Jakhotia Polymers Pvt. Ltd., Telangana V. ACIT, CC-26, New Delhi

ITA 979/DEL/2021

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 9900 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-10-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 26-09-2022
• Assessment Year: 2011-2012
• Appeal Filed On: 15-08-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ANJULA JAIN
• Keywords: Question of law; Retraction; Set aside
• Section: 132; 153A; 195; 13; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘C’: NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA Nos.963 to 965/DEL/2021 [Assessment Years: 2010-11 to 2012-13] M/s Jakotia Plastics Pvt. Ltd. 3-6, 323, Basheerbagh, Hyderabad, Andhra Pradesh-500029 Vs ACIT, Circle-26(1), E-2, Room No.323, ARA Centre, Jhandewalan Extension, New Delhi-110055 PAN-AAACJ5070A Assessee Revenue ITA Nos.979 & 967/DEL/2021 [Assessment Years: 2011-12 & 2012-13] M/s Jakotia Polymers Pvt. Ltd. 3-6, 323, Basheerbagh, Hyderabad, Andhra Pradesh-500029 Vs ACIT, Circle-26(1), E-2, Room No.323, ARA Centre, Jhandewalan Extension, New Delhi-110055 PAN-AABCJ6660P Assessee Revenue Revenue by Sh. Ajay Wadhwa, Adv. And Ms. Bharti Sharma, Adv. Assessee by Ms. Anjula Jain, CIT(DR) Date of Hearing 27.09.2022 Date of Pronouncement 21.10.2022 ORDER PER SHAMIM YAHYA, AM, These appeals filed by the assessee belonging to the same group against the respective orders of the Ld. CIT(A)-29, New Delhi. Since, the issues are common and connected, hence, the appeals were heard together and are being consolidated and disposed off by this common order. 2 ITA No.963, 964, 965, 967 & 979/Del/2021 & 2. The issue raised is whether addition u/s 153A can be made de hors any inquiry or incriminating material found only on the basis of declaration before Settlement Commission. 3. Brief facts of the case are that the assessee is a private limited company incorporated on 14.10.1992 vide Certificate of Incorporation issued by the Registrar of Companies Andhra Pradesh. It is engaged in the business of manufacturing polypropylene woven sack bags which are supplied to cement and sugar companies. There are three directors in the company namely Shri Om Prakash Jakhotia Managing Director Smt. Lata Bai Jakhotia and Shri Balkishan Jakhotia. The search under section 132 of the Act were carried out at the residential and business premises of the applicant 20.12012. During the course of search statement of the applicant was recorded on 20.01.2012 under section 132 4 of the Income tax Act 1961 and he admitted undisclosed income of Rs. 21.42 crores for the A.Ys. 2011-12 and 2012-13. On 31.10.2013 the assessee and his two companies namely Jakhotia Plastics Pvt. Ltd and Jakhotia Polymers Pvt. Ltd filed settlement applications under section 245C (1) of the Act before the Income tax Settlement Commission disclosing additional income as under In the hands of Shri Om Prakash Jakhotia Rs. 1.93 crores In the hands of Jakhotia Plastics Pvt. Ltd Rs.38,15,000/- In the hands of Jakhotia Polymers Pvt. Ltd. Rs.34,30,000/-. On 26.11.2014 the Settlement Commission passed final order of settlement under section 245D(4) of the Act in which undisclosed income of the assessee was settled at Rs.7,48,04,200/- by making an addition of Rs.5.55 crores being the difference in the net asset and the income declared at Rs. 2.27 crores 3 ITA No.963, 964, 965, 967 & 979/Del/2021 & in the settlement application. The Department filed a writ petition before the Delhi High Court W.P. No.11859/2016 challenging the Settlement Commission order passed on 26.11.2014 under section 245D 4 of the Act and the Hon’ble High Court vide its order dated 15.04.2019 quashed the order of Settlement Commission and remitted the matter to the Assessing Officer directing him to complete the assessments in accordance with law. 4. In the assessment order, the Assessing Officer finalized the assessment of the assessee company under section 143 (3) dated 12.09.2019 for A.Y. 2010-11 at Rs. 99,71,560/- as against the income of Rs. 73,96,560/- shown in the return filed on 29.09.2010 by making addition of Rs. 25,20,000/- on protective basis on account of alleged unexplained payments kick back made to an employee of Dalmia Cement Ltd and of Rs. 55,000/- which was additional income declared before ITSC. 5. Upon assessee’s appeal, the Ld. CIT(A) elaborately noted the submission of the assessee. 6. As regards the protective addition of Rs.25,20,000/- made by the AO, the Ld. CIT(A) held that since he had confirmed the same on substantive basis in the hands of Sh. Om Prakash Jakhotia, hence this addition in the hands of the company should be deleted. 7. Thereafter, the Ld. CIT(A) dealt with disclosure of Rs.55,000/- made at the time of filing of application before the Settlement Commission. The Ld. CIT(A) confirmed the addition on the basis of disclosure made by the 4 ITA No.963, 964, 965, 967 & 979/Del/2021 & assessee before the Settlement Commission. In this regard, the order of the Ld. CIT(A) can be gainfully referred as under:- 12. Ground No. 6: /The Assessing Officer has completed the assessment u/s 153A/143(3) of the Act on 12.09.2019 and added a sum of Rs. 55,000/- on the ground that the same was offered to tax by the assessee in its application for settlement before the Income-tax Settlement Commission. According to the Assessing Officer, the source of the amount of Rs. 55,000/- was not explained by the assessee and, therefore, it was treated as undisclosed income. The appellant during the course of appellate proceedings has given written submissions which are reproduced in the above paras. The appellant has submitted that undisclosed income of Rs.55,000/- was offered as additional income in the settlement application in order to qualify for admission of the settlement application by the Income Tax Settlement Commission. The appellant has stated that this was an ad-hoc amount not backed by any incriminating evidence found during the course of search. That this was the amount that was offered by the assessee before the ITSC in order to be eligible for. going through the settlement route. The appellant has further stated that as per clause (ia) of the proviso to section 245C(1) of the Act, an applicant related to specified person referred to in clause (i), can approach the Settlement Commission only if the additional income tax payable by him on the income disclosed in the settlement application exceeds ten lakh rupees. That in their case, the specified person referred to in clause (i) of the section 245(C) was Sh. Om Prakash Jakhotia and his two group concerns; M/s Jakhotia Plastics Pvt. Ltd. (“the Assessee Company’) and M/s Jakhotia Polymers Pvt. Ltd. were the related persons who were required to pay minimum additional income tax of Rs. 10 lakhs on the additional income offered in the settlement application in order to qualify for admission of the matter before the Income-tax Settlement Commission. 12.2 In its submission the appellant has mentioned that in order to meet the conditions prescribed under the clause (ia) of proviso of section 254C(1) of the Act for admission of the settlement application, the assessee company had offered the 5 ITA No.963, 964, 965, 967 & 979/Del/2021 & following additional incomes before the Income Tax Settlement Commission: S. No A.Ys Additional Income disclosed 1 2006-07 Rs. 20,000/- 2 2007-08 Rs. 25,000/- 3 2008-09 Rs. 30,000/- 4 2009-10 Rs. 40,000/- 5 2010-11 Rs. 55,000/- 6 2011-12 Rs. 18,00,000/- 7 2012-13 Rs. 18,45,000/- Total Rs. 38,15,000/- 12.3 Thus, as per the appellant the undisclosed income of Rs. 55,000/- was offered to tax only to meet the requirements of the Settlement Commission and there was no income as such that endured to the assessee during the year under consideration. 