M/s. Shri Ram Realcon Pvt. Ltd., Kolkata V. DCIT, Central Circle - 1(4), Kolkata , Kolkata

CO 15/KOL/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7338 (ITAT-KOLKATA)
• Duration Of Justice: 6 month(s) 29 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-10-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-08-2019
• Assessment Year: 2010-2011
• Appeal Filed On: 18-03-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RADHEY SHYAM
• Assessee Lawyers: R P AGARWALA; NIRAV
• Keywords: Unexplained cash credit; Search and seizure; Question of law; Deemed dividend; Set aside
• Section: 143(3); 133A; 153A; 2(22)(e); 14A; 80IB; 133(6); 143(2); 264; 68; 263; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B, KOLKATA [ BEFORE SHRI P.M. JAGTAP, VICE-PRESIDENT (KZ) & SHRI S.S. VISWANETHRA RAVI, JM ] IT(SS)A NOS. 154 & 155/KOL/2017 ASSESSMENT YEAR: 2009-10 & 2010-11 D.C.I.T, CENTRAL CIRCLE 1(4) KOLKATA.......................................................................APPELLANT 110, SHANTI PALLY, KOLKATA 700 107. M/S. SHRI RAM REALCON PVT. LTD.................RESPONDENT 8, CAMAC STREET, SHANTINIKETAN BUILDING, KOLKATA 700 017. [PAN : AALCS 1007 K] C.O. NO. 14 & 15/KOL/2019 (ARISING OUT OF IT(SS)A NO. 154 & 155/KOL/2017) ASSESSMENT YEAR: 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD...........CROSS-OBJECTOR 8, CAMAC STREET, SHANTINIKETAN BUILDING, KOLKATA 700 017. [PAN : AALCS 1007 K] D.C.I.T, CENTRAL CIRCLE 1(4) KOLKATA...................................................................RESPONDENT 110, SHANTI PALLY, KOLKATA 700 107. APPEARANCES BY: SHRI RADHEY SHYAM, CIT, DR APPEARING ON BEHALF OF THE REVENUE SHRI R.P. AGARWALA, SR. ADVOCATE & SHRI NIRAV SHETH, FCA APPEARING ON BEHALF OF THE ASSESSEE DATE OF CONCLUDING THE HEARING : AUGUST 28, 2019 DATE OF PRONOUNCING THE ORDER : OCTOBER 16, 2019 ORDER PER P.M. JAGTAP, VICE-PRESIDENT (KZ) THESE TWO APPEALS ARE PREFERRED BY THE REVENUE AGAINST TWO SEPARATE ORDERS BOTH DATED 02.08.2017 PASSED BY THE LD. CIT (A) 20, KOLKATA AND SINCE THE ISSUED INVOLVED THEREIN ARE COMMON, THE SAME HAVE BEEN HEARD TOGETHER AND ARE BEING DISPOSED OF BY A CONSOLIDATED ORDER ALONG WITH CORRESPONDING CROSS-OBJECTIONS FILED BY THE ASSESSEE BEING C.O. NO. 14 & 15/KOL/2019. 2 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. 2. THE RELEVANT FACTS OF THE CASE GIVING RISE TO THESE APPEALS AND CROSS-OBJECTIONS ARE AS FOLLOWS. THE ASSESSEE IS A COMPANY WHICH IS ENGAGED IN THE BUSINESS OF REAL ESTATE. THE RETURNS OF INCOME FOR BOTH THE YEARS UNDER CONSIDERATION WERE ORIGINALLY FILED BY IT ON 25.09.2009 AND 21.09.2010 FOR A.Y. 2009-10 AND 2010-11 RESPECTIVELY DECLARING TOTAL INCOME AT NIL CLAIMING THAT THERE WAS NO BUSINESS CARRIED ON BY IT DURING THE SAID YEARS. A SEARCH AND SEIZURE ACTION U/S 132 WAS CONDUCTED IN THE CASE OF THE ASSESSEE AS WELL AS IN THE CASES BELONGING TO THE SAME GROUP ON 05.08.2014 AS WELL AS ON THE SUBSEQUENT DATES. THE LOCKERS BELONGING TO THE VARIOUS PERSONS OF THE GROUP WERE ALSO COVERED IN THE SAID ACTION. DURING THE COURSE OF SEARCH AND SEIZURE ACTION, VALUABLES SUCH AS CASH, JEWELLERY, SILVER UTENSILS WERE FOUND AND SEIZED. PURSUANT TO THE SAID ACTION, NOTICES U/S 153A WERE ISSUED BY THE AO ON 20.03.2015 IN RESPONSE TO WHICH THE RETURNS OF INCOME WERE FILED BY THE ASSESSEE FOR BOTH THE YEARS UNDER CONSIDERATION ON 08.052015 DECLARING TOTAL INCOME AT NIL. ON PERUSAL OF THE RELEVANT BALANCE SHEETS OF THE ASSESSEE COMPANY, THE AO NOTICED THAT THE ASSESSEE HAD RECEIVED SHARE CAPITAL AND SHARE PREMIUM AMOUNTING TO RS. 2.78 CRORES AND 5.33 CRORES DURING THE PREVIOUS YEAR RELEVANT TO A.Y. 2009-10 AND 2010-11 RESPECTIVELY FROM THE VARIOUS COMPANIES. THE POST SEARCH VERIFICATION CARRIED OUT BY HIM BY MAKING THE SPOT ENQUIRIES REVEALED THAT THE SHARE SUBSCRIBER COMPANIES WERE NOT IN EXISTENCE AT THE GIVEN ADDRESS AND EVEN NOBODY IN THE SURRENDERING LOCATIONS WAS AWARE OF THE EXISTENCE OF THE SAID COMPANIES. HE, THEREFORE, REQUIRED THE ASSESSEE COMPANY TO FURNISH THE LIST OF SHARE SUBSCRIBER COMPANIES AND ALSO PRODUCE THE COPIES OF THEIR SHARE APPLICATION FORMS, INCOME TAX RETURNS, BALANCE 3 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. SHEETS AND BANK STATEMENTS. IN REPLY, THE ASSESSEE COMPANY FURNISH ONLY THE NAMES AND ADDRESSES OF THE SHARE SUBSCRIBER COMPANIES AND FAILED TO PRODUCE THE DOCUMENTARY EVIDENCE REQUIRED BY ASSESSEE. THE AO ISSUED NOTICES U/S 133(6) OF THE ACT TO THE ADDRESSES OF THE SHARE SUBSCRIBER COMPANIES AS FURNISHED BY THE ASSESSEE. THE SAME HOWEVER WERE RETURNED BACK UNSERVED. KEEPING IN VIEW ALL THESE FACTS OF THE CASE, THE AO HELD THAT THE PRIMARY ONUS THAT LAY ON THE ASSESSEE TO ESTABLISH THE IDENTITY AND CAPACITY OF THE CONCERNED SHARE SUBSCRIBER COMPANIES AS WELL AS THE GENUINENESS OF THE RELEVANT TRANSACTIONS WAS NOT DISCHARGED BY THE ASSESSEE COMPANY. ACCORDINGLY, HE TREATED THE SHARE CAPITAL AND SHARE PREMIUM AMOUNTS RECEIVED BY THE ASSESSEE DURING BOTH THE YEARS UNDER CONSIDERATION AS UNEXPLAINED CASH CREDIT AND ADDITION TO THE EXTENT OF RS. 2.78 CRORES AND RS. 5.33 CRORES WAS MADE BY HIM TO THE TOTAL INCOME OF THE ASSESSEE U/S 68 IN THE ASSESSMENTS COMPLETED FOR AY 2009-10 AND 2010-11 RESPECTIVELY U/S 153A / 143(3) OF THE ACT VIDE ORDERS DATED 31.12.2016. 