ACIT, New Delhi V. M/s. Moolchand Steels Pvt. Ltd., Uttar Pradesh

ITA 2544/DEL/2015

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 4050 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-10-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2006-2007
• Appeal Filed On: 30-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Keywords: Search and seizure
• Section: 143(3); 153A; 133(6); 131; 68; 6; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SHRI G.D. AGRAWAL, HONBLE PRESIDENT AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO. 2544/DEL/2015 ASSESSMENT YEAR: 2006-07 ASSTT. COMMISSIONER OF INCOME TAX, VS M/S MOOLC HAND STEELS PVT. LTD., CENTRAL CIRCLE-04, R/O VILLAGE REHRI, NEW DELHI. P.O. CHHUTMALPUR, DISTT. SAHARANPUR, U.P. (PAN: AAACM9286H) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.S. RANA, C.I.T. DR RESPONDENT BY : SHRI SALIL AGARWAL, ADVOCATE SHRI SHAILESH GUPTA, CA DATE OF HEARING: 17.07.2018 DATE OF PRONOUNCEMENT : 10.10.2018 ORDER PER SUDHANSHU SRIVASTAVA, J.M. THIS APPEAL IS PREFERRED BY THE DEPARTMENT AGAINST THE ORDER DATED 10.02.2015 PASSED BY THE LD. CIT (APPEALS)-23 , NEW DELHI FOR ASSESSMENT YEAR 2006-07 WHEREIN VIDE THE IMPUGN ED ORDER, THE LD. CIT (A) HAS DELETED THE ADDITION OF RS. 80 LAKH MADE BY THE ASSESSING OFFICER ON ACCOUNT OF SHARE APPLICATI ON MONEY AND SHARE PREMIUM U/S 68 OF THE INCOME TAX ACT, 1961 (H EREINAFTER REFERRED TO AS 'THE ACT'). ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 2 1.1 THE ASSESSEE HAS ALSO FILED AN APPLICATION UNDE R RULE 27 OF THE INCOME TAX APPELLATE TRIBUNAL RULES, 1963. 2.0 BRIEF FACTS OF THE CASE ARE THAT A SEARCH AND S EIZURE OPERATION U/S 132 OF THE ACT WAS CARRIED OUT IN THE CASE OF THE ASSESSEE AS WELL AS THE GROUP COMPANIES ON 4.8.2011 . A NOTICE U/S 153A OF THE ACT WAS ISSUED ON 22.12.2013 AND TH E ASSESSEE FILED THE RETURN OF INCOME ON 11.2.2014 DECLARING A N INCOME OF RS. 4,05,332/-. DURING THE COURSE OF ASSESSMENT PR OCEEDINGS, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE COMPA NY HAD, DURING FINANCIAL YEAR 2005-06, ISSUED 20000 SHARES TO M/S GEEFCEE FINANCE LIMITED HAVING A FACE VALUE OF RS. 100/- PER SHARE AT A PREMIUM OF RS. 300/- PER SHARE TOTALING TO RS. 80 LAKH. THE ASSESSING OFFICER ALSO NOTED THAT M/S GEEFCEE F INANCE LIMITED WAS ENGAGED IN THE ACTIVITY OF PROVIDING EN TRIES. THE ASSESSING OFFICER SOUGHT INFORMATION FROM M/S GEEFC EE FINANCE LIMITED U/S 133(6) OF THE ACT. SUMMONS U/S 131 OF THE ACT WERE ALSO ISSUED TO M/S GEEFCEE FINANCE LIMITED TO FURNI SH THE REQUIRED INFORMATION. HOWEVER, NO RESPONSE WAS REC EIVED FROM M/S GEEFCEE FINANCE LIMITED. THE ASSESSEE WAS ALSO ASKED TO ESTABLISH THE GENUINENESS OF SHARE CAPITAL AND AFTE R CONSIDERING ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 