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2014 (7) TMI 254 - AT - Income TaxComputation u/s 153A of the Act - Sale of flat – Computation of LTCG – Held that:- Chapter XIV-B of the Act deals with computation of undisclosed income, whereas section 153A, etc., provides for the computation of ‘total income’ - the language of section 153A has been structured in such a way so as not to permit the making of addition for the AY of which the assessment is not pending as on the date of search, without there being any incriminating material found during the course of search - where a search is initiated u/s 132 of the Act etc., the AO shall issue a notice requiring the person searched etc. to furnish his return of income in respect of each assessment year falling within six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made - a duty has been cast on the AO to determine the 'total income' of the assessee for such six assessment years. If no incriminating material is found in respect of such completed assessment, then the total income in the proceedings u/s 153A shall be computed by considering the originally determined income - if some incriminating material is found in respect of such assessment years for which the assessment is not pending, then the 'total income' would be determined by considering the originally determined income plus income emanating from the incriminating material found during the course of search - In the other scenario of the assessments pending on the date of search which would abate in terms of second proviso to sec. 153A(1), the total income shall be computed afresh uninfluenced by the fact whether or not there is any incriminating material - no addition can be made for any assessment year u/s 153A, the assessment for which is not pending on the date of search, unless any incriminating material is found in the course of search - The assessment order is silent on both the counts as to whether the assessment for AY 2003-04 was pending as on the date of search and whether any incriminating material was found during the course of search having bearing on the addition so made – the matter is to be remitted back to the AO for fresh adjudication – Decided in favour of Assessee.
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