3. THE ADDITIONS MADE BY THE ASSESSING OFFICER UNDER SECTION 68 IN THE ASSESSMENTS COMPLETED UNDER SECTION 153A/143(3) OF THE ACT VIDE ASSESSMENT ORDERS DATED 31.12.2016 FOR THE ASSESSMENT YEARS 2009-10 AND 2010-11 BY TREATING THE SHARE CAPITAL AND SHARE PREMIUM AMOUNTS RECEIVED DURING THE YEARS UNDER CONSIDERATION AS UNEXPLAINED CASH CREDITS WERE CHALLENGED BY THE ASSESSEE IN THE APPEAL FILED BEFORE THE LD. CIT(APPEALS). DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT(APPEALS), DETAILED WRITTEN SUBMISSIONS WERE FILED BY THE ASSESSEE STATING, INTER ALIA, THAT THE 4 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. SCOPE OF UNABATED ASSESSMENTS COMPLETED BY THE ASSESSING OFFICER UNDER SECTION 153A/143(3) WAS LIMITED TO ASSESS THE UNDISCLOSED INCOME ONLY ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH AND IN THE ABSENCE OF ANY SUCH INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH, THE ADDITION MADE BY THE ASSESSING OFFICER UNDER SECTION 68 BY TREATING THE SHARE CAPITAL AND SHARE PREMIUM AMOUNTS AS UNEXPLAINED CASH CREDITS WAS UNJUSTIFIED. THE LD. CIT(APPEALS) FOUND MERIT IN THIS CONTENTION RAISED ON BEHALF OF THE ASSESSEE AND AFTER EXTRACTING THE ENTIRE WRITTEN SUBMISSION FILED BY THE ASSESSEE IN HIS IMPUGNED ORDER, HE DELETED THE ADDITION MADE BY THE ASSESSING OFFICER UNDER SECTION 68 AFTER RECORDING HIS OBSERVATIONS/FINDINGS AS UNDER WHICH ARE IDENTICAL FOR BOTH THE YEARS UNDER CONSIDERATION: 5. I HAVE CONSIDERED THE FINDINGS OF THE AO IN THE ASSESSMENT ORDER AND THE WRITTEN SUBMISSION AS WELL AS DIFFERENT CASE LAWS BROUGHT ON RECORD BY THE AR. THE MAIN ARGUMENT OF THE AR IS THAT ADDITIONS MADE BY THE AO IN THE ASSESSMENT ORDER PASSED U] S 153A/143(3) ARE NOT BASED ON ANY INCRIMINATING DOCUMENTS/PAPERS SEIZED DURING THE SEARCH OPERATION. THE AR HAS BROUGHT ON RECORD MANY CASE LAWS DECIDED BY THE JURISDICTIONAL KOLKATA BENCH OF ITAT AND JURISDICTIONAL CALCUTTA HIGH COURT ON THIS ISSUE. CALCUTTA HIGH COURT HAS TIME AND AGAIN REITERATED ITS VIEW THAT THE ADDITION IN CASE OF THE SEARCH ASSESSMENTS HAS TO BE MADE ON THE BASIS OF INCRIMINATING MATERIAL. SOME OF THE RECENT DECISIONS OF THE HON'BLE JURISDICTIONAL HIGH COURT ARE DISCUSSED HEREUNDER. PCIT-2. KOLKATA VS. SALASAR STOCK BROKING LIMITED (ITAT NO. 264 OF 2016) DATED 24.08.2016: (CALCUTTA), IN THIS CASE, THE HONBLE HIGH COURT OBSERVED THAT THE LD. ITAT, KOLKATA WAS OF THE OPINION THAT THE ASSESSING OFFICER HAD NO JURISDICTION IS] S 153A OF THE I.T. ACT TO REOPEN THE CONCLUDED CASES WHEN THE SEARCH & SEIZURE DID NOT DISCLOSE ANY INCRIMINATING MATERIAL. IN TAKING THE AFORESAID VIEW, THE LD. ITAT RELIED UPON THE JUDGMENTS OF DELHI HIGH' COURT IN THE CASE OF CIT(A) VS. KABUL CHAWLA IN ITA NO. 707/2014 DATED 28.08.2014. THE 5 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. COURT ALSO OBSERVED THAT MORE OR LESS AN IDENTICAL VIEW HAS BEEN TAKEN BY THIS BENCH IN ITA NO. 661/2008 IN THE CASE OF CIT VS. VEERPRABHU MARKETING LIMITED. CONSIDERING THE ABOVE FACTS, THE HONBLE HIGH COURT DID NOT ADMIT THE APPEAL FILED BY THE DEPARTMENT. 'CIT.KOLKATA-III VS. VEERPRABHU MARKETING LTD.[20161 73 TAXMANN.COM 149 (CALCUTTA) : IN THIS CASE THE HONBLE CALCUTTA HIGH COURT EXPRESSED THE FOLLOWING VIEWS: 'WE ARE IN AGREEMENT WITH THE VIEWS OF THE KARNATAKA HIGH COURT THAT INCRIMINATING MATERIAL IS A PRE-REQUISITE BEFORE POWER COULD HAVE BEEN EXERCISED UNDER SECTION 153C READ WITH SECTION 153A. IN THE CASE BEFORE US, THE ASSESSING OFFICER HAS MADE DISALLOWANCES OF THE EXPENDITURE, WHICH WERE ALREADY DISCLOSED, FOR ONE REASON OR THE OTHER. BUT SUCH DISALLOWANCES WERE NOT CONTEMPLATED BY THE PROVISIONS CONTAINED UNDER SECTION 153C READ WITH SECTION 153A. THE DISALLOWANCES MADE BY THE ASSESSING OFFICER WERE UPHELD BY THE CIT(A) BUT THE LEARNED TRIBUNAL DELETED THOSE DISALLOWANCES.' THE HON'BLE KOLKATA HIGH COURT IN THE ABOVE CASES RELIED ON THE FOLLOWING JUDGMENTS. CIT VS KABUL CHAWLA (2016) 380 ITR 0573( DEL) SEARCH AND SEIZURE-NEW SCHEME OF ASSESSMENT IN SEARCH CASES-SEARCH WAS CARRIED OUT U/S 132 ON A LEADING REAL ESTATE DEVELOPER OPERATING ALL OVER INDIA AND SOME OF ITS GROUP COMPANIES-SEARCH WAS ALSO CARRIED OUT IN THE PREMISES OF THE ASSESSEE-PURSUANT TO THE SEARCH A NOTICE U/S 153A(1) WAS ISSUED TO ASSESSEE AND THEREAFTER HE FILED RETURNS-AS ON THE DATE OF THE SEARCH, NO ASSESSMENT PROCEEDINGS WERE PENDING FOR RELEVANT AYS AND FOR SAID AYS, ASSESSMENTS WAS ALREADY MADE U/S 143(1),ASSESSEE FILED AN APPLICATION U/S 154 SEEKING RECTIFICATION OF THE