3 THE SUBMISSIONS OF THE ASSESSEE, THE ASSESSING OFFI CER MADE AN ADDITION OF RS. 80 LAKH U/S 68 OF THE ACT. 2.1 AGGRIEVED, THE ASSESSEE APPROACHED THE LD. FIRS T APPELLATE AUTHORITY AND CHALLENGED THE ADDITION ON MERITS. T HE ASSESSEE ALSO CHALLENGED THE ADDITION ON THE LEGAL GROUND TH AT THE SAME WAS NOT BASED ON ANY INCRIMINATING MATERIAL FOUND A S A RESULT OF SEARCH. THE LD. CIT (A) DISMISSED THE ASSESSEES L EGAL GROUND BUT DELETED THE ADDITION ON MERITS AND ALSO NOTED THAT THE ORIGINAL ASSESSMENT WAS COMPLETED U/S 143(3) OF THE ACT WHER EIN THE ISSUE OF SHARE CAPITAL HAD BEEN SCRUTINIZED AND ACC EPTED BY THE AO HOLDING THE SAME AS SHARE CAPITAL. THE LD. CIT (A) ALSO HELD THAT NOW TREATING THE SAME SHARE CAPITAL AS UNEXPLA INED IN THE ASSESSMENT PROCEEDINGS U/S 153A OF THE ACT WAS A CH ANGE OF OPINION NOT BACKED BY ANY EVIDENCE. 2.2 AGGRIEVED BY THE AFORESAID FINDINGS OF THE LD. CIT (A), THE DEPARTMENT IS NOW IN APPEAL BEFORE THE ITAT CHALLEN GING THE ACT OF THE LD. CIT (A) IN DELETING THE AFORESAID ADDITI ON OF RS. 80 LAKH. 2.3 THE ASSESSEE HAS ALSO FILED AN APPLICATION UNDE R RULE 27 OF THE INCOME TAX APPELLATE TRIBUNAL RULES, 1963 ON TH E GROUND THAT THE ADDITION IN RESPECT OF SHARE CAPITAL WAS M ADE WITHOUT ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 4 CONSIDERING THE FACT THAT DURING THE COURSE OF SEAR CH, NO INCRIMINATING DOCUMENTS IN RESPECT OF SHARE CAPITAL WERE FOUND. 3.0 THE LD. AR ARGUED AT LENGTH SUBMITTING THAT THE ASSESSEE HAD MOVED APPLICATION UNDER RULE 27 OF THE INCOME T AX APPELLATE TRIBUNAL RULES 1963. IT WAS ALSO SUBMITTED THAT TH E GROUND RAISED IN THE APPLICATION WAS SPECIFICALLY RAISED A S GROUND NO. 1.7 BEFORE THE LD. CIT (A). THE LD. AR PRAYED THAT THE APPLICATION UNDER RULE 27 MAY BE ADMITTED. 4.0 IN RESPONSE, THE LD. C.I.T. DR OPPOSED THE ASSE SSEES PRAYER FOR ADMITTING OF APPLICATION UNDER RULE 27 OF THE A CT. 5.0 HAVING HEARD BOTH THE PARTIES ON THE ISSUE OF A DMITTING THE APPLICATION MOVED BY THE ASSESSEE UNDER RULE 27 OF THE INCOME TAX APPELLATE TRIBUNAL RULES 1963, WE ARE OF THE CO NSIDERED OPINION THAT IN AN APPEAL BEFORE THE ITAT, THE RESP ONDENT IS ENTITLED TO SUPPORT THE ORDER OF THE APPELLATE AUTH ORITY EVEN ON A GROUND WHICH HAS BEEN DECIDED AGAINST IT EVEN THOUG H IT MAY NOT HAVE FILED ANY APPEAL AGAINST SUCH AN ORDER. ACCOR DINGLY, WE DEEM IT FIT TO ADMIT THE ASSESSEES APPLICATION MAD E UNDER RULE 27 OF THE INCOME TAX APPELLATE TRIBUNAL RULES, 1963 WHEREIN THE ASSESSEE HAS TAKEN THE FOLLOWING GROUND:- 1. THAT THE LEARNED CIT (A) HAS ERRED IN LAW AND O N FACTS IN OVERLOOKING THE BASIC FACT THAT NO DOCUMEN T ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 5 MUCH LESS INCRIMINATING MATERIAL WAS FOUND DURING T HE COURSE OF SEARCH AND THE ASSESSMENT AS CONTEMPLATED UNDER SECTION 153A IS NOT A DE NOVO ASSESSMENT AND AS SUCH, THE ADDITIONS SO MADE BY ASSESSING OFFICER WH ICH ARE BEYOND INCRIMINATING/SEIZED MATERIALS ARE LIABL E TO BE DELETED IN TOTALITY. 