Appeal Details
Counselvise Citation
[2019] 117 COUNSELVISE.COM (IT) 7767 (ITAT-JAIPUR)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
1 year(s) 15 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
24-04-2019
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
B
Assessment Year
2010-2011
Appeal Filed On
09-04-2018
Judgement Text
VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S,B JAIPUR JH JESK LH0 KEKZ] YS[KK LNL; ,OA JH FOT; IKY JKO] U;KF;D LNL; DS LE{K BEFORE: SHRI RAMESH. C. SHARMA, AM & SHRI VIJAY PA L RAO, JM VK;DJ VIHY LA- @ ITA NO. 474 TO 476/JP/2018 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2010-11, 2011-12 &2015-16 SHRI BANNA LAL JAT BUS STAND, JAHAJPUR, DISTRICT- BHILWARA. CUKE VS. THE ACIT, CENTRAL CIRCLE, AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AFNPJ 1819 E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI P.C. PARWAL (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : SHRI B.K. GUPTA (CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 10/04/2019 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 24/04/2019 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THESE THREE APPEALS BY THE ASSESSEE ARE DIRECTED AG AINST THE COMPOSITE ORDERS OF THE LD. CIT(A), UDAIPUR DATED 1 9.01.2019 FOR THE ASSESSMENT YEARS 2010-11 & 2011-12 AND ORDER DATED 01.02.2018 FOR THE ASSESSMENT YEAR 2015-16 RESPECTIVELY. FOR THE A SSESSMENT YEARS 2010-11 & 2011-12 THE ASSESSEE HAS RAISED COMMON GR OUNDS EXCEPT THE QUANTUM OF DISALLOWANCE/ADDITION. THE GROUNDS R AISED FOR THE ASSESSMENT YEAR 2010-11 ARE REPRODUCED AS UNDER:- ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 2 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN UPHOLDING THE ACTION OF AO BY TREATING THE LONG TERM CAPITAL GAIN ON SALE OF SHARES CLAIMED EXEMPT U/S 10(38) AS BOGUS AND THERE BY CONFIRMING THE ACTION OF RS. 11,31,564/- 1.1 THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ABOVE ADDITION IN THE ASSESSMENT FRAMED U/S 153A EV EN WHEN THE ASSESSMENT PROCEEDINGS FOR THE YEAR UNDER CONSI DERATION HAS NOT ABATED AND NO INCRIMINATING MATERIAL RELATING T O THE SAME WAS FOUND IN SEARCH. 2. THE ASSESSEE CRAVES TO AMEND, ALTER AND MODIFY A NY OF THE GROUNDS OF APPEAL. 3. THE APPROPRIATE COST BE AWARDED TO BE ASSESSEE. 2. THE ASSESSEE HAS RAISED ISSUE OF VALIDITY OF ADD ITION MADE BY THE AO IN THE ASSESSMENT FRAMED U/S 153A OF THE ACT. SI NCE, THIS ISSUE GOES TO THE ROUTE OF THE MATTER THEREFORE, WE FIRST TAKE UP THE ISSUE OF VALIDITY/SUSTAINABILITY OF THE ADDITION MADE BY THE AO IN THE ASSESSMENT FRAMED U/S 153A OF THE ACT. THERE WAS A SEARCH AND SEIZURE ACTION CARRIED OUT AT THE RESIDENTIAL AND BUSINESS PREMISE S OF THE ASSESSEE GROUP ON 10.10.2014. SUBSEQUENTLY THE AO ISSUED NOT ICED U/S 153A OF THE ACT ON 22.12.2014. IN RESPONSE TO THE NOTICE U/ S 153A OF THE ACT THE ASSESSEE FILED HIS RETURN OF INCOME ON 29.09.20 10 DECLARING INCOME OF RS. 1,23,12,260/- AND RS. 1,60,73,870/- FOR THE ASSESSMENT YEARS 2010-11 & 2011-12 RESPECTIVELY. DURING THE COURSE O F ASSESSMENT PROCEEDINGS, THE AO OBSERVED THAT THE ASSESSEE HAS CLAIMED LONG TERM ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 3 CAPITAL GAIN ARISING FROM SALE OF SHARE OF RS. 11,3 1,564 AND RS. 8,53,677/- AS EXEMPT U/S 10(38) OF THE ACT. THE AO ASKED THE ASSESSEE TO FURNISH THE EVIDENCES IN SUPPORTS OF HIS CLAIM V IDE NOTICE DATED 19.09.2016. THE ASSESSEE PRODUCED ITS REPLY AS WELL AS THE DOCUMENTS IN RESPECT OF SALE OF THE SHARES THROUGH M/S SHILPA STOCK BROKERS PVT. LTD. HOWEVER, THE ASSESSEE DID NOT SUBMIT THE PURCH ASE BILL, BROKER CONTRACT NOTES FOR PURCHASE OF SHARES AND DE-MAT AC COUNT STATEMENT ETC. SUBSEQUENTLY, THE ASSESSEE VIDE LETTER DATED 0 7.10.2016 SURRENDERED THE SAID LONG TERM CAPITAL GAIN OF RS. 11,31,564 AND RS. 8,53,677/- FOR THE ASSESSMENT YEARS 2010-11 & 2011- 12 RESPECTIVELY. THE AO ACCORDINGLY ADDED THE SAME TO THE TOTAL INCO ME WHILE COMPLETING ASSESSMENT U/S 153A OF THE ACT. THE ASSE SSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT(A) ON THE G ROUND OF NO INCRIMINATING MATERIAL INDICATING ANY UNDISCLOSED I NCOME FOR THE YEAR UNDER CONSIDERATION WAS FOUND AND THEREFORE, NO AD DITION CAN BE MADE IN THE ASSESSMENT COMPLETED U/S 153A OF THE ACT. TH E ASSESSEE CONTENDED THAT THE ASSESSMENT FOR THESE TWO ASSESSM ENT YEARS WERE NOT PENDING AS ON THE DATE OF SEARCH AND THEREFORE, NO ADDITION CAN BE MADE IN ABSENCE OF ANY INCRIMINATING MATERIAL IN TH E REASSESSMENT FRAMED U/S 153A OF THE ACT. THE LD. CIT(A) DID NOT ACCEPT THIS ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 4 CONTENTION OF THE ASSESSEE ON THE GROUND THAT WHEN THE ASSESSEE HIMSELF AS SURRENDERED THE SAID INCOME DURING THE C OURSE OF ASSESSMENT PROCEEDINGS, THEN THE ASSESSEE IS STOPPED FROM CHAN GING ITS STAND. 3. BEFORE US, THE LD. AR OF THE ASSESSEE HAS SUBMIT TED THAT THE ASSESSEE FILED THE ORIGINAL RETURN OF INCOME ON 29. 09.2010 & 26.09.2011 FOR AY 2010-11 & AY 2011-12 RESPECTIVELY. THE TIME LIMIT FOR SERVICE OF NOTICE U/S 143(2) FOR AY 2010-11 WAS UPTO 30.09.201 1 AND FOR AY 2011-12 WAS UPTO 30.09.2012. NO NOTICE WAS ISSUED T O THE ASSESSEE BEFORE THESE DATES. THUS, THE ASSESSMENT PROCEEDING S FOR THE YEARS UNDER CONSIDERATION WERE NOT PENDING ON THE DATE OF SEARCH. IN SEARCH NO INCRIMINATING MATERIAL INDICATING ANY UNDISCLOSE D INCOME FOR THE YEARS UNDER CONSIDERATION WAS FOUND. SECTION 153A E MPOWERS THE AO TO ISSUE NOTICE TO A PERSON WHO IS SEARCHED U/S 132 TO FILE RETURN IN RESPECT OF 6 A.Y.S PRECEDING THE ASSESSMENT YEAR I N WHICH SEARCH IS CONDUCTED AND TO ASSESS OR REASSESS THE TOTAL INCOM E OF THESE YEARS NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139, 147 AND OTHER RELATED SECTIONS. THUS, THE ASSESSMENT U/S 153A ARE NOT DE NOVO ASSESSMENTS SINCE THE PURPOSE OF MAKING THE REASSES SMENTS UNDER SECTION 153A IS SUBJECT TO TAX, HITHERTO UNDISCLOSE D INCOME UNEARTHED DURING THE COURSE OF THE SEARCH. IT IS FOR THIS REA SON THAT THE SECOND ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 5 PROVISO TO SECTION 153A(1) PROVIDES ONLY FOR THE AB ATEMENT OF THE PENDING ASSESSMENTS. THIS IS DONE TO ENSURE THAT TH E REGULAR ASSESSMENT PROCEEDINGS UNDER THE NORMAL PROVISIONS AND THE ASSESSMENT PROCEEDINGS UNDER SECTION 153A ARE NOT C ONDUCTED SIMULTANEOUSLY SINCE THAT WOULD RESULT IN REDUNDANC Y. THEREFORE, ALREADY COMPLETED ASSESSMENTS DO NOT ABATE AND THEY SHALL HOLD THE FIELD. IT CAN BE INTERFERED BY THE AO WHILE MAKING THE ASSESSMENT U/S 153A ONLY IF SOME INCRIMINATING MATERIAL IS UNEARTH ED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSE D INCOME OR PROPERTY IS DECLARED IN THE COURSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF OR IGINAL ASSESSMENT. THE ISSUANCE OF NOTICES UNDER SECTION 153A(1) FOR A LL THE SIX ASSESSMENT YEARS DOES NOT ENTAIL ALTOGETHER A FRESH EXERCISE O F MAKING A FRESH ASSESSMENT. HENCE, THE COMPLETED ASSESSMENT CAN BE INTERFERED WITH BY THE AO WHILE MAKING ASSESSMENT U/S 153A ONLY ON THE BASIS OF THE INCRIMINATING DOCUMENTS FOUND IN SEARCH. THUS, WHEN NO INCRIMINATING DOCUMENTS FOR THE YEAR UNDER CONSIDERATION WERE FOU ND, DISALLOWANCE MADE BY THE AO IN ASSESSMENT PROCEEDINGS U/S 153A I S ILLEGAL AND BAD IN LAW. THE LD. AR OF THE ASSESSEE HAS RELIED UPON THE FOLLOWING DECISIONS:- ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 6 PCIT VS. MEETA GUTGUTIA (2018) 257 TAXMAN 441 (SC) M/S RAJASTHAN FORT & PALACE PVT. LTD. VS. DCIT ITA NO. 597 TO 599/JP/2017 ORDER DATED 24.01.2018 (JAIPUR) (TRIB.) PRINCIPAL CIT VS. DIPAK JASHVANTLAL PANCHAL [2017] 397 ITR 153(GUJ.) (HC) CIT VS. DEEPAK KUMAR AGARWAL & ORS. (2017) 158 DTR 100/ 251 TAXMAN 22 (BOM.) (HC) DCIT VS. M/S A.M. EXPORTS IN ITA NO. 561/JP/2018 DA TED 07.01.2019. 4. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED THAT IT IS NOT A CASE OF INADVERTENT OR BONAFIDE MISTAKE ON THE PART OF T HE ASSESSEE WHILE FILING THE RETURN OF INCOME AND OFFERING THE INCOME TO TAX DUE TO MISTAKE BUT THE ASSESSEE DURING THE COURSE OF ASSES SMENT PROCEEDING FAILED TO SUBSTANTIATE HIS CLAIM OF LONG TERM CAPIT AL GAIN U/S 10(38) OF THE ACT. THEREFORE, THE ASSESSEE HAS SURRENDERED TH E SAID INCOME AS IT WAS BOGUS CLAIM MADE BY THE ASSESSEE. THE ASSESSEE EVEN COULD NOT PRODUCE THE PURCHASE BILLS, DE-MATE ACCOUNT STATEME NT TO ESTABLISH THE GENUINENESS OF THE TRANSACTIONS ALL THE PURCHASES W ERE CLAIMED TO HAVE BEEN MADE BY CASH THEREFORE, THE CLAIM OF THE ASSES SEE WAS APPARENTLY BOGUS CLAIM SURRENDERED DURING THE COURSE OF ASSESS MENT PROCEEDINGS. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THE ORIGINAL RETURN OF INCOME F OR THE ASSESSMENT ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 7 YEARS 2010-11 & 2011-12 WERE FILED BY THE ASSESSEE ON 29.09.2010 AND 26.09.2011 DECLARING TOTAL INCOME OF RS. 1,23,12,26 0/- AND RS. 1,60,73,870/- RESPECTIVELY. THE RETURN OF INCOME FO R THE ASSESSMENT YEAR 2010-11 WAS PROCESSED U/S 143(1) AND THE RETUR N OF INCOME FOR THE ASSESSMENT YEAR 20111-12 SUBJECTED TO SCRUTINY ASSESSMENT YEAR U/S 143(3) OF THE ACT VIDE ORDER DATED 25.03.2014. THERE WAS A SEARCH U/S 132 OF THE ACT ON 10.10.2014 IN THE CASE OF THE ASSESSEE. THERE IS NO DISPUTE THAT AS ON THE DATE OF SEARCH THE PROCEE DING FOR THE ASSESSMENT YEARS 2010-11 & 2011-12 WERE NOT PENDING AND THEREFORE, THE ASSESSMENT FOR THESE TWO YEARS WERE NOT GOT ABA TED BY VIRTUE OF SEARCH AND SEIZURE ACTION U/S 132 OF THE IT ACT. IT IS ALSO NOT IN DISPUTE THAT IN THE RETURN OF INCOME FILED U/S 139(1) OF TH E ACT THE ASSESSEE DECLARED THE LONG TERM CAPITAL GAIN OF RS. 11,31,56 4/- AND RS. 8,53,677/- FOR THE ASSESSMENT YEARS 2010-11 & 2011- 12 RESPECTIVELY THOUGH THE SAME WAS CLAIMED AS EXEMPT U/S 10(38) OF THE ACT. THUS, THE FACTS EMERGED FROM THE RECORD CLEARLY MANIFEST THAT THE ASSESSEE DECLARED THESE TRANSACTIONS OF PURCHASE AND SALE OF SHARES AND CONSEQUENTIAL LONG TERM CAPITAL GAIN IN THE ORIGINA L RETURN OF INCOME FILED U/S 139(1) OF THE ACT FOR THESE TWO ASSESSMEN T YEARS. SINCE, THE ASSESSMENT YEARS 2010-11 & 2011-12 WERE NOT PENDING AS ON THE DATE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 8 OF SEARCH ON 10.10.2014 THEREFORE A QUESTION ARISES WHETHER THE ADDITION CAN BE MADE BY THE AO IN THE PROCEEDINGS U /S 153A OF THE ACT IN THE ABSENCE OF ANY INCRIMINATING MATERIAL INDICA TED SUCH UNDISCLOSED INCOME. AT THE OUTSET, WE NOTE THAT THE ASSESSING O FFICER IN THE ASSESSMENT ORDER PASSED U/S 153A OF THE ACT HAS NOT MADE ANY REFERENCE TO ANY INCRIMINATING MATERIAL FOUND OR SE IZED DURING THE COURSE OF SEARCH AND SEIZURE ACTION, HOWEVER THE AD DITION IS MADE BASED ON THE STATEMENT OF THE ASSESSEE RECORDED U/S 132(4) OF THE ACT. THE AO HAS ALSO NOT DISPUTED THAT THERE WAS NO INCR IMINATING MATERIAL FOUND OR SEIZED DURING THE COURSE OF SEARCH AND SEI ZURE ACTION U/S 132 OF THE ACT. HOWEVER, THE ASSESSING OFFICER HAS REJE CTED THE OBJECTION OF THE ASSESSEE BY PLACING THE RELIANCE ON THE DECISIO N OF THE HONBLE KERALA HIGH COURT IN CASE OF E.N. GOPAKUMAR VS. CIT 75 TAXMANN.COM 215. THE RELEVANT FINDINGS OF THE AO ARE AS UNDER:- IT IS ALSO RELEVANT TO MENTION HERE THAT IN THE CA SE OF E.N. GOPAKUMAR VS. COMMISSIONER OF INCOME-TAX (CENTRAL) [2016] 75TAXMANN.COM 215 (KERALA), THE HONBLE HIGH COURT HELD THAT ASSESSMENT PROCEEDINGS GENERATED BY ISSUANCE OF A N OTICE UNDER SECTION 153A(1)(A) CAN BE CONCLUDED AGAINST INTERES T OF ASSESSEE INCLUDING MAKING ADDITIONS EVEN WITHOUT ANY INCRIMI NATING MATERIAL BEING AVAILABLE AGAINST ASSESSEE IN SEARCH UNDER SECTION 132 ONBASIS OF WHICH NOTICE WAS ISSUED UNDER SECTIO N 153A(1)(A). CONSIDERING THE DECISION OF THE HONBLE HIGH COURT OF KERALA (SUPRA), THE ISSUE RELATING TO EXEMPTED LONG TERM C APITAL GAIN IS ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 9 CONSIDERED WHILE FINALIZING ASSESSMENT U/S 143(3) R .W.S. 153A OF THE ACT. AS THE ASSESSEE HAS HIMSELF SURRENDER THE CLAIM OF EXEMPTION U/S 10(38) OF THE ACT, SUCH CLAIM OF THE ASSESSEE OF RS . 