ASSESSMENTS ON THE GROUND THAT THE ACCUMULATED PROFITS OF THE COMPANIES PAYING THE DIVIDEND WERE LESS THAN THE AMOUNT OF LOAN OR ADVANCE GIVEN BY THEM TO THE RECIPIENT COMPANIES- AO DECLINED TO RECTIFY THE ASSESSMENTS-CIT ALSO HELD THAT ADDITION NEED NOT BE RESTRICTED ONLY TO THE SEIZED MATERIAL-ITAT ON APPEAL HOWEVER DELETED ADDITION ON GROUNDS THAT THE ADDITIONS MADE FOR RELEVANT AY'S U/S 2(22)(E) WERE NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING SEARCH OPERATION AND SAME WAS NOT SUSTAINABLE IN LAW-ISSUE WAS WHETHER THE ADDITIONS MADE TO THE INCOME OF THE ASSESSEE FOR THE SAID AYS U/S 2(22)(E) WAS NOT SUSTAINABLE BECAUSE NO INCRIMINATING MATERIAL CONCERNING SUCH ADDITIONS WERE FOUND DURING THE COURSE OF SEARCH AND 6 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. FURTHER NO ASSESSMENTS FOR SUCH YEARS WERE PENDING ON THE DATE OF SEARCH- HELD, PRESENT APPEALS CONCERNED AYS,2002-03, 2005-06 AND 2006-07-0N THE DATE OF THE SEARCH THE SAID ASSESSMENTS ALREADY STOOD COMPLETED-SINCE NO INCRIMINATING MATERIAL WAS UNEARTHED DURING THE SEARCH, NO ADDITIONS COULD HAVE BEEN MADE TO THE INCOME ALREADY ASSESSED-QUESTION FRAMED BY THE COURT WAS ANSWERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE- REVENUE'S APPEAL DISMISSED. 6. I FURTHER FIND THAT IN THIS REGARD THE HON'BLE ITAT KOLKATA HAS TIME AND AGAIN REITERATED ITS VIEW THAT THE ADDITIONS IN CASE OF THE SEARCH ASSESSMENTS HAS TO BE MADE ON THE BASIS OF INCRIMINATING MATERIAL AND ANY DEVIATION FROM THE SAME WOULD RENDER THE ASSESSMENT ORDER INVALID. SOME OF THE RECENT DECISION OF THE HON'BLE JURISDICTIONAL TRIBUNAL IS DISCUSSED HEREUNDER: M/S ADHUNIK GASES LTD. & OTHERS VS. DCIT CC-XXX, IT(SS)A NO. 47/KOL/2015, IT(SS)A NO. 49/KOL/2015, IT(SS)A NO. 50-2/KOL/2015, IT(SS)A NO. 54/KOL/2015, IT(SS)A NO. 55/KOL/2015, IT(SS)A NO. 94- 96/KOL/2015 ORDER DATED 06.01.2017(ITAT KOLKATA). IN THIS CASE IT IS HELD THAT NO ADDITION U/S 68 OF THE I. TAX ACT FOR THE SHARE CAPITAL CAN BE MADE IN ABSENCE OF ANY INCRIMINATING MATERIAL. THE CONCLUDING PARA OF THE HON'BLE ITAT'S ORDER IS AS UNDER: HAVING HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD, WE ARE OF THE VIEW THAT THERE IS MERIT IN THE SUBMISSIONS OF THE ASSESSEE AS THE PROPOSITIONS CANVASSED BY THE LD. AR FOR THE ASSESSEE ARE SUPPORTED BY THE JUDGMENTS OF JURISDICTIONAL !TAT AND HON'BLE HIGH COURTS. LD. AR HAS POINTED OUT THAT NO INCRIMINATING DOCUMENT WAS FOUND EITHER DURING SURVEY OR DURING SEARCH PROCEDURE. THE STATEMENT OF SHRI NARESH KUMAR CHHAPERIA SHOULD NOT BE RELIED ON} BECAUSE HE IS A DOUBLE SPEAKING PERSON. THE ASSESSMENT PROCEEDINGS WERE COMPLETED BEFORE THE DATE OF SEARCH. BESIDES, THE TIME LIMIT TO ISSUE NOTICE U/S 143(2) WAS ALSO EXPIRED. IN ORDER TO INITIATE ASSESSMENT PROCEEDINGS U/S 153A, THERE SHOULD BE A NEW OR INCRIMINATING DOCUMENT. THE ASSESSMENT WHICH IS ALREADY COMPLETED U/S. 143(3)/143(1) SHOULD NOT BE REOPENED. THEREFORE, CONSIDERING THE SCHEME OF SECTION 132 AND SECTION 153A, WE ARE OF THE VIEW THAT THERE SHOULD BE SOME NEW DOCUMENT/INCRIMINATING DOCUMENT TO INVOKE THE PROVISIONS OF SECTION 153A. LD. DR FOR THE REVENUE HAD POINTED OUT THAT THERE IS A DIRECT NEXUS AMONG THE COMPANIES, WHICH HAS BEEN ESTABLISHED BY THE STATEMENT OF MR. NARESH KUMAR CHHAPPERIA, 7 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. WHICH CANNOT BE RELIED ON, AS HE WAS A DOUBLE SPEAKING PERSON. THEREFORE, CONSIDERING THE FACTUAL POSITION AND THE JUDGMENTS CITED BY ID. AR, WE ARE OF THE VIEW THAT THE ADDITIONS MADE BY THE AA U/ S 153A AND CONFIRMED BY THE LD. CIT(A) NEEDS TO BE DELETED. THEREFORE, WE DELETE THE ADDITION. FURTHERMORE, THE DECISION OF THE JURISDICTIONAL TRIBUNAL IN THE CASE OF M/S TANUJ HOLDINGS PVT. LTD VS. DCIT CC-L(2), KOLKATA VIDE ITAT NO. 360 TO 363JKOL/2015 DATED 20.01.2016 IS IMPORTANT. THE RELEVANT PORTION OF THE ORDER IS REPRODUCED AS UNDER: WE ALSO FIND THAT NO INCRIMINATING MATERIALS WERE FOUND DURING THE SEARCH IN THE RESPECT OF THE ISSUE OF DEEMED DIVIDEND. HENCE IT CANNOT BE THE SUBJECT MATTER OF ADDITION IN 153C PROCEEDINGS IN RESPECT OF COMPLETED ASSESSMENTS. WE HOLD THAT WHEN AN ADDITION COULD NOT BE MADE AS PER LAW IN SECTION 153C PROCEEDINGS, THEN THE SAID ORDER CANNOT BE CONSTRUED AS ERRONEOUS WARRANTING REVISION JURISDICTION U/S 263 OF THE ACT.' SHRI. MANISH MUNDHRA VS. ACIT-CC-XXX IN ITA-469- 470/KOL/2013 DT. 16.12.2015 (ITAT KOLKATA); WE ALSO ARE OF THE VIEW THAT IN THE LIGHT OF THE ADMITTED FACT THAT NO INCRIMINATING MATERIAL WAS FOUND IN THE COURSE OF SEARCH THE IMPUGNED ADDITION COULD NOT HAVE BEEN MADE IN THE PROCEEDINGS U/S 153A OF THE ACT. THE DECISION OF THE ITAT, DELHI BENCH IN THE CASE OF ACIT VS M/S. DELHI HOSPITAL SUPPLY PVT. LTD. (SUPRA) FOLLOWED THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) SUPPORTS THE PLEA OF THE ASSESEE IN THIS REGARD .....' ACIT-CC-XXVII VS KANCHAN OIL INDUSTRIES LTD. IN