S. 147: Even s. 143(1) Intimation cannot be reopened in the absence of new information

Mohan Gupta (HUF) vs. CIT (Delhi High Court)

S. 147: Even s. 143(1) Intimation cannot be reopened in the absence of new information


The reassessment is not on the basis of new information or facts that have come to the fore now, but rather, a re-appreciation or review of the facts that were provided along with the original return filed by the assesse. The record does not show any tangible material that created the reason to believe that income had escaped. Rather, the reassessment proceedings amount to a review or change of opinion carried out in the earlier A.Y. 2005-06, which amounts to an abuse of power and is impermissible. In response, it is argued that since the return was processed under Section 143(1) for the A.Y. 2005-06, which involves a mere intimation, rather than an application of mind or true assessment of the return, a less stringent threshold must be taken in terms of ‘reasons to believe’ that income has escaped assessment or not. This precise argument, however, has been considered and rejected by this Court in CIT v. Orient Craft [2013] 354 ITR 536 (Delhi)

S. 153A: High Court Explains Importance Of Search Warrant And Panchnama In Search Assessments

MDLR Resorts Pvt. Ltd vs. CIT (Delhi High Court)

S. 132: Copy of search warrant should be given to the searched person. Defects in the panchnama do not invalidate the search or the s. 153A assessment proceedings


A search u/s 132 was conducted on the premises of the assessee and its group concerns. Though a panchnama was prepared, the assessee’s name did not appear therein. An assessment order u/s 153A was passed to assess the alleged undisclosed income. The assessee claimed that as s. 153B imposed a limitation for passing of a s. 153A order by reference to the last panchnama drawn in relation to the searched person, the absence of the assessee’s name in the panchnama meant that the s. 153A assessment order could not be passed. A Writ Petition was filed to challenge the assessment. HELD by the High Court dismissing the Petition:

S. 153A(1) does not make any reference to panchnama or the date of panchnama. A panchnama is not a pre-condition for invoking s. 153A. As regards the argument that the time limit u/s 153B is calculated with reference to the date of the last panchnama, a panchnama was drawn up on the occasion of the search and it referred to documents belonging to the assessee though it did not refer to the assessee by name. The panchnama also does not refer to the conclusion of the search. The non-reference to the name of the assessee and the suspension/ conclusion of the search is a lapse and failure to comply with the requirements of the search and seizure manual. However, this does not affect the validity of the search or the assessment order u/s 153A. The department should take remedial steps and ensure that such lapses do not occur in future. Also, the department should give a copy of the search warrant to the person searched so as to curtail allegations of interpolation, addition of names etc