6.0 THE LD. AR VEHEMENTLY ARGUED THAT IT IS APPAREN T FROM THE ASSESSMENT ORDER ITSELF THAT THE IMPUGNED ADDITION WAS NOT MADE ON THE BASIS OF ANY INCRIMINATING MATERIAL FOUND AN D SEIZED DURING THE COURSE OF SEARCH AND THEREFORE, IN VIEW OF THE JUDGMENT OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA REPORTED IN 380 ITR 573 (DELHI), ADDITION WA S NOT SUSTAINABLE. 7.0 IN RESPONSE, THE LD. CIT DR SUBMITTED THAT THE DEPARTMENT WAS RELYING ON THE STATEMENT OF ONE SHRI TARUN GOYA L, WHICH HAS BEEN REFERRED TO BY THE ASSESSING OFFICER IN PARA 4 .1 OF THE ASSESSMENT ORDER, AND THIS STATEMENT ITSELF WAS THE INCRIMINATING MATERIAL BASED ON WHICH THE ADDITION HAD BEEN MADE. THE LD. CIT DR ALSO PLACED RELIANCE ON THE JUDGMENT OF THE HONBLE KERALA HIGH COURT IN THE CASE OF E.N. GOPUKUMAR VS. CIT RE PORTED IN (2016) 75 TAXMANN.COM 215 (KERALA) WHEREIN THE HON BLE KERALA HIGH COURT HAD HELD THAT ADDITIONS COULD BE MADE EV EN WHEN NO INCRIMINATING MATERIAL WAS FOUND AGAINST THE ASSESS EE IN SEARCH ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 6 U/S 132 OF THE ACT. THE LD. CIT DR SUBMITTED THAT THIS JUDGMENT OF THE HONBLE KERALA HIGH COURT HAD BEEN PASSED AF TER DULY CONSIDERING THE CASE OF CIT VS. KABUL CHAWLA (SUPRA ). RELIANCE WAS ALSO PLACED ON THE JUDGMENT OF THE HONBLE DELH I HIGH COURT IN THE CASE OF SMT. DAYAWANTI VS. CIT REPORTED IN 3 90 ITR 496 (DEL) WHEREIN THE HONBLE DELHI HIGH COURT HAD HELD THAT WHERE THE INFERENCES DRAWN IN RESPECT OF UNDECLARED INCOM E OF ASSESSEE WERE PREMISED ON MATERIAL FOUND AS WELL AS STATEMEN TS RECORDED IN THE COURSE OF SEARCH OPERATIONS, THE ADDITIONS W ERE JUSTIFIED. APART FROM THIS, THE LD. CIT DR ALSO PLACED RELIANC E ON THE FOLLOWING JUDICIAL PRECEDENTS IN SUPPORT OF HIS CON TENTION THAT THE ADDITION COULD BE MADE WITHOUT ANY INCRIMINATING MA TERIAL HAVING BEEN FOUND DURING THE COURSE OF SEARCH:- 1. KISHORE KUMAR VS CIT (62 TAXMANN.COM 215, 234 TAXMAN 771) 2. CIT VS RAJ KUMAR ARORA (2014) 52 TAXMANN.COM 172 (ALLAHABAD) (2014) 367 ITR 517 (ALLAHABAD) 3. CIT VS KESARWANI ZARDA BHANDAR SAHSON ALLD. (ITA NO . 270 OF 2014) (ALLAHABAD) 4. M/S PUNJAB SIND DAIRY PRODUCTS PVT. LTD. VS DCIT 20 17 TIOL-83-SC-IT ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 7 7.1 THE LD. CIT DR ALSO SUBMITTED THAT THE ASSESS EE SHOULD ARGUE THE CASE ON MERITS RATHER THAN TAKING SHELTER BEHIND TECHNICALITIES. 