ITA725/KOL/2011 DT. 09.12.2015 (ITAT KOLKATA); IN VIEW OF THE AFORESAID FINDINGS AND JUDICIAL PRECEDENT RELIED UPON, WE HOLD THAT THE DENIAL OF DEDUCTION IX] S 801B OF THE ACT IN THE ASSESSMENTS FRAMED U/S 153A OF THE ACT FOR THE ASST YEARS 2003-04 AND 2004-05 WITHOUT ANY INCRIMINATING MATERIALS FOUND DURING THE COURSE OF SEARCH WITH RESPECT TO THOSE ASSESSMENT YEARS IS NOT WARRANTED AND HELD AS NOT IN ACCORDANCE WITH LAW. ACCORDINGLY, THE GROUNDS RAISED BY THE REVENUE IN THIS REGARD FOR THE ASSESSMENT YEARS 2003-04 AND 2004-05 ARE DISMISSED. WE HOLD THAT THE SAME DECISION WOULD BE APPLICABLE FOR THE DISALLOWANCE MADE BY THE LEARNED AO U/ S 14A OF THE ACT AND ACCORDINGLY NO DISALLOWANCE U/ S 14A OF THE ACT COULD BE MADE FOR THE ASST YEAR 2004-05 BY THE LEARNED AO IN THE ASSESSMENT FRAMED U/ S 153A OF THE ACT IN THE ABSENCE OF ANY INCRIMINATING MATERIALS FOUND DURING THE COURSE OF SEARCH 8 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. WITH REGARD TO THE RELEVANT ASSESSMENT YEAR AND WITH REGARD TO THE RELEVANT ISSUE. WITH REGARD TO THE CLAIM OF DEDUCTION U/ S 80LB OF THE ACT FOR THE ASST YEARS 2007-08 D 2008-09 ARE CONCERNED} WE FIND THAT THE SAME IS ONLY CONSEQUENTIAL IN NATURE AND ONCE THE ASSESSEE HAS BEEN GRANTED DEDUCTION U/ S 80LB OF THE ACT FOR THE INITIAL ASSESSMENT YEAR I.E. ASST YEAR 2003- 04 THE GRANT OF DEDUCTION UNDER THE SAID SECTION IN RESPECT OF THE SAME UNIT IS ONLY ACADEMIC AND HENCE THE ASSESSEE IS ENTITLED FOR DEDUCTION U/ S 80LB OF THE ACT FOR THE ASST YEARS 2007-08 AND 2008-09. ACCORDINGLY THE GROUND RAISED BY THE REVENUE IN THIS REGARD FOR THE ASSESSMENT YEARS 2007-08 AND 2008-09 ARE DISMISSED. SINCE THE DECISIONS ARE RENDERED BY US ON LEGAL GROUNDS, WE REFRAIN TO GIVE OUR DECISION ON THE MERITS OF THE ISSUES. BUDHIYA MARKETING PVT. LTD. & ORS. VS. ACIT IN ITA NOS1545-1546/ KOL./2012 [REPORTED IN (2015) 44 CCH 03441DT. 10.07.2015 (ITAT KOLKATA) THE ISSUE WHETHER THE ADDITION IN AN ASSESSMENT FRAMED UNDER SECTION 153A CAN BE MADE ON THE BASIS OF THE INCRIMINATING MATERIAL FOUND DURING THE COURSE OF THE SEARCH WHERE THE ASSESSMENT HAS NOT BEEN ABATED, HAS NOT BEEN CONSIDERED OR DECIDED BY THIS TRIBUNAL. THEREFORE, THIS DECISION, IN OUR OPINION WILL NOT ASSIST THE REVENUE WHILE DISPOSING OF THE PLEA OF THE ASSESSEE THAT SINCE NO INCRIMINATING MATERIAL IS FOUND DURING THE COURSE OF THE SEARCH RELATING TO THE SHARE CAPITAL AND THE SHARE PREMIUM, THEREFORE, NO ADDITION CAN BE MADE WHILE MAKING AN ASSESSMENT UNDER SECTION 153A OF THE INCOME TAX ACT. NO CONTRARY DECISION WAS BROUGHT TO OUR KNOWLEDGE BY THE LD. D.R. IN VIEW OF THE AFORESAID DISCUSSION AND THE DECISION OF THE HON'BLE SPECIAL BENCH, BOMBAY HIGH COURT, AS WELL AS HON'BLE DELHI HIGH COURT, WE CONFIRM THE ORDER OF THE CIT(APPEALS) DELETING THE ADDITION MADE IN EACH OF THE ASSESSMENT YEARS AS WE HOLD THAT THE ASSESSING OFFICER WAS NOT CORRECT IN LAW IN MAKING THE ADDITION IN THE ASSESSMENT MADE UNDER SECTION 153A READ WITH SECTION 143(3) WHEN NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF THE SEARCH IN RESPECT OF THE ADDITION MADE BY HIM. WE ACCORDINGLY PARTLY ALLOWED THE CROSS OBJECTIONS TAKEN BY THE ASSESSEE.' ACIT VS. SHANTI KUMAR SURANA& ORS. IN IT(SS)A NOS. 12 TO 20 AND CO NOS. 13 TO 20 (REPORTED IN 44 CCH 241) ORDER DT. 22.06.2015(ITAT KOLKATA) 9 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. 'IN VIEW OF THE FACTS IN ENTIRETY AND THE LEGAL PRINCIPLES ENUNCIATED BY HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (NHAVASHEVA) LTD., SUPRA, OF HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF SHAILA AGARWAL, SUPRA AND MUMBAI SPECIAL BENCH DECISION IN THE CASE OF ALL CARGO GLOBAL LOGISTICS, SUPRA, WE ARE OF THE VIEW THAT THERE IS NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH IN THE PRESENT CASE FOR THESE ASSESSMENT YEARS, EXCEPT THE STATEMENT OF ONE SHRI SAMBHU KR MORE, AS ADMITTED BY THE AO IN HIS REMAND REPORT DATED 23.09.2011 AND DESPITE NUMBER OF OPPORTUNITIES REVENUE COULD NOT PRODUCE ANY INCRIMINATING MATERIAL BEFORE THE BENCH AND THE ASSESSMENTS ARE ALREADY COMPLETED FOR THESE ASSESSMENT YEARS ORIGINALLY, THE ASSESSMENTS FRAMED U/S. 153A OF THE ACT IS IN VALID AND HENCE, QUASHED. TRISHUL HITECH INDUSTRIES LTD VS. DCIT-CC-XI. IT(SS)A84- 86/KOL/2011 DT. 24.09.2014 (ITAT KOLKATA); FROM THE ABOVE VARIOUS DISCUSSIONS AND PRECEDENCE WE ARE OF THE CONSIDERED VIEW THAT ASSESSMENT IN THE IMPUGNED ASSESSMENT YEARS HAVE BEEN COMPLETED U/S 143(3) OF THE ACT. HENCE THE ASSESSMENT FOR THE CONCERNED ASSESSMENT YEAR DOES NOT ABATE. HENCE DEHORSE ANY INCRIMINATING MATERIAL, AO CANNOT MADE ANY ADDITION IN THESE CASES. ACCORDINGLY WE HOLD THAT ASSESSMENT U/S 153C OF THE ACT IN THESE CASES DEHORSE ANY INCRIMINATING MATERIAL IS NOT SUSTAINABLE. HENCE WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DECIDE THE ISSUE IN FAVOUR OF ASSESSEE. SINCE WE ARE QUASHING THE APPEALS ON