12.4 It is further submitted that the Hon'ble Delhi HighJJburt, vide their judgment dated 15.04.2019 have set aside the order of the Settlement Commission in its totality before the Ld.Assessing Officer and the Ld.Assessing Officer was required to frame the assessments afresh in accordance with law. Therefore, the ad-hoc surrendered amount of Rs. 55,000/-, as per the appellant does not have to be added unless and until there was evidence of any undisclosed income. The appellant has taken a plea that in case of completed assessment made u/s 153A, addition can only be made on the basis of incriminating material found during the course of search. In support of its argument the appellant has relied upon the judicial pronouncements as mentioned in the above paras. 12.5 The issue in this ground of appeal is regarding the addition of Rs. 55,000/- made by the AO on the basis of the additional income disclosed by the appellant before the ITSC. The appellant has claimed that since the said addition was made only on the basis of the undisclosed income of Rs. 55,000/- offered as additional income in the settlement application in order to qualify for admission of the settlement application by the ITSC and since the same was not backed by any incriminating evidence, therefore the same was unjustified. It is a matter of fact that the appellant had made the disclosure of undisclosed income of Rs. 55,000/- 6 ITA No.963, 964, 965, 967 & 979/Del/2021 & offered as additional income in its settlement application. The said fact has been admitted by the appellant in writing before the ITSC. The application of the appellant before the ITSC reflecting the said disclosure of an undisclosed income of Rs. 55,000/- is in itself an admission which cannot be denied. In my view, the same stands on the equal footing of acceptance of undisclosed income and is in the nature of incriminating material. 12.6 Under sub-section (3) of section 245HA of the Act, upon abatement of the proceedings before the Settlement Commission when the Assessing Officer proceeds to dispose of the pending cases, the Assessing Officer or other income-tax authority would be entitled to use material and other information produced by the assessee before the Settlement Commission, as if such material had been produced before the Assessing Officer or the authority as the case may be. The relevant provision of the section is as under: “245HA. Abatement of proceeding before Settlement Commission (3) For the purposes of sub-section (2), the Assessing Officer, or, as the case may be, other income-tax authority, shall be entitled to use all the material and other information produced by the assessee before the Settlement Commission or the results of the inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it, as if such material, information, inquiry and evidence had been produced before the Assessing Officer or other income-tax authority or held or recorded by him in the course of the proceedings before him." 12.7 The Hon’ble High Court of Gujarat has held in the case of Vikas Shipping Corporation vs. Union of India, reported as 86 taxmann.com 68 (Gujarat), date of order 07.09.2017 at para 10 as under: “10. The alternative request of preventing the income-tax authority from using the material on record before Settlemerd Commission cannot be accepted in terms of plain language used in sub-section(3) of section 245HA of the Act which reads as under: 7 ITA No.963, 964, 965, 967 & 979/Del/2021 & "(3) For the purposes of sub-section (2), the Assessing Officer, or, as the case may be, other income-tax authority, shall be entitled to use all the material and other information produced by the assessee before the Settlement Commission or the results of the inquiry held of evidence recorded by the Settlement Commission in the course of the proceedings before it, as if such material, information, inquiry and evidence had been produced before the Assessing Officer or other income-tax authority or held or recorded by him in the course of the proceedings before him." 12.8 In view of the section 245HA(3) of the Act, and respectfully following the judgment of the Hon’ble Gujarat High Court in the case of Vikas Shipping Corporation vs. Union of India, reported as 86 taxmann.com 68 (Gujarat), date of order 07.09.2017, it is held that the Assessing Officer has rightly made the addition of Rs. 55,000/- on account of undisclosed income on the basis of submission of the appellant before the ITSC. In view of careful consideration of all the facts and circumstances of the case, I am of the considered opinion that the action taken by the Assessing Officer is as per law and is accordingly upheld and the said addition made by the AO of Rs. 55,000/- is confirmed. This ground of appeal is dismissed.” 8. Against this order, the assessee is in appeal before us. 9. We have heard both the parties and perused the records. The Ld. Counsel for the assessee made following submissions in summarized manner pleading that the addition is not warranted:- “1. Additional income was offered in the settlement application merely to qualify for admission of the settlement application. Admittedly, both the Ld.AO and the ld. CIT (A) have concurred with the contention of the assessee that the income offered before the Hon'ble Income Tax Settlement Commission (herein after referred to as "Settlement Commission"] was an ad-hoc amount merely to qualify for admission of the settlement application by the Hon'ble Settlement Commission. Hence, the amount offered is not on account of any incriminating material found or any enquiry by the department. 8 ITA No.963, 964, 965, 967 & 979/Del/2021 & 2. Our case is not a case of abatement u/s 245H A(l) of the Act. The Ld .CIT(A) has referred to sub-section 3 of section 245HA of the Act which talks of abatement of proceedings before the Settlement Commission. If the proceedings before the Settlement Commission abates, the Assessing Officer can use the material or information which was available before the Settlement Commission. In the case before hand is not a case of abatement. Abatement takes-place only under the following conditions referred to under the clauses (i) to (iv) of section 245H A(l) of the Act. Relevant section is reproduced as under: "245HA. (1) Where— (i) an application made under section 245C on or after the 1st day of June, 2007 has been rejected under sub-section [1 ) of section 245D; or (ii) an application made under section 245C has not been allowed to be proceeded with under sub-section (2A] or further proceeded with under sub-section (2D) of section 245D; or (iii) an application made under section 245C has been declared as invalid under sub-section (2C) of section 245D; or [(iiia) in respect of any application made under section 245Can order under sub-section (4) of section 245D has been passed not providing for the terms of settlement or] (iv) in respect of any other application made under section 245C, an order under sub-section (4) of section 245D has not been passed within the time or period specified under sub-section (4A) of section 245D, the proceedings before the Settlement Commission shall abate on the specified date." Our case does not fall under any of the clauses of section 245HA (1) of the Act. Ours is a case where the Hon'ble High Court of Delhi did not find the disclosure made by the assessee vide the Settlement Application to be full and true under section 245C (1] of the Act and therefore, quashed the Settlement Order passed u/s 245D (4) of the Act dated 26.11.2014 and directed the Assessing Officer to frame a fresh assessment vide their order dated 15.04.2019. Hence it's not a case of abatement u/s 245HA(1) of the Act. 3. Income offered before the Settlement Commission is not an admission or confession u/s 132 f4) of the Act. Thirdly, this is not a case of any statement or admission made under 132(4] of the Act. Hence, there is nothing which binds the 9 ITA No.963, 964, 965, 967 & 979/Del/2021 & assessee vis a vis the amount offered before the Hon'ble Settlement Commission. 