ACIT, New Delhi V. M/s. Saldi Chits Pvt. Ltd., New Delhi

ITA 6697/DEL/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5241 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 11-05-2017
• Assessment Year: 2006-2007
• Appeal Filed On: 20-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Assessee Lawyers: KAPIL GOYAL
• Keywords: Unexplained investment; Unexplained expenditure; Search and seizure; Document seized; Principle of natural justice; Procedural lapse; Documents seized
• Section: 69C; 143(3); 142(1); 153A; 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: G, NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMB ER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NOS . 6697, 6698 & 6699/DEL/2013 AY: 2006-07, 2007-08 AND 2008-09 ACIT, CENTRAL CIRCLE 17 VS. SALDI CHITS PVT.LTD. NEW DELHI B 340, 2 ND FLOOR, HARI NAGAR NEW DELHI 110 064 PAN: AAJCS 6818 G AND CROSS OBJECTION NO. 396/DEL/ 2014 (IN ITA 6697/DEL/1 3) CROSS OBJECTION NO. 397/DEL/ 2014 (IN ITA 6698/DEL/1 3) CROSS OBJECTION NO. 398/DEL/ 2014 (IN ITA 6699/DEL/1 3) SALDI CHITA P.LTD. VS. ACIT, CC 17 NEW DELHI NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. KAPIL GOYAL, ADV. DEPARTMENT BY : SH. SS RANA, CIT (DR). DATE OF HEARING : 15 TH MAY, 2017 DATE OF PRONOUNCEMENT : 11TH AUGUST, 2017 ORDER PER BENCH THE ABOVE THREE APPEALS FILED BY THE REVENUE ARE DIRECTED AGAINST SEPARATE ORDERS OF THE LD.CIT(A)-II, NEW DELHI DATED 18.10.2013 FOR A.Y. 2006-07, ORDER DATED 21.10.20 13 FOR A.Y. 2007-08 AND ORDER DT. 21.10.2013 FOR A.Y. 2008-09 . THE CROSS OBJECTION NOS. 396, 397 AND 298/DEL/14 A RE FILED BY THE ASSESSEE AGAINST THE ABOVE THREE APPEALS. FOR THE SAKE OF CONVENIENCE ALL THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON O RDER. 2. THE GROUNDS OF APPEALS BY THE REVENUE IN ITA NO. 6697/DEL/2013 FOR AY 2006-07 ARE AS UNDER: 1. THE CIT(A) ERRED IN LAW AND ON FACTS IN DELETIN G THE ADDITION OF RS.40,59,650/- AS DISALLOWANCE OF PURCHASES U/S 69C OF THE ACT. 2. THE CIT(A) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.36,36,180/- ON ACCOUNT OF BOGUS CASH CREDIT U /S 68 OF THE ACT. 3. (A) THE ORDER OF THE CIT(A) IS ERRONEOUS AND N OT TENABLE IN LAW AND ON FACTS. (B) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AME ND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE O F HEARING OF THE APPEAL. THE GROUNDS RAISED BY THE REVENUE IN THE OTHER TWO APPEALS ARE ALSO SIMILAR EXCEPT THE DIFFERENCE IN THE AMOUNTS. 2.1 GROUNDS RAISED IN C.O.NO.396/DEL/2014 (IN ITA 6697/DEL/13) FOR THE A.Y. 2006-07 READ AS UNDER: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT(A) HAS FAILED TO APPR ECIATE THAT THE NOTICE ISSUED U/S. 153C AND ASSESSMENT ORDER PASSED BY THE LD.AO U/S. 153C/143(3) IS ILLEGAL, BAD IN LAW, WITH OUT JURISDICTION AND WRONG ON FACTS. THE ADDITIONS MADE ARE UNJUST, UNLAWFUL AND ARBITRARY AND ARE MADE AGAINST THE PRI NCIPLES OF NATURAL JUSTICE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT(A) HAS FAILED TO APP RECIATE THAT THE LD.AO WAS NOT JUSTIFIED TO IGNORE THE SUBMISSIONS O F THE APPELLANT THAT THE ASSESSMENT PROCEEDINGS FOR THE Y EAR UNDER APPEAL WAS NOT PENDING ON THE DATE OF THE RECORDING OF SATISFACTION U/S. 153C AND SINCE THE SAME DIDN'T AB ATE, THE PROCEEDINGS U/S. 153C OF THE I.T. ACT IN THIS CASE ARE BAD IN LAW AND DESERVES TO BE QUASHED. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD.CIT (A) HAS FAILED TO APP RECIATE THAT THE ASSESSMENT FRAMED BY LD.AO IS AGAINST THE STATUTORY PROVISIONS OF THE I.T. ACT AND WITHOUT COMPLYING THE PROCEDURE S PRESCRIBED U/S. 153C OF THE I.T. ACT AND AS SUCH THE ASSESSMEN T BEING BAD IN LAW DESERVES TO BE QUASHED. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISIONS OF LAW, THE LD. CIT(A) HAS FAILED TO APP RECIATE THAT THE LD.AO WAS NOT JUSTIFIED TO IGNORE THE SUBMISSIONS O F THE APPELLANT THAT ASSESSMENT U/S. 153C OF THE I. T. AC T BE RESTRICTED TO ASSESSMENT IN RESPECT OF SEIZED DOCUM ENTS OF INCRIMINATING NATURE IN THE CASE OF THE APPELLANT F OR ONLY THE YEAR TO WHICH SAID DOCUMENTS RELATES TO, AND IN ABS ENCE OF ANY SUCH INCRIMINATING SEIZED DOCUMENT IN THE CASE OF A PPELLANT, ASSESSMENT FRAMED U/S. 153C OF THE I.T. ACT FOR THE YEAR UNDER CONSIDERATION, IS BAD IN LAW AND DESERVE TO BE QUAS HED. 5. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN HOLD ING THE CONCLUSION THAT THE AUDITED BOOKS NOTWITHSTANDING , THE BOOK RESULTS ARE REQUIRED TO BE REJECTED, SINCE THE NARR ATIONS ARE ARTIFICIAL, SHAM AND NOT REFLECTIVE OF THE ACTUAL BUSINESS/COMMERCIAL TRANSACTIONS. HOWEVER, THE LD.C IT(A) STILL RELYING ON THESE BOOK RESULTS FOR GIVING DIRECTION S TO THE AO FOR THE PURPOSE OF CALCULATING THE PEAK FROM THE ENTRI ES IN THE CASH BOOK OF THE APPELLANT FOR THE RELEVANT YEAR. 6. THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF T HE CASE, LD.CIT (A) HAS ERRED IN DISREGARDING THE PURCHASES OF RS. 40,59,650/- AND SALES OF RS. 36,36,180/- CLAIMED BY THE ASSESSEE COMPANY. 7. A) THAT ON THE FACTS AND ON THE CIRCUMSTANCES OF THE CASE AND THE PROVISION OF LAW, THE LD. CIT (A) HAS ERRED IN WRONGLY DIRECTING THE AO TO WORK OUT THE PEAK FROM THE ENTR IES IN THE CASH BOOR OF THE APPELLANT FOR THE RELEVANT YEAR AN D MAKE A SINGULAR ADDITION OF THE SAID AMOUNT, AS UNEXPLAINE D INVESTMENT/EXPENDITURE, IGNORING THE FACT THAT THE SAME HAS DULY BEEN ENTERED IN THE AUDITED BOOKS OF ACCOUNTS OF THE APPELLANT FOR THE YEAR UNDER CONSIDERATION; B) THAT THE LD. CIT (A) DID NOT GIVE SUFFICIENT OPP ORTUNITY OF BEING HEARD TO THE APPELLANT AND IGNORED THE CONCEP T OF 'REAL INCOME' AND WRONGLY DIRECTED THE AO TO WORK OUT THE PEAK FROM THE ENTRIES IN THE CASH BOOKS OF THE APPELLANT COM PANY FOR THE RELEVANT YEAR, WITHOUT GRANTING THE CREDIT OF THE P EAK OF FINANCIAL TRANSACTIONS AS PER THE CASH BOOKS FOR T HE PRECEDING YEARS. 7.THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE VARIOUS OBSERVATIONS AND FINDINGS OF THE LD.CIT(A) AND LD. AO IN THE IMPUGNED APPELLATE ORDER AND ASSESSMENT ORDER, RESP ECTIVELY, IS IRRELEVANT AND VITIATED IN THE LAW. 9. THAT THE LD. CIT(A) HAS ERRED IN IGNORING THE FA CT THAT THE AO HAS ERRED BOTH ON FACTS AND IN LAW, IN USING STA TEMENT OF VARIOUS PERSONS WITHOUT GIVING A COPY OF THE SAME A ND OPPORTUNITY TO CROSS EXAMINE. 10. THAT THE LD.CIT(A) HAS ERRED IN IGNORING THE E XPLANATION GIVEN, EVIDENCES AND MATERIAL PLACED AND AVAILABLE ON RECORD. THE SAME HAS NOT BEEN PROPERLY CONSIDERED AND JUDIC IALLY INTERPRETED AND THE SAME DO NOT JUSTIFY THE ADDITIONS/DISALLOWANCES MADE. THE ADDITIONS HAVE BE EN SUSTAINED WITH PRESET MIND OF THE LD. CIT(A) AND H ER ORDER IS BASED ON SURMISES, CONJECTURES AND SUSPICION. 11. THAT THE RESPONDENT CRAVES THE RIGHT TO AMEND, APPEND, DELETE ANY OR ALL GROUNDS OF APPEAL. 3. FOR THE SAKE OF CONVENIENCE, WE ARE TAKING UP TH E FACTS FOR A.Y. 2006-07 AS THE LEAD CASE. FOR THE OTHER YEARS THE F ACTS ARE SIMILAR. THE ASSESSEE COMPANY BELONGS TO THAPAR HOMES GROUP. IN RESPECT OF M/S THAPAR HOMES GROUPS A SEARCH WAS CONDUCTED A T THE PREMISES OF THE ASSESSEE ON 20/10/2008. SOME DOCUM ENTS BELONGING TO THE ASSESSEE WERE FOUND. SATISFACTION NOTE FOR ISSUING NOTICE U/S 153C OF THE INCOME TAX ACT, 1961 WAS ISS UED ON 26/10/2010 REQUIRING THE ASSESSEE TO FURNISH RETURN OF INCOME. IN RESPONSE TO THE SAME, THE ASSESSEE FURNISHED RETURN OF INCOME ON 18/11/2010 DECLARING INCOME OF RS.6,430/-. NOTICE U /S 142(1) & 143(2) ALONG WITH QUESTIONNAIRE WERE ISSUED ON 25/1 1/2010. THE ASSESSEE FILED DETAILS AS ASKED BY THE ASSESSING OF FICER. THE ASSESSING OFFICER OBSERVED THAT THE COMPANY WAS INC ORPORATED ON 21/9/1982 AND WAS FILING ITS RETURN WITH INCOME TAX DEPARTMENT REGULARLY. THE ASSESSING OFFICER NOTED THAT THE AS SESSEE DECLARED CLOSING STOCK OF RS.10,78,36,450/- AS ON 31/3/2005 WHICH FORMS THE OPENING STOCK FOR THE PREVIOUS YEAR UNDER CONSI DERATION. DURING THE CURRENT YEAR, THE ASSESSEE PURCHASED TEX TILE GOODS OF RS. 40,59,615/- AND MADE SALES OF RS.36,36,180/-. THE ASSESSEE WAS DIRECTED TO PROVE ITS TRADING ACTIVITIES AND TO PRO DUCE SALES TAX RECORDS BY THE ASSESSING OFFICER. IN REPLY, THE AS SESSEE SUBMITTED THAT SINCE THE ASSESSEE IS DEALING WITH TAX FREE GO ODS THEREFORE, THERE IS NO NECESSITY FOR FILING SALES TAX RETURN. THE ASSESSING OFFICER OBSERVED THAT THERE WAS NO INDEPENDENT PROO F OF SALE/PURCHASE OF THE GOODS EXCEPT THE DECLARATION O F THE ASSESSEE BEFORE HIM AND ALL THE PURCHASES AND SALES WERE MAD E IN CASH ONLY. THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER HELD THAT IN THE CIRCUMSTANCES OF THE CASE AND THE STATEMENTS TAKEN DURING THE ENQUIRIES OF NEIGHBORS OF THE ASSESSEE INDICATED TH AT THE BUSINESS WAS NOT GENUINE. THE ASSESSING OFFICE HELD THAT AL L THE PURCHASES AND SALES ARE IN CASH AND THE ITEMS PURCHASED AND S OLD WERE TEXTILE GOODS AND FABRICS. THE ASSESSING OFFICER FURTHER H ELD THAT THERE IS NO NAME OF ANY COMPANIES IN THESE PRODUCTS. SHWA LS ARE PURCHASED AND SOLD IN PIECES AND REST OTHER ITEMS A RE SOLD IN METERS. IT WAS FURTHER OBSERVED BY THE ASSESSING OFFICER TH AT THE PURCHASES AND SALES ARE WITHIN M/S THAPAR HOMES GRO UPS. INVENTORIES OF FABRICS AND TEXTILE GOODS SHOWN IN T HE BALANCE SHEET AS THE CLOSING STOCK OF THE LAST YEAR STANDS AT RS. 