8.0 IN REJOINDER, THE LD. AR SUBMITTED THAT THE JUD GMENT OF THE HONBLE DELHI HIGH COURT IN THE CASE OF SMT. DAYAWA NTI VS. CIT (SUPRA) HAD SINCE BEEN STAYED BY THE HONBLE APEX C OURT AND, THEREFORE, THE JUDGMENT OF THE HONBLE DELHI HIGH C OURT IN THE CASE OF CIT VS. KABUL CHAWLA (SUPRA) WOULD APPLY. THE LD. AR ALSO SUBMITTED THAT THE STATEMENT OF SHRI TARUN GOY AL WAS NOT RECORDED DURING THE COURSE OF SEARCH BUT BEFORE THE DATE OF SEARCH AND, ACCORDINGLY, IT COULD NOT BE CONSIDERED AS INC RIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. THE LD . AR ALSO HIGHLIGHTED THE FACT THAT THE ISSUE OF SHARE CAPITA L HAD BEEN DULY CONSIDERED IN THE ORIGINAL ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT VIDE ORDER DATED 28.12.2007 WHEREIN NO ADDI TION HAD BEEN MADE. IT WAS SUBMITTED THAT THIS ORIGINAL ASS ESSMENT ORDER WAS ALSO PASSED AFTER DULY CONSIDERING THE FACT THA T AN EARLIER SEARCH HAD TAKEN PLACE ON 6.3.2006 AND THE ASSESSEE S RETURNED INCOME HAD BEEN ACCEPTED. 9.0 WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. A PERUSAL OF THE ASSE SSMENT ORDER ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 8 SHOWS THAT WHILE MAKING THE IMPUGNED ADDITION, THER E IS NO REFERENCE TO ANY INCRIMINATING MATERIAL WHICH HAS B EEN FOUND DURING THE COURSE OF SEARCH. IT IS ALSO UNDISPUTED THAT THE SEARCH TOOK PLACE ON 4.8.2011 WHEREAS THE STATEMENT OF SHR I TARUN GOYAL WAS RECORDED ON 14.12.2010. THUS, THE STATEM ENT OF SHRI TARUN GOYAL WAS RECORDED BEFORE THE DATE OF THE SEA RCH AND THE SAME CANNOT BE CONSIDERED TO BE A STATEMENT RECORDE D DURING THE COURSE OF SEARCH AND, THEREFORE, WE DO NOT AGREE WI TH THE CONTENTION OF THE LD. CIT DR THAT THE STATEMENT OF SHRI TARUN GOYAL CAN BE CONSIDERED INCRIMINATING MATERIAL IN T HIS REGARD. IT IS ALSO UNDISPUTED THAT THE ASSESSEE GROUP, INCLUDI NG THE ASSESSEE COMPANY, WAS EARLIER SUBJECT TO SEARCH AND SEIZURE OPERATION ON 6.3.2006 AND THE ASSESSMENT WAS COMPLE TED IN THE CASE OF THE ASSESSEE ON 28.12.2007 U/S 143(3) OF TH E ACT WHEREIN THE RETURNED INCOME OF RS. 4,05,332/- WAS ACCEPTED. NO UNDISCLOSED INCOME WAS DECLARED OR ASSESSED IN RESP ECT OF THE ASSESSEE COMPANY INCLUDING ANY SHARE CAPITAL. ALTH OUGH THE ASSESSEE HAD RAISED THE GROUND OF THE ADDITION BEIN G WRONG IN VIEW OF NO INCRIMINATING MATERIAL HAVING BEEN FOUND DURING THE COURSE OF SEARCH IN GROUND NO. 1.7 OF ITS APPEAL BE FORE THE LD. CIT (A), THE LD. CIT (A) DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 9 ON THE GROUND THAT AS THE RELIEF HAD ALREADY BEEN A LLOWED TO THE ASSESSEE ON MERITS, IT WAS NOT NECESSARY TO GO INTO THE LEGAL ISSUE. HOWEVER, IT IS APPARENT FROM THE ORDER OF T HE LD. CIT (A) THAT THERE IS NO FINDING RECORDED BY THE LD. CIT (A ) ALSO REGARDING ANY INCRIMINATING MATERIAL HAVING BEEN FOUND DURING THE COURSE OF SEARCH. THE LD. CIT DR ALSO COULD NOT POINT OUT TOWARDS ANY INCRIMINATING MATERIAL WHICH HAS BEEN FOUND DURING THE COURSE OF SEARCH ON THE BASIS OF