4. The Hon’ble CBDT INSTRUCTION F. NO. 286/2/2003-IT (INV. II), DATED 10-3-2003 and LETTER F.N0.286/98/2013-IT (INV.II)], DATED 18-12-2014 are relied upon where even confessions or surrender obtained without any incriminating evidence to back the same, are eschewed since they have no legs to stand on. 5. No addition can be made merely on basis of income offered by the assessee before the Settlement Commission in absence of any incriminating material. i. The judgment of the Hon’ble Gujarat High Court in the case of Commissioner v. Maruti Fabrics [2014] 47 taxmann.com 298 delivered in CESTAT proceedings squarely applies to our case. The Hon'ble Gujarat High Court has held that whatever is admitted by the assessee while submitting the application before the Settlement Commission straightway cannot be said to be admission on his behalf. ii. The Hon'ble Mumbai Tribunal in the cases of Anantnadh Constructions and Farms (P.) Ltd. v. DCIT [2017] 166 ITD 83 and Late Shri Sawarmal Hisaria v DCIT in ITA no. 274/M/2021, order dated 05.04.2022 which has a very extensive discussion on the issue, held that the judgment of the Hon'ble Gujarat High Court in the case of Maruti Fabrics (supra) although pertaining to Central Excise should be applied to the cases under the Income Tax Act also. The Hon'ble Mumbai Tribunal in both the cases, following the decision of Maruti Fabrics (supra) have held that no addition can be made merely on basis of income offered by the assessee before the Settlement Commission in absence of any incriminating material. Following other decisions are also relied upon for the above legal proposition: a) ACIT v. Smt. Renu Sehgal I.T.A No. 837/JP/2018, ITA 708 & 709/JP/2018 ; order dated 19.08.2019 (Jaipur Trib.) b) M/s Dolat Investments Ltd. v. DCIT [2010] 38 SOT 123 (Mumbai Trib.)[21- 01-2010] c) Shri Sameer Maheswari v. ITO, I.T.A No.224/Ind/2019; order dated 27.07.2020 (ITAT Indore) 6. Judgment relied upon by the CIT (A) does not apply to our case. The judgment relied upon by the Id. CIT(A) of the Hon'ble Gujarat High Court in the case of Vikas Shipping Corporation vs. Union of India, reported as 86 taxmann.com 68, does not apply to our case 10 ITA No.963, 964, 965, 967 & 979/Del/2021 & since it applies to the cases abated u/s 245HA(1) of the Act and it merely reiterates the legal position stated in section 245HA(3) of the Act. As already stated above, our case does not fall u/s 245HA(1) and 245HA(3) of the Act. 7. No enquiry was conducted by the Id. AO and the Id. CIT(A). The assessee at the very first instance before the Id. AO stated that the income was offered merely for the purpose of qualifying before the Hon'ble Settlement Commission and as such there was no income which was earned during the year under consideration. The Id. AO and the Id. CIT(A) did nothing to controvert that and didn't conduct any further enquiry to find out as to whether such income was in fact earned by the assessee or not. 8. Only real income can be taxed and department cannot levy tax on a hypothetical income which was never accrued to the assessee The Hon'ble Supreme Court in the case of CIT v. Excel Industries Limited (2013) 258 ITR 295 (SC) have held that unless and until there is existence and complete evidence of real income, the same cannot be chargeable to tax. It is reiterated that no such income was found to have arisen to the assessee during the year under consideration.” 10. Per contra, the Ld. DR also made submission, which is summarized as under:- “A. JURISDICTION OF THE CASES/APPEALS 1. Jakhotia group of cases including that of appellants under consideration have been decentralized u/s 127(2) of the Income-tax Act, 1961 (the Act) from Central Circle- 26, New Delhi to Circle - 2(1), Hyderabad w.e.f. 15.12.2020 by the PCIT (Central)-3, Delhi vide F.No.Pr.CIT(Central)-3/Decent.-26/220-21/1149 dated 08/12/2020 (Annexure-1), therefore, now jurisdiction over the assessees/ appellants under consideration lies with PCIT - 2, Hyderabad and even appeal against order of ITAT, Delhi in ITA No. 968 to 971 /Del/2021 in the case of Om Prakash Jakhotia- Managing Director of Jakhotia Plastics Pvt. Ltd and Director of Jakhotia Polymers Pvt. Ltd has been filed before the Hon’ble High Court of Hyderabad in IASR No. 73392 & 73393/2022. 1.1In view of above, it is requested that the appeals under consideration may be transferred to the current jurisdictional ITAT i.e. ITAT, Hyderabad, as is the case of Om Prakash Jakhotia- Managing 11 ITA No.963, 964, 965, 967 & 979/Del/2021 & Director of Jakhotia Plastics Pvt. Ltd and Director of Jakhotia Polymers Pvt. Ltd. B. EVIDENTIARY VALUE OF DISCLOSURE IN FORM NO. 34B – APPLICATION FOR SETTLEMENT OF CASES BEFORE INCOME TAX SETTLEMENT COMMISSION U/S 245C OF THE INCOME-TAX ACT. 1961: 2. Without prejudice to above, the issue being considered by this Hon’ble Bench is whether disclosure of additional income by assessee/ appellant before Income Tax Settlement Commission (ITSC) and which has not been disclosed before the Assessing Officer (AO) in Form No. 34B - Application for settlement of cases before ITSC u/s 245C of the Act can be added as income of the assessee? 2.1 In various judicial pronouncements, it has been held that the statement recorded under Section 132 of the Act during the course of search proceedings, has probative and evidentiary value which could not be cast aside. In this regard reliance is placed on following case laws: I. Hon’ble Delhi HC’s order in the case of CIT v. Om Prakash Jakhotia (2019) 414 ITR 176: The Hon’ble High Court of Delhi in its order dated 15.04.2019 in the case of Om Prakash Jakhotia (Managing Director of Jakhotia Plastics Pvt. Ltd and Director of Jakhotia Polymers Pvt. Ltd) and others in WP(C) No. 11859/2016 (Annexure-2) has held as under: "15. The stark facts emerging from the above discussion and the discussion in the impugned order thus are that statement was made voluntarily on 20.01.2012, in the course of search proceedings. There is presumptive value to such statement by virtue of Section 132(4) of the Act... 16. This Court is of the opinion that the approach of the ITSC was flawed throughout. Apart from brushing aside the fact that the retraction took place close to two years after the statement was made, the commission overlooked that nowhere did the assessees complain that the statement of the first respondent was recorded under coercion..... The SLP of assessee against the aforesaid order of HC has been dismissed in Om Prakash Jakhotia v. PCIT (2019) 418 TR 18 (St) (SC). II. Hon’ble Madras HC’s order in the case of B. Kishore Kumar v. Deputy Commissioner of Income-tax. Central Circle-IV (1). Chennai [2014] 52 taxmann.com 449 (Madras): The Hon’ble High Court of Madras in its order dated 03.11.2014 in the case of B. Kishore Kumar v. Deputy