11,31,564/- IS DISALLOWED AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. THE LD. CIT(A) THOUGH REFERRED TO VARIOUS DECISIONS RELIED UPON THE ASSESSEE ON THE POINT THAT NO ADDITION CAN BE MADE IN THE REASSESSMENT FRAMED U/S 153A OF THE ACT IN THE ABSE NCE OF ANY INCRIMINATING MATERIAL HOWEVER, THE LD. CIT(A) HAS CONFIRMED THE ADDITION MADE BY THE AO ON THE GROUND THAT THE SLP FILED BY THE REVENUE IN CASE OF KABUL CHAWLA, M/S ALL CARGO GLOB AL LOGISTICS WERE ADMITTED BY THE BY THE HONBLE SUPREME COURT. WE FI ND THAT THE HONBLE SUPREME COURT IN CASE OF PCIT VS. MEETA GUT GUTIA 257 TAXMAN 441 (SC) HAS ALSO DISMISSED THE SLP FILED BY THE RE VENUE AGAINST THE DECISION OF HONBLE OF DELHI HIGH COURT WHEREIN THE DECISION IN CASE OF KABUL CHAWLA WAS FOLLOWED. THERE ARE SERIES OF DECI SIONS ON THIS POINT BY VARIOUS HONBLE HIGH COURTS INCLUDING THE JURISD ICTIONAL HIGH COURT AND THEREFORE, THE DECISIONS WHICH HAVE NOT BEEN RE VERSED BY THE HONBLE SUPREME COURT ARE BINDING PRECEDENT FOR THI S TRIBUNAL AS WELL AS FOR THE LD. CIT(A). THOUGH THE ASSESSING OFFICER CAN MAKE THE ADDITION TO KEEP THE ISSUE ALIVE AS THE REVENUE HAS CHALLENGED THE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 10 SAME OF THE DECISIONS BEFORE THE HONBLE SUPREME CO URT. THE COORDINATE BENCH OF THIS TRIBUNAL IN CASE OF DCIT V S. M/S A.M. EXPORTS (SUPRA) WHILE CONSIDERING AN IDENTICAL ISSUE HAS HE LD IN PARA 8 AS UNDER:- 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS RELEVANT MATERIAL ON RECORD. THE FIRST ASPECT INVOL VED IN THE MATTER IS SUSTAINABILITY OF THE ADDITION MADE BY TH E ASSESSING OFFICER WITHOUT ANY INCRIMINATING MATERIAL FOUND OR SEIZED DURING THE COURSE OF SEARCH AND SEIZURE ACTION. THERE IS N O DISPUTE THAT THE ORIGINAL RETURN OF INCOME FILED BY THE ASSESSEE U/S 139(1) OF THE ACT ON 11/10/2010 WAS NOT PENDING ASSESSMENT AS ON THE DATE OF SEARCH ON 03/4/2013. THEREFORE, THE ASSESSM ENT WAS COMPLETED U/S 143(1) AND IT WAS NOT ABATED DUE TO T HE SEARCH AND SEIZURE ACTION U/S 132 OF THE ACT ON 03/4/2013. THE ORDER OF THE ASSESSING OFFICER IS BASED ON THE STATEMENT OF THE ASSESSEE RECORDED U/S 132(4) OF THE ACT AND SPECIFICALLY THE QUESTION NO. 77. IT IS PERTINENT TO NOTE THAT DURING THE COURSE OF SEARCH AND SEIZURE ACTION, THE STATEMENT OF THE ASSESSEE WAS B EING RECORDED FROM 04/4/2013 TO 05/4/2013 AND AS MANY AS 78 QUEST IONS WERE PUT TO THE ASSESSEE. THE STATEMENT OF THE ASSESSEE RECORDED U/S 132(4) RUNS INTO ABOUT 50 PAGES. THE STATEMENT OF T HE ASSESSEE WAS RECORDED FROM 12.00 NOON ON 04/4/2013 AND CONTI NUED UP TO 1.00 A.M. ON 05/4/2013. AFTER THE BREAK, THE RECORD ING OF STATEMENT AGAIN RESUMED AT 7.50 A.M. ON 05/4/2013 W E NOTE THAT UP TO QUESTION NO. 67 WERE RECORDED ON 04/4/2013 AN D UP TO 1.00 A.M. ON 05/4/2013 AND THEREAFTER THE STATEMENT OF THE ASSESSEE WAS AGAIN RESUMED IN THE MORNING OF 05/4/2 013 AND CONTINUED UP TO QUESTION NO. 78. IT IS MANIFEST FRO M THE STATEMENT RECORDED U/S 132(4) OF THE ACT THAT REPEA TED QUESTIONS WERE ASKED ABOUT THE GENUINENESS OF THE LOANS TAKEN BY THE ASSESSEE DURING THE FINANCIAL YEAR 2009-10 RELEVANT TO THE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 11 ASSESSMENT YEAR UNDER CONSIDERATION AND THE ASSESSE E HAS GIVEN THE ANSWER AND STATED THAT ALL THESE LOANS ARE GENU INE AND TAKEN THROUGH BANKING CHANNEL AND THE ASSESSEE ALSO REPAI D THESE LOANS PRIOR TO THE DATE OF THE SEARCH. THESE TRANSA CTIONS ARE VERY MUCH PART OF THE REGULAR BOOKS OF ACCOUNT OF THE AS SESSEE. HOWEVER, THE SEARCH TEAM AGAIN PUT QUESTION TO THE ASSESSEE AS QUESTION NO. 77 IN WHICH THE ASSESSEE HAS STATED TH AT THE ASSESSEE HAS CHECKED THE DETAILS OF THE LOANS FROM M/S DIPNARAYAN VYAPAR PVT. LTD. FOR WHICH THE ASSESSEE RECEIVED CASH AND THE SAME WAS DECLARED AS UNDISCLOSED INCOME FOR THE YEAR OF THE SEARCH. WE FIND THAT PRIOR TO THAT THE ASSESSEE WAS ALSO ASKED QUESTION NO. 34 TO 36 AND QUESTION NO. 39. EVEN AFT ER THE STATEMENT RECORDED U/S 132(4) OF THE ACT, THE INVES TIGATION WING AGAIN SUMMONED THE ASSESSEE U/S 131 OF THE ACT FOR CONDUCTING POST SEARCH ENQUIRY AND THE STATEMENT OF THE ASSESS EE WAS RECORDED ON 30/05/2013 WHEREIN IN RESPONSE TO QUEST ION NO. 12, THE ASSESSEE CLARIFIED THAT THE EARLIER STATEMENT O F THE ASSESSEE IN QUESTION NO. 77 WAS NOT A CORRECT STATEMENT REGARDI NG THE LOAN TAKEN FROM M/S DIPNARAYAN VYAPAR PVT. LTD.. THUS, F OR UNDERSTANDING OF THE ISSUE, ALL THE RELEVANT QUESTI ONS PUT TO THE ASSESSEE AND ANSWERED TO THEM ARE TO BE READ CONJOI NTLY. HENCE, WE QUOTE QUESTION NO. 34 TO 36 AND QUESTION NO. 39 OF ASSESSEES STATEMENT RECORDED U/S 132(4) DATED 04/4 /2013 AND QUESTION NO. 77 OF STATEMENT RECORDED U/S 132(4) ON 05/4/2013 AND QUESTION NO. 12 AND REPLY OF THE STATEMENT OF T HE ASSESSEE RECORDED U/S 131 OF THE ACT IN POST SEARCH INVESTIG ATION BY THE ADIT AS UNDER:- IZ IZIZ IZ- -- -34 3434 34 ESA VKILS VKIDH HKKXHNKJH QEZ ,-,E-,DLIKSVLZ CQD ESA FUEUFYF[KR VUFLD;KSJMZ YKSU SFMVLZ DS YSTJ FN[KK JGK GW& (I) INTERLINK SAVING & FINANCE PVT. LTD. 57 ADARSH NAGA R, RISHIKESH, DEHRADUN, UTTRANCHAL. (II) PARMATMA DEVELOPERS PVT. LTD., 101, BALARAM DEY STR EET, GR FLOOR, KOLKATA ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 12 (III) RAMESHWAR FINVEST PVT. LTD., 101 BALARAM DEY STREET , KOLKATA (IV) SRI RAM TIE UP PVT. LTD., 2, BANARASHI GHOSH, 2 ND BYE LANE, KOLKATA (V) ________________________DO ________________________ _ (VI) TARA VINIMAY PVT. LTD., 101, BALARAM DEY STREET, G. FLOOR, KOLKATA (VII) VICTOR PROJECT PVT. LTD., 2 MULLICK STREET, IST FLO OR, KOLKATA (VIII) YATAN TRADERS PVT. LTD., 62/1, HRIDAY KRISHNA BANER JEE LANE, HOWRAH. MIJKSDR LHKH TRANSACTIONS DH IZEK.K LI'V DJSA\ MKJ MKJ MKJ MKJ& MIJKSDR [KKRKSA DH UDYKSA DKS ESAUS NS[KDJ ;G DGUK PKGRK GW ;G FOK O'KZ 2009&2010 C;KT IJ DTKZ FY;K GQVK FOK O'KZ 2011&12 ESAUSA PQDK FN;KA IZ IZIZ IZ- -- -35 3535 35 MIJKSDR OF.KZR LHKH DEIFU;KA VKIDS LEIDZ ESA DSL S VK;H FOOJ.K NSA MKJ MKJ MKJ MKJ& ESJH QEZ }KJK T;IQJ ,OA T;IQJ DS CKGJ ESA TGKA LS HKH O;KIKJ DS FY, EQ>S DTKZ IZKIR GQVK ESAUS FY;K RFKK YKSVK;K ,OA XR O'KK SZA EAS BULS ESJK LEIDZ DSLS JGK EQ>S VHKH ;KN UGHA VK JGK GSA IZ IZIZ IZ- -- -36 3636 36 BU DEIFU;KSA LS D;K JSV VKWQ BUVSLV FN;K GS FOOJ.K NS\ MKJ& MKJ& MKJ& MKJ& XR O'KKSZA DH CKR EQ>S TCKUHRKSJ IJ ;KN UGHA GSA ;G QEZ }KJK IS'K DH XBZ [KKRKSA ESA X.KUK DJ FUDKYUK GKSXK TKS JHEKU~ DS DK ;KZY; ESA GKTJH NSUS VKAXK TC X.KUK DJ CRKAXKA IZ IZIZ IZ- -- -39 3939 39 VKIDH QEZ A.M. EXPORTS DK DIPNARAYAN VYAPAAR PVT. LTD. DS LKFK D;K LECU/K GS] LI'V DJSA\ MKJ MKJ MKJ MKJ& ESAUS DIPNARAYAN VYAPAAR PVT. LTD. LS YXHKX RHU O'KZ IGYS C;KT LS ISLK M/KKJ FY;K FKK EQ>S ;G ISLK FDL C;KT NJ IJ FNYK;K F KK EQ>S VHKH ;KN UGHA VK JGK GSA DIPNARAYAN VYAPAAR PVT. LTD. LS FDL O;FDR DS EK/;E LS ISLK M/KKJ FY;K FKK VHKH EQ>S ;KN UGHA VK JGK GSA B L LECU/K ESA TKUDKJH IZKIR DJ ESA VKIDKS CRK NWAXKA ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 13 IZ IZIZ IZ- -- -77 7777 77 GEUS IZ'U LA- 39 ESA A.M. EXPORTS ,OA DIPNARAYAN O;KIKJ DS TRANSACTIONS DS CKJS ESA IWNK RKS VKIUS V/KWJH TKUDKJH NH FKH D;K V C VKIDKS BL CKCR~ VKSJ VF/KD FOOJ.K CRKUK GS\ MKJ MKJ MKJ MKJ& TH GK] ESJS DKS NKS FNU LS ;KN DJRS GQ, ;K N VK JGK GS ,OA FOHKKX LS LG;KSX DH BPNK J[KRS GQ, CRKUK PKGRK GW FD ESAUS E SLLZ DIPNARAYAN VAYAPAR PRIVATE LIMITED DKS PSD FN;K FKK FTLDK EQ>S BL LKY ESA DS'K IZKIR GKS X;K FTLS ESAUS BL FOK O'KZ DH V?KKSF'KR VK; DS :I ESA FOHKKX DKS LEFIZR DJ FN;KA IZ IZIZ IZ- -- -12 1212 12 VKIUS IZ'U LA[;K 11 DS TOKC ESA ,USDLJ AS EXIBIT- 5 DS IST LA[;K 37 D TOKC ESA CRK;K FD VKIUS ESLLZ NHIUKJK;.K O;KIKJ IZK -FY- LS C;KT IJ ISLK FY;K GQVK GSA MLDK , ,E ,DLIKSVZ DH YS[KK IQLRDKSA ESA FNUKAD 01-04-11 LS FNUKAD 31-03-12 DH VOF/K DK YSTJ GSA ESA VKIDKS RYK 'KH ,OA TCRH DH DK;ZOKGH DS NKSJKU VKIDS L'KIFK NTZ C;KU DK IZ'U LA [;K 77 FN[KK JGK GW FTLDS MRRJ ESA VKIUS DGK FKK FD------- TH GKA ESJS DKS NKS FNU LS ;KN DJRS GQ, ;KN VK JG K GS ,OA FOHKKX LS LG;KSX DH BPNK J[KRS GQ, CRK;K PKGRK GWA FD ESAUS E SLLZ NHIUKJK;.K O;KIKJ IZK-FY- DKS PSD FN;K FKK FTLDK EQ>S BL LKY ESA DS'K IZKIR GKS X;K FTLS ESAUS BL FORR O'KZ DH V?KKSF'KR VK; DS :I ESA FOHKKX DKS LEFIZR DJ FN;KA D`I;K RYK'KH ,OA TCRH DH DK;ZOKGH DS NKSJKU VKIDS L 'KIFK NTZ C;KU DK IZ'U LA[;K 77 DS TOKC DKS ,D CKJ IQU% I<+DJ LE> YSO SA FD VKIUS MIJKSDR IZ'U LA[;K 11 DS TOKC ESA D;K LGH MRRJ FN;K GSA BL LACA/K ESA ESA VKIDK /;KU VK;DJ VF/KFU;E 1961 DS VFHK;KSTU IZKO/KK UKSA DH RJQ VKIDK /;KU VKDF'KZR DJUK PKGRK GW FD XYR C;KUH DH N'KK E AS VKIDS FO:) VFHK;KSTU DH DK;ZOKGH IZKJEHK DH TK LDRH GSA D`I;K ,D CKJ IQU% LKSPDJ CRK;SA FD VKIUS ESLLZ NHIUKJK;.K O;KIKJ IZK-FY- LS FDRUK :I;K M/KKJ FY;K GS VFKOK VKIUS PSD NSDJ MULS OKIL UXN JKF'K IZKIR D H FKH] LI'V DJSAA MKJ MKJ MKJ MKJ& ESAUS VKIDS }KJK FN[KK;S X;S ,USDLJ AS EXIBIT -5 DS IST LA[;K 37 ,OA RYK'KH ,OA TCRH DH DK;ZOKGH DS NKSJKU NTZ ESJS C;KUKSA DKS VPNH RJG LS I<+DJ LE> FY;K GSA ESA ;GKA ;G DGUK PKGRK GWA FD RYK'KH , OA TCRH DH DK;ZOKGH DS NKSJKU FOHKKX DS VF/KDKFJ;KSA }KJK BL L ACA/K ESA EQ>LS CKJ&CKJ IWNK X;K RKS ESAUS EKUFLD :I LS FKDDJ ;G TOKC NS FN ;K FKKA YSFDU VC ESAUS VIUH IWJH YS[KK IQLRDKSA DKS NS[K FY;K GS VKS J ESA VC ;G 'KIFKIWOZD ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 14 C;KU DJUK PKGRK GW FD ESAUS ESLLZ NHIUKJK;.K O;KIK J IZK-FY- PSD LS C;KT IJ ISLK FY;K FKK ,OA MLDK HKQXRKU HKH PSD LS GH FD; K GSA ESAUS BL DEIUH DS LKFK DKSBZ UXN YSU&NSU UGHA FD;K GSA TGKA RD VK; DJ IZKO/KKUKSA DH CKR GS MLDS LACA/K ESA ESJS C;KU NTZ DJRS ODR FOHKK X }KJK EQ>S VOXR DJK FN;K X;K FKK TKS ESJH TKUDKJH ESA GSA FQJ HKH ESA I W.KZ :I LS LARQ'V GKSDJ BL I`'B DS CKJS ESA TOKC NS JGK GWAA IN REPLY TO THE QUESTION NO. 34, THE ASSESSEE HAS C LEARLY STATED THAT THE TRANSACTION OF LOAN FROM ALL THE PARTIES WERE TAKEN ON INTEREST IN THE F.Y. 2009-10 AND THESE WERE REPAID IN THE F.Y. 2011 -12. THEREAFTER A SPECIFIC QUESTION WAS PUT TO THE ASSESSEE REGARDING THE LOAN TAKEN FROM M/S DIPNARAYAN VYAPAR PVT. LTD. AS QUESTION NO. 39 AND IN REPLY TO THE SAME, THE ASSESSEE STATED THAT THE LOAN WAS TAKEN A BOUT THREE YEARS BACK ON INTEREST BUT THE ASSESSEE WAS NOT ABLE TO R EMEMBER THE PERSON THROUGH WHOM THE LOAN WAS TAKEN. THEREFORE, THERE W AS NO AMBIGUITY IN THE REPLY TO QUESTION NO. 39 EXCEPT THAT THE ASS ESSEE WAS NOT ABLE TO TELL THE NAME OF THE PERSON WHO HELPED THE ASSESSEE IN PROCURING THE LOAN. SINCE THE INVESTIGATION WING WAS NOT SATISFIE D WITH THE ANSWERS OF THE ASSESSEE AS THEY COULD NOT EXTRACT THE STATEMEN T WHICH CAN BE USED AGAINST THE ASSESSEE, THEREFORE, QUESTION WERE CONT INUOUSLY PUT TO THE ASSESSEE FOR TWO DAYS AND IT IS A MATTER OF RECORD THAT THE ASSESSEE WAS GRILLED UP TO 1.00 A.M. ON THE NIGHT OF 04/4/2013 A ND AGAIN RESTARTED IN THE MORNING AT 7.50 A.M. AND THE QUESTION NO. 77 WA S AGAIN ASKED SPECIFICALLY REGARDING LOAN FROM M/S DIPNARAYAN VYA PAR PVT. LTD. IN REPLY TO THAT THE ASSESSEE HAS EXPLAINED THAT AFTER TRYIN G TO REMEMBER FOR CONTINUOUSLY FOR TWO DAYS AND HOPING THE COOPERATIO N FROM THE DEPARTMENT, HE SAID THAT HE RECEIVED CASH AGAINST T HE SAID LOAN WHICH WAS DECLARED AS UNDISCLOSED INCOME FOR THE YEAR OF SEARCH. THE INVESTIGATION WING WAS STILL NOT SATISFIED WITH THE STATEMENT OF THE ASSESSEE AND AGAIN CALLED THE ASSESSEE FOR FURTHER INVESTIGATION ON 30/5/2013 AND THEREAFTER ON 21/6/2013. THE ASSESSEE WAS AGAIN PUT THE QUESTION ABOUT THE LOAN TAKEN FROM M/S DIPNARAY AN VYAPAR PVT. LTD., IN REPLY, THE ASSESSEE EXPLAINED THAT ON REPE ATED INSTANCES OF THE INVESTIGATION TEAM AND DUE TO EXHAUSTED MIND, THE A SSESSEE GIVEN AN INCORRECT REPLY TO QUESTION NO. 77 RECORDED U/S 132 (4) OF THE ACT ON ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 15 05/4/2013 AND AGAIN STATED THAT AFTER VERIFYING THE BOOKS OF ACCOUNT, THE SAID LOAN WAS TAKEN ON INTEREST AND WAS ALSO RE PAID BOTH THE TRANSACTIONS ARE THROUGH BANKING CHANNEL. THUS, HAV ING REGARD TO THE BACKGROUND OF THE CIRCUMSTANCES IN WHICH STATEMENT OF THE ASSESSEE REGARDING SAID TRANSACTION OF LOAN FROM M/S DIPNARA YAN VYAPAR PVT. LTD. WAS RECORDED AND FINALLY STATEMENT RECORDED IN POST SEARCH INQUIRY WE ARE OF THE VIEW THAT THE ASSESSEE FINALLY CLARIFIED THE ISSUE IN THE STATEMENT RECORDED U/S 131 OF THE ACT AND THEREFORE , THERE WAS NO ADMISSION ON THE PART OF THE ASSESSEE. EXCEPT THE S TATEMENT OF PARTNER OF THE ASSESSEE, THERE WAS NOTHING INCRIMINATING FO UND OR SEIZED DURING THE COURSE OF SEARCH AND SEIZURE ACTION, THEREFORE, THE STATEMENT OF THE ASSESSEE RECORDED DURING THE SEARCH AND POST SEARCH ENQUIRY HAS TO BE READ TOGETHER AND THE OUTCOME OF THE SAID STATEMENT IS THAT THE ASSESSEE HAS NEVER ADMITTED ANY BOGUS TRANSACTION E XCEPT THE MISUNDERSTANDING DUE TO CONTINUOUS GRILLING BY THE INVESTIGATION WING AND DUE TO MENTALLY EXHAUSTED, THE ASSESSEE GIVEN S OME INCONSISTENT REPLY TO QUESTION NO. 77 WHICH WAS SUBSEQUENTLY CLA RIFIED IN QUESTION NO. 12 OF THE STATEMENT RECORDED BY THE INVESTIGATI ON WING IN THE POST SEARCH ENQUIRY U/S 131 OF THE ACT. EVEN OTHERWISE, ALL THESE STATEMENTS ARE ONLY REGARDING ONE TRANSACTION OF LOAN THAT CAN NOT BE APPLIED TO THE ENTIRE TRANSACTIONS OF LOAN TAKEN FROM 12 PARTIES. THEREFORE, EXCEPT THE STATEMENT OF THE ASSESSEE TO QUESTION NO. 77, WHICH WAS SUBSEQUENTLY CLARIFIED IN QUESTION NO. 12, THERE WAS NOTHING IN THE SHAPE OF ANY MATERIAL OR DOCUMENT MUCH LESS INCRIMINATING MATERI AL WITH THE ASSESSING OFFICER TO MAKE THE ADDITION TO THE TOTAL INCOME OF THE ASSESSEE. IF THE STATEMENT OF THE ASSESSEE IS READ IN TOTO THEN THERE WILL BE NO ADMISSION REGARDING ANY OF THE LOAN TRANSACTI ONS BEING AN ACCOMMODATION ENTRY. THEREFORE, THE QUESTION ARISES WHETHER IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE ASSESSIN G OFFICER CAN MAKE ANY ADDITION TO THE TOTAL INCOME OF THE ASSESSEE WH EN THE ASSESSMENT WAS NOT ABATED DUE TO THE SEARCH AND SEIZURE ACTION . THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA (SUP RA) HAS CONSIDERED AND OBSERVED IN PARA 37 AND 38 AS UNDER: ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 16 37. ON A CONSPECTUS OF SECTION 153A(1) OF THE ACT, REA D WITH THE PROVISOS THERETO, AND IN THE LIGHT OF THE LAW EXPLA INED IN THE AFOREMENTIONED DECISIONS, THE LEGAL POSITION THAT E MERGES IS AS UNDER: I. ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF THE ACT, NOTICE UNDER SECTION 153 A(1) WILL HAVE TO BE MANDATORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR S IX AYS IMMEDIATELY PRECEDING THE PREVIOUS YEAR RELEVANT TO THE AY I N WHICH THE SEARCH TAKES PLACE. II. ASSESSMENTS AND REASSESSMENTS PENDING ON THE DATE O F THE SEARCH SHALL ABATE. THE TOTAL INCOME FOR SUCH AYS W ILL 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 WHICH THE SEARCH TAKES PLACE. THE AO HAS THE POWER TO ASSESS AND REASSESS THE 'TOTAL INCOME' OF THE AFOREMENTIONED SIX YEARS IN SEPARATE ASSESSMENT ORDERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS THERE WILL BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX AYS 'IN WHICH BOTH THE DISCLOSED AND THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX'. IV. ALTHOUGH SECTION 153 A DOES NOT SAY THAT ADDITIONS SHOULD BE STRICTLY MADE ON THE BASIS OF E VIDENCE FOUND IN THE COURSE OF THE SEARCH, OR OTHER POST- SEARCH MATERIAL OR INFORMATION AVAILABLE WITH THE AO WHICH CAN BE RELATED TO THE EVIDENCE FO UND, IT DOES NOT MEAN THAT THE ASSESSMENT 'CAN BE ARBITRARY OR M ADE WITHOUT ANY RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOUSLY AN ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY O N THE BASIS OF SEIZED MATERIAL.' V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPL ETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSM ENT OR REASSESSMENT CAN BE M ADE. THE WORD 'ASSESS' IN SECTION 153 A IS RELATABLE TO ABATED PROCEEDINGS (I.E. THOSE PENDING ON THE DATE OF ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 17 SEARCH) AND THE WORD 'REASSESS' TO COMPLETED ASSESS MENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, THE J URISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND THE ASSESSMENT UNDER SE CTION 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 MATERIAL EXISTING OR BROUGHT ON THE R ECORD OF THE AO. VII. COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE AO WHILE MAKING THE ASSESSMENT UNDER SECTION 153 A ONLY ON T HE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE CO URSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSED I NCOME OR PROPERTY DISC OVERED IN THE COURSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. CONCLUSION 38. THE PRESENT APPEALS CONCERN AYS, 2002-03, 2005-06 AND 2006- 07.ON THE DATE OF THE SEARCH THE SAID ASSESSMENTS A LREADY STOOD COMPLETED. SINCE NO INCRIMINATING MATERIAL WAS UNEA RTHED DURING THE SEARCH, NO ADDITIONS COULD HAVE BEEN MADE TO THE IN COME ALREADY ASSESSED. THUS, THE HON'BLE HIGH COURT HAS RULED THAT THE ASS ESSING OFFICER WHILE MAKING THE ASSESSMENT U/S 153A OF THE ACT CAN MAKE THE ADDITION ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTH ED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS, WHICH WERE N OT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF OR IGINAL ASSESSMENT. IN THE CASE IN HAND, ALL THE TRANSACTIONS WERE DULY RECORDED IN THE BOOKS OF ACCOUNT. EVEN THE LOANS WERE ALREADY PAID DURING THE F.Y. 2011-12 AND THEREFORE, THESE TRANSACTIONS WERE DISC LOSED AND KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT/RETURN OF INCOME. HENCE IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE ASSESSING OFFICE R CANNOT MAKE ANY ADDITION TO THE TOTAL INCOME OF THE ASSESSEE. IN TH E SUBSEQUENT ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 18 DECISION, THE HONBLE DELHI HIGH COURT IN THE CASE OF PR.CIT VS. MEETA GUTGUTIA (SUPRA) HAS HELD IN PARA 57 TO 72 AS UNDER : 57. THE QUESTION WHETHER UNEARTHING OF INCRIMINATING M ATERIAL RELATING TO ANY ONE OF THE AYS COULD JUSTIFY THE RE-OPENING OF THE ASSESSMENT FOR ALL THE EARLIER AYS WAS CONSIDERED BOTH IN ANIL KUM AR BHATIA (SUPRA) AND CHETAN DAS LACHMAN DAS (SUPRA). INCIDENTALLY, B OTH THESE DECISIONS WERE DISCUSSED THREADBARE IN THE DECISION OF THIS COURT IN KABUL CHAWLA (SUPRA). AS FAR AS ANIL KUMAR BHATI A (SUPRA) WAS CONCERNED, THE COURT IN PARAGRAPH 24 OF THAT DECISI ON NOTED THAT 'WE ARE NOT CONCERNED WITH A CASE WHERE NO INCRIMINATIN G MATERIAL WAS FOUND DURING THE SEARCH CONDUCTED UNDER SECTION 132 OF THE ACT. WE THEREFORE EXPRESS NO OPINION AS TO WHETHER SECTION 153A CAN BE INVOKED EVEN UNDER SUCH SITUATION'. THAT QUESTION W AS, THEREFORE, LEFT OPEN. AS FAR AS CHETAN DAS LACHMAN DAS (SUPRA) IS C ONCERNED, IN PARA 11 OF THE DECISION IT WAS OBSERVED: '11. SECTION 153A (1) (B) PROVIDES FOR THE ASSESSME NT OR REASSESSMENT OF THE TOTAL INCOME OF THE SIX ASSESSM ENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE SEARCH TOOK PLACE. TO REPEAT, THE RE IS NO CONDITION IN THIS SECTION THAT ADDITIONS SHOULD BE STRICTLY M ADE ON THE BASIS OF EVIDENCE FOUND IN THE COURSE OF THE SEARCH OR OTHER POST-SEARCH MATERIAL OR INFORMATION AVAILABLE WITH THE ASSESSIN G OFFICER WHICH CAN BE RELATED TO THE EVIDENCE FOUND. THIS, HOWEVER , DOES NOT MEAN THAT THE ASSESSMENT UNDER SECTION 153A CAN BE ARBITRARY OR MADE WITHOUT ANY RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOUSLY AN ASSESSMENT HAS TO BE MADE UNDER THIS S ECTION ONLY ON THE BASIS OF SEIZED MATERIAL.' 58. IN KABUL CHAWLA (SUPRA), THE COURT DISCUSSED THE D ECISION IN FILATEX INDIA LTD. (SUPRA) AS WELL AS THE ABOVE TWO DECISIO NS AND OBSERVED AS UNDER: '31. WHAT DISTINGUISHES THE DECISIONS BOTH IN CIT V . CHETAN DAS LACHMAN DAS (SUPRA), AND FILATEX INDIA LTD. V. CIT- IV (SUPRA) IN THEIR APPLICATION TO THE PRESENT CASE IS THAT IN BO TH THE SAID CASES ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 19 THERE WAS SOME MATERIAL UNEARTHED DURING THE SEARCH , WHEREAS IN THE PRESENT CASE THERE ADMITTEDLY WAS NONE. SECONDL Y, IT IS PLAIN FROM A CAREFUL READING OF THE SAID TWO . DECISIONS THAT THEY DO NOT HOLD THAT ADDITIONS CAN BE VALIDLY MADE TO INCOME F ORMING THE SUBJECT MATTER OF COMPLETED ASSESSMENTS PRIOR TO TH E SEARCH EVEN IF NO INCRIMINATING MATERIAL WHATSOEVER WAS UNEARTHED DURING THE SEARCH. 32. RECENTLY BY ITS ORDER DATED 6TH JULY 2015 IN IT A NO. 369 OF 2015 (PR. COMMISSIONER OF INCOME TAX V. KURELE PAPE R MILLS P. LTD.), THIS COURT DECLINED TO FRAME A QUESTION OF L AW IN A CASE WHERE, IN THE ABSENCE OF ANY INCRIMINATING MATERIAL BEING FOUND DURING THE SEARCH UNDER SECTION 132 OF THE ACT, THE REVENUE SOUGHT TO JUSTIFY INITIATION OF PROCEEDINGS UNDER SECTION 153A OF THE ACT AND MAKE AN ADDITION UNDER SECTION 68 OF THE ACT ON BOG US SHARE CAPITAL GAIN. THE ORDER OF THE CIT (A), AFFIRMED BY THE ITAT, DELETING THE ADDITION, WAS NOT INTERFERED WITH.' 59. IN KABUL CHAWLA (SUPRA), THE COURT REFERRED TO THE DECISION OF THE RAJASTHAN HIGH COURT IN JAI STEEL (INDIA) V. ASSTT. CIT [2013] 36 TAXMANN.COM 523/219 TAXMAN 223 . THE SAID PART OF THE DECISION IN KABUL CHAWLA (SUPRA) IN PARAS 33 AND 34 READS AS UNDER: '33. THE DECISION OF THE RAJASTHAN HIGH COURT IN JA I STEEL (INDIA), JODHPUR V. ACIT (SUPRA) INVOLVED A CASE WHERE CERTA IN BOOKS OF ACCOUNTS AND OTHER DOCUMENTS THAT HAD NOT BEEN PROD UCED IN THE COURSE OF ORIGINAL ASSESSMENT WERE FOUND IN THE COU RSE OF SEARCH. IT WAS HELD WHERE UNDISCLOSED INCOME OR UNDISCLOSED PR OPERTY HAS BEEN FOUND AS A CONSEQUENCE OF THE SEARCH, THE SAME WOULD ALSO BE TAKEN INTO CONSIDERATION WHILE COMPUTING THE TOT AL INCOME UNDER SECTION 153A OF THE ACT. THE COURT THEN EXPLAINED A S UNDER: '22. IN THE FIRM OPINION OF THIS COURT FROM A PLAIN READING OF THE PROVISION ALONG WITH THE PURPOSE AND PURPORT OF THE SAID PROVISION, WHICH IS INTRICATELY LINKED WITH SEARCH AND REQUISI TION UNDER SECTIONS 132 AND 132A OF THE ACT, IT IS APPARENT THAT: ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 20 (A ) THE ASSESSMENTS OR REASSESSMENTS, WHICH STAND ABATE D IN TERMS O F II PROVISO TO SECTION 153A OF THE ACT, THE AO ACT S UNDER HIS ORIGINAL JURISDICTION, FOR WHICH, ASSESSMENTS HAVE TO BE MADE; (B ) REGARDING OTHER CASES, THE ADDITION TO THE INCOME T HAT HAS ALREADY BEEN ASSESSED, THE ASSESSMENT WILL BE MADE ON THE BASIS OF INCRIMINATING MATERIAL; AND (C ) IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPL ETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSM ENT OR REASSESSMENT CAN BE MADE.' 34. THE ARGUMENT OF THE REVENUE THAT THE AO WAS FRE E TO DISTURB INCOME DE HORS THE INCRIMINATING MATERIAL WHILE MAK ING ASSESSMENT UNDER SECTION 153A OF THE ACT WAS SPECIFICALLY REJE CTED BY THE COURT ON THE GROUND THAT IT WAS 'NOT BORNE OUT FROM THE S CHEME OF THE SAID PROVISION' WHICH WAS IN THE CONTEXT OF SEARCH AND/OR REQUISITION. THE COURT ALSO EXPLAINED THE PURPORT O F THE WORDS 'ASSESS' AND 'REASSESS', WHICH HAVE BEEN FOUND AT M ORE THAN ONE PLACE IN SECTION 153A OF THE ACT AS UNDER: '26. THE PLEA RAISED ON BEHALF OF THE ASSESSEE THAT AS THE FIRST PROVISO PROVIDES FOR ASSESSMENT OR REASSESSMENT OF THE TOTAL INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING W ITHIN THE SIX ASSESSMENT YEARS, IS MERELY READING THE SAID PROVIS ION IN ISOLATION AND NOT IN THE CONTEXT OF THE ENTIRE SECTION. THE W ORDS 'ASSESS' OR 'REASSESS'-HAVE BEEN USED AT MORE THAN ONE PLACE IN THE SECTION AND A HARMONIOUS CONSTRUCTION OF THE ENTIRE PROVISI ON WOULD LEAD TO AN IRRESISTIBLE CONCLUSION THAT THE WORD ASSESS HAS BEEN USED IN THE CONTEXT OF AN ABATED PROCEEDINGS AND REASSESS HAS B EEN USED FOR COMPLETED ASSESSMENT PROCEEDINGS, WHICH WOULD NOT A BATE AS THEY ARE NOT PENDING ON THE DATE OF INITIATION OF THE SE ARCH OR MAKING OF REQUISITION AND WHICH WOULD ALSO NECESSARILY SUPPOR T THE INTERPRETATION THAT FOR THE COMPLETED ASSESSMENTS, THE SAME CAN BE TINKERED ONLY BASED ON THE INCRIMINATING MATERIAL F OUND DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS.'' ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 21 60. IN KABUL CHAWLA (SUPRA), THE COURT ALSO TOOK NOTE OF THE DECISION OF THE BOMBAY HIGH COURT IN CIT V. CONTINENTAL WAREHOU SING CORPN (NHAVA SHEVA) LTD. [2015] 58 TAXMANN.COM 78/232 TAXMAN 270/374 ITR 645 (BOM.) WHICH ACCEPTED THE PLEA THAT IF NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH IN RESPECT OF AN ISSUE, THEN NO ADDITIONS IN RESPECT OF ANY IS SUE CAN BE MADE TO THE ASSESSMENT UNDER SECTION 153A AND 153C OF THE A CT. THE LEGAL POSITION WAS THEREAFTER SUMMARIZED IN KABUL CHAWLA (SUPRA) 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 EXPLA INED IN THE AFOREMENTIONED DECISIONS, THE LEGAL POSITION THAT E MERGES IS AS UNDER: I. ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF THE ACT, NOTICE UNDER SECTION 153 A (1) WILL HAVE TO BE MANDA TORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR S IX AYS IMMEDIATELY PRECEDING THE PREVIOUS YEAR RELEVANT TO THE AY IN WHICH THE SEARCH TAKES PLACE. II. ASSESSMENTS AND REASSESSMENTS PENDING ON THE DATE O F THE SEARCH SHALL ABATE. T HE TOTAL INCOME FOR SUCH AYS WILL HAVE TO BE COMPUTED BY THE AOS AS A FRESH EXERCISE. III. THE AO WILL EXERCISE NORMAL ASSESSMENT POWERS IN RE SPECT OF THE SIX YEARS PREVIOUS TO THE RELEVANT AY IN WHICH THE SEARCH TAKES PLACE. THE AO HAS THE POWER TO ASS ESS AND REASSESS THE 'TOTAL INCOME' OF THE. AFOREMENTIONED SIX YEARS IN SEPARAT E ASSESSMENT ORDERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS TH ERE WILL BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX AYS 'IN WHICH BOTH THE DISCLOSED AND THE UNDI SCLOSED INCOME WOULD BE BROUGHT TO TAX'. IV. ALTHOUGH SECTION 153 A DOES NOT SAY THAT ADDITIONS SHOULD BE STRICTLY MADE ON THE BASIS OF EVIDENCE FOUND IN THE COURSE OF THE SEARCH, OR OTHER POST- SEARCH MATERIAL OR INFORMATION AVAILABLE WITH THE AO WHICH CAN BE RELATED TO THE EVIDENCE FOUND, IT DOES ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 22 NOT MEAN THAT THE ASSESSMENT 'CAN BE ARBITRARY OR M ADE WITHOUT ANY RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OB VIOUSLY AN ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY O N THE BASIS OF SEIZED MATERIAL.' V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPL ETED 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 PENDING ON THE DATE OF SEARCH ) AND THE WORD 'REASSESS' TO COMPLETED ASSESSMENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, THE J URISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND THE ASSESSMENT UND ER SECTION 153A MERGES INTO ONE. ONLY ONE ASSESSMENT SHALL BE MADE SE PARATELY FOR EACH AY ON THE BASIS OF THE FINDINGS O F THE SEARCH AND ANY OTHER MATERIAL EXISTING OR BROUGHT ON THE R ECORD OF THE AO. VII. COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE AO WHILE MAKING THE ASSESSMENT UNDER SECTION 153 A ONLY ON T HE B ASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE CO URSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSED I NCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH W ERE NOT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT.' 61. IT APPEARS THAT A NUMBER OF HIGH COURTS HAVE CONCU RRED WITH THE DECISION OF THIS COURT IN KABUL CHAWLA(SUPRA) BEGIN NING WITH THE GUJARAT HIGH COURT IN SAUMYA CONSTRUCTION (P.) LTD. (SUPRA) . THERE, A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT ON 7TH OCTOBE R, 2009 AND AN ASSESSMENT CAME TO BE FRAMED UNDER SECTION 143(3) R EAD WITH SECTION 153A(1)(B) IN DETERMINING THE TOTAL INCOME OF THE A SSESSEE OF RS. 14.5 CRORES AGAINST DECLARED INCOME OF RS. 3.44 CRORES. THE ITAT DELETED THE ADDITIONS ON THE GROUND THAT IT WAS NOT BASED ON AN Y INCRIMINATING MATERIAL FOUND DURING THE COURSE OF THE SEARCH IN R ESPECT OF AYS UNDER CONSIDERATION I.E., AY 2006-07. THE GUJARAT HIGH CO URT REFERRED TO THE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 23 DECISION IN KABUL CHAWLA (SUPRA), OF THE RAJASTHAN HIGH COURT IN JAI STEEL (INDIA) (SUPRA) AND ONE EARLIER DECISION OF T HE GUJARAT HIGH COURT ITSELF. IT EXPLAINED IN PARA 15 AND 16 AS UNDER: '15. ON A PLAIN READING OF SECTION 153A OF THE ACT, IT IS EVIDENT THAT THE TRIGGER POINT FOR EXERCISE OF POWERS THEREUNDER IS A SEARCH UNDER SECTION 132 OR A REQUISITION UNDER SECTION 13 2A OF THE ACT. ONCE A SEARCH OR REQUISITION IS MADE, A MANDATE IS CAST UPON THE ASSESSING OFFICER TO ISSUE NOTICE UNDER SECTION 153 A OF THE ACT TO THE PERSON, REQUIRING HIM TO FURNISH THE RETURN OF INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN SIX ASSESSME NT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED OR REQUISITI ON IS MADE AND ASSESS OR REASSESS THE SAME. SINCE THE ASSESSMENT U NDER SECTION 153A OF THE ACT IS LINKED WITH SEARCH AND REQUISITI ON UNDER SECTIONS 132 AND 132A OF THE ACT, IT IS EVIDENT THAT THE OBJ ECT OF THE SECTION IS TO BRING TO TAX THE UNDISCLOSED INCOME WHICH IS FOUND DURING THE COURSE OF OR PURSUANT TO THE SEARCH OR REQUISITION. HOWEVER, INSTEAD OF THE EARLIER REGIME OF BLOCK ASSESSMENT WHEREBY, IT WAS ONLY THE UNDISCLOSED INCOME OF THE BLOCK PERIOD THAT WAS ASS ESSED, SECTION 153A OF THE ACT SEEKS TO ASSESS THE TOTAL INCOME FO R THE ASSESSMENT YEAR, WHICH IS CLEAR FROM THE FIRST PROVISO THERETO WHICH PROVIDES THAT THE ASSESSING OFFICER SHALL ASSESS OR REASSESS THE TOTAL INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN S UCH SIX ASSESSMENT YEARS. THE SECOND PROVISO MAKES THE INTE NTION OF THE LEGISLATURE CLEAR AS THE SAME PROVIDES THAT ASSESSM ENT OR REASSESSMENT, IF ANY, RELATING TO THE SIX ASSESSMEN T YEARS REFERRED TO IN THE SUB-SECTION PENDING ON THE DATE OF INITIA TION OF SEARCH UNDER SECTION 132 OR REQUISITION UNDER SECTION 132A , AS THE CASE MAY BE, SHALL ABATE. SUB-SECTION (2) OF SECTION 153 A OF THE ACT PROVIDES THAT IF ANY PROCEEDING OR ANY ORDER OF ASS ESSMENT OR REASSESSMENT MADE UNDER SUB-SECTION (1) IS ANNULLED IN APPEAL OR ANY OTHER LEGAL PROVISION, THEN THE ASSESSMENT OR R EASSESSMENT RELATING TO ANY ASSESSMENT YEAR WHICH HAD ABATED UN DER THE SECOND PROVISO WOULD STAND REVIVED. THE PROVISO THERETO SA YS THAT SUCH ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 24 REVIVAL SHALL CEASE TO HAVE EFFECT IF SUCH ORDER OF ANNULMENT IS SET ASIDE. THUS, ANY PROCEEDING OF ASSESSMENT OR REASSE SSMENT FALLING WITHIN THE SIX ASSESSMENT YEARS PRIOR TO THE SEARCH OR REQUISITION STANDS ABATED AND THE TOTAL INCOME OF THE ASSESSEE IS REQUIRED TO BE DETERMINED UNDER SECTION 153A OF THE ACT. SIMILA RLY, SUB-SECTION (2) PROVIDES FOR REVIVAL OF ANY ASSESSMENT OR REASS ESSMENT WHICH STOOD ABATED, IF ANY PROCEEDING OR ANY ORDER OF ASS ESSMENT OR REASSESSMENT MADE UNDER SECTION 153A OF THE ACT IS ANNULLED IN APPEAL OR ANY OTHER PROCEEDING. 