WHICH THE ADDITION OF RS. 80 LAKH COULD HAVE BEEN JUSTIFIED EXCEPT FOR THE STATEMENT OF SHR I TARUN GOYAL WHICH WE HAVE ALREADY HELD AS NOT BEING INCRIMINATI NG MATERIAL QUA THE ASSESSEE. THE LD. CIT DR HAS RELIED ON THE JUD GMENT OF THE HONBLE KERALA HIGH COURT IN E.N. GOPAKUMAR VS. CIT (SUPRA). HOWEVER, WE NOTE THAT THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA (SUPRA) IS SQUAREL Y IN FAVOUR OF THE ASSESSEE AND THE HONBLE DELHI HIGH COURT BEING THE JURISDICTIONAL HIGH COURT FOR THE ASSESSEE WE ARE B OUND TO FOLLOW THE LAW AS LAID DOWN BY THE HONBLE JURISDICTIONAL HIGH COURT. WE ALSO NOTE THAT ANOTHER JUDGMENT OF THE HONBLE DELH I HIGH COURT IN THE CASE OF SMT. DAYAWANTI VS. CIT (SUPRA) HAS S INCE BEEN STAYED BY THE HONBLE APEX COURT AND, THEREFORE, TH E JUDGMENT OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 10 (SUPRA) WILL HAVE TO BE FOLLOWED. IN PARA 37 OF TH IS JUDGEMENT, THE HONBLE DELHI HIGH COURT HAS SUMMARIZED THE LEGAL P OSITION AS UNDER: 37. ON A CONSPECTUS OF SECTION 153A(1) OF THE ACT, READ WITH THE PROVISOS THERETO, AND IN THE LIGHT OF THE LAW E XPLAINED IN THE AFOREMENTIONED DECISIONS, THE LEGAL POSITION T HAT EMERGES IS AS UNDER: I. ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF T HE ACT, NOTICE UNDER SECTION 153 A (1) WILL HAVE TO BE MAND ATORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR SIX AYS IMMEDIATELY PRECEDING THE PREVIOUS YEAR REL EVANT TO THE AY IN WHICH THE SEARCH TAKES PLACE. II. ASSESSMENTS AND REASSESSMENTS PENDING ON THE DA TE OF THE SEARCH SHALL ABATE. THE TOTAL INCOME FOR SUCH A YS WILL HAVE TO BE COMPUTED BY THE AOS AS A FRESH EXERCISE. III. THE AO WILL EXERCISE NORMAL ASSESSMENT POWERS IN RESPECT OF THE SIX YEARS PREVIOUS TO THE RELEVANT AY IN WHI CH THE SEARCH TAKES PLACE. THE AO HAS THE POWER TO ASSESS AND REASSESS THE 'TOTAL INCOME' OF THE AFOREMENTIONED S IX YEARS IN SEPARATE ASSESSMENT ORDERS FOR EACH OF THE SIX YEAR S. IN OTHER WORDS THERE WILL BE ONLY ONE ASSESSMENT ORDER IN RE SPECT OF EACH OF THE SIX AYS IN WHICH BOTH THE DISCLOSED AN D THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX. ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 11 IV. ALTHOUGH SECTION 153 A DOES NOT SAY THAT ADDITI ONS SHOULD BE STRICTLY MADE ON THE BASIS OF EVIDENCE FOUND IN THE COURSE OF THE SEARCH, OR OTHER POST-SEARCH MATERIAL OR INF ORMATION AVAILABLE WITH THE AO WHICH CAN BE RELATED TO THE E VIDENCE FOUND, IT DOES NOT MEAN THAT THE ASSESSMENT CAN BE ARBITRARY OR MADE WITHOUT ANY RELEVANCE OR NEXUS WI TH THE SEIZED MATERIAL. OBVIOUSLY AN ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY ON THE BASIS OF SEIZED MATE RIAL. V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE CO MPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSM ENT OR