10,78,36,450/- AND FOR THIS ASSESSMENT YEAR THE FIGURE IS RS.10,8 6,12,500/- WHICH WAS ALMOST THE SAME. THEREFORE, PURCHASE AND SALES WERE ONLY OUT OF CURRENT YEAR TRANSACTIONS WHICH WERE HELD UNVE RIFIABLE AND BOGUS. THE ASSESSING OFFICER FURTHER HELD THAT THE ASSESSEE COMPANY HAD NO BANK ACCOUNT AS PER THE ASSESSEES R EPLY DATED 13/12/2010. THEREFORE, PURCHASES AND SALES WERE UN VERIFIABLE. THEREFORE, ENTIRE PURCHASES OF RS.40,59,650/- WERE HELD BOGUS AND BROUGHT TO TAX AS UNACCOUNTED EXPENDITURE U/S 69C O F THE ACT BY THE ASSESSING OFFICER . FURTHER, THE ASSESSING OFF ICER HELD THAT NO SALE BILLS WERE PRODUCED. SINCE, THERE IS NO EVIDE NCE SUBMITTED THE ENTIRE SALE OF RS.36,36,180/- WAS HELD AS BOGUS CAS H CREDIT U/S 68 OF THE ACT. 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASS ESSEE FILED APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A), THE AS SESSEE TOOK UP THE GROUNDS CHALLENGING THE PROCEEDINGS UNDER SECTION 1 53A OF THE ACT, VIOLATION OF PRINCIPLES OF NATURAL JUSTICE AND ALSO THAT ON MERIT. THE CIT(A) WHILE REJECTING THE GROUNDS OF CHALLENGE TO SECTION 153A PROCEEDINGS AND VIOLATION OF PRINCIPLES OF NATURAL JUSTICE, PARTLY ALLOWED THE APPEAL OF THE ASSESSEE ON MERIT. 5. THE LD. AR SUBMITTED THAT THE CROSS-OBJECTIONS B E TAKEN FIRST AS IT GOES TO THE ROOT OF THE APPEALS FILED BY THE REVENUE WHETHER SUSTAINABLE OR NOT. THE LD. AR POINTED OUT TO THE S ATISFACTION NOTE SUPPLIED TO THE ASSESSEE AND SUBMITTED THAT REASONS FOR THE SAID SATISFACTION NOTE, IS NOT VALID TO ASSUME THE JUR ISDICTION U/S 153C OF THE ACT. THE LD. AR FURTHER SUBMITTED THAT IT IS NOT RECORDED BY THE SPECIFIED AUTHORITY THAT IS THE AO OF SEARCHED PARTY DURING ASSESSMENT PROCEEDINGS. THE LD. AR SUBMITTED THAT T HERE IS NO REMOTE INDICATION IN THE SATISFACTION NOTE THAT SAM E IS RECORDED DURI NG THE COURSE OF ASSESSMENT OF A PARTICULAR SEARCHED PERSON. O N THE CONTRARY, FROM A CURSORY LOOK IT IS PALPABLE THAT SAME IS MERE NOTING BY AO OF ASSESSEE (OTHER PERSON ) BEFORE ISSUANCE OF NOTICE U/S 153C. HE DREW THE ATTENTION OF THE BENCH TO THE SATISFACTION NOTE FOR ISSUANCE OF NOTICE U/S 15 3C, A COPY OF WHICH IS PLACED AT PAGE 7 OF THE PAPER BOOK AND SUB MITTED THAT THERE IS NO VALID SATISFACTION ON PART OF LD. AO. B EFORE ISSUING NOTICE U/S 153C OF THE ACT. THE LD. AR SUBMITTED THAT ON IDENTICAL FACTS, THE DELHI BENCHES OF ITAT ON FOUR DIFFERENT OCCASIONS I N CASES OF AKASH AROGYA MANDIR PVT. LTD., TANVIR COLLECTIONS PVT. LTD., TANVIR FINANCE AND LEASING LTD. AND VICTORIA MARKETING PVT . LTD. HAVE QUASHED THE SIMILAR PROCEEDINGS BEING NULLITY FOR LACK OF JURISDICTION. IN THESE PRECEDENTS, COORDINATE BENCH DECISIONS, THE HONBLE JURISDICTIONAL HIGH COURT AND APEX COURT DE CISIONS ARE CITED AT LENGTH. THE ORDER OF DELHI ITAT IN DSL CASE REPORTED AT 60 SOT 88 WAS APPLIED (DIRECTLY AND/OR INDIRECTLY) IN ABOVE CASES. THIS ORDER IS FOLLOWED IN MANY OTHER DECISIONS BY I TAT. REGARDING SPECIFIC SATISFACTION BY AO OF SEARCHED PARTY AND I N ITS ABSENCE CONSEQUENTIAL NULLIFICATION OF PROCEEDINGS, THE DEC ISION OF THE HONBLE DELHI HIGH COURT DATED 26.11.2014 IN CASE O F MANJU FINANCE CORPORATION WAS RELIED UPON BY THE LD. AR. THE LD. AR FURTHER SUBMITTED T HAT INSTANT NOTE IS RECORDED MECHANICALLY AND WITHOUT APPLICATION OF MIND. THE LD. AR SUBMITTED THAT THE SAME IS RECORDED WITHOUT EVEN NARRATING AND DESCRIB ING THE NATURE OF DOCUMENTS AND THEIR FINANCIAL IMPLICATIONS AND ONLY ANNEXURE NUMBERS ARE LOOSELY AND VAGUELY MENTIONED WHICH DO NOT MEET THE BASIC CRITERIA OF ANY OBJECTIVE AND RATION AL SATISFACTION. THE LD. AR FURTHER SUBMITTED T HAT THERE IS NO CLEAR FINDING IN AFORESAID NOTE ON I) NATURE OF DOCUMENTS AND II) AS TO HOW AO ARRIVED AT THE SATISFACTION THAT SAME BELONGS TO AS SESSEE WHICH IS QUITE CRUCIAL AND CRITICAL III) THE FINANCIAL IMPLI CATIONS OF DOCUMENTS FOR THE BLOCK PERIOD. NOTHING IS COMPREHENSIBLE FRO M THE AFORESAID NOTE. THE LD. AR SUBMITTED THAT H OW CAN THE AO WITHOUT ENUMERATION OF BASIC DOCUMENTS AND BY MERE MENTIONI NG OF ANNEXURE NOS CAN TREAT AS ADEQUATE FOR ARRIVING AT JUST AND VALID SATISFACTION U/S 153C. THIS, ACCORDING TO THE LD. AR, REFLECTS MECHANICAL RECORDING OF THE SAME. ON BOTH THE ABOVE COUNTS, THAT IS NON RECORDING OF SATISFACTION BY SPECIFIED AUTHORIT Y (BEING A.O OF A SEARCHED PARTY) AND FOR TOTAL LACK OF CLARITY OF NATURE OF DOCUMENTS SEIZED AND HOW TREATED TO BE BE LONGING TO THE ASSESSEE, MAKES THE INSTANT PROCEEDINGS NULL AN D VOID AND THE GIVEN NOTE AT PAGE 1 CANNOT BE TREATED AS VALID FOR ASSUMPTION OF JURISDICTION. 