Commissioner of Income-tax, Central Circle-IV (1), Chennai in 273 CTR 468 has held as under: 12 ITA No.963, 964, 965, 967 & 979/Del/2021 & .......Therefore, admission of undisclosed income of Rs.52,73,920/- is categoric and undisputed. The assessee in the sworn statement made onl0.10.2006, stated that outstanding loans to the tune of Rs.25Lakhs to 30 Lakhs are to be recovered with interest at the rate ofl8%. This is a clear admission. This amount has also been calculated and added as undisclosed income. When there is a clear and categoric admission of the undisclosed income by the assessee himself, in our considered opinion, there is no necessity to scrutinize the documents. The document can be of some relevance, if the undisclosed income is determined higher than what is now determined by the department. Moreover, it is not the case of the assessee that the admission made by him was incorrect or there is mistake. In fact, when there is a clear admission, voluntarily made, by the assessee, that would constitute a good piece of evidence for the Revenue. The SLP of assessee against the aforesaid order of HC has been dismissed in B. Kishore Kumar v. Deputy Commissioner of Income- tax, Chennai [20151 62 taxmann.com 215 (SC). III. Hon’ble ITAT. Pune, Bench A’s order in the case of Sinhagad Technical Education Society v. Deputy Commissioner of Income-tax f20221 139 taxmann.com 270: The Hon’ble ITAT, Pune, Bench ‘A’ in its order dated 01.04.2022 in the case of Sinhagad Technical Education Society v. Deputy Commissioner of Income-tax, in 195 ITD 683 has held that where AO considered statements recorded under section 132(4) of the Act which confirmed that assessee was collecting capitation fees/ donation in cash from students for admission under management quota in various institutions run by assessee and retraction statements were identically worded and filed after 7 months gap; recorded statements would carry more evidentiary value and could not be discarded merely because retraction statements were filed. 2.2 Similarly, the income disclosed by assessees/appellants before ITSC (which has not been disclosed before the AO) in Form No. 34B voluntarily on their own volition and under their own signatures without any pressure or coercion, wherein they have solemnly declared that to the best of their knowledge and belief, what has been stated in the application and in the Annexure [including the statement(s) and documents accompanying such Annexure] was correct and complete, has probative and evidentiary value which could not be cast aside. For ready reference, the verification which is duly signed by the applicant in Form No. 34 B is reproduced as under: VERIFICATION I,................ son/daughter/wife of.................do hereby solemnly declare that to the best of my knowledge and belief, what is 13 ITA No.963, 964, 965, 967 & 979/Del/2021 & stated above and in the Annexure [including the statement(s) and documents accompanying such Annexure] is correct and complete. I further declare that I am making this application in my capacity as................................................. [write your designation] and that I am competent to make this application and to verify it. I also certify that the proceedings for which this application is being made is not covered by the proviso to clause (b) of section 245A of the Income-tax Act. Verified today the .................................day of........................ Place Signature of applicant 2.3In the present cases, in the year 2013 the assessees/appellants have declared undisclosed income as under: Jakhotia Plastics Pvt. Ltd. Assessment Year 2010-11 2011-12 2012-13 Appeal No. 963/D/2021 964/D/2021 965/D/2021 Undisclosed income before ITSC(in Rs.) 55,000 18,00,000 18,45,000 Jakhotia Plastics Pvt. Ltd. Assessment Year 2011-12 2012-13 Appeal No. 979/D/2021 967/D/2021 Undisclosed income before ITSC (in Rs.) 10,90,000 10,50,000 2.4Thereafter, the ITSC passed orders u/s 245D(4) of the Act. But as the assessees had not made full and true disclosure, the impugned orders were set aside and quashed by the Hon’ble High Court of Delhi vide order dated 15.04.2019 in the case of Om Prakash Jakhotia (Managing Director of Jakhotia Plastics Pvt. Ltd and Director of Jakhotia Polymers Pvt. Ltd) and others in WP(C) No. 11859/2016. Thereafter, while completing assessments, the AO made additions on account of additional income disclosed before ITSC in form no. 34B. 2.5 As is evident from duly signed verification in form No. 34B filed by the assessees/appellants before ITSC, they have clearly admitted and solemnly declared their additional undisclosed income before ITSC voluntarily on their own and without any coercion or pressure. In the year 2013, these assessees/appellants have also paid additional taxes and interest on the income so disclosed before ITSC voluntarily and without any coercion or pressure. If the assessees/appellants did not have any undisclosed income, they would have not approached ITSC 14 ITA No.963, 964, 965, 967 & 979/Del/2021 & u/s 245C(1) of the Act. No person would pay taxes on income not belonging to him/her. 2.6 Now after 6 years, during assessment proceedings the assessees claimed that the income disclosed before ITSC was not their income, which can’t be accepted. Further, the assessees/appellants have also not brought out any evidence on record to show that such disclosure before ITSC was under coercion or pressure. 2.7 Therefore, the income disclosed by assessees/appellants voluntarily before ITSC in Form No. 34B on their own volition and after due verification under their own signatures without any pressure or coercion, has probative and evidentiary value and should be treated as income of the assessees/appellants. Therefore, its requested that additions made by AO on account of disclosure by the appellants in their form No. 34B before ITSC as per details in para 2.3 supra should be upheld. C. CASE LAWS RELIED UPON BY ASSESSEE: 3. The facts and circumstances of the case Commissioner vs. Maruti Fabrics ITA No. 523 of 2014, CA No. 331 of 2014 [2014] 47 taxmann.com 298 (Gujarat HC) relied upon by assessee/appellant are totally different. This judgment has been passed considering the provisions of section 32L of the Central Excise Act, 1944 (Excise Act), which gives power to the Settlement Commission to send a case back to the Central Excise Officer. For ready reference, the same are reproduced as under: 32L. Power of Settlement Commission to send a case back to the Central Excise Officer. — (1) The Settlement Commission may, if it is of opinion that any person who made an application for settlement under section 32E has not co-operated with the Settlement Commission in the proceedings before it, send the case back to the Central Excise Officer having jurisdiction who shall thereupon dispose of the case in accordance with the provisions of this Act as if no application under section 32E had been made. (2) for purpose of sub-section (1), the Central Excise Officer shall be entitled to use all the materials and other information produced by the assessee before the Settlement Commission or the result of the inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it as if such materials, information, inquiry and evidence had been produced before such Central Excise Officer or held or recorded by him in the course of the proceedings before him.” 3.1As per section 32L(2) of the Excise Act, after an order is passed by the Settlement Commission under sub-section (1) of Section 32L thereby sending