JURISDICTION WE ARE NOT ADJUDICATING THE MERITS OF THE APPEAL AS THE SAME IS NOW ONLY OF ACADEMIC INTEREST.' DCIT VS. MERLIN PROJECT LTD. IT(SS)A NO-138/KOL/2011 DT. 14.11.2013 (ITAT KOLKATA); 'WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE UNDISPUTED FACT ABOUT THIS CASE IS THAT THE ORIGINAL ASSESSMENT IN THIS CASE WAS COMPLETED UNDER SECTION 143(3) IN WHICH DEDUCT ION WAS ALLOWED IN ENTIRETY UNDER SECT ION 801B OF THE ACT INTER ALIA ON THE AMOUNT OF INTEREST INCOME. IT IS ALSO UNDISPUTED THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH CASTING DOUBT ABOUT THE ALLOWABILITY OR OTHERWISE OF SUCH DEDUCTION UNDER SECTION 80IB. THIS FACT HAS BEEN FAIRLY ADMITTED BY LD. D.R. DURING THE COURSE OF PROCEEDINGS BEFORE US AS WELL. 10 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. PRATIBHA INDUSTRIES (2013) 141 ITD 151 (MUM.) HAS HELD, INTER ALIA, THAT HAVING DONE ORIGINAL ASSESSMENT U/S 143(3), IF NO INCRIMINATING MATERIAL IS FOUND DURING THE COURSE OF SEARCH, THEN IT IS PERMISSIBLE TO MAKE ANY ADDITION IN THE ASSESSMENT UNDER SECTION 153A PURSUANT TO SEARCH ACTION. THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LIMITED VS. DCIT (2012) 137 ITD 217 (SD)(MUM.) HAS ALSO HELD TO THE SAME EXTENT. IN VIEW OF THE FOREGOING DISCUSSION, WE ARE OF THE CONSIDERED OPINION THAT NO EXCEPTION CAN BE FOUND TO THE VIEW TAKEN BY CIT(APPEALS) FOR DECIDING THIS ISSUE IN ASSESSEE'S FAVOUR. BEFORE PARTING WITH THIS MATTER, WE WANT TO MAKE IT CLEAR THAT OUR DECISION IS BASED IN THE BACKDROP OF THE FACTS THAT THE DEDUCT ION UNDER SECT ION 80IB COULD NOT HAVE BEEN TINKERED WITH BECAUSE NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH ON THIS ISSUE WHEN ORIGINAL ASSESSMENT GRANTING DEDUCT ION ON THIS ISSUE WAS COMPLETED UNDER SECT ION 143(3). WE HAVE NOT EXPRESSED ANY OPINION ON THE MERITS OF THE CASE ABOUT THE ALLOW ABILITY OR OTHERWISE OF DEDUCT ION UNDER SECTION 80IB ON INTEREST INCOME ARISING IN THE PRESENT FACTS AND CIRCUMSTANCES. IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. LMJ INTERNATIONAL LTD VS. DCIT(2008) 119 TTJ (KOL) 214. (ITAT KOLKATA); 'WHERE NOTHING INCRIMINATING IS FOUND IN THE COURSE OF SEARCH RELATING TO ANY ASSESSMENT YEARS, THE ASSESSMENTS FOR SUCH YEARS CANNOT BE DISTURBED; ITEMS OF REGULAR ASSESSMENT CANNOT BE ADDED BACK IN THE PROCEEDINGS UNDER S. 153A/153C WHEN NO INCRIMINATING DOCUMENTS WERE FOUND IN RESPECT OF THE DISALLOWED AMOUNTS IN THE SEARCH PROCEEDINGS. FURTHERMORE, THE HON'BLE SUPREME COURT HAS DISMISSED DEPARTMENT'S SPECIAL LEAVE PETITION(SLP) AGAINST THE JUDGMENT DT.06-07-2015 OF THE DELHI HIGH COURT IN ITA NO.369 OF 2015 WHERE THE HIGH COURT HELD THAT NO SUBSTANTIAL QUESTION OF LAW AROSE SINCE THERE WAS FACTUAL FINDINGS THAT NO INCRIMINATING EVIDENCE RELATE TO SHARE CAPITAL ISSUED WAS FOUND DURING THE COURSE OF SEARCH. THE AR HAS FILED A WRITTEN SUBMISSION ON THIS ISSUE WHICH IS AS UNDER: 'WHETHER SECTION 68 COULD BE INVOKED WHERE NO INCRIMINATING EVIDENCE RELATED TO SHARE CAPITAL FOUND. 7-12-2015 : THEIR LORDSHIPS MADAN B LOKUR AND S A BOBDE JJ DISMISSED THE DEPARTMENT'S SPECIAL LEAVE PETITION AGAINST THE JUDGMENT DATED JULY 6, 2015 OF THE DELHI HIGH COURT IN ITA NO.369 OF 2015, WHEREBY THE HIGH COURT HELD THAT NO SUBSTANTIAL 11 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. QUESTION OF LAW AROSE SINCE THERE WAS A FACTUAL FINDING THAT NO INCRIMINATING EVIDENCE RELATED TO SHARE CAPITAL ISSUED WAS FOUND DURING THE COURSE OF SEARCH AND THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN INVOKING SECTION 68 OF THE ACT FOR THE PURPOSES OF MAKING ADDITIONS ON ACCOUNT OF SHARE CAPITAL PR. CIT V KURELE PAPER MILLS P LTD, SLP (C) NO.34554 OF 2015'. 7. THE AR HAS ALSO BROUGHT ON RECORD THE CASE LAW OF CIT, KOLKATA-III VS VEERPRABHU MARKETING LTD [2016] 73 TAXMANN 149 KOLKATA IN THIS CASE THE HONORABLE CALCUTTA HIGH COURT EXPRESSED THE FOLLOWING VIEWS: 'WE ARE IN AGREEMENT WITH THE VIEWS OF THE KARNATAKA HIGH COURT THAT INCRIMINATING MATERIAL IS A PRE-REQUISITE BEFORE POWER COULD HAVE BEEN EXERCISED UNDER SECTION 153C READ WITH SECTION 153A. IN THE CASE BEFORE US, THE ASSESSING OFFICER HAS MADE DISALLOWANCES OF THE EXPENDITURE, WHICH WERE ALREADY DISCLOSED, FOR ONE REASON OR THE OTHER. BUT SUCH DISALLOWANCES WERE NOT CONTEMPLATED BY THE PROVISIONS CONTAINED UNDER SECTION 153C READ WITH SECTION 153A. THE DISALLOWANCES MADE BY THE ASSESSING OFFICER WERE UPHELD BY THE CIT(A) BUT THE LEARNED TRIBUNAL DELETED THOSE DISALLOWANCES.' THE HON'BLE KOLKATA HIGH COURT IN THE ABOVE CASES RELIED ON THE FOLLOWING JUDGMENTS. CIT VS KABUL CHAWLA (2016) 380 ITR 0573( DEL) SEARCH AND SEIZURE-NEW SCHEME OF ASSESSMENT IN SEARCH CASES-SEARCH WAS CARRIED OUT U/S 132 ON A LEADING REAL ESTATE DEVELOPER OPERATING ALL OVER INDIA AND SOME OF ITS GROUP COMPANIES-SEARCH WAS ALSO CARRIED OUT IN THE PREMISES OF THE ASSESSEE-PURSUANT TO THE SEARCH A NOTICE U/S 