6. THE LD. AR FURTHER SUBMITTED THAT THERE ARE AT L EAST FOUR HIGH COURT DECISIONS (INCLUDING TWO FROM JURISDICTIONAL - HIGH COURT REPORTED AT [2014] 289 ITR 341; [2014] 270 CTR 467 IN CASE OF PEPSI FOODS AND PEPSICO INDIA HOLDINGS RESPECTIVELY AND OTHER TWO FROM ALLAHABAD HIGH COURT (GOPI APARTMENTS [2014] 365 ITR 411), SMT. NIRMALA KESHWANI (11.03.2015, ITA 108 OF 2014) AND TELANGANA & ANDHRA PRADESH HIGH COURT IN SHETTY PHARMACEUTICALS (26.11.2014 I.T.A. 662 OF 2014 AND BATCH) , WHERE IN DETAILED PRINCIPLES ON VALIDITY OF PROCEED INGS U/S 153C ARE LAID DOWN WHICH SUPPORTS THE VIEW TAKEN IN CASES OF I) AKASH AROGYA MANDIR PVT. LTD. (SUPRA) II) TANVIR COLLECTI ONS PVT. LTD. (SUPRA) III) TANVIR FINANCE AND LEASING LTD. IV) VI CTORIA MARKETING PVT. LTD. AND OUR PRAYER (SUPRA). 7. THE LD. AR IN CONTEXT OF REVENUES ATTEMPT TO DI STINGUISH THE JURISDICTIONAL HIGH COURT DECISIONS (IN CASES O F PEPSI AND PEPSICO SUPRA) ON NON EXISTING AND EXTRANEOUS GROUN DS, THE LD. AR SUBMITTED THAT ONCE THE DECISION OF JURISDICTIONAL HIGH COURT EXISTS ON AN ISSUE, IT IS SETTLED POSITION IN LAW AS DECLARED BY THE SUPREME COURT IN THE CASE OF EAST INDIA COMMERC IAL CO. LTD. VS. COLLECTOR OF CUSTOMS AIR 1962 (SC) 1793 THAT THE LAW DECLARED BY THE HIGH COURT IS BINDING ON ALL AUTHOR ITIES AND TRIBUNALS WITHIN THE STATE. 8. LASTLY, THE LD. AR BROUGHT TO NOTICE THE RECENT CONSTITUTION BENCH ORDER OF HONBLE SUPREME COURT IN VATIKA TOWNSHIP CASE REPORTED IN 367 ITR 466 WHEREIN IT IS HELD THAT TAX LAWS ARE CLEARLY IN DEROGATION OF PERSONAL RIGHTS AND PROPER TY INTERESTS AND ARE, THEREFORE, SUBJECT TO STRICT CONSTRUCTION, AND ANY AMBIGUITY MUST BE RESOLVED AGAINST IMPOSITION OF THE TAX THA T IS WHERE TWO VIEWS ARE THERE THE VIEW WHICH FAVORS THE TAX PAYER MUST BE FOLLOWED, (VIDE SC DECISION IN CASE OF VEGETABLE PR ODUCTS 88 ITR 192. FURTHER, THE LD. AR SUBMITTED THAT WHERE THE ISSUE IS COVERED IN FAVOR OF ASSESSEE ON LEGAL JURISDICTIONAL GROUNDS, THERE IS NO NEED TO ENTER INTO MERITS AT ALL IS SUPPORTED BY BOMBAY HIG H COURT DECISION IN CASE OF M/S. PETROLEUM INDIA INTERNATIONAL, MUMB AI ORDER DATED 19TH NOVEMBER, 2012 IN INCOME TAX APPEAL NO. 2660 O F 2009 WHEREIN IT IS HELD THAT ONCE, IT IS HELD THAT THE REOPENING OF THE ASSESSMENT IS BAD IN LAW, THEN, IN OUR OPINION, THE CIT (A) AS ALSO THE ITAT WERE NOT JUSTIFIED IN DEALING WITH THE MER ITS OF THE CASE. THE LD. AR HAS GIVEN THE FOLLOWING NOTES AS HIS SUB MISSIONS ON HIGH COURT OF DELHIS DECISION IN CASE OF SSP AV IATION (346 ITR 177) WHICH IS RELIED HEAVILY BY REVENUE AT ITAT AND CIT(A). RELEVANT FACTS OF INSTANT CASE/DOCUMENTS: I) THE FIRST RESPONSE TO AO IN THE MONTH OF NOVEMBER, 2010 DURING ASSESSMENT PROCEEDINGS (PAGES 38 TO 43 OF PAPER BOOK) THAT SEIZED DOCUMENT ARE FULLY DISCLOSED AND ACCOUNTED AND NOTHING IS UNDISCLOSED AS FAR AS SEARCH RELATED DOC UMENTS ARE CONCERNED REMAINED UNCONTROVERTED; II) AT NO STAGE IT IS CONTROVERTED THAT SEIZED DOCUMENTS FOUND DURING SEARCH ARE NOT FULLY DISCLOSED AND UNACCOUNT ED. 9. THE LD. DR RELIED UPON VARIOUS DECISIONS OF THE TRIBUNAL & HONBLE HIGH COURT AS WELL AS THE ORDER OF THE ASSE SSING OFFICER. FIRSTLY, THE LD. DR RELIED UPON THE DECISION OF THE HONBLE DELHI HIGH COURT IN CASE OF SSP AVIATION LTD VS DCIT (20 TAXMANN.COM 214) W HEREIN IT IS HELD THAT IN VIEW OF PROVISIONS OF SEC TION 153C, SATISFACTION THAT IS REQUIRED TO BE REACHED BY ASSE SSING OFFICER HAVING JURISDICTION OVER SEARCHED PERSON IS THAT VA LUABLE ARTICLE OR BOOKS OF ACCOUNT OR DOCUMENTS SEIZED DURING SEARCH BELONG TO A PERSON OTHER THAN SEARCHED PERSON AND, IT IS NOT NE CESSARY THAT DOCUMENTS SO SEIZED MUST REFLECT ANY UNDISCLOSED IN COME. THE LD. DR ALSO RELIED UPON THE DECISION IN CASE OF CIT VS CLASSIC ENTERPRISES (35 TAXMANN.COM 244, 219 TAXMAN 237, 35 8 ITR 465, 268 CTR 364) WHEREIN THE HONBLE ALLAHABAD HIGH COURT HELD THAT WHERE AFTER SEARCH AT BUSINESS PREMISES OF ASSESSEE -FIRM AND ITS PARTNER, BOOKS OF ACCOUNT WERE HANDED OVER TO CONCE RNED ASSESSING OFFICER, WHO AFTER RECORDING SATISFACTION ISSUED NO TICE UNDER SECTION 153C AND COMPLETED ASSESSMENT UNDER SECTION 153C/14 3(3), ASSESSMENT WAS IN ACCORDANCE WITH LAW. THE LD. DR R ELIED UPON THE DECISION IN CASE OF SAVESH KUMAR AGARWAL VS UNION O F INDIA (353 ITR 26) WHEREIN THE HONBLE ALLAHABAD HIGH COURT HELD THAT EVEN IF ASSESSING AUTHORITY RECEIVING SATISFACTION NOTE HAD NOT FOUND ANY THING ADVERSE AGAINST ASSESSEE ON EXAMINATION OF AC COUNT BOOKS, AND FURTHER SEIZED GOODS HAD ALREADY BEEN RELEASED, NOTICE UNDER SECTION 153C COULD STILL BE ISSUED TO ASSESSEE TO F ILE RETURN OF INCOME. WHERE BULLION SEIZED WAS RELEASED TO ASSESS EE FOR HAVING BEEN VALIDLY ENTERED IN STOCK BOOKS, ASSESSING OFFI CER ON RECEIVING SATISFACTION NOTE COULD STILL PROCEED UNDER SECTION 153A AGAINST ASSESSEE TO FIND OUT SOURCE OF INCOME. THE LD. DR F URTHER RELIED UPON THE CASE OF PCIT VS SUPER MALLS PVT LTD (ITA N O. 449 OF 2016) WHEREIN THE HONBLE DELHI HIGH COURT HELD THAT SATI SFACTION NOTE RECORDED U/S 153C IN RESPECT OF THE ASSESSEE, BEING THE THIRD PARTY, COULD NOT BE SAID TO BE INVALID ON A HYPER TECHNICA L GROUND BY INTERPRETING THE EXPRESSION 'BELONGING TO' TOO LITE RALLY. THE LD. DR ALSO RELIED UPON PCIT VS M/S NAU NIDH OVERSEAS PVT LTD. (ITA NO.58/2017) WHEREIN THE HONBLE DELHI HIGH COURT HELD THAT SATISFACTION RECORDED BY THE OFFICER ISSUING NOTICE U/S 153C IS SUFFICIENT IF THE AO OF THE SEARCHED PERSON AND THI RD PARTY ARE THE SAME. 10. THE LD. DR SUBMITTED THAT THE FOLLOWING DECISIO NS MAY BE CONSIDERED WITH REGARD TO ADDITION MADE U/S 68 OF I .T.ACT: I. N K PROTEINS LTD VS CIT (2017-TIQL-23-SC-IT) WHERE THE HONBLE SUPREME COURT HELD THAT ENTIRE UNDISCLOSED INCOME GENERATED OUT OF BOGUS TRANSACTIONS, DESERVES TO BE ADDED TO TOTAL INCOME. II. CIT VS. NIPUN BUILDERS & DEVELOPERS (P) LTD. (3 50 ITR 407) WHEREIN THE HONBLE DELHI HIGH COURT HELD THAT WHER E ASSESSEER FAILED TO PROVE IDENTITY AND CAPACITY OF SUBSCRIBER COMPANIES TO PAY SHARE APPLICATION MONEY, AMOUNT SO RECEIVED WAS LIA BLE TO BE TAXED U/S 68. III. CIT VS. N R PORTFOLIO PVT. LTD (29 TAXMANN.CO M 291) WHEREIN THE HONBLE DELHI HIGH COURT HELD IF A.O DOUBTS THE DOC UMENTS PRODUCED BY THE ASSESSEE, THE ONUS SHIFTS ON THE AS SESSEE TO FURTHER SUBSTANTIATE THE FACTS OR PRODUCE THE SHARE APPLIC ANT IN PROCEEDING. IV. SANRAJ ENGINERING PVT. LTD. VS. CIT( ITA NO. 79 /2016) (DELHI) WHEREIN THE HONBLE DELHI HIGH COURT HELD THAT ADDI TION MADE U/S 68 ON ACCOUNT OF UNSECURED LOANS WAS JUSTIFIED WHER E INITIAL ONUS OF PROVING THE CREDITWORTHINESS OF THE LENDERS WAS NOT DISCHARGED BY THE ASSESSEE. V. NARESH CHANDRA JAIN VS CIT (ITA NO.335 OF2009) ( ALLAHABAD) W HEREIN THE HONBLE ALLAHABAD HIGH COURT HELD THAT T RIBUNAL WAS JUSTIFIED IN HOLDING THAT AMOUNT OF LOAN RECEIVED B Y ASSESSEE WAS UNEXPLAINED INCOME U/S 68 IN AS MUCH AS IDENTITY, G ENUINENESS, CREDITWORTHINESS OF THE TRANSACTION IS NOT PROVED. 11. THE LD. DR SUBMITTED THAT THE FOLLOWING DECISIO NS MAY BE CONSIDERED WITH REGARD TO ADDITION U/S 69C: I. R. MALLIKA VS CIT T20171 79 TAXMANN.COM 117 (SC) WHEREIN THE HONBLE SUPREME COURT DISMISSED SLP AGAINST MAD RAS HIGH COURT'S RULING THAT WHERE ASSESSEE HAD NOT DISCHARG ED BURDEN AS REGARDS SOURCE FROM WHICH INVESTMENT HAD BEEN MADE, INVESTMENT IN PROPERTY WAS AN UNEXPLAINED INVESTMENT AND SAME WAS RIGHTLY ADDED TO INCOME OF ASSESSEE. III. KAHAN UDYOG VS CIT T20131 38 TAXMANN.COM 261 (DELHI)/2013 1 219 TAXMAN 23 (DELHI)(MAG.) WHEREIN THE HONBLE DELHI HIGH COURT HELD THAT WHERE APPELLANT FAILED T O EXPLAIN PURPOSE AND NATURE OF EXPENDITURE DISCLOSED IN SEAR CH AND SAME WAS ALSO NOT RECORDED IN BOOKS OF ACCOUNT, ADDITION WAS TO BE MADE UNDER SECTION 69C. IV. S. RUDRAMUNIYAPPA VS CIT (75 TAXMANN.COM 241) ( SC) WHEREIN THE HONBLE SUPREME COURT DISMISSED SLP ON GROUND OF DELAY AGAINST ORDER OF HIGH COURT WHEREIN IT WAS HE LD THAT SINCE ASSESSEE FAILED TO JUSTIFY HIS STAND THAT THERE WAS NO UNACCOUNTED SALE AS INDICATED IN SEIZED DOCUMENTS, ADDITION MAD E ON BASIS OF SEIZED DOCUMENTS WAS JUSTIFIED. 12. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. AR RIGHTLY POINTED OU T THAT THERE IS NO INCRIMINATING MATERIAL CONFRONTED TO THE ASSESSEE B Y THE ASSESSING OFFICER. SINCE, THE ASSESSING OFFICER WAS THE SAME AND THE SATISFACTION NOTE WAS NOT SEPARATELY RECORDED BY TH E ASSESSING OFFICER WHICH IS A MAJOR LAPSE AND THEREFORE, THE A SSESSING OFFICERS PART CANNOT BE IGNORED. THOUGH THERE IS A MENTION OF DOCUMENTS RELATING TO CHEQUE BOOK (THOUGH THERE IS NO SPECIFI C MENTION TO THAT EXTENT) IN THE SATISFACTION NOTE, IT IS NOT MENTION ED AS TO WHETHER THESE ENTRIES ARE RECORDED OR UNRECORDED TRANSACTIO NS. THE SATISFACTION NOTE AS SUPPLIED TO ASSESSEE DATED 25. 10.2010 IS REPRODUCED BELOW: 'SATISFACTION NOTE FOR ISSUING NOTICE U/S. 153C OF I.T. ACT. 1961. IN THE CASE OF SALDI CHITS PRIVATE LIMITED. KHAASRA NO. 34/7. VILLAGE DERA MANDI. TEHSIL MEHRAULI. NEW DELHI- 110030. PAN : AAJCS6818 G FOR AY. 2003-04 TO 2008-09. 25.10.2010: IN THE CASE OF SH. B.K. DHINGRA, SMT. P OONAM DHINGRA, M/S. MADHUSUDAN BUILDCON PVT. LTD., SEARCH & SEIZURE TOOK PLACE U/S. 132 ON 20.10.2008. THE UNDE RSIGNED IS THE JURISDICTIONAL AO OF THESE CASES. DURING THE COURSE OF SEARCH & SEIZURE DOCUMENTS/PAPERS AS PER ANNEXURE A -23, PAGES 199-205 SEIZED BY PARTY-R-2, ARE FOUND TO BEL ONG TO M/S. SALDI CHITS P. LTD., KHAASRA NO. 34/7, VILLAGE DERA MANDI, TEHSIL MEHRAULI, NEW DELHI. I HAVE EXAMINED THE ABOVE MENTIONED DOCUMENTS/PAPERS AND PROVISION OF S ECTION 153C IS INVOKEABLE IN THIS CASE. AS THE UNDERSIGNED IS ALSO THE JURISDICTIONAL AO OF M/S. SALDI CHITS P. LTD., KHAASRA NO. 34/7, VILLAGE DERA MANDI, TEHSIL MEHRAULI, NEW DELHI, THIS SATISFACTION NOTE IS PLACED IN THE FILE BEFORE ISSUING NOTICE U/S. 153C. SD/- ACIT, CENTRAL CIRCLE-17, NEW DELH I THE ASSESSING OFFICER HAS NOT SET OUT AS TO HOW THE SAID CHEQUE BOOK IS INCRIMINATING MATERIAL IN HIS ASSESSMENT OR DER. THEREFORE, THE PROVISIONS OF SECTION 153C AND THE ASSESSMENT O RDER PASSED U/S 143(3) HAS NOT BEEN FULLY SATISFIED AS PER THE PROVISIONS OF THESE SECTIONS. IN-FACT THOUGH THE AO RELIED UPON THE STA TEMENTS OF SHRI B. K. DHINGRA, THE ASSESSEE WAS NOT GIVEN AN OPPORT UNITY TO CROSS EXAMINE THE SAID PERSON AND HENCE THE PRINCIPLE OF NATURAL JUSTICE WAS ALSO NOT FOLLOWED BY THE ASSESSING OFFICER. TH IS IS ANOTHER PROCEDURAL LAPSE ON PART OF THE ASSESSING OFFICER. S INCE IN THE INSTANT CASE ONLY CHEQUE BOOK ENTRIES BELONGING TO THE ASSESSEE WERE FOUND DURING THE COURSE OF SEARCH IN THE PREMISES OF THE M/S. THAPAR HOMES GROUP WHICH WAS NOT TAKEN INTO COGNIZA NCE WHILE MAKING ADDITION IN THE ASSESSEES CASE AT THE TIME OF ASSESSMENT, THEREFORE, ISSUE OF NOTICE U/S.153C OF THE INCOME TAX ACT BY THE AO IN OUR OPINION IS NOT A VALID NOTICE. THEREFORE, THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF SSP AVI ATION LTD. (SUPRA) WILL NOT BE APPLICABLE IN THE PRESENT CASE. HOWEVER, SINCE ALL THE ENTRIES FOUND IN THOSE DOCUMENTS HAVE ALREADY B EEN REFLECTED IN THE BOOKS OF ACCOUNTS AS PER THE RECORDS FURNISHED BY THE ASSESSEE AND WHICH WAS NOT CONTROVERTED BY THE LD. DR, THERE FORE NO ADDITION U/S 68 COULD HAVE BEEN MADE. WE FIND SUPPO RT TO THE SUBMISSIONS OF THE LD. AR BY THE JUDGMENTS/ORDER RE LIED UPON BY THE LD. AR DURING THE HEARING OF THE CASE. IN CASE OF ARN INFRASTRUCTURE INDIA LTD. VS. ACIT (WP (C) NO. 2768 & 2769 OF 2016 & CM APPL. 11636-11637 OF 2016 ORDER DATED 25.04.20 17), THE HONBLE DELHI HIGH COURT HELD AS UNDER: 17. AS REGARDS THE OTHER DOCUMENT SEIZED, AND MENT IONED IN THE SATISFACTION NOTE VIZ., THE EXTRACT OF THE LEDG ER ACCOUNT MAINTAINED BY THE PETITIONER CONCERNING THE PAYMENT S OF COMMISSION MADE BY IT TO RGEPL, EVEN IF IT IS HELD TO BELONG TO THE PETITIONER, IT COULD HARDLY BE SAID TO BE AN I NCRIMINATING DOCUMENT. THIS WAS A DOCUMENT RELEVANT ONLY FOR THE AY 2010- 11. IT COULD NOT HAVE BEEN USED FOR RE-OPENING THE ASSESSMENTS OF THE EARLIER YEARS I.E. AYS 2007-08 TO AY 2009-10 , 2011-12 AND 2012-13. THIS POSITION AGAIN STANDS SETTLED BY THE DECISION IN CIT-7 V. RRJ SECURITIES LTD (SUPRA). THE FACT TH AT THE REVENUES SLP AGAINST THE SAID DECISION IS PENDING IN THE SUPREME COURT DOES NOT MAKE A DIFFERENCE SINCE THE OPERATION OF THE SAID DECISION HAS NOT BEEN STAYED. 18. WHILE THE LEDGER ACCOUNT EXTRACT MAY BE RELEVAN T FOR AY 2010-11, IT CANNOT BE SAID TO BE INCRIMINATING MATE RIAL WARRANTING RE-OPENING OF THE ASSESSMENT. THE RETURN ORIGINALLY FILED BY THE PETITIONER FOR THE SAID AY 2010-11 WAS PICKED UP FOR SCRUTINY AND FINALIZED BY AN ASSESSMENT ORDER UNDER SECTION 143(3) OF THE ACT. THE PAYMENTS OF COMMISSION TO RG EPL TO THE TUNE OF RS. 4.95 CRORES AS REFLECTED IN THE LEDGER ACCOUNT WAS ALREADY DISCLOSED IN THE PETITIONERS ACCOUNTS WHIC H WERE EXAMINED WHILE FINALISING THE REGULAR ASSESSMENT. THEREFORE, THE LEDGER ACCOUNT COULD NOT HAVE LED THE AO TO BE SATISFIED THAT ANY INCOME HAD ESCAPED ASSESSMENT FOR THE AY 2010-1 1. 19. THE NET RESULT IS THAT NEITHER OF THE DOCUMENTS MENTIONED IN THE SATISFACTION NOTE COULD HAVE FORMED A VALID BASIS FOR THE AO TO INITIATE PROCEEDINGS AGAINST THE PETITIONER U NDER SECTION 153C OF THE ACT FOR AY 2010-11 OR ANY OF THE OTHER YEARS AS PROPOSED. 20. FOR ALL THE AFOREMENTIONED REASONS, THE COURT Q UASHES THE IMPUGNED NOTICE DATED 23 RD JULY, 2014 ISSUED BY THE AO TO THE PETITIONER UNDER SECTION153C OF THE ACT AND ALL PRO CEEDINGS CONSEQUENT THERETO INCLUDING THE ORDER DATED 16 TH MARCH 2016 OF THE AO. IN CASE OF PR.CIT VS. SUNNY INFRAPROJECTS LTD. (ITA NO. 502/2016 ORDER DATED 24.04.2017), THE HONBLE DELHI HIGH COU RT HELD AS UNDER: 10. AS ALREADY MENTIONED, THIS COURT CONSIDERS IT NECESSARY ONLY TO ADDRESS THE ISSUE AS TO WHETHER WHAT WAS RE COVERED DURING THE SEARCH COULD BE CONSIDERED TO BE INCRIMI NATING MATERIAL QUA EACH OF THE ASSESSEES. IN THAT VIEW OF THE MATTER, THE COURT IS NOT ANSWERING THE OTHER ASPECTS CONCER NING THE VALIDITY OF THE INITIATION OF THE PROCEEDINGS UNDER SECTION 153C OF THE ACT AND, IN PARTICULAR, WHETHER THE MATERIAL WHICH MAY BE RELEVANT TO THE YEAR OF THE SEARCH COULD JUSTIFY TH E RE-OPENING OF THE ASSESSMENT FOR THE ASSESSMENTS OF THE EARLIER Y EARS AS WAS DONE IN THE PRESENT CASE. 11. IT IS IMPORTANT TO NOTE THAT IN CASE OF EACH OF THESE ASSESSEES, RETURNS WERE FILED FOR THE AYS IN QUESTI ON. THE RETURNS WERE PICKED UP FOR SCRUTINY AND THE ASSESSM ENT WAS FINALIZED UNDER SECTION 143(3) OF THE ACT FOR EACH OF THE ASSESSEES FOR EACH OF THE AYS IN QUESTION. NOTICE U NDER SECTION 153C OF THE ACT WAS ISSUED TO EACH OF THE ASSESSEES NEARLY TWO YEARS AFTER THE ACTUAL SEARCH OF THE MINDA GROUP. T HE COPY OF THE SATISFACTION NOTE PREPARED BY THE AO OF THE ASS ESSEE REFERS TO THE INCRIMINATING DOCUMENTS/PAPERS WHICH WERE SEIZED DURING THE SEARCH AND SEIZURE ACTION IN THE CASE OF THE MINDA GROUP. THESE DOCUMENTS ARE COPIES OF THE BALANCE SH EET ABSTRACTS AND COMPANYS GENERAL PROFILE, BALANCE SH EET, PROFIT AND LOSS ACCOUNT, AUDITORS ACCOUNT, COPIES OF INCO ME TAX RETURNS AND COPY OF TRIAL BALANCES. 12. APART FROM THE ABOVE, THERE WAS NO OTHER MATERI AL REFERRED TO THAT COULD GIVE RISE TO THE BELIEF ABOUT INCOME HAVING ESCAPED ASSESSMENT. EACH OF THE ABOVE DOCUMENTS WAS ALREADY AVAILABLE WITH THE AO WHEN THE INITIAL ASSESSMENTS WERE FINALIZED UNDER SECTION 143(3) OF THE ACT. THE COUR T ENQUIRED FROM MR. SHIVPURI WHETHER, IN FACT, THERE WAS ANY N EW OR FRESH MATERIAL WHICH COULD FORM THE BASIS FOR THE AO FOR RE-OPENING THE ASSESSMENTS. MR. SHIVPURI SUBMITTED THAT THE TR IAL BALANCES WERE NOT AVAILABLE EARLIER. HOWEVER, HE COULD NOT D ENY THAT IT IS THESE VERY TRIAL BALANCES THAT LED TO THE PREPARATI ON OF THE BALANCE SHEET, WHICH WERE ALREADY AVAILABLE WITH TH E AO AND THAT THERE WAS NO NEW INFORMATION CONTAINED IN THE TRIAL BALANCE WHICH JUSTIFIED THE ADDITIONS. 13. CONSEQUENTLY, THE COURT IS OF THE VIEW THAT THE ABOVE DOCUMENTS COULD NOT CONSTITUTE INCRIMINATING MATERI AL WHICH COULD JUSTIFY THE MAKING OF THE ADDITIONS IN EXERCI SE OF THE POWERS UNDER SECTION 153C OF THE ACT. IT HAS BEEN R EPEATEDLY STRESSED BY THIS COURT IN SEVERAL JUDGMENTS INCLUDI NG CIT V ANIL KUMAR BHATIA 352 ITRA 493 (DEL.); CIT V. KABUL CHAW LA 380 ITR 573 (DEL); DAYAWANTI THROUGH LEGAL HEIR SUNITA GUPTA V. CIT (2016) 390 ITR 496 (DEL.) AND CIT-VII V. RRJ SE CURITIES LIMITED (2016) 380 ITR 612 THAT THE SEIZED MATERIAL MUST HAVE SOME NEXUS OR RELEVANCE TO THE ADDITIONS SOUGHT TO BE MADE AND MUST BE RELEVANT FOR THE BELIEF FORMED REGARDING IN COME HAVING ESCAPED ASSESSMENT. WHILE DISCUSSING THE DECISION O F THIS COURT IN SSP AVIATION LTD. V. DEPUTY CIT (2012) 346 ITR 1 77, THIS COURT IN CIT-VII V. RRJ SECURITIES LIMITED (SUPRA) NOTED AS UNDER: 35. ..SECTION 153C ONLY ENABLES THE AO OF A PERSON OTHER THAN THE ONE SEARCHED TO INVESTIGATE INTO THE DOCUM ENTS SEIZED AND/OR THE ASSETS SEIZED AND ASCERTAIN THAT THE SAME DO NOT REFLECT ANY UNDISCLOSED INCOME OF THE ASSESS EE (I.E. A PERSON OTHER THAN THE ONE SEARCHED) FOR THE RELEVAN T ASSESSMENT YEARS. IF THE SEIZED MONEY, BULLION, JEW ELLERY OR OTHER VALUABLE ARTICLE OR THING SEIZED AS HANDED OV ER TO THE AO OF THE ASSESSEE, ARE DULY DISCLOSED AND REFLECTE D IN THE RETURNS FILED BY THE ASSESSEE, NO FURTHER INTERFERE NCE WOULD BE CALLED FOR. SIMILARLY, IF THE BOOKS OF ACCOUNTS/ DOCUMENTS SEIZED DO NOT REFLECT ANY UNDISCLOSED INCOME, THE ASSESSMENTS ALREADY MADE CANNOT BE INTERFERED WITH. MERELY BECAUSE VALUABLE ARTICLES AND/OR DOCUMENTS BELONGIN G TO THE ASSESSEE HAVE BEEN SEIZED AND HANDED OVER TO THE AO OF THE ASSESSEE WOULD NOT NECESSARILY REQUIRE THE AO TO RE OPEN THE CONCLUDED ASSESSMENTS AND REASSESS THE INCOME OF TH E ASSESSEE. 14. AS FAR AS THE PRESENT CASES ARE CONCERNED, THE DOCUMENTS AND MATERIAL SEIZED ARE ONLY THE BALANCE SHEET, AUD IT REPORTS ETC., WHICH DID NOT REFLECT ANY INCOME THAT WAS NOT ALREADY DISCLOSED WHEN THE ASSESSMENTS WERE FINALIZED INITI ALLY UNDER SECTION 143(3) OF THE ACT. THIS BY ITSELF IS SUFFIC IENT TO DELETE THE ADDITIONS SUSTAINED BY THE CIT(A). CONSEQUENTLY, TH E ITAT WAS NOT IN ERROR IN ORDERING SUCH DELETION. 