the case back to the Central excise Officer in case of non-cooperation by the applicant, then the adjudicating authority is 15 ITA No.963, 964, 965, 967 & 979/Del/2021 & required to adjudicate the case as if no application had been made under section 32E of the Excise Act, and such adjudicating authority i.e. Central Excise Officer shall be entitled to use all the materials and other information produced by the assessee before the Settlement Commission or the result of inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it as if such materials, information, inquiry and evidence have been produced before such Central Excise Officer or held or recorded by him in the course of the proceedings before him, while adjudicating the show cause notice and the proceedings. In this context, the Hon’ble Gujarat HC held that whatever is admitted by the assessee while submitting the application before the Settlement Commission submitted under Section 32E(1) of the Act straightway cannot be said to be admission on behalf of the assessing accepting the liability because then there was no question of further adjudication by the Central Excise Officer u/s 32L(2)Act of the Excise Act. For ready reference, the relevant part of the Hon’ble HC’s order is reproduced as under as under: ........Considering sub-section (2) of Section 32L of the Act, in a case where an order is passed by the Settlement Commission under sub-section (1) of Section 32L and thereafter adjudicating authority is required to adjudicate the case, the Central Excise Officer shall be entitled to use all the materials and other information produced by the assessee before the Settlement Commission or the result of inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it as if such materials, information, inquiry and evidence have been produced before such Central Excise Officer or held or recorded by him in the course of the proceedings before him on fair reading of sub-section (2) of Section 32L of the Act whatever is admitted by the assessee while submitting the application before the Settlement Commission submitted under Section 32E(1) of the Act straightway cannot be said to be admission on behalf of the assessing accepting the liability. Whatever the material is produced along with the application and/or any material and/or other information produced by the assessee before the Settlement Commission or the result of the inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it can be used by the adjudicating authority as if such materials, information, inquiry and evidence has been produced before such Central Excise Officer, while adjudicating the show cause notice and the proceedings. If the contention on behalf of the appellant is accepted, in that case, there is no question of further adjudication by the Central Excise Officer with respect to the amount admitted by the assessee while submitting the application before the Settlement Commission submitted under Section 32E(1) of the Act. 3.2 But in the Income-tax Act, 1961, there is no such provision which gives power to the Settlement Commission to send a case back to the AO for adjudication using all the 16 ITA No.963, 964, 965, 967 & 979/Del/2021 & materials and other information produced by the assessee before the Settlement Commission or the result of inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it as if such materials, information, inquiry. Therefore, the ratio of case of Maruti Fabrics supra quoted/relied upon by the assessees/appellants does not apply to the appeals under consideration. 3.3 The other case laws relied upon by assessee are based on Maruti Fabrics supra and hence the ratio of these cases also does not apply to that of the appellants. D. CBDT INSTRUCTION/LETTER RELIED UPON BY ASSESSEE: 4. The reliance of assessee on the CBDT Instruction dated 10.03.2003 and letter dated 18.12.2014 has no relevance in the present appeals, because both of these make distinction between the voluntary statement and one under duress. The object of the aforesaid Instruction and letter is to prevent recording of statement under duress. Once it was declared that the statement was not recorded under duress, the question of ignoring it does not arise. 4.1 In the present appeals also, the income has been disclosed by assessees/appellants voluntarily before ITSC in Form No. 34B on their own and after due verification under their own signature without any pressure or coercion, has probative and evidentiary value and should not be ignored. 5. In view of detailed facts and discussion above, its requested that all these five appeals may be transferred to ITAT, Hyderabad, as current jurisdiction over these assessees now lie with ITAT, Hyderabad. Without prejudice to this, these appeals may be dismissed and order of the CIT(A) confirming the additions made by AO on account of additional income disclosed by the appellants in their form No.34B before ITSC as per details in para 2.3 supra should be upheld.” 11. In the rejoinder, the ld. Counsel for the assessee stated the challenge of the jurisdiction of the appeal before the ITAT was already dealt with by the ITAT in the case of Shri Om Prakash Jakhotia vs ACIT in ITA Nos.968, 969, 970 & 971/Del/2021, vide order dated 21.02.2022. Similar request was duly rejected on the facts of the case on same facts, the order of the ITAT in this case in this connection reads as under:- 17 ITA No.963, 964, 965, 967 & 979/Del/2021 & “17 We have perused the request letter for transfer filed by the ld. CIT-DR and also the submissions made by the assessee vide his letter dated 25.11.2021 before us. 18 In our considered view, whence the assessments in respect of all the captioned assessment years have been made by the ACIT, Central Circle-26, New Delhi and the appeals against the assessments were also decided by the CIT (Appeals)-29, New Delhi and appeal has been filed before Delhi Benches, then we do not find any justifiable reasons for transfer, even if for the future years assessment years have been transferred to Hyderabad. We do not find any prejudice is caused when all the material record for adjudicating the issues involved are available and it is also not the case of Ld. CIT DR that assessment records are required which may have been transferred to Jurisdictional Assessing Officer at Hyderabad. Apart from that, as of now, we find that Hon’ble Bombay High Court in the case MSPL Ltd (supra) has questioned as far as the power of the Hon’ble President of the Tribunal to transfer an appeal from one bench to another bench in different State outside its headquarter is concerned, the Hon’ble High Court at paras 36, 37 and 38 of their order has held as under: “36. Sub section (1) of section 255 says that the powers and functions of the Appellate Tribunal may be exercised and discharged by Benches constituted by the President of the Appellate Tribunal from among the members thereof. As per sub section (5), subject to the provisions of the Act, the Appellate Tribunal shall have power to regulate its own procedure and the procedure of Benches in all matters arising out of the powers or of the discharge of its functions, including the places at which the Benches shall hold their sittings. To complete the narrative, we may also refer to sub section (6) of section 255 which clearly says that a proceeding before the Appellate Tribunal shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purpose of section 196 of the Indian Penal Code. It also says that the Appellate Tribunal shall be deemed to be a civil court for all the purposes of section 195 and Chapter XXXV of the Code of Criminal Procedure, 1898. 