REASSESSMENT CAN BE MADE. THE WORD 'ASSESS' IN SECT ION 153 A IS RELATABLE TO ABATED PROCEEDINGS (I.E. THOSE PE NDING ON THE DATE OF SEARCH) AND THE WORD 'REASSESS' TO COMPLETE D ASSESSMENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, T HE JURISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND TH E ASSESSMENT UNDER SECTION 153A MERGES INTO ONE. ONLY ONE ASSESSMENT SHALL BE MADE SEPARATELY FOR EACH AY ON THE BASIS OF THE FINDINGS OF THE SEARCH AND ANY OTHER M ATERIAL EXISTING OR BROUGHT ON THE RECORD OF THE AO. VII. COMPLETED ASSESSMENTS CAN BE INTERFERED WITH B Y THE AO WHILE MAKING THE ASSESSMENT UNDER SECTION 153 A ONL Y ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UND ISCLOSED INCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEAR CH WHICH ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 12 WERE NOT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. 9.1 AS PER PARA (IV) ABOVE IT HAS BEEN HELD THAT TH OUGH SECTION 153A DOES NOT SAY THAT ADDITION SHOULD BE STRICTLY MADE ON THE BASIS OF THE EVIDENCE FOUND IN THE COURSE OF THE SE ARCH, OR OTHER POST SEARCH MATERIAL OR INFORMATION AVAILABLE WITH THE AO WHICH CAN BE RELATED TO THE EVIDENCE FOUND, IT DOES NOT M EAN THAT THE ASSESSMENT CAN BE MADE WITHOUT ANY REFERENCE OR EST ABLISHING ANY NEXUS WITH THE SEIZED MATERIAL. THUS, AS PER TH IS JUDGMENT, THE EXISTENCE OF THE SEIZED MATERIAL FOUND DURING S EARCH IS A MUST FOR MAKING ADDITION IN THOSE ASSESSMENT YEARS WHICH HAVE NOT ABATED. THEREFORE, IN VIEW OF THE ABOVE JUDGME NT OF THE HONBLE DELHI HIGH COURT, RESPECTFULLY FOLLOWING TH E SAME, IT IS OUR CONSIDERED OPINION THAT NO ADDITION COULD HAVE BEEN MADE U/S 68 OF THE ACT IN VIEW OF THE FACT THAT NO INCRI MINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH TO W HICH THIS IMPUGNED ADDITION COULD BE RELATED. ACCORDINGLY, W E ALLOW THE GROUND RAISED BY THE ASSESSEE IN ITS APPLICATION FI LED UNDER RULE 27 OF THE ITAT RULES, 1963 AND HOLD THAT THE ASSESS ING OFFICER COULD NOT HAVE MADE THE IMPUGNED ADDITION IN ABSENC E OF ANY INCRIMINATING MATERIAL ON RECORD. IN VIEW OF OUR H OLDING THUS, THE ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 13 APPEAL FILED BY THE DEPARTMENT BECOMES IN FRUCTUOUS. ACCORDINGLY, WE DISMISS THE GROUNDS RAISED BY THE DEPARTMENT. 10.0 IN THE RESULT, THE APPEAL FILED BY THE DEPAR TMENT STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH OCTOBER, 2018. SD/- SD/- (G.D. AGRAWAL) (SUDHANSHU SRI VASTAVA) PRESIDENT JUDICIA L MEMBER DATED: 10 TH OCTOBER , 2018 GS COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT BY ORDER ASSTT. REGISTRAR ITA NO. 2544/DEL/2015 ASSESSMENT YEAR 2006-07 14 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P S/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER 1