment proceeding stood abated by virtue of the second proviso to section 153A of the said Act. Instead of complying with the requirements of section 153A of the Act, the respondents proceeded with the pending assessment proceeding for the assessment year 2004-05 and passed an assessment order during the pendency of the instant writ application. The said impugned order has also been challenged by the petitioner by filing amendment petition. In the aforesaid facts and circumstances of the case, I am of the definite opinion that the entire action of the respondents in proceeding with the assessment after search in contravention of the provisions of section 153A is vitiated in law. Consequently, the impugned assessment order dated December 28,2006, purportedly passed u/s 143(3) of the Act in a pending assessment proceeding which stood abated is a nullity. As discussed, continuation of the impugned assessment proceeding after the initiation of search without giving any notice u/s 153A of the Act and passing the impugned final order of assessment is illegal, arbitrary and wholly without jurisdiction. Thus, this writ application is allowed and the impugned notice and the final order of assessment are set aside. The concerned authorities of the respondents are directed to proceed with the block assessment after issuing notices as contemplated u/s 153A of the Act and pass order in accordance with law after giving opportunity of hearing to the petitioner.
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