37. From a careful analysis of section 255, more particularly sub section (5) thereof, it is not discernible as to how power of the President to transfer a pending appeal from one Bench to another 18 ITA No.963, 964, 965, 967 & 979/Del/2021 & Bench outside the headquarters in a different State can be said to be traceable to this provision. What sub section (5) says is that the Tribunal shall have power to regular its own procedure and that of its various Benches while exercising its powers or in the discharge of its functions. This includes notifying the places at which the Benches shall hold their sittings e.g., a particular Bench at Mumbai may hold its sittings at, say, Thane for a particular period for administrative reasons. This provision cannot be interpreted in such a broad manner to clothe the President of the Tribunal the jurisdiction to transfer a pending appeal from one Bench to another Bench outside the headquarters in another State. 38. We have also noticed from sub section (6) that a proceeding before the Tribunal shall be deemed to a judicial proceeding within the meaning of sections 193, 196 and 228 of the Indian Penal Code and it shall also be deemed to be a civil court for the purpose of section 195 and Chapter XXXV of the Code of Criminal Procedure, 1898. Therefore, there is no manner of doubt that a proceeding before the Tribunal is a judicial proceeding and for certain limited purpose it is deemed to be a civil court. Question for consideration is when an appeal or a bunch of appeals are being heard by a Bench of the Tribunal in one State, can an order on the administrative side be passed by the President transferring a live appeal from one Bench to another Bench that too in a different State outside the headquarters ? In our opinion, no such power is discernible in section 255 of the Act. Reading or conferring such a power would amount to interference in a judicial proceeding of the Tribunal.” 19 Further, as far as the power of the bench to transfer the appeal is concerned, the Hon’ble High Court at paras 40 and 41 has held as follows: “The Tribunal Rules have been framed in exercise of the powers conferred by sub section (5) of section 255 of the Act to regulate the procedure of the Appellate Tribunal and the procedure of the Benches of the Tribunal. Since the order dated 20- 8-2020 has been passed under rule 4 of the Tribunal Rules, the same is extracted hereunder :- "Power of Bench. 19 ITA No.963, 964, 965, 967 & 979/Del/2021 & 4. (1) A Bench shall hear and determine such appeals and applications made under the Act as the President may by general or special order direct. (2) Where there are two or more Benches of the Tribunal working at any headquarters, the President or, in his absence, the Senior Vice- President/Vice-President of the concerned zone or, in his absence, the senior most member of the station present at the headquarters may transfer an appeal or an application from any one of such Benches to any other." 41. From an analysis of rule 4 as extracted above, we find that as per sub rule (1), a Bench shall hear and determine such appeals and applications made under the Act as the President may by general or special order direct. Sub rule (2) says that where there are two or more Benches of the Tribunal working at any headquarters, the President or, in his absence, the senior Vice President or Vice President of the concerned zone or in his absence the senior most member of the station present at the headquarters may transfer an appeal or an application from any one of such Benches to any other. While sub rule (1) empowers the President to direct hearing of appeals by a Bench by a general or special order, sub rule (2) is more specific. It deals with a situation where there are more than two Benches of the Tribunal at any headquarter; when there are multiple Benches in a headquarter, the President or, in his absence the senior Vice President etc. may transfer an appeal or an application from one of such Benches to any other. Meaning thereby that it is a transfer of an appeal or an application from one Bench to another Bench within the same headquarters. For example, in Mumbai the number of Benches is twelve and in Bangalore, the number of Benches is three. Thus, this provision can be invoked to transfer an appeal from one Bench in Mumbai to another Bench in Mumbai or from one Bench in Bangalore to another Bench in Bangalore. But this provision cannot be invoked to transfer a pending appeal from one Bench under one headquarter to another Bench in a different headquarter.” 20. However, independent of the ratio of the above decision, we have already held that on the facts of the present case such a request for transfer cannot be accepted as the Assessing Officer who and CIT(A) of Delhi had jurisdiction 20 ITA No.963, 964, 965, 967 & 979/Del/2021 & over the assessee when orders were passed and all the records for deciding the issues are already on record and no prejudice is caused to any of the parties. Accordingly, we reject the request made by the Ld. CIT DR and proceed to decide the appeals of the assessee.” 12. We find that facts and circumstances here being identical, we follow the same and find that request made by the ld. CIT DR is not sustainable. Hence, we proceed to decide the appeals here. 13. Having heard both the parties and perusing the records, we note that the only issue for adjudication before us is whether the addition can be made u/s 153A of the Act by the AO only on the basis of additional income declared before ITSC. We find that the issue is squarely covered by the decision of Hon’ble Gujarat High Court in the case of Commissioner v. Maruti Fabrics [2014] 47 taxmann.com 298 which has been duly followed by various Benches of the ITAT as referred hereinabove in the submission by ld. Counsel of the assessee. Ld. CIT DR has tried to distinguish this claim by referring that Hon’ble Gujarat High Court decision was rendered in the context of provisions of section 32L of the Central Excise Act, 1944. However, we find that ITAT in the decisions aforementioned including that of Anantnadh Constructions and Farms (P.) Ltd. v. DCIT [2017] 166 ITD 83 has found that the said decision of Hon’ble Gujarat High Court is squarely applicable on the facts of the present case. The reasoning in the said order may be referred as under :- “13. We find that assessee has made declaration and filed some information before Settlement Commission admitted under section 245D of the Act and it can be used only for limited purpose for settlement of tax dispute and passing an order under section 245D(4) of the Income Tax Act and not for other purpose. The assessee has made a disclosure and such 21 ITA No.963, 964, 965, 967 & 979/Del/2021 & disclosure ultimately ended in settlement order under section 245D(4) of the Act. The disclosure came to the possession of AO. The fact that the disclosure made under section 245D(1) of the Act even if constructed as if no order under section 245D(4) has been passed it will not give a license to the AO to use the confidential information disclosed in an annexure to the application of the Settlement Commission. If the application is treated as not admitted under 245D(1) of the Act, then the provisions are clear that confidential information can never be passed on to the AO nor can it be used in evidence against the assessee. Section 245D(4) has clearly held that admission of assessee’s