16. SECTION 153A BEARS THE HEADING 'ASSESSMENT IN C ASE OF SEARCH OR REQUISITION'. IT IS 'WELL SETTLED AS HELD BY THE SUPREME COURT IN A CATENA OF DECISIONS THAT THE HEADING OR THE SECTION CAN BE REGARDED AS A KEY TO THE INTERPRETATION OF THE OPERATIVE POR TION OF THE SECTION AND IF THERE IS NO AMBIGUITY IN THE LANGUAGE OR IF IT IS PLAIN AND CLEAR, THEN THE HEADING USED IN THE SECTION STRENGT HENS THAT MEANING. FROM THE HEADING OF SECTION 153. THE INTEN TION OF THE LEGISLATURE IS CLEAR, VIZ., TO PROVIDE FOR ASSESSME NT IN CASE OF SEARCH AND REQUISITION. WHEN THE VERY PURPOSE OF THE PROVI SION IS TO MAKE ASSESSMENT IN CASE OF SEARCH OR REQUISITION, IT GOE S WITHOUT SAYING THAT THE ASSESSMENT HAS TO HAVE RELATION TO THE SEA RCH OR REQUISITION, IN OTHER WORDS, THE ASSESSMENT SHOULD CONNECTED WITH SOMETHING ROUND DURING THE SEARCH OR REQUISITION VI Z., INCRIMINATING MATERIAL WHICH REVEALS UNDISCLOSED INCOME. THUS, WH ILE IN VIEW OF THE MANDATE OF SUB-SECTION (1) OF SECTION 153A OF T HE ACT, IN EVERY CASE WHERE THERE IS A SEARCH OR REQUISITION, THE AS SESSING OFFICER IS OBLIGED TO ISSUE NOTICE TO SUCH PERSON TO FURNISH R ETURNS OF INCOME FOR THE SIX YEARS PRECEDING THE ASSESSMENT YEAR REL EVANT TO THE PREVIOUS YEAR IN WHICH THE SEARCH IS CONDUCTED OR R EQUISITION IS MADE, ANY ADDITION' OR DISALLOWANCE CAN BE MADE ONL Y ON THE BASIS OF MATERIAL COLLECTED DURING THE SEARCH OR REQUISIT ION, IN CASE NO INCRIMINATING MATERIAL IS FOUND, AS HELD BY THE RAJ ASTHAN HIGH COURT IN THE CASE OF JAI STEEL (INDIA) V. ASST. CIT (SUPR A), THE EARLIER ASSESSMENT WOULD HAVE TO BE REITERATED, IN CASE WHE RE PENDING ASSESSMENTS HAVE ABATED, THE ASSESSING OFFICER CAN PASS ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 25 ASSESSMENT ORDERS FOR EACH OF THE SIX YEARS DETERMI NING THE TOTAL INCOME OF THE ASSESSEE WHICH WOULD INCLUDE INCOME D ECLARED IN THE RETURNS, IF ANY, FURNISHED BY THE ASSESSEE AS WELL AS UNDISCLOSED INCOME, IF ANY, UNEARTHED DURING THE SEARCH OR REQU ISITION. IN CASE WHERE A PENDING REASSESSMENT UNDER SECTION 147 OF T HE ACT HAS ABATED, NEEDLESS TO STATE THAT THE SCOPE AND AMBIT OF THE ASSESSMENT WOULD INCLUDE ANY ORDER WHICH THE ASSESS ING OFFICER COULD HAVE PASSED UNDER SECTION 147 OF THE ACT AS W ELL AS UNDER SECTION 153A OF THE ACT. ** ** ** 19. ON BEHALF OF THE APPELLANT, IT HAS BEEN CONTEND ED THAT IF ANY INCRIMINATING MATERIAL IS FOUND, NOTWITHSTANDING TH AT IN RELATION TO THE YEAR UNDER CONSIDERATION, NO INCRIMINATING MATE RIAL IS FOUND, IT WOULD BE PERMISSIBLE TO MAKE ADDITIONS AND DISALLOW ANCE IN RESPECT OF AN THE SIX ASSESSMENT YEARS. IN THE OPINION OF T HIS COURT, THE SAID CONTENTION DOES NOT MERIT ACCEPTANCE, INASMUCH AS. THE ASSESSMENT IN RESPECT OF EACH OF THE SIX ASSESSMENT YEARS IS A SEPARATE AND DISTINCT ASSESSMENT. UNDER SECTION 153A OF THE ACT, ASSESSMENT HAS TO BE MADE IN RELATION TO THE SEARCH OR REQUISITION , NAMELY, IN RELATION TO MATERIAL DISCLOSED DURING THE SEARCH OR REQUISITION. IF IN RELATION TO ANY ASSESSMENT YEAR, NO INCRIMINATING M ATERIAL IS FOUND, NO ADDITION OR DISALLOWANCE CAN BE MADE IN RELATION TO THAT ASSESSMENT YEAR IN EXERCISE OF POWERS UNDER SECTION 153A OF THE ACT AND THE EARLIER ASSESSMENT SHALL HAVE TO BE REI TERATED. IN THIS REGARD, THIS COURT IS IN COMPLETE AGREEMENT WITH TH E VIEW ADOPTED BY THE RAJASTHAN HIGH COURT IN THE CASE OF JAI STEE L (INDIA) V. ASST. CIT (SUPRA). BESIDES, AS RIGHTLY POINTED OUT BY THE LEARNED COUNSEL FOR THE RESPONDENT, THE CONTROVERSY INVOLVED IN THE PRESENT CASE STANDS CONCLUDED BY THE DECISION OF THIS COURT IN T HE CASE OF CIT V. JAYABEN RATILAL SORATHIA (SUPRA) WHEREIN IT HAS BEEN HELD THAT WHILE IT CANNOT BE DISPUTED THAT CONSIDERING S ECTION 153A OF THE ACT, THE ASSESSING OFFICER CAN REOPEN AND/OR ASSESS THE RETURN WITH RESPECT TO SIX PRECEDING YEARS ; HOWEVER, THERE MUS T BE SOME ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 26 INCRIMINATING MATERIAL AVAILABLE WITH THE ASSESSING OFFICER WITH RESPECT TO THE SALE TRANSACTIONS IN THE PARTICULAR ASSESSMENT YEAR.' 62. SUBSEQUENTLY, IN DEVANGI ALIAS RUPA (SUPRA), ANOTH ER BENCH OF THE GUJARAT HIGH COURT REITERATED THE ABOVE LEGAL POSIT ION FOLLOWING ITS EARLIER DECISION IN SAUMYA CONSTRUCTION (P.) LTD. ( SUPRA) AND OF THIS COURT IN KABUL CHAWLA (SUPRA). AS FAR AS KARNATAKA HIGH COURT IS CONCERNED, IT HAS IN IBC KNOWLEDGE PARK (P.) LTD.(S UPRA) FOLLOWED THE DECISION OF THIS COURT IN KABUL CHAWLA (SUPRA) AND HELD THAT THERE HAD TO BE INCRIMINATING MATERIAL QUA EACH OF THE AYS IN WHICH ADDITIONS WERE SOUGHT TO BE MADE PURSUANT TO SEARCH AND SEIZU RE OPERATION. THE CALCUTTA HIGH COURT IN SALASAR STOCK BROKING LTD. ( SUPRA), TOO, FOLLOWED THE DECISION OF THIS COURT IN KABUL CHAWLA (SUPRA). IN GURINDER SINGH BAWA (SUPRA), THE BOMBAY HIGH COURT HELD THAT: '6. . . . . . ONCE AN ASSESSMENT HAS ATTAINED FINAL ITY FOR A PARTICULAR YEAR, I.E., IT IS NOT PENDING THEN THE SAME CANNOT BE SUBJECT TO TAX IN PROCEEDINGS UNDER SECTION 153A OF THE ACT. THIS OF COURSE WOULD NOT APPLY IF INCRIMINATING MATERIALS ARE GATHERED I N THE COURSE OF SEARCH OR DURING PROCEEDINGS UNDER SECTION 153A OF THE ACT WHICH ARE CONTRARY TO AND/OR NOT DISCLOSED DURING THE REG ULAR ASSESSMENT PROCEEDINGS.' 63. EVEN THIS COURT HAS IN MAHESH KUMAR GUPTA (SUPRA) AND RAM AVTAR VERMA (SUPRA) FOLLOWED THE DECISION IN KABUL CHAWLA (SUPRA). THE DECISION OF THIS COURT IN KURELE PAPER MILLS (P.) L TD. (SUPRA) WHICH WAS REFERRED TO IN KABUL CHAWLA (SUPRA) HAS BEEN AFFIRM ED BY THE SUPREME COURT BY THE DISMISSAL OF THE REVENUE'S SLP ON 7TH DECEMBER, 2015. THE DECISION IN DAYAWANTI GUPTA 64. THAT BRINGS US TO THE DECISION IN SMT. DAYAWANTI G UPTA (SUPRA). AS RIGHTLY POINTED OUT BY MR. KAUSHIK, LEARNED COUNSEL APPEARING FOR THE RESPONDENT, THAT THERE ARE SEVERAL DISTINGUISHING F EATURES IN THAT CASE WHICH MAKES ITS RATIO INAPPLICABLE TO THE FACTS OF THE PRESENT CASE. IN THE FIRST PLACE, THE ASSESSEES THERE WERE ENGAGED I N THE BUSINESS OF PAN MASALA AND GUTKHA ETC. THE ANSWERS GIVEN TO QUE STIONS POSED TO ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 27 THE ASSESSEE IN THE COURSE OF SEARCH AND SURVEY PRO CEEDINGS IN THAT CASE BRING OUT THE POINTS OF DISTINCTION. IN THE FI RST PLACE, IT WAS STATED THAT THE STATEMENT RECORDED WAS UNDER SECTION 132(4 ) AND NOT UNDER SECTION 133A. IT WAS A STATEMENT BY THE ASSESSEE HI MSELF. IN RESPONSE TO QUESTION NO. 7 WHETHER ALL THE PURCHASES MADE BY THE FAMILY FIRMS, WERE ENTERED IN THE REGULAR BOOKS OF ACCOUNT, THE A NSWER WAS: 'WE AND OUR FAMILY FIRMS NAMELY M/S. ASSAM SUPARI T RADERS AND M/S. BALAJI PERFUMES GENERALLY TRY TO RECORD THE TR ANSACTIONS MADE IN RESPECT OF PURCHASE, MANUFACTURING AND SALES IN OUR REGULAR BOOKS OF ACCOUNTS BUT IT IS ALSO FACT THAT SOME TIM E DUE TO SOME FACTORS LIKE INABILITY OF ACCOUNTANT, OUR BUSY SCHE DULE AND SOME FAMILY PROBLEMS, VARIOUS PURCHASES AND SALES OF SUP ARI, GUTKA AND OTHER ITEMS DEALT BY OUR FIRMS IS NOT ENTERED AND S HOWN IN THE REGULAR BOOKS OF ACCOUNTS MAINTAINED BY OUR FIRMS.' 65. THEREFORE, THERE WAS A CLEAR ADMISSION BY THE ASSE SSEES IN SMT. DAYAWANTI GUPTA (SUPRA) THERE THAT THEY WERE NOT MA INTAINING REGULAR BOOKS OF ACCOUNTS AND THE TRANSACTIONS WERE NOT REC ORDED THEREIN. 66. FURTHER, IN ANSWER TO QUESTION NO. 11, THE ASSESSE E IN SMT. DAYAWANTI GUPTA (SUPRA) WAS CONFRONTED WITH CERTAIN DOCUMENTS SEIZED DURING THE SEARCH. THE ANSWER WAS CATEGORICAL AND R EADS THUS: 'ANS:- I HEREBY ADMIT THAT THESE PAPERS ALSO CONTEN D DETAILS OF VARIOUS TRANSACTIONS INCLUDE PURCHASE/SALES/MANUFAC TURING TRADING OF GUTKHA, SUPARI MADE IN CASH OUTSIDE BOOKS OF ACC OUNTS AND THESE ARE ACTUALLY UNACCOUNTED TRANSACTIONS MADE BY OUR TWO FIRMS NAMELY M/S. ASOM TRADING AND M/S. BALAJI PERFUMES.' 67. BY CONTRAST, THERE IS NO SUCH STATEMENT IN THE PRE SENT CASE WHICH CAN BE SAID TO CONSTITUTE AN ADMISSION BY THE ASSES SEE OF A FAILURE TO RECORD ANY TRANSACTION IN THE ACCOUNTS OF THE ASSES SEE FOR THE AYS IN QUESTION. ON THE CONTRARY, THE ASSESSEE HEREIN STAT ED THAT, HE IS REGULARLY MAINTAINING THE BOOKS OF ACCOUNTS. THE DI SCLOSURE MADE IN THE SUM OF RS. 1.10 CRORES WAS ONLY FOR THE YEAR OF SEA RCH AND NOT FOR THE EARLIER YEARS. AS ALREADY NOTICED, THE BOOKS OF ACC OUNTS MAINTAINED BY ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 28 THE ASSESSEE IN THE PRESENT CASE HAVE BEEN ACCEPTED BY THE AO. IN RESPONSE TO QUESTION NO. 16 POSED TO MR. PAWAN GADI A, HE STATED THAT THERE WAS NO POSSIBILITY OF MANIPULATION OF THE ACC OUNTS. IN SMT. DAYAWANTI GUPTA (SUPRA), BY CONTRAST, THERE WAS A C HART PREPARED CONFIRMING THAT THERE HAD BEEN A YEAR-WISE NON-RECO RDING OF TRANSACTIONS. IN SMT. DAYAWANTI GUPTA (SUPRA), ON T HE BASIS OF MATERIAL RECOVERED DURING SEARCH, THE ADDITIONS WHICH WERE M ADE FOR ALL THE YEARS WHEREAS ADDITIONS IN THE PRESENT CASE WERE MA DE BY THE AO ONLY FOR AY 2004-05 AND NOT ANY OF THE OTHER YEARS. EVEN THE ADDITIONS MADE FOR AYS 2004-05 WERE SUBSEQUENTLY DELETED BY THE CI T (A), WHICH ORDER WAS AFFIRMED BY THE ITAT. EVEN THE REVENUE HAS CHAL LENGED ONLY TWO OF SUCH DELETIONS IN ITA NO. 306/2017. 68. IN PARA 23 OF THE DECISION IN SMT. DAYAWANTI GUPTA (SUPRA), IT WAS OBSERVED AS UNDER: '23. THIS COURT IS OF OPINION THAT THE ITAT'S FINDI NGS DO NOT REVEAL ANY FUNDAMENTAL ERROR, CALLING FOR CORRECTION. THE INFERENCES DRAWN IN RESPECT OF UNDECLARED INCOME WERE PREMISED ON TH E MATERIALS FOUND AS WELL AS THE STATEMENTS RECORDED BY THE ASS ESSEES. THESE ADDITIONS THEREFORE WERE NOT BASELESS. GIVEN THAT T HE ASSESSING AUTHORITIES IN SUCH CASES HAVE TO DRAW INFERENCES, BECAUSE OF THE NATURE OF THE MATERIALS - SINCE THEY COULD BE SCANT Y (AS ONE HABITUALLY CONCEALING INCOME OR INDULGING IN CLANDE STINE OPERATIONS CAN HARDLY BE EXPECTED TO MAINTAIN METICULOUS BOOKS OR RECORDS FOR LONG AND IN ALL PROBABILITY BE ANXIOUS TO DO AWAY W ITH SUCH EVIDENCE AT THE SHORTEST POSSIBILITY) THE ELEMENT OF GUESS W ORK IS TO HAVE SOME REASONABLE NEXUS WITH THE STATEMENTS RECORDED AND DOCUMENTS SEIZED. IN TILLS CASE, THE DIFFERENCES OF OPINION BETWEEN THE CIT (A) ON THE ONE HAND AND THE AO AND ITAT ON THE OTHER CANNOT BE THE SOLE BASIS FOR DISAGREEING WITH WHAT IS ESSENTIALLY A FACTUAL SURMISE THAT IS LOGICAL AND PLAUSIBLE. THES E FINDINGS DO NOT CALL FOR INTERFERENCE. THE SECOND QUESTION OF LAW I S ANSWERED AGAIN IN FAVOUR OF THE REVENUE AND AGAINST THE ASSESSEE.' ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 29 69. WHAT WEIGHED WITH THE COURT IN THE ABOVE DECISION WAS THE 'HABITUAL CONCEALING OF INCOME AND INDULGING IN CLA NDESTINE OPERATIONS' AND THAT A PERSON INDULGING IN SUCH ACTIVITIES 'CAN HARDLY BE ACCEPTED TO MAINTAIN METICULOUS BOOKS OR RECORDS FOR LONG.' THE SE FACTORS ARE ABSENT IN THE PRESENT CASE. THERE WAS NO JUSTIFICAT ION AT ALL FOR THE AO TO PROCEED ON SURMISES AND ESTIMATES WITHOUT THERE BEING ANY INCRIMINATING MATERIAL QUA THE AY FOR WHICH HE SOUG HT TO MAKE ADDITIONS OF FRANCHISEE COMMISSION. 70. THE ABOVE DISTINGUISHING FACTORS IN SMT. DAYAWANTI GUPTA (SUPRA), THEREFORE, DO NOT DETRACT FROM THE SETTLED LEGAL PO SITION IN KABUL CHAWLA (SUPRA) WHICH HAS BEEN FOLLOWED NOT ONLY BY THIS COURT IN ITS SUBSEQUENT DECISIONS BUT ALSO BY SEVERAL OTHER HIGH COURTS. 71. FOR ALL OF THE AFOREMENTIONED REASONS, THE COURT I S OF THE VIEW THAT THE ITAT WAS JUSTIFIED IN HOLDING THAT THE INVOCATI ON OF SECTION 153A BY THE REVENUE FOR THE AYS 2000-01 TO 2003-04 WAS WITH OUT ANY LEGAL BASIS AS THERE WAS NO INCRIMINATING MATERIAL QUA EA CH OF THOSE AYS. CONCLUSION 72. TO CONCLUDE: (I ) QUESTION (I) IS ANSWERED IN TH E NEGATIVE I.E., IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. IT IS HELD THAT I N THE FACTS AND CIRCUMSTANCES, THE REVENUE WAS NOT JUSTIFIED IN INV OKING SECTION 153A OF THE ACT AGAINST THE ASSESSEE IN RELATION TO AYS 2000- 01 TO AYS 2003-04? (II ) QU ESTION (II) IS ANSWERED IN THE AFFIRMATIVE I.E., IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. IT IS HELD THAT W ITH REFERENCE TO AY 2004- 05, THE ITAT WAS CORRECT IN CONFIRMING THE ORDERS O F THE CIT (A) TO THE EXTENT IT DELETED THE ADDITIONS MADE BY TH E AO TO THE TAXABLE INCOME OF THE ASSESSEE OF FRANCHISE COMMISSION IN THE SUM OF RS. 88 LAKHS AND RENT PAYMENT FOR THE SU M OF RS. 13.79 LAKHS? ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 30 THE SAID DECISION OF HON'BLE HIGH COURT WAS CHALLEN GED BY THE REVENUE BEFORE THE HON'BLE SUPREME COURT, HOWEVER, THE SLP OF THE REVENUE WAS DISMISSED VIDE ORDER DATED 02/7/2018 REPORTED S UPRA. THUS, THE HON'BLE HIGH COURT HAS REITERATED ITS VIEW AS TAKEN IN THE CASE OF CIT VS. KABUL CHAWLA (SUPRA) AND SPECIFICALLY HELD THAT ONCE THE ASSESSMENT HAS ATTAINED THE FINALITY I.E. IS NOT PENDING THEN THE SAME CANNOT BE SUBJECT TO TAX IN PROCEEDINGS U/S 153A OF THE ACT E XCEPT SOME INCRIMINATING MATERIAL ARE GATHERED IN COURSE OF SE ARCH OR DURING THE PROCEEDINGS U/S 153A OF THE ACT. THE HONBLE JURISD ICTIONAL HIGH COURT IN THE CASE OF JAI STEEL (INDIA) VS ACIT (SUPRA) HA S ALSO CONSIDERED THIS ISSUE IN PARA 22 TO 26 AS UNDER: 22. IN THE FIRM OPINION OF THIS COURT FROM A PLAIN REA DING OF THE PROVISION ALONG WITH THE PURPOSE AND PURPORT OF THE SAID PROVISION, WHICH IS INTRICATELY LINKED WITH SEARCH AND REQUISI TION UNDER SECTIONS 132 AND 132A OF THE ACT, IT IS APPARENT THAT: (A ) THE ASSESSMENTS OR REASSESSMENTS, WHICH STAND ABATE D IN TERMS OF II PROVISO TO SECTION 153A OF THE ACT, THE AO AC TS UNDER HIS ORIGINAL JURISDICTION, FOR WHICH, ASSESSMENTS HAVE TO BE MADE; (B ) REGARDING OTHER CASES, THE ADDITION TO THE INCOME T HAT HAS ALREADY BEEN ASSESSED, THE ASSESSMENT WILL BE MADE ON THE BASIS OF INCRIMINATING MATERIAL AND (C ) IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPL ET ED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSM ENT OR REASSESSMENT CAN BE MADE. THOUGH SUCH A CLAIM BY THE ASSESSEE FOR THE FIRST T IME UNDER SECTION 153A OF THE ACT IS NOT COMPLETED, THE CASE IN HAND, HAS TO BE CONSIDERED AT BEST SIMILAR TO A CASE WHERE IN SPITE OF A SEARCH AND/OR REQUISITION, NOTHING INCRIMINATING IS FOUND. IN SUC H A CASE THOUGH SECTION 153A OF THE ACT WOULD BE TRIGGERED AND ASSE SSMENT OR REASSESSMENT TO ASCERTAIN THE TOTAL INCOME OF THE P ERSON IS REQUIRED TO BE DONE, HOWEVER, THE SAME WOULD IN THAT CASE NOT R ESULT IN ANY ADDITION AND THE ASSESSMENTS PASSED EARLIER MAY HAV E TO BE REITERATED. ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 31 23. THE RELIANCE PLACED BY THE COUNSEL FOR THE APPELLA NT ON THE CASE OF ANIL KUMAR BHATIA (SUPRA) ALSO DOES NOT HELP THE CASE OF THE ASSESSEE. THE RELEVANT EXTRACT OF THE SAID JUDGMENT READS AS UNDER: '19. UNDER THE PROVISIONS OF SECTION 153A, AS WE HA VE ALREADY NOTICED, THE ASSESSING OFFICER IS BOUND TO ISSUE NO TICE TO THE ASSESSEE TO FURNISH RETURNS FOR EACH ASSESSMENT YEA R FALLING WITHIN THE SIX ASSESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH THE SEA RCH OR REQUISITION WAS MADE. ANOTHER SIGNIFICANT FEATURE OF THIS SECTI ON IS THAT THE ASSESSING OFFICER IS EMPOWERED TO ASSESS OR REASSES S THE 'TOTAL INCOME' OF THE AFORESAID YEARS. THIS IS A SIGNIFICA NT DEPARTURE FROM THE EARLIER BLOCK ASSESSMENT SCHEME IN WHICH THE BL OCK ASSESSMENT ROPED IN ONLY THE UNDISCLOSED INCOME AND THE REGULA R ASSESSMENT PROCEEDINGS WERE PRESERVED, RESULTING IN MULTIPLE A SSESSMENTS. UNDER SECTION 153A, HOWEVER, THE ASSESSING OFFICER HAS BEEN GIVEN THE POWER TO ASSESS OR REASSESS THE 'TOTAL INCOME' OF THE SIX ASSESSMENT YEARS IN QUESTION IN SEPARATE ASSESSMENT ORDERS. THIS MEANS THAT THERE CAN BE ONLY ONE ASSESSMENT ORDER I N RESPECT OF EACH OF THE SIX ASSESSMENT YEARS, IN WHICH BOTH THE DISCLOSED AND THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX. 20. A QUESTION MAY ARISE AS TO HOW THIS IS SOUGHT T O BE ACHIEVED WHERE AN ASSESSMENT ORDER HAD ALREADY BEEN PASSED I N RESPECT OF ALL OR ANY OF THOSE SIX ASSESSMENT YEARS, EITHER UN DER SECTION 143(1)(A) OR SECTION 143(3) OF THE ACT. IF SUCH AN ORDER IS ALREADY IN EXISTENCE, HAVING OBVIOUSLY BEEN PASSED PRIOR TO TH E INITIATION OF THE SEARCH/REQUISITION, THE ASSESSING OFFICER IS EMPOWE RED TO REOPEN THOSE PROCEEDINGS AND REASSESS THE TOTAL INCOME, TA KING NOTE TO THE UNDISCLOSED INCOME, IF ANY, UNEARTHED DURING THE SE ARCH.FOR THIS PURPOSE, THE FETTERS IMPOSED UPON THE ASSESSING OFF ICER BY THE STRICT PROCEDURE TO ASSUME JURISDICTION TO REOPEN T HE ASSESSMENT UNDER SECTIONS 147 AND 148, HAVE BEEN REMOVED BY TH E NON OBSTANTE CLAUSE WITH WHICH SUB-SECTION (1) OF SECTI ON 153A OPENS. THE TIME-LIMIT WITHIN WHICH THE NOTICE UNDER SECTIO N 148 CAN BE ISSUED, AS PROVIDED IN SECTION 149 HAS ALSO BEEN MA DE INAPPLICABLE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 32 BY THE NON OBSTANTE CLAUSE. SECTION 151 WHICH REQUI RES SANCTION TO BE OBTAINED BY THE ASSESSING OFFICER BY ISSUE OF NO TICE TO REOPEN THE ASSESSMENT UNDER SECTION 148 HAS ALSO BEEN EXCL UDED IN A CASE COVERED BY SECTION 153A. THE TIME-LIMIT PRESCRIBED FOR COMPLETION OF AN ASSESSMENT OR REASSESSMENT BY SECTION 153 HAS ALSO BEEN DONE AWAY WITH IN A CASE COVERED BY SECTION 153A. W ITH ALL THE STOPS HAVING BEEN PULLED OUT, THE ASSESSING OFFICER UNDER SECTION 153A HAS BEEN ENTRUSTED WITH THE DUTY OF BRINGING T O TAX THE TOTAL INCOME OF AN ASSESSEE WHOSE CASE IS COVERED BY SECT ION 153A, BY EVEN MAKING REASSESSMENTS WITHOUT ANY FETTERS, IF N EED BE. 21. NOW THERE CAN BE CASES WHERE AT THE TIME WHEN T HE SEARCH IS INITIATED OR REQUISITION IS MADE, THE ASSESSMENT OR REASSESSMENT PROCEEDINGS RELATING TO ANY ASSESSMENT YEAR FALLING WITHIN THE PERIOD OF THE SIX ASSESSMENT YEARS MENTIONED ABOVE, MAY BE PENDING. IN SUCH A CASE, THE SECOND PROVISO TO SUB- SECTION (1) OF SECTION 153A SAYS THAT SUCH PROCEEDINGS 'SHALL ABAT E'. THE REASON IS NOT FAR TO SEEK. UNDER SECTION 153A, THERE IS NO ROOM FOR MULTIPLE ASSESSMENT ORDERS IN RESPECT OF ANY OF THE SIX ASSE SSMENT YEARS UNDER CONSIDERATION. THAT IS BECAUSE THE ASSESSING OFFICER HAS TO DETERMINE NOT MERELY THE UNDISCLOSED INCOME OF THE ASSESSEE, BUT ALSO THE 'TOTAL INCOME' OF THE ASSESSEE IN WHOSE CA SE A SEARCH OR REQUISITION HAS BEEN INITIATED. OBVIOUSLY THERE CAN NOT BE SEVERAL ORDERS FOR THE SAME ASSESSMENT YEAR DETERMINING THE TOTAL INCOME OF THE ASSESSEE. IN ORDER TO ENSURE THIS STATE OF A FFAIRS NAMELY, THAT IN RESPECT OF THE SIX ASSESSMENT YEARS PRECEDING TH E ASSESSMENT YEAR RELEVANT TO THE YEAR IN WHICH THE SEARCH TOOK PLACE THERE IS ONLY ONE DETERMINATION OF THE TOTAL INCOME, IT HAS BEEN PROVIDED IN THE SECOND PROVISO OF SUB-SECTION (1) OF SECTION 15 3A THAT ANY PROCEEDINGS FOR ASSESSMENT OR REASSESSMENT OF THE A SSESSEE WHICH ARE PENDING ON THE DATE OF INITIATION OF THE SEARCH OR MAKING REQUISITION 'SHALL ABATE'. ONCE THOSE PROCEEDINGS A BATE, THE DECKS ARE CLEARED, FOR THE ASSESSING OFFICER TO PASS ASSE SSMENT ORDERS FOR EACH OF THOSE SIX YEARS DETERMINING THE TOTAL INCOM E OF THE ASSESSEE WHICH WOULD INCLUDE BOTH THE INCOME DECLAR ED IN THE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 33 RETURNS, IF ANY, FURNISHED BY THE ASSESSEE AS WELL AS THE UNDISCLOSED INCOME, IF ANY, UNEARTHED DURING THE SEARCH OR REQU ISITION. THE POSITION THUS EMERGING IS THAT THE SEARCH IS INITIA TED OR REQUISITION IS MADE, THEY WILL ABATE MAKING WAY FOR THE ASSESSING OFFICER TO DETERMINE THE TOTAL INCOME OF THE ASSESSEE IN WHICH THE UNDISCLOSED INCOME WOULD ALSO BE INCLUDED, BUT IN CASE WHERE TH E ASSESSMENT OR REASSESSMENT PROCEEDINGS HAVE ALREADY BEEN COMPL ETED AND ASSESSMENT ORDERS HAVE BEEN PASSED DETERMINING THE ASSESSEE'S TOTAL INCOME AND SUCH ORDERS SUBSISTING AT THE TIME WHEN THE SEARCH OR THE REQUISITION IS MADE, THERE IS NO QUES TION OF ANY ABATEMENT SINCE NO PROCEEDINGS ARE PENDING. IN THIS LATTER SITUATION, THE ASSESSING OFFICER WILL REOPEN THE AS SESSMENTS OR REASSESSMENTS ALREADY MADE (WITHOUT HAVING THE NEED TO FOLLOW THE STRICT PROVISIONS OR COMPLYING WITH THE STRICT COND ITIONS OF SECTIONS 147, 148 AND 151) AND DETERMINE THE TOTAL INCOME OF THE ASSESSEE. SUCH DETERMINATION IN THE ORDERS PASSED U NDER SECTION 153A WOULD BE SIMILAR TO THE ORDERS PASSED IN ANY R EASSESSMENT, WHERE THE TOTAL INCOME DETERMINED IN THE ORIGINAL A SSESSMENT ORDER AND THE INCOME THAT ESCAPED ASSESSMENT ARE CLUBBED TOGETHER AND ASSESSED AS THE TOTAL INCOME. IN SUCH A CASE, TO RE ITERATE, THERE IS NO QUESTION OF ANY ABATEMENT OF THE EARLIER PROCEED INGS FOR THE SIMPLE REASON THAT NO PROCEEDINGS FOR ASSESSMENT OR REASSESSMENT WERE PENDING SINCE THEY HAD ALREADY CULMINATED IN A SSESSMENT OR REASSESSMENT ORDERS WHEN THE SEARCH WAS INITIATED O R THE REQUISITION WAS MADE.' (EMPHASIS SUPPLIED) 24. THE SAID JUDGMENT ALSO IN NO UNCERTAIN TERMS HOLDS THAT THE REASSESSMENT OF THE TOTAL INCOME OF THE COMPLETED A SSESSMENTS HAVE TO BE MADE TAKING NOTE OF THE UNDISCLOSED INCOME, IF A NY, UNEARTHED DURING THE SEARCH AND THE INCOME THAT ESCAPED ASSES SMENTS ARE REQUIRED TO BE CLUBBED TOGETHER WITH THE TOTAL INCO ME DETERMINED IN THE ORIGINAL ASSESSMENT AND ASSESSED AS THE TOTAL INCOM E. THE OBSERVATIONS MADE IN THE JUDGMENT CONTRASTING THE PROVISIONS OF DETERMINATION OF UNDISCLOSED INCOME UNDER CHAPTER XIVB WITH DETERMIN ATION OF TOTAL INCOME UNDER SECTIONS 153A TO 153C OF THE ACT HAVE TO BE READ IN THE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 34 CONTEXT OF SECOND PROVISO ONLY, WHICH DEALS WITH TH E PENDING ASSESSMENT/REASSESSMENT PROCEEDINGS. THE FURTHER OB SERVATIONS MADE IN THE CONTEXT OF DE NOVO ASSESSMENT PROCEEDINGS AL SO HAVE TO BE READ IN CONTEXT THAT IRRESPECTIVE OF THE FACT WHETHER AN Y INCRIMINATING MATERIAL IS FOUND DURING THE COURSE OF SEARCH, THE NOTICE AND CONSEQUENTIAL ASSESSMENT UNDER SECTION 153A HAVE TO BE UNDERTAKEN. 25. THE ARGUMENT OF THE LEARNED COUNSEL THAT THE AO IS ALSO FREE TO DISTURB INCOME, EXPENDITURE OR DEDUCTION DE HORS TH E INCRIMINATING MATERIAL, WHILE MAKING ASSESSMENT UNDER SECTION 153 A OF THE ACT IS ALSO NOT BORNE OUT FROM THE SCHEME OF THE SAID PROVISION WHICH AS NOTICED ABOVE IS ESSENTIALLY IN CONTEXT OF SEARCH AND/OR RE QUISITION. THE PROVISIONS OF SECTIONS 153A TO 153C CANNOT BE INTER PRETED TO BE A FURTHER INNINGS FOR THE AO AND/OR ASSESSEE BEYOND P ROVISIONS OF SECTIONS 139 (RETURN OF INCOME), 139(5) (REVISED RE TURN OF INCOME), 147 (INCOME ESCAPING ASSESSMENT) AND 263 (REVISION OF O RDERS) OF THE ACT. 26. THE PLEA RAISED ON BEHALF OF THE ASSESSEE THAT AS THE FIRST PROVISO PROVIDES FOR ASSESSMENT OR REASSESSMENT OF THE TOTA L INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN THE SIX ASSE SSMENT YEARS, IS MERELY READING THE SAID PROVISION IN ISOLATION AND NOT IN THE CONTEXT OF THE ENTIRE SECTION. THE WORDS 'ASSESS' OR 'REASSESS ' HAVE BEEN USED AT MORE THAN ONE PLACE IN THE SECTION AND A HARMONIOUS CONSTRUCTION OF THE ENTIRE PROVISION WOULD LEAD TO AN IRRESISTIBLE CONCLUSION THAT THE WORD 'ASSESS' HAS BEEN USED IN THE CONTEXT OF AN AB ATED PROCEEDINGS AND REASSESS HAS BEEN USED FOR COMPLETED ASSESSMENT PROCEEDINGS, WHICH WOULD NOT ABATE AS THEY ARE NOT PENDING ON TH E DATE OF INITIATION OF THE SEARCH OR MAKING OF REQUISITION AND WHICH WO ULD ALSO NECESSARILY SUPPORT THE INTERPRETATION THAT FOR THE COMPLETED A SSESSMENTS, THE SAME CAN BE TINKERED ONLY BASED ON THE INCRIMINATIN G MATERIAL FOUND DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUM ENTS. THUS, THE HON'BLE HIGH COURT HAS HELD THAT FOR THE COMPLETED ASSESSMENTS, THE SAME CAN BE TINKERED ONLY BASED ON THE INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH OR REQUI SITION OF DOCUMENTS. THE LD. CIT(A) HAS DECIDED THIS ISSUE IN PARA 7 TO 7.7 AS UNDER: ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 35 7. I HAVE PERUSED THE ORDER OF THE AO AND SUBMISSI ONS MADE IN THIS REGARD. I HAVE ALSO GONE THROUGH THE VARIOU S CASE LAWS CITED BY THE AR. FOR THE SAKE OF CONVENIENCE T HE LEGAL GROUND IS ADJUDICATED 1 ST AS IT GOES TO THE ROOT OF THE MATTER. 