15. FOR THE AFOREMENTIONED REASONS, THE QUESTION FR AMED IS ANSWERED IN THE NEGATIVE I.E., AGAINST THE REVENUE AND IN FAVOUR OF THE ASSESSEE. THE APPEALS ARE DISMISSED B UT IN THE CIRCUMSTANCES, NO ORDERS AS TO COSTS. THE RELIANCE ON THE ORDER OF THE ITAT, DELHI BENCH IN CASE OF M/S. GLOBAL REALTY CREATIONS LTD. VS. DCIT ( ITA NO. 124 5/DEL/2014 ALONG WITH OTHER GROUP APPEALS DATED 07.04.2017 IS ALSO APPLICABLE IN PRESENT CASE. THE ITAT HELD AS UNDER: 13.7 AFTER PERUSING THE ASSESSMENT ORDER AS WELL A S APPELLATE ORDER, WE FIND THAT IN THE PRESENT CASE T HE AO HAS COMPLETED THE ASSESSMENT U/S. 153C OF THE I.T ACT, 1961 AND MADE THE ADDITION IN DISPUTE WITHOUT ANY INCRIMINAT ING MATERIAL FOUND DURING THE SEARCH AND SEIZURE OPERATION AND T HE ADDITION IN THIS CASE WAS PURELY BASED ON THE MATERIAL ALREA DY AVAILABLE ON RECORD, WHICH IS NOT SUSTAINABLE IN THE EYES OF LAW, HENCE, NEEDS TO BE DELETED. ALSO ON THE PERUSAL OF THE ASS ESSMENT ORDER UNDISPUTEDLY INDICATES THAT NO REFERENCE WHAT SOEVER HAS BEEN MADE TO ANY MATERIAL FOUND/SEIZED DURING THE C OURSE OF SEARCH. OUR AFORESAID VIEW IS FULLY SUPPORTED BY TH E DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA 380 ITR 573, WHEREIN THE HONBLE HIGH COURT HAS HELD 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 EXPLAINED IN THE AFOREMENTIONED ITA NOS. 707, 709 A ND 713 OF 2014 OF DECISIONS, THE LEGAL POSITION THAT EMERG ES IS AS UNDER: I. ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF T HE ACT, NOTICE UNDER SECTION 153A(1) WILL HAVE TO BE MANDAT ORILY 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 RESPECT OF EACH OF THE SIX AYS IN WHICH BOTH THE D ISCLOSED AND THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX . IV. ALTHOUGH SECTION 153A DOES NOT SAY THAT ADDITIO NS 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 ITA NOS. 707, 709 AND 713 OF 2014 OF ASSESSMENT HAS TO BE MADE UNDER THIS SECTIO N ONLY ON THE BASIS OF SEIZED MATERIAL. 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 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 153A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE CO URSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCL OSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. 38. THE PRESENT APPEALS CONCERN AYS, 2002-03, 2005- 06 AND 2006-07. ON THE DATE OF SEARCH THE SAID ASSESSMENTS ALREADY STOOD COMPLETED. SINCE NO INCRIMINATING MAT ERIAL WAS UNEARTHED DURING THE SEARCH, NO ADDITIONS COULD HAV E BEEN MADE TO THE INCOME ALREADY ASSESSED. 14. RESPECTFULLY FOLLOWING THE PRECEDENT OF THE HON BLE JURISDICTIONAL HIGH COURT IN THE CASE OF KABUL CHAW AL (SUPRA), WE DELETE THE ADDITION IN DISPUTE AND ALLOW THE APP EAL OF THE ASSESSEE BEING ITA NO. 1245/DEL/2014 (AY 2005-06), BECAUSE AO HAS COMPLETED THE ASSESSMENT AND MADE THE ADDITI ON IN DISPUTE WITHOUT ANY INCRIMINATING MATERIAL FOUND DU RING THE SEARCH AND SEIZURE OPERATION AND THE ADDITION IN TH IS CASE WAS PURELY BASED ON THE MATERIAL ALREADY AVAILABLE ON R ECORD, WHICH IS NOT SUSTAINABLE IN THE EYES OF LAW. ACCORDINGLY, THE ADDITIONAL LEGAL GROUND NO. 2 RAISED BY THE ASSESSEE IN THE AP PEAL IS ALLOWED. SINCE WE HAVE ALREADY DELETED THE ADDITION IN DISPUTE, THE ADDITIONAL GROUND NO. 1 AND OTHER GROUNDS RAISE D IN THE APPEAL HAVE BECOME ACADEMIC IN NATURE, HENCE, THE S AME ARE NOT ADJUDICATED UPON. 15. FOLLOWING THE CONSISTENT VIEW ADOPTED IN ITA NO . 1245/DEL/2014 (AY 2005-06) IN THE CASE OF GLOBAL RE ALTY CREATIONS LTD. DCIT, CC-12, NEW DELHI, AS AFORESAID , THE ADDITIONS IN DISPUTE INVOLVED IN OTHER APPEALS OF T HE SEPARATE ASSESSEES BEING ITA NOS. 1335-1336/DEL/2014 (AYS 20 03-04 & 2004-05) IN THE CASE OF GLOBAL HERITAGE VENTURE L TD. VS. DCIT AND ITA NO. 1341/DEL/2014 (AY 2004-05) IN THE CASE OF GLOBAL TELEVENTURE LTD. VS. DCIT ARE HEREBY DELETED AND TH E APPEAL OF THE ASSESSES STAND ALLOWED. AS RELATES TO CASE LAWS RELIED UPON BY THE REVENUE, THE FACTUAL ASPECTS IN THE PRESENT CASE AND IN THOSE CASES ARE DIFFERENT, THEREFORE, THE SAME WILL NOT BE APPLICABLE AND THE RATIO LAID DOWN IN THOSE CASES WILL NOT SUPPORT THE CASE OF THE REVENU E. HOWEVER, SINCE THE ASSESSEE HAS SATISFACTORILY EXPLAINED THAT ENTR IES FOUND IN THE SEIZED DOCUMENTS ARE REFLECTED IN THE REGULAR BOOKS OF ACCOUNT, THEREFORE, THE ASSESSEE SUCCEEDS ON THIS PRELIMINAR Y ISSUE. THUS, WE REFRAIN OURSELVES FROM ADJUDICATING THE OTHER GR OUNDS BY THE ASSESSEE AS WELL AS THE REVENUE ON MERIT. SINCE APP EALS AND THE CROSS-OBJECTIONS ARE IDENTICAL, THEREFORE, FOLLOWIN G ABOVE REASON IN ALL THE APPEALS FILED BY THE REVENUE ARE DISMISSED AND CROSS- OBJECTIONS FILED BY THE ASSESSEE ARE ALLOWED. 13. IN THE RESULT, THE APPEALS OF THE REVENUES ARE DISMISSED AND THE CROSS-OBJECTION OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH AUGUST, 2017 . (R.K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDI CIAL MEMBER DATED: THE 11 TH AUGUST, 2017 * MANGA/R. NAHEED COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT - TRUE COPY - BY ORDER, ASSISTANT REGISTRAR ITAT DELHI BENCHES NEW DELHI