application under section 245(1) was incorrect. We find that any confidential information disclosed in annexure to the settlement application before Income Tax Settlement Commission can never be the basis to make the addition. We find that in the instant case, the AO has reopened the assessment under section 147. Thereafter, AO has not brought any evidence or made any inquiry that assessee has earned additional income of Rs.5 lakhs as brokerage income. In the instant case, after reopening the assessment order, the AO had not made any inquiry and not examined the material which was before him that how this income was declared by the assessee and addition has been made simply relying upon the declaration made in the application before the Settlement Commission under section 245D. The AO was in possession of the paper relating to the income but in absence of any material no addition can be made. The Hon’ble Gujarat High Court in the case of Commissioner vs. Maruti Fabrics 47 Taxmann.com 297 has held that whatever material is produced along with application by the assessee before Settlement Commission or result of inquiry held or evidence recorded by the Settlement Commission in course of proceedings before it can be used by the adjudicating authority as if same had been produced before such Central Excise Officer. Once application or proceedings before Settlement Commission fails, Central Excise Officer is required to adjudicate entire proceedings and show cause notice and Hon’ble Gujarat High Court has held as under: “Considering sub-section (2) of section 32L of the Act, in a case where an order is passed by the Settlement Commission under sub-section (1) of section 32L and thereafter adjudicating authority is required to adjudicate the case, the Central Excise Officer shall be entitled to use all the materials and other information produced by the assessee before the Settlement Commission or the result of inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it as if such materials, information, inquiry and evidence have been produced before such Central Excise Officer or held or recorded by him in the course of the 22 ITA No.963, 964, 965, 967 & 979/Del/2021 & proceedings before him on fair reading of sub-section (2) of Section 32L of the Act whatever is admitted by the assessee while submitting the application before the Settlement Commission submitted under Section 32E(1) of the Act straightway cannot be said to be admission on behalf of the assessing accepting the liability. Whatever the material is produced alongwith the application and/or any material and/or other information produced by the assessee before the Settlement Commission or the result of the inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it can be used by the adjudicating authority as if such materials, information, inquiry and evidence has been produced before such Central Excise Officer, while adjudicating the show cause notice and the proceedings. If the contention on behalf of the appellant is accepted, in that case, there is no question of further adjudication by the Central Excise Officer with respect to the amount admitted by the assessee while submitting the application before the Settlement Commission submitted under Section 32E(1) of the Act. Once the application or proceedings before the Settlement Commission fails, the Central Excise Officer is required to adjudicate the entire proceedings and show cause notice. Under the circumstances, so far as proposed question of law No.1 is concerned, the present Tax Appeals deserve to be dismissed and are, accordingly, dismissed by answering the proposed question of law No.1 against the Revenue.” 14. Respectfully following the same, we hold that Hon’ble Gujarat High Court’s judgment in the case of Maruti Fabrics pertains to Central Excise but if we compare central excise under section 32E of the Central Excise Act this section is parallel to section 245C of the Income Tax Act. One primary condition mentioned in section 32E for filing central excise settlement petition is “a show cause notice for recovery of duty issued by Central Excise Officer has been received”. In Income Tax Act section 245C requires some pendency of proceedings. The Central Excise application is allowed or rejected vide order under section 32F(1). This section is parallel to section 245D(1). Section 32L gives the powers and procedure of Central Excise Settlement Commission. This section is similar to section 245F of the Income Tax Act. Section 32L gives the powers of the Settlement Commission to send the case back to the Central Excise Officer. Section 32L reads as under: “32L(1) The Settlement Commission may, if it is of opinion that any person who made an application for settlement under section 32E has not co-operated with the Settlement Commission in the proceedings before it, send 23 ITA No.963, 964, 965, 967 & 979/Del/2021 & the case back to the Central Excise Officer having jurisdiction who shall thereupon dispose of the case in accordance with provisions of the Act as if no application under section 32E had been made. 32L(2) For the purpose of sub-section (1), the Central Excise Officer shall be entitled to use all the materials and other information produced by the assessee before the Settlement Commission in the course of the proceedings before it as if such materials, information, inquiry and evidence had been produced before such Central Excise Officer or held or recorded by him in the course of the proceedings before him.” 15. We find that section 245HA(1) of the income Tax Act lists several circumstances in which the case before the Settlement Commission would abate; whereas in section 32L(1) non - cooperation of the petitioner is the only ground. The Central Excise Officer derives its power its power to assess such abated proceeding vide section 32L(2) of the Central Excise Act. This is identical to powers vested with an AO under section 245HA(2) and 245HA(3) under the Income Tax Act. It is therefore very clear that the provisions of Central Excise Settlement Commission and that for Income Tax settlement Commission are identical. Therefore, the judgment of Hon’ble Gujarat High Court in the case of Maruti Fabrics although pertaining to Central Excise should be applied to cases abated under section 245HA of the Income Tax Act also. 16. Therefore, we are of the view that the judgment of Hon’ble Gujarat High Court is applicable to the facts of the assessee’s case. We find that Hon’ble Gujarat High Court has held that if the petition filed before the Settlement Commission wherein assessee has made declaration but proves that assessee has neither earned such income nor any incriminating material was found during the search relating to undisclosed income then no addition can be made. 17. We have also gone through the judgment of ITAT, Mumbai in the case of Dolat Investment vs. Dy. Commissioner of Income Tax wherein the ITAT has specifically held in para 22 which reads as under: “22. The first issue is whether the case of the assessee for assessment year 2005-06 was admitted by the Settlement Commission under section 245D(1) of the Act? On this issue, we have already seen that in the order dated 30-11-2007 under section 245D(4) of the Act, the Settlement Commission has clearly held that the assessee 24 ITA No.963, 964, 965, 967 & 979/Del/2021 & for assessment year 2005-06 does not satisfy the criteria of offering income on which at least an income-tax payable should exceed Rs. 1 lakh. The Settlement Commission has further held