7.2 IN SUPPORT OF THE ADDITIONAL GROUND TAKEN/ CONT ENTION RAISED DETAILED WRITTEN SUBMISSION ARE MADE WHEREIN THE APPELLANT HAS CHALLENGED THE LEGAL VALIDITY OF THE ADDITION MADE IN THE ORDER FRAMED U/S 143(3)/153A. IT IS SUB MITTED THAT SUCH ADDITIONS CANNOT BE MADE AS THEY ARE NOT RELATABLE TO ANY INCRIMINATING SEIZED MATERIAL FOUN D DURING THE COURSE OF SEARCH. THE APPELLANT HAS CITED FOLLO WING JUDGMENTS IN SUPPORT OF THE CONTENTION TAKEN: 1) JAY STEEL LIMITED VS. ACIT (88 DTR 1) [RAJ HC] 2) KABUL CHAWLA VS. ACIT 380 ITR 573 (DEL HC) 3) CONTINENTAL WAREHOUSING CORPORATION 374 ITR 645 ETC. 7.3 I HAVE PERUSED THE ORDER OF THE AO AND SUBMISSI ONS MADE IN THIS REGARD. PERUSAL OF ASSESSMENT ORDER PASSED U/S 143(3)/153A SHOWS THAT ALL THE ADDITIONS MADE BY TH E AO ARE NOT RELATABLE TO ANY SEIZED MATERIAL. I ALSO FI ND THAT FOR THE A.YR THE ASSESSMENT STOOD COMPLETED ON THE DATE OF SEARCH. 7.4 THE ISSUE OF ADDITIONS MADE BY THE AO IN THE AS SESSMENT U/S 143(3)/153A WITHOUT ANY REFERENCE TO INCRIMINAT ING SEIZED MATERIAL WAS CONSIDERED BY THE HONBLE RAJAS THAN HIGH COURT IN THE CASE OF JAI STEEL LIMITED VS. ACIT (88 DTR 1). THE HONBLE COURT WAS OF THE VIEW IN CASE OF COMPLETED ASSESSMENTS NO ADDITION CAN BE MADE IF NO INCRIMINATING SEIZED MATERIAL IS FOUND DURING THE C OURSE OF SEARCH. THE RELEVANT OBSERVATION OF THE JUDGMENT IS REPRODUCED BELOW: ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 36 'IN THE FIRM OPINION OF THIS COURT FROM A PLAIN RE ADING OF THE PROVISION ALONG WITH THE PURPOSE AND PURPORT OF THE SAID PROVISION, WHICH IS INTRICATELY LINKED WITH SE ARCH AND REQUISITION UNDER SECTIONS 132 AND 132A OF THE ACT, IT IS APPARENT THAT: (A) THE ASSESSMENTS OR REASSESSMENTS, WHICH STAND ABATED IN TERMS OF II PROVISO TO SECTION 153A OF TH E ACT, THE AO ACTS UNDER HIS ORIGINAL JURISDICTION, FOR WH ICH, ASSESSMENTS HAVE TO BE MADE; (B) REGARDING OTHER CASES, THE ADDITION TO THE INC OME THAT HAS ALREADY BEEN ASSESSED, THE ASSESSMENT WILL BE M ADE ON THE BASIS OF INCRIMINATING MATERIAL AND JUST IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE COMPLETED ASSESS MENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR 13 D .B. INCOME TAX APPEAL NO.53/2011 JAI STEEL (INDIA), JODHPUR VS. ASSISTANT COMMISSIONER OF INCOME TAX, JODHPUR (ALONG WITH OTHER 16 SIMILAR MATTERS) REASSESSMENT CAN BE MADE.' 7.5 SIMILAR VIEW POINT WAS EXPRESSED BY THE HONBLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA VS. ACIT 380 ITR 573 (DEL HC). THE RELEVANT OBSERVATION OF HONBLE COURT COULD BE SEEN IN PARA 37 & 38 OF ORDER, SAME IS REP RODUCED BELOW: PARA 37. ON A CONSPECTUS OF SECTION 153A (1) OF TH E ACT, READ WITH THE PROVISOS THERETO, AND IN THE LIGHT OF THE LAW EXPLAINED IN THE AFOREMENTIONED DECISIONS, THE LEGA L POSITION THAT 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 MANDATORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR SIX AYS IMMEDIATELY PRECEDING T HE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 37 PREVIOUS YEAR RELEVANT TO THE AY IN WHICH THE SEARC H 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 EXER CISE. III. THE AO WILL EXERCISE NORMAL ASSESSMENT POWERS IN RESPECT OF THE SIX YEARS PREVIOUS TO THE RELEVANT A Y IN WHICH THE SEARCH TAKES PLACE. THE AO HAS THE POWER TO ASSESS AND REASSESS THE TOTAL INCOME OF THE AFOREMENTIONED SIX YEARS IN SEPARATE ASSESSMENT ORD ERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS THERE WIL L BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX AYS IN WHICH BOTH THE DISCLOSED AND THE UNDISCLOSE D INCOME WOULD BE BROUGHT TO TAX. IV. ALTHOUGH SECTION 153 A DOES NOT SAY THAT ADDITI ONS SHOULD BE STRICTLY MADE ON THE BASIS OF EVIDENCE FO UND IN THE COURSE OF THE SEARCH, OR OTHER POST-SEARCH MATERIAL OR INFORMATION AVAILABLE WITH THE AO WHICH CAN BE RELATED TO THE EVIDENCE FOUND, IT DOES NOT MEAN THAT THE ASSESSMENT CAN BE ARBITRARY OR MADE WITHOUT AN Y RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOU SLY ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY O N THE BASIS OF SEIZED MATERIAL. V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE CO MPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR REASSESSMENT CAN BE MADE. THE WORD 'ASSESS' IN SECTION 153 A IS RELATABLE TO ABATED PROCEEDINGS (I.E. THOSE PENDING ON THE DATE OF SEAR CH) AND THE WORD 'REASSESS' TO COMPLETED ASSESSMENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, T HE JURISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND TH E ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 38 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 MATERIAL EXISTING OR BROUGHT ON THE RECORD OF THE A O. VII COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE AO WHILE MAKING THE ASSESSMENT UNDER SECTION 153 A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITIO N OF DOCUMENTS OR UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. CONCLUSION 38. THE PRESENT APPEALS CONCERN 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 SEA RCH, NO ADDITIONS COULD HAVE BEEN MADE TO THE INCOME ALREAD Y ASSESSED. 7.6 THE ISSUE OF ADDITIONS MADE BY THE AO WHILE FRA MING THE ASSESSMENT U/S 143(3)/153A, IF NO INCRIMINATING MAT ERIAL IS FOUND DURING THE COURSE OF SEARCH WAS CONSIDERED BY HONBLE GUJARAT HIGH COURT IN THE CASE OF SOUMYA CONSTRUCTION PL VS CIT 387 ITR 529. IN ITS ORDER DA TED 14/03/2016 HONBLE COURT HAS CATEGORICALLY STATED T HAT, IN CASES OF COMPLETED ASSESSMENT, IF NO INCRIMINATING MATERIAL IS FOUND THEN NO ADDITIONS CAN BE MADE IN THE ASSES SMENT FRAMED U/S 153A OF THE ACT. THE RELEVANT PARA NO. 1 8 8S 19 OF THE COURT ORDER CAN BE REFERRED TO. SIMILAR VIEW OF ALSO TAKEN IN THE FOLLOWING JUDGME NTS, INCLUDING BY HON'BLE JAIPUR ITAT HON'BLE ITAT JAIPU R IN MANY CASES: ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 39 A. CONTINENTAL WAREHOUSING CORPORATION 374 ITR 645 B. PCIT VS. MEETA GUTGUTIA 152 DTR 153 C. VIJAY KUMAR D AGARWAL V/S DCIT IN IT(SS)A NOS. 153,154,155 & 156/AHD/2012 D. RATAN KUMAR SHARMA VS. DCIT ITA 797 & 798 /JAIPUR/2014 E. VIKRAM GOYAL VS. DCIT ITA 174/JAIPUR/2017 ETC F. JADAU JEWELLERS & MANUFACTURER PL VS ACIT (686/JAIPUR/2014) G. PRATEEK KOTHARI VS. ACIT (312/JAIPUR/2015. 7.7 CONSIDERING THE ABOVE I AM OF THE VIEW THAT AS THE ADDITIONS MADE BY AO ARE WITHOUT ANY REFERENCE TO T HE SEIZED MATERIAL, THEY ARE NOT LEGALLY TENABLE. THE SAME ARE THEREFORE DIRECTED TO BE DELETED. THE LEGAL GROUND TAKEN BY THE APPELLANT IS THUS ALLOWED. THE APPELLANT SUCCEE DS ON LEGAL GROUND. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES AS WEL L AS IN THE LIGHT OF BINDING PRECEDENTS AS DISCUSSED IN THE FORGOING PAR AGRAPHS, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE IMPUGNED ORDER OF THE LD. CIT(A) QUA THIS ISSUE. THEREFORE, AFTER DISCUSSING THE ISSUE IN LIGHT OF V ARIOUS DECISIONS ON THIS POINT THE TRIBUNAL HAS HELD THAT IN ABSENCE OF ANY INCRIMINATING MATERIAL THE ADDITION CANNOT BE MADE BY THE AO IN THE PROCEE DINGS U/S 153A OF THE ACT WHEN THE ASSESSMENT FOR THE YEAR WAS NOT PE NDING AS ON THE DATE OF SEARCH. FOLLOWING THE DECISION AS RELIED UP ON THE LD. AR AS WELL AS THE DECISION OF THIS TRIBUNAL IN CASE OF DCIT VS . M/S A.M. EXPORTS ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 40 (SUPRA) WE DELETED THE ADDITION MADE BY THE AO ON A CCOUNT OF LONG TERM CAPITAL GAIN. 6. SINCE, WE HAVE DELETED THE ADDITION ON THE LEGAL GROUND THEREFORE, WE DO NOT PROPOSE TO GO INTO THE MERITS OF THE ISSUE REGARDING THE GENUINENESS OF THE TRANSACTIONS AS RA ISED IN GROUND NO. 1.1. 7. FOR THE ASSESSMENT YEAR 2015-16, THE ASSESSEE HA S RAISED THE FOLLOWING GROUNDS:- 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS.7,14,920/- BY TREATING THE PEAK OF I NCOMING CASH NOTED ON PG 29 TO 40 OF ANNEXURE A-1 AND PG 15-24 O F ANNEXURE A-5 AS THE PROFIT FROM UNACCOUNTED TRANSACTIONS BY NOT APPRECIATING THE FACT THAT ALL THESE ENTRIES ARE DU LY RECORDED IN THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE. H E HAS FURTHER ERRED IN CONFIRMING THE ADDITION BY NOT ACCEPTING T HE CONTENTION OF ASSESSEE THAT NO SEPARATE ADDITION IS CALLED FOR AS IT IS COVERED BY THE EXTRA INCOME OFFERED IN RESPECT OF ANNEXURE A-2. 2. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN UPHOLDING THE FINDING OF AO THAT RECEIPT OF RS.2 LACS RECORDED ON PG 183 OF ANNEXURE A-24 IS THE UNACCOUNTED RECEIPT OF THE ASS ESSEE. 2.1 THE LD. CIT(A) HAS FURTHER ERRED ON FACTS AND I N LAW IN APPLYING THE N.P. RATE OF LAST YEAR, I.E. 13.28% ON THE ALLEGED UNACCOUNTED RECEIPT OF RS.2 LACS AS AGAINST N.P. RA TE OF 3.92% DECLARED BY THE ASSESSEE AND THEREBY CONFIRMING THE ADDITION OF RS.26,560/-. ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 41 3. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN UPHOLDING THE FINDING OF AO THAT AMOUNT OF RS.6,32,171/-, BEING T HE DIFFERENCE BETWEEN THE AMOUNT OF RS.1,73,72,171/- NOTED ON PG 2 TO 12 OF ANNEXURE A-2 AND THE AMOUNT OF RS.1,67,00,000/- ALR EADY SURRENDERED BY THE ASSESSEE IN THE RETURN IS THE UN ACCOUNTED EXPENDITURE OF THE ASSESSEE. 3.1 THE LD. CIT(A) HAS FURTHER ERRED ON FACTS AND I N LAW IN APPLYING THE N.P. RATE OF LAST YEAR, I.E. 13.28% ON THE ALLEGED UNACCOUNTED EXPENDITURE OF RS.6,32,171/- AS AGAINST N.P. RATE OF 3.92% DECLARED BY THE ASSESSEE AND THEREBY CONFIRMI NG THE ADDITION OF RS.83,952/-. HE HAS FURTHER ERRED IN CO NFIRMING THE ADDITION BY NOT ACCEPTING THE CONTENTION OF ASSESSE E THAT NO SEPARATE ADDITION IS CALLED FOR AS IT IS COVERED BY THE EXTRA INCOME OFFERED IN RESPECT OF ANNEXURE A-2. 4. THE ASSESSEE CRAVES TO AMEND, ALTER AND MODIFY A NY OF THE GROUNDS OF APPEAL 5. THE APPROPRIATE COST BE AWARDED TO BE ASSESSEE. 8. GROUND NO. 1 IS REGARDING UNACCOUNTED TRANSACTIO N DETECTED DURING THE COURSE OF SEARCH AND SEIZURE ACTION AS R ECORDED IN THE LOOSE PAPERS AND OTHER INCRIMINATING MATERIAL FOUND AND S EIZED AND WAS MARKED AS ANNEXURE AS-2 AND ANNEXURE A-1 TO A-6. TH E ASSESSEE HAS ADMITTED UNDISCLOSED INCOME OF RS. 1,35,00,000/- IN THE STATEMENT RECORDED U/S 132(4) AND SECTION 131 OF THE ACT. THE RELEVANT DETAILS OF THE UNDISCLOSED INCOME AND SEIZED MATERIAL ARE AS U NDER:- F.Y. ANNEXURE PAGE NO. UNDISCLOSED INCOME 2014-15 AS-2 2 RS.20,00,000/- ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 42 2014-15 AS-2 6 RS.17,00,000/- 2014 - 15 AS - 2 30 RS.15,00,000/ - 2014-15 AS-2 40 RS.13,00,000/- 2014 - 15 AS - 2 53 RS.70,00,000/ - TOTAL RS.1,35,00,000/- FURTHER THE ASSESSEE SURRENDERED RS.2,80,00,000/- D URING THE STATEMENT RECORDED U/S 132(4) ON THE BASIS OF DOCUM ENTS FOUND AT THE BUSINESS PREMISES, DETAILS OF WHICH ARE AS UNDER:- F.Y. ANNEXURE PAGE NO. UNDISCLOSED INCOME REMARKS 2014-15 A-2 4 RS.30,00,000/- RENOVATION OF HOUSE 2014 - 15 A - 2 5 RS.10,00,000/ - ENGAGEMENT OF NE PHEW 2014-15 A-2 6 RS.60,00,000/- MINES ADVANCES 2014-15 A-2 10 RS.10,00,000/- KOBELCO MACHINE ADVANCE 2014-15 A-2 10 RS.40,00,000/- LAND ADVANCE 2014-15 A-2 12 RS.5,00,000/- LAND ADVANCE 2014 - 15 A - 2 12 RS.12,00,000/ - STONES MINES ADVANCE 2014-15 A-2 13 RS.20,00,000/- MINES ADVANCE 2014 - 15 A - 2 RS.93,00,000/ - MISC.SURRENDER TOTAL RS.2,80,00,000/- ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 43 THIS IS THE YEAR OF SEARCH AND THEREFORE, THE ASSES SEE FILED ITS RETURN OF INCOME ON 30.10.2015 DECLARING TOTAL INCOME OF RS. 3,48,32,980/-. THE AO IN THE ASSESSMENT PROCEEDING NOTED THAT SOME OF THE ENTRIES IN THE SEIZED MATERIAL ARE NOT ACCOUNTED IN THE BOOKS OF A CCOUNTS OF THE ASSESSEE AND ACCORDINGLY, HE PROPOSED TO MAKE THE A DDITION OF RS. 30,09,720/- IN RESPECT OF ANNEXURE-A-5. ON APPEAL, THE LD. CIT(A) HAS RESTRICTED THE ADDITION BY CONSIDERING THE PEAK OF INCOMING CASH AT RS. 7,14,920/-. 9. BEFORE US, THE LD. AR OF THE ASSESSEE HAS SUBMIT TED THAT THE ASSESSEE HAS RECORDED EACH AND EVERY TRANSACTION ME NTIONED AT PAGES 29-40 OF ANNEXURE A-1 AND PAGES 15-24 OF ANNEXURE A -5 IN THE REGULAR BOOKS OF ACCOUNTS. IN FACT, THE ASSESSEE PREPARED S EPARATE IMPREST ACCOUNT OF THESE ANNEXURES IN THE REGULAR CASH BOOK WHICH RECORDS ALL THESE TRANSACTIONS. COPY OF THE IMPREST ACCOUNT IS ENCLOSED AT PB 39- 43. IN ASSESSMENT PROCEEDINGS, ASSESSEE FILED STATE MENT EXPLAINING EACH AND EVERY ENTRY OF CASH AND BANK AND THE PURPO SE OF THE SAME. THE AO ACCEPTED THE BANK TRANSACTION BUT IGNORED TH E CASH TRANSACTION SIMPLY BY STATING THAT THE SAME IS NOT RECORDED WHI CH IS FACTUALLY INCORRECT. THE LD. CIT(A) TAXED THE PEAK FOR INCOMI NG CASH RS.7,14,920/- BY INCORRECTLY HOLDING THAT ASSESSEE COULD NOT IDENTIFY ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 44 EACH AND EVERY TRANSACTION FROM THESE SEIZED PAPERS . WHILE HOLDING SO, THE LD. CIT(A) HAS NOT POINTED OUT ANY SPECIFIC TRA NSACTION WHICH HAS NOT BEEN EXPLAINED BY ASSESSEE. HENCE, WHEN ALL THE SE TRANSACTIONS ARE DULY RECORDED IN THE REGULAR BOOKS, SEPARATE ADDITI ON FOR THE SAME IS UNCALLED FOR AND BE DELETED. THE LD. AR FURTHER PO INTED OUT THAT ASSESSEE HAS SEPARATELY OFFERED A SUM OF RS.1,35,00 ,000/- ON THE BASIS OF ANNEXURE A-2. THE PEAK OF ANNEXURE A-2 WAS ONLY RS.90,35,400/-. HOWEVER, THE ASSESSEE OFFERED RS.1,35,00,000/- TO C OVER THE DISCREPANCIES IN OTHER ANNEXURES. THE PEAK OF PAGE 29-40 TO A-1 AND PAGE 15-24 OF ANNEXURE A-5 IS ONLY RS.7,14,920/- WH ICH IS COVERED BY THE EXTRA INCOME OFFERED IN RESPECT OF ANNEXURE A-2 . HENCE, NO SEPARATE ADDITION IN RESPECT OF THESE PAPERS IS CAL LED FOR. THE LD. AR FURTHER SUBMITTED THAT ASSESSEE HAS OFFERED AN INCO ME OF RS.2,80,00,000/- AS PER ANNEXURE A-2 WHICH INCLUDES RS.93,00,000/- ON ACCOUNT OF MISCELLANEOUS SURRENDER. THEREFORE, NO S EPARATE ADDITION OF RS.7,14,920/-SHOULD BE MADE AS THE SAME IS COVERED BY THE DISCLOSURE ALREADY MADE BY THE ASSESSEE. 10. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED TH AT APART FROM SURRENDERED MADE BY THE ASSESSEE ON THE BASIS OF TH E SEIZED MATERIAL THE AO DURING THE ASSESSMENT PROCEEDINGS WHICH IS A REGULAR ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 45 ASSESSMENT HAS FURTHER CONDUCTED INQUIRY AND FOUND SOME OF THE ENTRIES TO THE EXTENT OF RS. 30,09,720/- WERE NOT R ECORDED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE THEREFORE, THE AO MADE THE ADDITION. THE SURRENDERED MADE BY THE ASSESSEE SHALL HAVE NO BEAR ING ON THE SCRUTINY ASSESSMENTS WHEN THOSE TRANSACTIONS WERE N OT RECORDED BY THE ASSESSEE. HE HAS RELIED UPON THE ORDERS OF THE AUTH ORITIES BELOW. 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS THE RELEVANT MATERIAL ON RECORD. THE AO HAS MADE THE ADDITION OF RS. 30,09,720/- WHICH IS THE AMOUNT OF THE ENTRIES RECORDED IN THE SEIZED MATERIAL BUT WERE NOT RECORDED IN THE BOOKS OF ACCOUNTS OF THE A SSESSEE. THEREFORE TO THE EXTENT OF THE SAID AMOUNT THE AO HAS CONSIDE RED IT IS OVER AND ABOVE THE SURRENDERED INCOME OF THE ASSESSEE. THE L D. CIT(A) RESTRICTED THE ADDITION BY NOTING THE FACT THAT THESE ENTRIES ARE ROUGH COPY OF DAY BOOK/ CASH BOOK OF THE ASSESSEE AND ALL THE TRANSAC TIONS AS RECORDED APPEARS TO BE ON DAY TO DAY BASIS. THEREFORE, CONSI DERING INFLOW AS WELL AS OUT FLOW OF CASH AND CHEQUES AS RECORDED IN THE SEIZED PAPERS THE LD. CIT(A) TOOK THE PEAK OF INCOMING CASH AT RS.7,14,92 0/- AND SUSTAINED THE ADDITION TO THAT EXTENT. WE FIND THAT IN THE ST ATEMENT RECORDED U/S 132(4) AS WELL AS SECTION 131 OF THE ACT THE ASSESS EE APART FROM SPECIFIC AMOUNTS HAS ALSO SURRENDERED RS. 93,00,000 /- ON ACCOUNT OF ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 46 SUNDRY/ MISCELLANEOUS ITEMS OF UNACCOUNTED EXPENSES OR IRREGULARITY IN THE BOOKS OF ACCOUNTS IF ANY. THE SAID AMOUNT OF RS . 93,00,000/- WAS SURRENDERED BY THE ASSESSEE TO COVER ANY IRREGULARI TY IN THE CLAIM IN THE BOOKS OF ACCOUNTS. HENCE, THE DISALLOWANCE MADE BY THE AO WHICH ARE RESTRICTED BY THE LD. CIT(A) IS VERY WELL COVERED B Y THE SAID AMOUNT OF RS. 93,00,000/- WHEN THE AO HAS NOT POINTED OUT ANY OTHER IRREGULARITY OR DISCREPANCY IN RESPECT OF ANY OTHER YEAR COVER U NDER THE SEARCH TO CONSUME OR UTILIZE THE SAID SUNDRY AMOUNT OF RS. 93 ,00,000/- SURRENDERED BY THE ASSESSEE. ACCORDINGLY, THE ADDIT ION RESTRICTED BY THE LD. CIT(A) IS NOT SUSTAINABLE WHEN THE ASSESSEE HAS ALREADY SURRENDERED EXTRA AMOUNT OF RS. 93,00,000/- TO COVER SUCH IRREG ULARITY. 12. GROUND NO. 2 IS REGARDING THE ADDITION OF RS. 2,00,000/- ON ACCOUNT OF RECEIPT RECORDED AT PAGE 183 OF ANNEXUR E A-24 TREATING AS UNACCOUNTED RECEIPT OF THE ASSESSEE WHICH WAS RESTR ICTED BY THE LD. CIT(A) BY APPLYING N.P. RATE OF 13.28% ON THE SAID AMOUNT WHICH COMES TO RS. 26,560/-. 13. BEFORE US, THE LD. AR OF THE ASSESSEE HAS SUBMI TTED THAT THE ASSESSEE MAY POINT OUT THAT THIS IS THE IMPREST ACC OUNT MAINTAINED BY EMPLOYEE OF THE COMPANY WHO KEPT THESE DETAILS FOR MAKING DAY TO DAY PAYMENT FOR VARIOUS SITES. ON THESE DATES THE ASSE SSEE IS HAVING ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 47 SUFFICIENT FUNDS AS PER THE CASH BOOK. THE EMPLOYEE ON GIVING ACCOUNT OF ACTUAL EXPENSES INCURRED, RECORDED THE SAME IN T HE BOOKS OF ACCOUNTS. THE PAPER ALSO INDICATES THAT PAYMENT HAS BEEN MADE TO VARIOUS PERSON. HENCE, ON SUCH INTERMEDIATELY ACCOU NTS NO ADDITION IS CALLED FOR. THE LD. AR FURTHER SUBMITTED THAT ASSES SEE HAS OFFERED AN INCOME OF RS.3,22,00,000/- IN THE COMPUTATION OF T OTAL INCOME. IT COMPRISES OF UNDISCLOSED INCOME OF RS.1,35,00,000/- AND ALSO THE UNDISCLOSED INVESTMENT OF RS.2,80,00,000/- WITHOUT CLAIMING ANY SET-OFF OF INCOME AGAINST THE INVESTMENT. THE AMOUNT OF RS. 2,80,00,000/- INCLUDES RS.93,00,000/- ON ACCOUNT OF MISCELLANEOUS SURRENDER. THEREFORE, NO SEPARATE ADDITION OF RS.26,650/- SHOU LD BE MADE AS THE SAME IS COVERED BY THE DISCLOSURE ALREADY MADE BY THE ASSESSEE. 14. ON THE OTHER HAND, THE LD. DR HAS RELIED UPON T HE ORDERS OF THE AUTHORITIES BELOW. 15. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS THE RELEVANT MATERIAL ON RECORD. THOUGH THE ASSESSEE HAS EXPLAIN ED THAT THIS AMOUNT OF RS. 2,00,000/- IS NOTHING BUT REPRESENTING THE I MPREST ACCOUNT MAINTAINED BY THE EMPLOYEES OF THE ASSESSEE WHO KEE P THESE DETAILS FOR MAKING DAY TO DAY PAYMENT FOR VARIOUS SITES. HO WEVER, SINCE THE ASSESSEE HAS ALREADY SURRENDERED ON ACCOUNT OF MISC ELLANEOUS/ ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 48 IRREGULARITY OF RS. 93,00,000/- THEN THE AMOUNT OF RS. 26,650/- CONFIRMED BY THE LD. CIT(A) IS ALREADY COVERED BY T HE SAID DISCLOSURE MADE BY THE ASSESSEE ACCORDINGLY, THE SAME IS DELET ED. 16. GROUND NO. 3 IS REGARDING THE ADDITION OF RS. 6 ,32,171/- MADE BY THE AO ON ACCOUNT OF DIFFERENCE BETWEEN THE SURREND ERED OF RS. 1,73,72,171/- RECORDED AT PAGE 2 TO 12 OF ANNEXURE A-2 WHICH WAS RESTRICTED BY THE LD. CIT(A) BY APPLYING THE NP RAT E AT 13.28%. 17. BEFORE US, THE LD. AR OF THE ASSESSEE HAS SUBM ITTED THAT THE ASSESSEE MAY POINT OUT THAT THE DIFFERENCE OF RS.6, 32,171/- REPRESENTS PAYMENT MADE FOR PERSONAL EXPENSES/OFFICE EXPENSES/ SITE EXPENSES WHICH ARE DULY RECORDED IN THE REGULAR BOOKS OF ACC OUNTS. IN ASSESSMENT PROCEEDING, THE ASSESSEE HAS PRODUCED AL L THE VOUCHERS FOR THE SAME WHICH ARE REJECTED SIMPLY FOR THE REASON T HAT THE SAME WERE RECORDED AFTER SEARCH. THE LOWER AUTHORITIES DID NO T FOUND ANY DEFECT IN THE BOOKS WHICH SHOWS SUFFICIENT BALANCE FOR MAKING THE PAYMENT AS PER THESE ANNEXURES. HENCE THE ADDITION CONFIRMED B Y LD. CIT(A) IS UNCALLED FOR AND BE DELETED. THE LD. AR FURTHER POI NTED OUT THAT ASSESSEE HAS SEPARATELY OFFERED A SUM OF RS.1,35,00 ,000/- ON THE BASIS OF ANNEXURE A-2. THE PEAK OF ANNEXURE A-2 WAS ONLY RS.90,35,400/-. HOWEVER, THE ASSESSEE OFFERED RS.1,35,00,000/- TO C OVER THE ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 49 DISCREPANCIES IN OTHER ANNEXURES. THE DIFFERENCE AS PER VARIOUS PAPERS OF IN THIS REGARD IS ONLY RS.6,32,171/- WHICH IS CO VERED BY THE EXTRA INCOME OFFERED IN RESPECT OF ANNEXURE A-2. HENCE NO SEPARATE ADDITION IN RESPECT OF THESE PAPERS IS CALLED FOR. IT IS FU RTHER SUBMITTED THAT ASSESSEE HAS OFFERED AN INCOME OF RS.2,80,00,000/- AS PER ANNEXURE A- 2 WHICH INCLUDES RS.93,00,000/- ON ACCOUNT OF MISCE LLANEOUS SURRENDER. THEREFORE, NO SEPARATE ADDITION OF RS.7,14,920/-SHO ULD BE MADE AS THE SAME IS COVERED BY THE DISCLOSURE ALREADY MADE BY THE ASSESSEE. 18. ON THE OTHER HAND, THE LD. DR HAS RELIED UPON T HE ORDERS OF THE AUTHORITIES BELOW. 19. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS THE RELEVANT MATERIAL ON RECORD. THE ASSESSEE IN THE STATEMENT R ECORDED U/S 132(4) OF THE ACT HAS MADE SURRENDERED OF RS. 1,67,00,000/ - ON ACCOUNT OF UNACCOUNTED EXPENDITURE OF THE ASSESSEE. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE AO NOTED THAT THE ACTUA L ACCOUNT OF EXPENDITURE RECORDED IN THE SEIZED MATERIAL IS RS. 1,73,72,171/- AND THERE IS EXCESS EXPENDITURE OF RS. 6,32,171/- WHICH WAS ADDED TO THE INCOME OF THE ASSESSEE. THE LD.CIT(A) RESTRICTED TH E ADDITION BY APPLY THE NP @ 13.28% WHICH COMES TO RS. 83,952/-.WE FIND THAT THIS AMOUNT OF RS. 83,952/- IS ALSO COVERED BY THE MISCE LLANEOUS ITA NO. 474 TO 476/JP/2018 SHRI BANNA LAL JAT VS. ACIT 50 SURRENDERED OF RS. 93,00,000/- BY THE ASSESSEE ON A CCOUNT OF THE SURDRY/IRREGULARITY IN THE ACCOUNTS OF THE ASSESSEE . ACCORDINGLY WITHOUT GOING INTO THE OTHER CONTENTION RAISED BY THE LD AR WHEN THIS AMOUNT IS ALSO COVERED BY THE SAID MISCELLANEOUS SURRENDERED THE ADDITION IS NOT JUSTIFIED AND THE SAME IS DELETED. IN THE RESULT, THESES APPEALS FILED BY THE ASSESSE E ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/04/2019. SD/- SD/- JESK LH0 KEKZ FOT; IKY JKO (RAMESH. C. SHARMA) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 24/04/2019. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI BANNA LAL JAT, BHILWARA. 2. IZR;FKHZ@ THE RESPONDENT- ACIT, CENTRAL CIRCLE, AJMER. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 474 TO 476/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR
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