153A(1) WAS ISSUED TO ASSESSEE AND THEREAFTER HE FILED RETURNS-AS ON THE DATE OF THE SEARCH, NO ASSESSMENT PROCEEDINGS WERE PENDING FOR RELEVANT AYS AND FOR SAID AYS, ASSESSMENTS WAS ALREADY MADE U/S 143(1), ASSESSEE FILED AN APPLICATION U/S 154 SEEKING RECTIFICATION OF THE ASSESSMENTS ON THE GROUND THAT THE ACCUMULATED PROFITS OF THE COMPANIES PAYING THE DIVIDEND WERE LESS THAN THE AMOUNT OF LOAN OR ADVANCE GIVEN BY THEM TO THE RECIPIENT COMPANIES-AO DECLINED TO RECTIFY THE ASSESSMENTS-CIT ALSO HELD THAT ADDITION NEED NOT BE RESTRICTED ONLY TO THE SEIZED MATERIAL-ITAT ON APPEAL HOWEVER DELETED ADDITION ON GROUNDS THAT THE ADDITIONS MADE FOR RELEVANT AY'S U/S 2(22)(E) WERE NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING SEARCH OPERATION AND SAME WAS NOT SUSTAINABLE IN LAW-ISSUE WAS WHETHER THE ADDITIONS MADE TO THE INCOME OF THE ASSESSEE FOR THE SAID AYS U/S 2(22)(E) WAS NOT SUSTAINABLE BECAUSE NO INCRIMINATING MATERIAL 12 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. CONCERNING SUCH ADDITIONS WERE FOUND DURING THE COURSE OF SEARCH AND FURTHER NO ASSESSMENTS FOR SUCH YEARS WERE PENDING ON THE DATE OF SEARCH- HELD, PRESENT APPEALS CONCERNED AYS,2002-03, 2005-06 AND 2006-07-0N THE DATE OF THE SEARCH THE SAID ASSESSMENTS ALREADY STOOD COMPLETED-SINCE NO INCRIMINATING MATERIAL WAS UNEARTHED DURING THE SEARCH, NO ADDITIONS COULD HAVE BEEN MADE TO THE INCOME ALREADY ASSESSED-QUESTION FRAMED BY THE COURT WAS ANSWERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE- REVENUE'S APPEAL DISMISSED. IT WAS ALSO INFORMED/BROUGHT ON RECORD THAT THE ORDER PASSED BY THE HON'BLE CALCUTTA HIGH COURT HAS ATTAINED FINALITY AS THE CBDT IN IT'S LETTER NO.ADG(L&R)- IIJEZJPR.CIT(C)- 1/KOLKATA/1184/2016/729 DT.07/08-02- 2017 HAS INTIMATED THAT THE PROPOSAL TO FILE SLP IN ABOVE CASE HAS NOT BEEN APPROVED BY THE BOARD'. APART FROM ABOVE MENTIONED CASE LAWS BROUGHT ON RECORD, THE AR HAS ALSO FILED COPIES OF APPEAL ORDERS IN DIFFERENT CASES PASSED BY MY THREE ESTEEMED PREDECESSORS ON THE SAME ISSUE WHEREIN THEY HAVE DISCUSSED IN LENGTH AND ARRIVED AT CONCLUSION THAT ADDITIONS IN SEARCH ASSESSMENTS U/S 153A/153C CANNOT BE MADE EXCEPT ON THE BASIS OF THE INCRIMINATING MATERIAL FOUND IN THE SEARCH. REFERENCE A) APPEAL NO.442/CC-3(1)/CIT(A)-21J 14-15, DATE OF ORDER 05-12-2014, B) APPEAL NO.440/CC-3(1)/CIT(A)-21/ 14-15, DATE OF ORDER 15-01-2015 C) APPEAL NO.547 /CC-3(1)/CIT(A)-21/ 14-15, DATE OF ORDER 10-04-2015 D) APPEAL NO.129 /CC-XVI I/CIT(A)- I J09-10, DATE OF ORDER 23-09-2010 E) APPEAL NO.292/CC-VL/CIT(A) -C-VI/ 11-12, DATE OF ORDER 23-10-2013. I HAVE CONSIDERED THE FINDINGS OF THE AO IN THE ASSESSMENT ORDER, DIFFERENT CASE LAWS BROUGHT ON RECORD AND APPEAL ORDERS PASSED BY MY PREDECESSORS ON THIS LEGAL ISSUE. I FIND FROM THE ASSESSMENT ORDER THAT DURING THE SEARCH AND SEIZURE OPERATIONS CONDUCTED U/S 132 OF THE I .T. ACT , 1961, INCRIMINATING DOCUMENTS/PAPERS WERE NOT SEIZED. AT LEAST, ADDITIONS MADE BY THE AO IN THE ASSESSMENT ORDER PASSED U/S 153A/ 143(3) ARE NOT BASED ON ANY INCRIMINATING DOCUMENTS/PAPERS SEIZED DURING THE SEARCH OPERATION IT WOULD ALSO NOT BE OUT OF CONTEXT TO- MENTION-HERE THAT IN THIS CASE, ON THE DATE OF SEARCH, NO ASSESSMENT FOR THIS YEAR WAS PENDING. THEREFORE, KEEPING IN VIEW THE RATIO DECIDED BY THE JURISDICTIONAL BENCH OF KOLKATA TRIBUNAL IN CASES REFERRED ABOVE AND THE RATIO DECIDED BY THE HON'BLE CALCUTTA HIGH COURT IN THE CASE OF VEER PRABHU MARKETING LTD (SUPRA) IN THE LIGHT OF CBDT'S DECISION OF NOT FILING SLP IN THIS CASE IN THE SUPREME COURT AND KEEPING IN VIEW THE APEX COURT S DECISION TO DISMISS SLP ON SIMILAR ISSUE 13 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. IN THE CASE OF PR. CIT VS . - KURELE PAPER MILLS PVT. LIMITED: SLP(C) NO. 34554 OF 2015 DATED 07.12.2015, I AM OF THIS VIEW THAT IN ORDER TO MAINTAIN JUDICIAL CONTINUITY ON THIS ISSUE AND RESPECTFULLY FOLLOWING THE RATIO DECIDED BY THE HON'BLE CALCUTTA HIGH COURT IN THE CASE OF VEER PRABHU MARKETING LTD (SUPRA), ASSESSEE' S APPEAL ON GROUNDS NO 1 IS ALLOWED ON TECHNICAL GROUND AND AS SUCH I AM NOT INCLINED TO ADJUDICATE APPEAL ON GROUND NO 2 ON MERIT. 4. AGGRIEVED BY THE ORDERS OF THE LD. CIT(A), THE REVENUE HAS PREFERRED THESE APPEALS BEFORE THE TRIBUNAL ON THE FOLLOWING IDENTICAL GROUNDS: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) 20 ERRED IN ALLOWING GROUND NO. 1(A) & 1(B) OF THE ASSESSEES APPEAL ON TECHNICAL GROUNDS IN WHICH THE ASSESSEE CHALLENGED THE ASSUMPTION OF JURISDICTION BY THE AO TO MAKE AN ASSESSMENT UNDER SECTION 153A/143(3) OF THE INCOME TAX ACT CLAIMING THAT NO INCRIMINATING DOCUMENT WAS FOUND AND / OR SEIZED DURING SEARCH AND HE DID NOT ADJUDICATE OTHER GROUNDS OF APPEAL ON MERIT. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE DECISION OF LD. CIT(A) ALLOWING GROUND NO. 1(A) & 1(B) OF THE ASSESSEES APPEAL IS NOT AS PER THE PROVISION OF SECTION 153A IN WHICH IT IS PROVIDED THAT ONCE A RETURN IS FILED IN ANSWER TO NOTICE U/S 153A, EXPLANATION TO SECTION 153A PROVIDES AMONG OTHER THINGS, THAT ALL PROVISIONS OF THE ACT WILL APPLY TO THE ASSESSMENT MADE U/S 153A OF THE ACT AS PER WHICH THE ASSESSMENT PROCEEDING U/S 153A(1) CAN BE CONCLUDED ASSESSING THE TOTAL INCOME OF THE ASSESSEE INCLUDING MAKING ADDITION WITHOUT ANY INCRIMINATING MATERIAL BEING AVAILABLE AGAINST THE ASSESSEE FOR ANY PARTICULAR YEAR. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) 20, KOLKATA ERRED IN LAW IN DELETING ADDITION AS NOT BASED ON INCRIMINATING MATERIALS FOUND IN COURSE OF SEARCH AND WRONGLY HELD THAT THE SAID ASSESSMENT IS BAD IN LAW OVERRULING SECTIONS 153A, 153A(1) AND EXPLANATIONS THEREUNDER. 4. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) 20, KOLKATA WAS WRONG IN HOLDING THAT IN RESPECT OF UNABATED ASSESSMENTS (NO PENDING PROCEEDINGS) AS ON DATE OF SEARCH, THE ASSESSING OFFICER CANNOT FRAME THE SEARCH ASSESSMENT UNDER SECTION 153A OF THE ACT BY MAKING CERTAIN ADDITIONS WITHOUT ANY INCRIMINATING MATERIALS FOUND DURING THE COURSE OF SEARCH. 14 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND UNDER LAW, THE LD. CIT(A) ERRED IN STATING THAT NO ADDITION U/S 68 OF THE I.T. ACT FOR SHARE CAPITAL CAN BE MADE IN ABSENCE OF ANY INCRIMINATING MATERIAL WITHOUT EXAMINING THIS ISSUE ON MERIT. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS OBSERVED THAT A SIMILAR ISSUE WAS INVOLVED IN THE CASE OF M/S. SHANTINATH FINANCIAL SERVICES LTD. (IT(SS)A NO. 102/KOL/2017 A.Y. 2010-11), WHICH WAS HEARD SIMULTANEOUSLY, WHEREIN A DETAILED SUBMISSION WAS MADE BY BOTH THE SIDES IN WRITING IN SUPPORT OF THEIR RESPECTIVE STAND AND AFTER CONSIDERING THE SAID WRITTEN SUBMISSION, THE TRIBUNAL DECIDED THE ISSUE AFTER ANALYSING THE LEGAL POSITION IN THE LIGHT OF THE VARIOUS JUDICIAL PRONOUNCEMENTS CITED BY BOTH THE SIDES VIDE PARAGRAPH NO. 7 TO 9 OF ITS ORDER DATED 30 TH SEPTEMBER, 2019 AS UNDER: 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN THIS CASE, A SEARCH AND SEIZURE ACTION UNDER SECTION 132(1) OF THE ACT WAS CONDUCTED ON 17T H & 18T H DECEMBER, 2014 AND THE ADDITION MADE BY THE ASSESSING OFFICER IN THE UNABATED ASSESSMENT COMPLETED IN PURSUANCE OF THE SEARCH UNDER SECTION 153A OF THE ACT ON ACCOUNT OF SHARE CAPITAL AND SHARE PREMIUM RECEIVED DURING THE YEAR UNDER CONSIDERATION BY TREATING THE SAME AS UNEXPLAINED CASH CREDIT WAS DELETED BY THE LD. CIT(APPEALS) ON THE GROUND THAT THE SAME WAS NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. IT IS TRUE THAT WHEN A SEARCH UNDER SECTION 132(1) IS CONDUCTED, THE ASSESSING OFFICER GETS JURISDICTION TO ISSUE NOTICE UNDER SECTION 153A FOR THE RELEVANT YEARS AND COMPLETE THE ASSESSMENTS FOR THE SAID YEARS. IT IS ALSO TRUE THAT THERE IS NO EXPLICIT MENTION IN THE LANGUAGE USED IN SECTION 153A THAT THE ADDITION MADE UNDER SECTION 153A SHOULD BE BASED ON THE INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. THE SCOPE OF ASSESSMENT TO BE MADE UNDER SECTION 153A, HOWEVER, IS CONSIDERED AND DEFINED IN THE VARIOUS JUDICIAL PRONOUNCEMENTS. IN THIS REGARD, THE ASSESSMENTS ARE CLASSIFIED IN TWO CATEGORIES, I.E. COMPLETED ASSESSMENT AND PENDING OR ABATED ASSESSMENT. IT IS HELD THAT IF THE ASSESSMENT FOR THE RELEVANT YEAR IS PENDING AS ON THE DATE OF SEARCH AND IT IS NOT COMPLETED, THE SAME GETS ABATED AND THE SCOPE OF ASSESSMENT TO BE 15 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. MADE UNDER SECTION 153A FOR THE SAID YEAR IS WIDE, WHICH INCLUDES ASSESSMENT OF INCOME ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH AS WELL AS THE ASSESSMENT OF INCOME, WHICH IS THE SUBJECT MATTER OF REGULAR ASSESSMENT. ON THE OTHER HAND, IF THE ASSESSMENT FOR THE RELEVANT YEAR IS NOT PENDING AS ON THE DATE OF SEARCH, THE SAME IS TO BE REGARDED AS COMPLETED ASSESSMENT AND THE SCOPE OF ASSESSMENT TO BE MADE UNDER SECTION 153A IS LIMITED TO THE ASSESSMENT OF UNDISCLOSED INCOME ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. THIS LEGAL POSITION CLEARLY EMANATES FROM THE VARIOUS JUDICIAL PRONOUNCEMENTS CITED AND RELIED UPON BY THE ASSESSEE IN THE WRITTEN SUBMISSION FILED BEFORE US. NO DOUBT, THERE ARE CERTAIN JUDICIAL PRONOUNCEMENTS CITED BY THE LD. D.R. IN HIS WRITTEN SUBMISSION, WHEREIN A CONTRARY VIEW HAS BEEN TAKEN, WHICH IS IN FAVOUR OF THE REVENUE. HOWEVER, A CONSISTENT VIEW HAS BEEN TAKEN BY THE HONBLE CALCUTTA HIGH COURT ON THIS ISSUE IN SEVERAL CASES, WHICH IS IN FAVOUR OF THE ASSESSEE. FOR INSTANCE, IN THE CASE OF DCIT VS.