Assessments based on third-party evidence require adherence to Section 153C, not Section 147, to ensure jurisdictional validity.

ORDER :

M. NAGAPRASANNA, J.

Petitioner is before this Court seeking the following prayers:

“(a) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice issued under section 148 dated: 1.8.2016 NO. AABFA 768K/DCIT-C-6(2)(1)/148/2016-17 by Respondent No.2 marked as Annexure-A1 for the A.Y.2013-14 as bad in law.

(b) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the order of assessment passed by Respondent No.2 under section 143(3) r.w.s 147 of the Act, dated 29.12.2017 marked as Annexure-A2 for the A.Y.2013-14 as one without jurisdiction.

(c) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice of demand issued u/s 156 of the Act pursuant to the above impugned assessment order passed 143(3) r.w.s 147 of the Act, by the Respondent No. 2 on 29.12.2017 for the assessment years 2013-14 marked as Annexure-A3.

(d) Issue a writ of Certiorari or direction in the nature of a writ of certiorari quashing the notice of penalty issued u/s 274 r.w.s 271 of the Act pursuant to the above impugned assessment order passed 143(3) r.w.s 147 of the Act, by the Respondent No. 2 on 29.12.2017 for the assessment years 2013-14 marked as Annexure-A4.

(e) Declare that the Respondent No. 2 erred in law in invoking the provisions of section 143(3) r.w.s 147 of the Act on mere surmises, conjectures and suspicion without having any reasons to believe as contemplated under the provisions of section 143(3) r.w.s 147 of the Act (f) And pass such other orders as this Hon'ble Court deems fit and proper in the interest of justice and equity.”

2. Heard Sri Gurumurthy M, learned counsel appearing for petitioner and Sri E I Sanmathi, learned counsel appearing for respondents.

3. Learned counsel for petitioner submits that the petition be disposed in terms of an order passed by the coordinate bench of this Court in W.P.No.8577 of 2018 dated 29-10-2024.

4. Learned counsel Sri E I Sanmathi would not dispute the position, as is laid down by the coordinate bench.

5. The coordinate bench in W.P.No.8577 of 2018, by its order dated 29-10-2024, has held as follows:

“…. …. ….

8. With regard to question No.2, the relevant provision of Section 147 of the Act as it was before amendment, which is applicable to the present case and Sections 153C & 153A of the Act read as under:

"Income escaping assessment

147. If any income chargeable to tax, in the case of an assessee, has escaped assessment for any assessment year, the Assessing Officer may, subject to the provisions of sections 148 to 153, assess or reassess such income or recompute the loss or the depreciation allowance or any other allowance or deduction for such assessment year (hereinafter in this section and in sections 148 to 153 referred to as the relevant assessment year)"

Section 153C of the Act, reads as follows:

Assessment of income of any other person

153C. (1) Not withstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that,-

(a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or

(b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in section 153A, then, the books of account or documents or assets, seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person] [and that Assessing Officer shall proceed against each such other person and issue notice and assess or reassess the income of the other person in accordance with the