On appeal, the High Court held that:
(i) The first search was conducted on 02-03-2005 in the assessment year 2005-06. Hence, it enabled assessments for six years prior to AY 2005-06 which brings in AY 1999-2000 in the block for six years. The limitation period with respect to finalization of assessment u/s 153B cannot be applied for computation of assessments years which are enabled in u/s 153A of the Act.
(ii) The two documents (tax evasion petition) based on which the search was conducted were itself incriminating documents. Pursuant to search and enquiry conducted thereafter that the suppressed account maintained by assessee is which unaccounted consideration from the purchaser was unearthed. Hence, the notices issued under S. 153A were not solely basis the two consent documents and even if there was no incriminating found during search, the Revenue was justified in proceedings with the assessments based on such consent letters, as otherwise, Revenue would have based on such consent letters initiated re-assessment proceedings, which would be well within the limitation period as on the date of issuance of notice u/s 153A of the Act since the Assessee himself has disclosed additional consideration in return filed in response to Section 153A proving that there was a failure on the part of Assessee to disclose true and complete details and the assessed income being more than 1 lakh, re-opening is possible within six years (not restricted to four years). (I.T. A No 186 of 2013 dt. 24-01-2018) (AY. 1999-2000 to 2004-05).