CIT v. Smt. Shaila Agarwal (Allahabad High Court) – he second proviso to Section 153A of the Act, refers to abatement of the pending assessment or re-assessment proceedings. The word ‘pending’ does not operate any such interpretation, that wherever the appeal against such assessment or reassessment is pending, the same along with assessment or reassessment proceedings is liable to be abated. The principles of interpretation of taxing statutes do not permit the Court to interpret the Second Proviso to Section 153A in a manner that where the assessment or reassessment proceedings are complete, and the matter is pending in appeal in the Tribunal, the entire proceedings will abate.
There is another aspect to the matter, namely that the abatement of any proceedings has serious causes and effect in as much as the abatement of the proceedings, takes away all the consequences that arise thereafter. In the present case after deducting bogus gifts in the regular assessment proceedings, the proceedings for penalty were drawn under Section 271 (1) (c) of the Act. The material found in the search may be a ground for notice and assessment under Section 153A of the Act but that would not efface or terminate all the consequence, which has arisen out of the regular assessment or reassessment resulting into the demand or proceedings of penalty.
Judgement reserved on 10.10.2011
Judgement delivered on 25.11.2011
Allahabad High Court
Income Tax Appeal No. 241 of 2008
Commissioner of Income-tax (Central), Kanpur
Vs.
Smt. Shaila Agarwal
Hon. Sunil Ambwani, J. Hon. K.N. Pandey, J.