- SALASAR STOCK BROKING LIMITED (SUPRA), THE DECISION OF THE TRIBUNAL HOLDING THAT THE ADDITION MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT COMPLETED UNDER SECTION 153A WAS BEYOND THE SCOPE IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH WAS UPHELD BY THE HONBLE CALCUTTA HIGH COURT. IT IS NOTED BY THEIR LORDSHIPS THAT THE TRIBUNAL WHILE ARRIVING AT ITS DECISION HAD RELIED UPON THE JUDGMENT OF THE HONBLE DELHI HIGH COURT IN THE CASE OF KABUL CHOWLA (SUPRA) AND MORE OR LESS AN IDENTICAL VIEW HAD BEEN TAKEN BY THE COURT EVEN IN THE CASE OF VEERPRABHU MARKETING LIMITED (SUPRA). IN THE CASE OF KABUL CHOWLA, SEARCH WAS CONDUCTED UNDER SECTION 132 OF THE ACT. AS ON THE DATE OF SEARCH, NO ASSESSMENT PROCEEDING WAS PENDING FOR THE RELEVANT ASSESSMENT YEAR AND THE ADDITION MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT COMPLETED UNDER SECTION 153A PURSUANT TO THE SEARCH ON ACCOUNT OF DEEMED DIVIDEND UNDER SECTION 2(22)(E) WAS DELETED BY THE TRIBUNAL ON THE GROUND THAT THE SAME WERE NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. THE DECISION OF THE TRIBUNAL WAS UPHELD BY THE HONBLE DELHI HIGH COURT BY HOLDING THAT THE ADDITIONS MADE TO THE INCOME OF THE ASSESSEE FOR THE RELEVANT ASSESSMENT YEARS UNDER SECTION 2(22)(E) WERE NOT SUSTAINABLE BECAUSE NO INCRIMINATING MATERIAL CONCERNING SUCH ADDITIONS WAS FOUND DURING THE COURSE OF SEARCH AND FURTHER NO ASSESSMENTS FOR THE SAID YEARS WERE PENDING ON THE DATE OF SEARCH. 8. IN THE CASE OF S. AJIT KUMAR (SUPRA), RELIED UPON BY THE LD. D.R., HONBLE SUPREME COURT HAS HELD THAT THE MATERIAL FOUND OR STATEMENT RECORDED IN THE SURVEY CONDUCTED SIMULTANEOUSLY AT THE PREMISES OF A CONNECTED 16 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. PERSON CAN BE TREATED AS INCRIMINATING MATERIAL FOR THE PURPOSE OF MAKING THE ADDITION UNDER SECTION 153A OF THE ACT. IN THE PRESENT CASE, IT IS OBSERVED THAT NO SUCH SURVEY HAD BEEN CONDUCTED UNDER SECTION 133A SIMULTANEOUSLY EITHER AT THE PREMISES OF THE ASSESSEE OR OF A CONNECTED PERSON. THE STATEMENTS OF THE SO-CALLED ENTRY OPERATORS AND DUMMY DIRECTORS RELIED UPON BY THE ASSESSING OFFICER FOR MAKING THE ADDITION WERE THUS NOT RECORDED IN ANY PROCEEDINGS SUCH AS SURVEY CONDUCTED SIMULTANEOUSLY OR IN CONNECTION WITH THE SEARCH CONDUCTED IN THE CASE OF THE ASSESSEE AND SINCE THE SAID STATEMENTS WERE ALSO RETRACTED SUBSEQUENTLY BY THE DEPONENTS, WE FIND MERIT IN THE CONTENTION RAISED ON BEHALF OF THE ASSESSEE THAT THE SAME COULD NOT BE TREATED AS AN INCRIMINATING MATERIAL ON THE BASIS OF WHICH THE ADDITION MADE IN THE ASSESSMENT UNDER SECTION 153A CAN BE JUSTIFIED. 9. AS REGARDS THE CONTENTION OF THE LD. D.R., THAT THE PROCESS OF ASSESSMENT OF TOTAL INCOME UNDER SECTION 153A CAN NEITHER BE RESTRICTED NOR HAVE A DIFFERENT CONNOTATION, WE FIND THAT THE SAME IS CONTRARY TO THE LAW LAID DOWN BY THE VARIOUS JUDICIAL PRONOUNCEMENTS DISCUSSED ABOVE INCLUDING THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT. ALTHOUGH THERE ARE CERTAIN JUDICIAL PRONOUNCEMENTS TAKING THE VIEW IN FAVOUR OF THE REVENUE ON THE ISSUE UNDER CONSIDERATION, WE FIND THAT THE CONSISTENT VIEW TAKEN BY THE HONBLE JURISDICTIONAL HIGH COURT IS IN FAVOUR OF THE ASSESSEE AND RESPECTFULLY FOLLOWING THIS BINDING PRECEDENT, WE HOLD THAT SINCE THE ASSESSMENT FOR THE YEAR UNDER CONSIDERATION WAS NOT PENDING AS ON THE DATE OF SEARCH, THERE WAS NO ABATEMENT AND THE ADDITION MADE BY THE ASSESSING OFFICER IN THE UNABATED ASSESSMENT COMPLETED UNDER SECTION 153A ON ACCOUNT OF SHARE CAPITAL AND SHARE PREMIUM AMOUNT BY TREATING THE SAME AS UNEXPLAINED CASH CREDIT WAS NOT SUSTAINABLE AS THE SAME WAS NOT MADE ON THE BASIS OF ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. WE ACCORDINGLY UPHOLD THE IMPUGNED ORDER OF THE LD. CIT(APPEALS) DELETING THE SAID ADDITION MADE BY THE ASSESSING OFFICER AND DISMISS THIS APPEAL OF THE REVENUE. 6. AS THE ISSUE INVOLVED IN THE PRESENT CASE AS WELL AS ALL THE MATERIAL FACTS RELEVANT THERETO AND THE ARGUMENTS BY BOTH THE SIDES ARE SIMILAR TO THE CASE OF M/S. SHANTINATH FINANCIAL SERVICES LTD. (SUPRA), WE RESPECTFULLY FOLLOW THE DECISION TO THIS TRIBUNAL RENDERED IN THE CASE OF M/S. SHANTINATH FINANCIAL SERVICES LTD. (SUPRA) AND UPHOLD THE IMPUGNED ORDERS OF THE LD. CIT(A) DELETING THE ADDITION 17 IT(SS)A NOS. 154 & 155/KOL/2017 & C.O. NOS. 14 & 15/KOL/2019 ASSESSMENT YEAR 2009-10 & 2010-11 M/S. SHRI RAM REALCON PVT. LTD. MADE BY THE AO U/S 68 ON ACCOUNT OF SHARE CAPITAL AND SHARE PREMIUM. BOTH THE APPEALS OF THE REVENUE ARE ACCORDINGLY DISMISSED. 7. AS A RESULT OF DISMISSAL OF THE APPEALS OF THE REVENUE, THE CROSS- OBJECTIONS FILED BY THE ASSESSEE SUPPORTING THE IMPUGNED ORDERS OF THE LD. CIT(A) HAVE BECOME INFRUCTUOUS AND THE SAME ARE ALSO DISMISSED. 8. IN THE RESULT, THE APPEALS OF THE REVENUE AS WELL AS CROSS- OBJECTIONS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH OCTOBER, 2019. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER VICE-PRESIDENT DATED: 16/10/2019 BISWAJIT, SR. PS COPY OF ORDER FORWARDED TO: 1. M/S. SHRI RAM REALCON PVT. LTD. 8, CAMAC STREET, SHANTINIKETAN BUILDING, KOLKATA 700 017. 2. DCIT, CENTRAL CIRCLE 1(4), KOLKATA. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, ASSISTANT REGISTRAR / H.O.O. ITAT, KOLKATA