The Supreme Court considered a Miscellaneous Application filed by the Revenue seeking clarification regarding the scope of reassessment proceedings under Sections 147 and 148 of the Income Tax Act, 1961, read with Section 150, in cases where assessments had been completed under Sections 153A or 153C pursuant to a search, and no incriminating material was found during such search.

The Revenue sought clarification that notwithstanding the dismissal of its appeals in relation to assessments made under Sections 153A and 153C in the absence of incriminating material, the Assessing Officer should be permitted to initiate reassessment proceedings for income alleged to have escaped assessment otherwise than through incriminating material, subject to the provisions of Sections 147 to 151. The Revenue also sought directions regarding the applicability of such clarification to pending proceedings and timelines for initiating reassessment.

The Supreme Court, after examining the averments and prayers in the application, held that the reliefs sought were in the nature of a review of the earlier judgment and would require detailed consideration on merits. The Court observed that such relief could not be granted by way of a clarification through a Miscellaneous Application.

Accordingly, without entering into the merits of the prayers or expressing any opinion on the substantive issues raised, the Supreme Court declined to entertain the Miscellaneous Application. The Court relegated the Revenue to file an appropriate review application, clarifying that any such review, if filed, would be heard and decided in open court in accordance with law and on its own merits.

The Miscellaneous Application was disposed of with the aforesaid observations.

Source Link - https://api.sci.gov.in/supremecourt/2023/17700/17700_2023_4_1505_44451_Judgement_12-May-2023.pdf

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