that when admitting the petition of the assessee for assessment year 2005-06, this aspect was overlooked and that they are rectifying the apparent error by excluding assessment year 2005-06 of the assessee from the process of settlement. Thus, the case of the assessee for assessment year 2005-06 cannot be considered to have been admitted for the process of settlement under section 245D(1) of the Act. Consequently, the confidential information disclosed in the Annexure to the Settlement application could not have been used by the Assessing Officer against the assessee to make the impugned addition. Therefore, the addition to the income made by the Assessing Officer in assessment year 2005-06 which is based only on the disclosure made in the Annexure to the Settlement Commission is not valid in law. Consequently, the imposition of penalty on the basis of such invalid addition cannot be sustained. In view of the above conclusion, we do not wish to go into the other alternate argument of the learned counsel for the assessee regarding abatement of proceedings before Settlement Commission and use of confidential information disclosed by the assessee in such proceedings by the Assessing Officer in making assessment.” 18. From the above decision of the Tribunal where they have discussed the section 245C(1) and section 245D(i) and 245HA by following observation: “20. The Finance Act, 2007 made changes to the provisions for settlement of cases contained in Chapter XIX-A of the Income-tax Act 1961. One change involves introduction of a new concept of abatement of proceedings before the Settlement Commission for which provisions has been made in the newly inserted section 245HA relevant portion whereof reads thus :— "245HA. Abatement of proceeding before Settlement Commission.—(1) where.... (i) an application made under section 245C on or after the 1st day of June, 2007 has been rejected under subsection (1) of section 245D; (ii )an application made under section 245C has not been allowed to be proceeded with under sub-section (2A) or 25 ITA No.963, 964, 965, 967 & 979/Del/2021 & further proceeded with under sub-section (2D) of section 245D; (iii)an application made under section 245C has been declared as invalid under sub-section (2C) of section 245D; (iv)in respect of any other application made under section 245C, an order under sub-section (4) of section 245D has not been passed within the time or period specified under sub-section (4A) of section 245D, the proceedings before the Settlement Commission shall abate on the specified date. Specified date would be (i) in respect of an application referred to in sub-section (2A) or sub-section (2D), on or before the 31st day of March, 2008; (ii) in respect of an application made on or after 1st day of June, 2007 within nine months from the end of the month in which the application was made. (2) Where a proceeding before the Settlement Commission abates, the Assessing Officer or as the case may be any other income-tax authority before whom the proceeding at the time of making the application was pending, shall dispose of the case in accordance with the provisions of this Act as if no application under section 245C had been made. (3) For the purposes of sub-section (2), the Assessing Officer or as the case may be, other income-tax authority, shall be entitled to use all the material and other information produced by the assessee before the Settlement Commission or the results of the inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it, as if such material, information inquiry and evidence had been produced before the Assessing Officer or other income-tax authority or held or recorded by him in the course of the proceedings before him." 21. Thus, when a proceedings before the Settlement Commission abates, it reverts to the income-tax authority before whom it was pending at the time of making the application for settlement and the income tax authority has to dispose of the case in accordance with the provisions of the Act as if no application for settlement had been made and for that purpose, it is entitled to use all the material and other information produced by the assessee before the Settlement Commission or the results 26 ITA No.963, 964, 965, 967 & 979/Del/2021 & of the inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it.” 19. We find from the above proposition of law by Hon’ble Gujarat High Court and Tribunal that simply relying upon the declaration made before the Settlement Commission no addition can be made. In this group case, the search was conducted in the business premises of Lodha Group and subsequent to search action assessee company along with other companies of Lodha Group filed a petition under section 245C(1) of the Act before Settlement Commission. The assessee has offered additional income of Rs.5 lakhs towards the land brokerage income. This offer was made for maintainability of petition before Settlement Commission as stated in clause (i) and clause (ia) of section 245C(1) of the Act. We are of the view that after reopening of the assessment order no addition can be made on the basis of income offered by the assessee before Settlement Commission. We find that no incriminating material was found during the course of search action substantiating that assessee has actually earned undisclosed income. Therefore, just because assessee has offered additional income before Settlement Commission, no addition can be made without basis. Hence, the addition made by the AO and Ld. CIT(A) is deleted.” 14. The above view has been also followed by ITAT in the decisions referred hereinabove in submission of ld. Counsel of assessee reproduced hereinabove. No contrary decision has been produced by the Revenue before us. Hence, ld. CIT DR’s endeavour to distinguish the ITAT decision does not succeed. In our considered opinion, on the facts and circumstances of the case, the aforesaid case laws are applicable, hence the addition made by the AO u/s 153A de hors any incriminating material but only on the basis of declaration before Settlement Commission, cannot succeed. 15. Other aspects of ld. Counsel of the assessee’s submissions are also germane and relevant. The same may gainfully be referred as under :- 27 ITA No.963, 964, 965, 967 & 979/Del/2021 & (i) Additional income was offered in the settlement application merely to qualify for admission of the settlement application; (ii) The case is not a case of abatement u/s 254HA (1) of the Act; (iii) Income offered before the Settlement Commission is not an admission or confession u/s 132 (4) of the Act; (iv) CBDT Instruction F.No.286/2/2003-IT (Inv.II) dated 10.03.2003 also refers confessions or surrender obtained without any incriminating evidence to back the same, are to be ignored; and (v) No enquiry whatsoever has been done by the AO or the ld. CIT (A) to substantiate the addition. 16. In the backdrop of aforesaid discussion and precedents, we set aside the orders of authorities below and hold that the additions made solely on the basis of declaration before the Settlement Commission de hors any incriminating material or enquiry is not sustainable. 17. Our above order applies mutatis mutandis to all the appeals here. 18. In the result, appeals by the assessee stand allowed as above. Order pronounced in the open court on 21 st October, 2022. Sd/- sd/- [ANUBHAV SHARMA] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER Delhi; 21.10.2022. f{x~{tÜ f{x~{tÜf{x~{tÜ f{x~{tÜBgf BgfBgf Bgf Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi