Shri Vinay Kumar Agarwal , Kolkata V. ACIT, Central Circle - 3(1) , Kolkata

ITSSA 124/KOL/2018

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 0466 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 11 month(s) 13 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 17-10-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 29-08-2022
• Assessment Year: 2013-2014
• Appeal Filed On: 04-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 132; 143(3); 153A; 14A; 80IB; 143(1); 250; 143(2); 192; 139(1); 64; 72; 13; 153; 153C

Judgement Text

आयकर अपीलीय अधिकरण कोलकाता 'ए' पीठ, कोलकाता म ें IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘A’ BENCH, KOLKATA श्री राजपाल यादव, उपाध्यक्ष (कोलकाता क्ष े त्र) एवं डॉ. मनीष बोरड, ल े खा सदस्य क े समक्ष Before SRI RAJPAL YADAV, VICE PRESIDENT & DR. MANISH BORAD, ACCOUNTANT MEMBER I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal....................................Appellant [PAN: ACAPA 3335 N] Vs. ACIT, Central Circle-3(1), Kolkata.........................Respondent Appearances by: Sh. S. Jhajharia, CA, appeared on behalf of the Assessee. Md. Ghayas Uddin, CIT, (D/R), appeared on behalf of the Revenue. Date of concluding the hearing : August 30 th , 2022 Date of pronouncing the order : October 18 th , 2022 ORDER Per Manish Borad, Accountant Member: This appeal filed by the assessee pertaining to the Assessment Year (in short “AY”) 2013-14 is directed against the order passed u/s 250 of the Income Tax Act, 1961 (in short the “Act”) by ld. Commissioner of Income-tax (Appeals)-21, Kolkata [in I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 2 of 17 short ld. “CIT(A)”] dated 10.08.2018 which is arising out of the assessment order framed u/s 153A/143(3) of the Act. 2. The assessee is in appeal before this Tribunal raising the following grounds: “1. For that in view of the facts and in the circumstances, the Ld. CIT(A) erred in not adjudicating the ground pertaining to the validity of the order u/s 153A/143(3) and in view of the facts and in the circumstances it may kindly be held accordingly. 2. Without prejudice to the Ground No. l above, the proceedings and the consequent order so passed u/s 153A/ 143(3) has no legal sanctity since there was no incriminating material and hence the order so passed is bad in law and it may kindly be held accordingly. 3. Without prejudice to the Grounds No. 1 & 2 above, the Ld. CIT(A) erred in not appreciating the law laid down in such respect by Hon’ble Jurisdictional High Court and other High Courts that in absence of incriminating material no addition can be made in order u/s 153 A/l 43(3) and in view of the facts and in the circumstances it may kindly be held accordingly. 4. For that in view of the facts and in the circumstances, the Ld. CIT(A) erred in treating, the long term capital gain of Rs. 46,12,800/- as unexplained cash credit and in view of the facts and in the circumstances the Ld. CIT(A)’s action in affirming the order of the A.O. is wholly bad and illegal and in view of the facts and in the circumstances it may kindly be held accordingly. 5. Without prejudice to the Ground No.4 above, the Ld. CIT(A) erred in not appreciating the fact that the entire addition of Rs. 46,12,800/- has been made by the A.O. without allowing Cross-Objection of the persons based on whose statements, the addition was made by the A.O. and affirmed by the Ld. CIT(A) and as such the addition so affirmed by the Ld. CIT(A) is bad in law in view of the facts and in the circumstances it may kindly be held accordingly. 6. Without prejudice to the Grounds No.4 & 5 above, the Ld. CIT(A) erred in not appreciating the fact that the addition of Rs. 46,12,800/- has been made by the A.O. based on material which were without conducting any enquiry by A.O. by himself nor allowing Cross- Objection of such material and/or persons whole statements were I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 3 of 17 relied upon and as such the A.O.’s order is void ab initio action of Ld. CIT(A) in affirming action of A.O. is bad in law and as such it may kindly be held accordingly.” 3. We will first take up ground nos. 1 to 3 of this appeal through which the assessee has raised the legal issue that the assessment order framed u/s 153A & 143(3) of the Act dated 28.12.2016 is invalid, bad in law and liable to be quashed as the additions have been made without referring to any incriminating material found during the course of search for the completed assessment year. 4. Ld. Counsel for the assessee submitted that the assessee regularly files its income tax return and original return for AY 2013-14 was filed on 28.09.2013. Search was conducted u/s 132 of the Act on 03.03.2015 at the premises of Gagan Group which belongs to the assessee. No notice u/s 143(2) of the Act was issued for the AY 2013-14. As on the date of search AY 2013-14 was a completed assessment year and in light of the settled judicial precedence additions during this year could have been made only on the basis of incriminating material seized during the search proceedings. The additions made by ld. AO in the assessment completed subsequent to search have no nexus with any incriminating material and therefore, the assessment proceedings are liable to be quashed. In support, reliance was placed on the following decisions: i. Decision of the Jurisdictional Tribunal at Kolkata, rendered in the case of Appellant’s brother, Shri Deepak Kumar Agarwal on similar sets of facts in ITSSA 125 & 16/Kol/2018 for Assessment Years 2013 & 2014 vide order dated 10.5.2019. ii. Decision of the jurisdictional High Court at Kolkata rendered in the case of M/S. RASHMI INFRASTRUCTURE PVT. LTD. In ITAT 99 OF 2019 GA 1211 OF 2019 dated 24 February, 2020. I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 4 of 17 iii. Decision of Chennai Bench of the ITAT rendered in the case of RPD Earth Movers (P.) Ltd in IT APPEAL NOS. 1606 TO 1612 (CHNY) OF 2018 [ASSESSMENT YEAR 2011-12] dated DECEMBER 3, 2018. iv. Decision of the Mumbai Bench of the ITAT rendered in the case of Vijayrattan Balkrishan Mittal in IT APPEAL NOS. 3427 TO 3429 (MUM.) OF 2019 & OTHERS [ASSESSMENT YEARS 2012-12 TO 2015- 16] Date of Order OCTOBER 1, 2019. v. Order of the decision of the Bangalore Tribunal, decided in the case of Sri Rathan Babulal Lath in ITA No. 157/Bang/2020 decided on 05.08.2022. 5. On the other hand, ld. D/R vehemently argued supporting the orders of both the lower authorities and referred to the following judicial pronouncements: “1. PCIT Vs Param Dairy Limited (2021) 133 taxmann.com 148 (SC) 20-9-2021 2. PCIT Vs Gaurav Arora (2021) 133 taxmann.com 293 (SC) 17-9-2021 3. PCIT Vs Anand Kr. Jain (2021) 133 taxmann.com 289 (SC) 9-9- 2021 4.PCIT Vs Gohoi Foods (P) Ltd (2021) 117 taxmann.com 118 (SC) 24- 1-2020 5. Principal Commissioner of Income-tax, Central-4 vs. Dhananjay International Ltd. [2020] 114 ta.xmann.com 351 (SC)[ 16-09-2019] 6. Principal Commissioner of Income-tax, Delhi-2 vs. Best Infrastructure (India) (P.) Ltd. [2018] 94taxmann.com 115 (SC)[ 14-05- 2018] 7. Commissioner of Income-tax-7 vs. RRJ Securities Ltd. [2017] 79taxmann.com 115 (SC)[03-02-2017] 8. Commissioner of Income-tax-I vs. MGF Automobiles Ltd. [2016] 72 taxmann.com 240 (SC)[ 12-07-2016] 9. Commissioner of Income-tax-11 vs. Continental Warehousing Corporation (Nhava Sheva) Ltd. [2015] 64 taxmann.com 34 (SC)[ 12- 10-2015] I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 5 of 17 10. E. N. GOPAKUMAR Vs CIT (2016) (2016) 75 taxmann.com 215 (Kerala) 3-10-2016 11. Filatex India Ltd. vs. Commissioner of Income-tax-I V [2014] 49 taxmann.com 465 (Delhi)[14-07-2014] 12. Harvey Heart Hospitals Ltd. vs. Assistant Commissioner of Income tax [2010] 130 TTJ 700 (Chennai)[30-01-2009]” 6. We have heard rival contentions and perused the records placed before us. The validity of the assessment proceedings u/s 153A r.w.s. 143(3) of the Act for AY 2013-14 is in challenge before us. It is an undisputed fact that the assessee e-filed its original return for AY 2013-14 on 28.09.2013 declaring income of Rs. 26,30,990/-. The return was processed u/s 143(1) of the Act on 26.03.2015. Assessee’s case was not selected for scrutiny by issuance of notice u/s 143(2) of the Act which could have been issued latest by 30.09.2014. Search proceedings were carried out on 03.03.2015. Now, at this stage, the assessment year under consideration cannot abate as it comes under the category of completed assessment and the same can be tinkered with only if ld. AO is able to lay its hand on such seized material which can indicate that the assessee has not disclosed such transactions/income in its return of income. It has been consistently held that additions in assessment proceedings u/s 153A r.w.s. 143(3) of the Act for the completed assessments can be carried out only after making reference to the seized material found during the course of search. For this proposition, though there are plethora of judgments, however, we would like to reproduce below the finding of the coordinate Bench of the Indore Tribunal in the case of M/s. Swadesh Developers and Builder vs. ACIT(Central)-II, Bhopal in IT(SS)A Nos. 304 to 309/Ind/2017 & I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 6 of 17 Others dated 10.08.2021 wherein similar issue has been adjudicated after considering the judgments both in favour of the assessee and the Revenue and finally the issue has been decided in favour of the assessee observing as follows: “11. We have heard the rival submissions, perused the materials available before us and carefully gone through the decisions referred and relied by the Ld. Counsel for the assessee. Through this legal ground assessee has challenged the finding of Ld. CIT(A) confirming the addition and denying the deduction u/s 80IB(10) of the Act on the ground that no incriminating material was found during the course of search and additions were purely made on the basis of information called during the course of assessment proceedings. 12. We note that the search was conducted at the assessee business premises on 29.01.2014. The assessee has been filing regular return income u/s 139(1) of the Act. Before the date of search return of income for A.Y. 2008-09 to 2013-14 already stood filed. Time limit for issuance of notice u/s 143(2) of the Act for selection of the case of the assessee for scrutiny proceedings for A.Ys. 2008-09 to 2012-13 stood expired as on the date of search. 13. Now for A.Ys. 2008-09 to 2012-13 it is an established fact that no incriminating material was found during the course of search. No Swadesh Developers such reference has been made by the ld. AO in the assessment order. Under these given facts whether the addition/disallowances/denying of claim of deduction u/s 80IB(10) of the Act by the ld. AO was justified or not needs to be examined in the light of settled judicial precedents. 14. Ld. counsel for the assessee has referred to one of the decision of this Tribunal in the case of Omprakash Gupta (supra) wherein also similar type of issue came up for adjudication before this tribunal. After discussing the settled judicial precedents, thus tribunal hold that the additions for non-abated/completed assessment can be made only on the basis of any incriminating material found during the course of search and the additions so made should have a nexus with such material. The relevant finding of this tribunal in case of Omprakash Gupta(supra) considering settled judicial precedents is reproduced below: 11.2014. The case of the assessee is that the return for A.Y. 2012-13 was filed on 7.11.2012. As per section 143(2) of the Act, the last date on which notice for assessment would have been issued was I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 7 of 17 30.9.2013. All the other returns are filed on earliest date and the time limit for issue of notice u/s 143(2) of the Act in all those cases has expired. The search was initiated in the business premises of the assessee on 29.1.2014 and therefore the time limit for issue of notice u/s 143(2) of the Act is lapsed. All the assessment years from 2008- 09 to 2012-13 are concluded and non abated assessments. The A.O. cannot reopen the assessments u/s 153A of the Act. In so far as the above submission is concerned from the assessment order and even from the Ld. CIT(A)'s order, there is nothing on the record which says that the additions made by the A.O. are based on any incriminating material. Even when the same was pointed out to Ld. D.R., she is not able to establish the fact that additions are based on any incriminating material, therefore we find that the additions made by the A.O. for all the years are not based on any incriminating material found during the course of search. It is only based on subsequent search by issue of notice u/s 153A of the Act calling for the various documents from the assessee additions are made. In so far as the arguments of the Ld. Counsel for the assessee in respect of concluded assessments cannot be reopened, we find that in all the assessment years from 2008-09 to 2012-13, there is no scope for the A.O to issue a notice u/s 143(2) of the Act for the reason that the time limit is already over before the date of search itself i.e. on 29.1.2014. Therefore, in our opinion, all the assessment years from 2008-09 to 2012-13 are concluded assessments and non abated assessments and any addition has to be made in respect of those assessment years, there must be an incriminating material. In the present case, there is no incriminating material and therefore, the additions made by the A.O. cannot survive. 12. This very issue has been considered by The Hon'ble Bombay High Court in the case of CIT Vs. Continental Warehousing Corporation (2015) 120 DTR (Bom) 89 and has observed that u/s 153A of the Act which enables carrying out a search or exercise of a power of requisition, assessment in furtherance thereof is contemplated. There is a mandatory issue of notice u/s 153(1A) of the Act and assess and reassess the total income of 6 assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made. That the crucial word 'search and requisition' appear for the substantive provision on the provisos. That would throw the light on the issue of applicability of the provision. True it is that the assessment, which has to be made in pursuance of the notice is in relation to the 6 years. An order will have to be made in that record while making the order, the income or the I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 8 of 17 return of income filed for all those assessment years is to be taken into account. A reference will have to be made to the income disclosed therein. However, the scope of enquiry there of not confined essentially revolves around the search or the requisition u/s 132A of the Act as the case may be. The proviso deals with the cases where the assessment or reassessment, if any relating to assessment years falling within the period of 6 assessment years refer to in sub section 1 of section 153A of the Act were pending. If they were pending on the date of initiation of search u/s 132 of the Act or making requisition u/s 132A of the Act as the case may be, they abate. It is only binding precedence that would abate and not where there are orders made on assessment or reassessment and which are in force on the date of initiation of the search or making the requisition. 13. In the case of Commissioner of Income Tax (Central)-3 Kabul Chawla (2015) 61 Taxman.com 412 (Del.), the Hon'ble Delhi High Court has considered the scope of section 132 of the Act and 153A(1) observed as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153 A(I) will have to be mandatorily issued to the person searched requiring him to file returns for six A Y s immediately preceding the previous year relevant to the A Y in which the search takes place. ii. Assessments and reassessments pending on the date 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 A Y in which the search takes place. The AO has the power to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words there will be only one assessment order in respect of each of the six AYs "in which both the disclosed and the undisclosed income would be brought to tax". iv. Although Section 153 A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment "can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material." I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 9 of 17 v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each A Yon the basis of the findings of the search and any other material existing or brought on the record of the AO. 14. From the above decision, it is very clear that in respect of concluded assessments additions cannot be made without incriminating material. 15. The Hon'ble Delhi High Court in the case of PCIT Vs. Meeta Gutgutia 395 ITR 296 (Delhi) has held that it was only if during the course of the search u/s 132 of the Act incriminating material justifying the reopening of the assessment years for 6 previous years was found that invocation of section 153A of the Act qua each of the assessment year would justify. 16. In the case of Principal CIT Vs. Soumya Constructions 387 ITR 529 (Guj.) the Hon'ble Gujarat High Court has observed that the addition was based on statement of the third person and not based on any incriminating material found during the course of search, therefore the addition deleted by the Tribunal was upheld. 17. In the case of PCIT Vs. Lata Jain 384 ITR 543 (Del) (supra), the Hon'ble Delhi High Court has held that the Tribunal was right in holding that there had to be incriminating material recovered during the course of search qua the assessee in each year for the purpose of framing an assessment u/s 153A of the Act. 18. From the above all the decisions, it is very clear that the A.O. to make an addition u/s 153A of the Act and there must be incriminating material available to the A.O. during the course of the search. Unless there is an incriminating material, the concluded/non abated assessments cannot be disturbed again u/s 153A of the Act. 19. In so far as Kerala High Court decision in the case of E.N. Gopakumar (supra) the Hon'ble Kerala High Court has held that even without there being any incriminating material, the A.O. is empowered I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 10 of 17 to make an addition u/s 153A of the Act. The same view has been expressed by the Hon'ble Karnataka High Court in the case of Canara Housing Development Company (supra). 20. In the above circumstances, whether the decision of the Hon'ble Supreme Court in the case of CIT Vs. Vegetable Products (supra) has to be applied or not. The Ld. D.R. has submitted that the decision held in CIT Vs. Vegetable Products (supra) cannot be applied in each and every case in the light of the decision of CCV Dilip Kumar (supra). In the present case, the assessee has filed all the returns before conducting the search and the time limit to issue notice u/s 143(2) of the Act already lapsed and a search is conducted and no incriminating material is found. The A.O. called for books of accounts and other relevant documents and assessment is completed u/s 153A r.w.s. 143(3) of the Act. 21. There are many decisions in favour of the assessee, which says that "once assessments are concluded without incriminating material, additions cannot be made by reopening u/s 153A of the Act. There are two decisions, one is of Hon'ble Kerala High Court in the case of E.N. Gopakumar (supra) and the second one is of Hon'ble Karnataka High Court in the case of Canara Housing Development Company Vs. DCIT Central Circle- 1, Bangalore (supra) in favour of the revenue in which it was held that no incriminating material is necessary to reopen the assessments and to make an addition. In the present case, decisions of Hon'ble Delhi, Gujarat and Bombay High Courts are in favour of the assessee. The decisions of Hon'ble Kerala High Court and Karnataka High Court are against the assessee. We find that after examining the facts and circumstances of the case, the judgement of the Hon'ble Supreme Court in the case of Vegetable Products (supra) has to be followed. The Hon'ble Supreme Court in the above case has held that "if two reasonable constructions of a taxing provisions are possible, then that construction, which favours the assessee must be adopted." 22. In the interest of justice, the decision of the Hon'ble Supreme Court in the case of Vegetable Products (supra) has to be followed. Therefore, we respectively following the decision of Hon'ble Delhi High Court in the case of Kabul Chawla (supra), Hon'ble Bombay High Court in the case of Continental Warehousing Corporation (supra) and also Hon'ble Gujarat High Court in the case of PCIT Vs. Meeta Gutgutia (supra), we hold that no addition can be made in respect of concluded assessments u/s 153A of the Act unless there is any incriminating material found during the course of search. We would I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 11 of 17 like to make it clear that where the assessment is completed u/s 143(1) or 143(3) of the Act unless A.O. has a time to issue notice u/s 143(2) of the Act, A.O. cannot make an addition u/s 153A of the Act, unless there is an incriminating material found during the course of the search. 23. The coordinate bench of the Tribunal in the case of Sainath Colonisers Vs. ACIT (Central)-II Bhopal in IT(SS)A Nos.289 to Swadesh Developers 291/Ind/2017 dated 28.2.2019 has considered the similar issue and has held that if there is no incriminating material found during the course of search and the time limit for issue of notice u/s 143(2) of the Act expires, no addition can be made u/s 153A of the Act. For the sake of convenience relevant portion of the order is extracted hereunder: "8. We observe that the assessee has filed regular return of income u/s 139 of the Act for Assessment Year 2008-09 to 2010-11 on 30.9.08, 31.3.2010 and 12.10.2010 after claiming deduction u/s 80IB(10) at Rs.8,92,452/-, Rs.2,66,948/- and Rs.2,44,417/- respectively. The time limit for issuance of notices u/s 143(2) of the Act stood expired in relation to the assessment year 2008-09 to 2010- 11 much before the date of conducting the search i.e. 29.1.2014 and therefore these three assessment years falls under the category of unabated/non abated assessments. Now in the given facts Ld. Counsel for the assessee has relied few judgments and Ld. Departmental Representative has relied to few judgments in its favour. However, the Hon'ble Apex Court in the case of CIT V/s Vegetable Products Ltd 88 ITR 192 has "held that if two reasonable construction of a taxing provisions are possible, then that construction which favours the assessee must be adopted". In the light of above judgment of Hon'ble Apex Court we have gone through the judgments referred and relied by both the parties and are inclined to follow the view taken by Hon'ble courts on the issue in question before us favouring the assessee. 9. The Hon'ble High Court of Gujarat in the case of PCIT Vs. Desai Construction (supra) confirmed the view taken by the Tribunal upholding the contention of the assessee that as no incriminating material was found during the course of search which could have enabled the Assessing Officer to re-examine its claim for deduction u/s 80IB which was part of the assessment prior to the search and such assessment unabated. Similarly Hon'ble High Court of Bombay in the case of Continental Warehousing Corporation and All Cargo Global Logistics Ltd (Supra) confirmed the view taken by the Special I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 12 of 17 Bench of I.T.A.T. Mumbai Bench decided in favour of assessee dismissing the revenue's appeal holding that there was no incriminating material found during the course of search, the Tribunal was right in holding the power conferred u/s 153A being not expected to be exercised routinely, should be exercised if the search revealed any incriminating material. If that was not found then in relation to the second phase of three years, there was no warrant for making an order within the meaning of this provision". 10. Similar view was also taken by the Hon'ble High Court of Delhi in the case of Kabul Chawla (2015) 61 taxmann 412. 11. We therefore in the given facts and circumstances of the case and respectfully following the judgments referred and relied by the Ld. Counsel Swadesh Developers for the assessee are of the considered view that no addition/disallowance was called for Assessment Year 2008-09 to 2010-11 as no incriminating material was found during the course of search at the premises of the assessee as the time limit of issuance of notice u/s 143(2) of the Act stood expired much before the date of conducting search u/s 132 of the Act. Accordingly all the three appeals of the assessee are allowed." 24. In so far as the arguments of the Ld. D.R. in respect of following the ratio of the Hon'ble Supreme Court in the case of Vegetable Products (supra), the Ld. D.R. by relying on the decision in the case of CCV Dilip Kumar (supra) has submitted that the ratio laid down in the case of Vegetable Products (supra) cannot be applied. We find that in the case of CCV Dilip Kumar (supra) has considered the exemption provisions and held that exemption provisions has to be considered strictly and in a case of ambiguity view which favours the revenue must be adopted. Therefore, the above decision relied by the Ld. D.R. has no application to the ratio laid down by the Hon'ble Supreme Court in the case of Vegetable Products (supra). Therefore, argument of the Ld. D.R. is rejected. 15. On examining the facts of the instant case in light of the above decision of this tribunal in case of Omprakash Gupta (supra) wherein various other judgments and decisions have been referred, we find that in the case of assessee, assessment years 2008-09 to 2012-13 comes under the category of non-abated/completed assessment and the additions made by the ld. AO towards denying the benefit of deduction u/s 80IB(10) of the Act as well as taxing Long Term Capital Gain on sale of land as business income are not supported by any incriminating material found during the course of search and I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 13 of 17 therefore, assessee succeeds on this legal ground and the addition made for A.Y. 2008-09 to A.Y. 2012-13 are deleted and deduction u/s 80IB(10) of the Act claimed by the assessee is accepted. We, thus, set aside the finding of ld. CIT(A) and allow this common legal ground raised by the assessee for A.Ys. 2008-09 to 20120-13. However, for A.Y. 2013-14 assessee fails to succeed on this legal ground as time limit for issuance of notice u/s 143(2) of the Act has not expired as on the date of search. As far as legal ground raised for A.Y. 2014-15 is concerned, the same is dismissed as not pressed.” 7. We would further like to refer to the following finding of the latest decision of coordinate Bench, Bangalore Tribunal in the case of Sri Rathan Babulal Lath in ITA No. 157/Bang/2020 dated 05.08.2022 favouring assessee: “4.12 In our opinion, the Ld. CIT(A) is required to examine the entire seized material and information found during the course of search and she has to give findings whether addition made by the AO in the assessment order framed u/s 153A of the Act were emanated from the seized material or information collected during the course of search action. With this observation, we remit the entire issue in dispute before us to the file of Ld. CIT(A) to reconsider the entire issue in the light of our observations. Accordingly, issue is remitted to the file of Ld. CIT(A) for passing a speaking order. 4.13 To sum up, the grounds of the appeal are disposed of as follows: (a) With regard to Ground No.2.1, the judgement of HonTole Karnataka High Court mentioned in the ground in the case of IBC Knowledge Park Ltd. cited (supra) have no application to the facts of the present case, which was delivered in the context of applicability of section 153C of the Act. In the assessee’s case, the assessment was completed u/s 153A of the Act. (b) With regard to Ground No. 3, the Tribunal in ITA No.355/Bang/2017 vide order dated 15.6.2018 has deleted the addition made in the course of re-assessment and that decision have no binding on this assessment framed u/s 153A of the Act. Being so, the plea of the assessee cannot be accepted on this reason. I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 14 of 17 (c) With regard to Ground No.4, the issue relating to the merit of the additions is remitted back to the file of Ld. CIT(A) for fresh consideration. (d) With regard to Ground No.4.1, this argument of the assessee’s counsel is devoid of merits. Once the search took place as discussed in paras 4.8 to 4.11 above, the AO is bound to reopen the assessment of 6 years covering the block period. Further, the legal position that emerges on a perusal of section 153A and section 132 of the Act is as under: (i) Once a search takes place under section 132 of the Act, notice under section 153A(1) will have to be mandatorily issued to the person in respect of whom search was conducted requiring him to file returns for six assessment years immediately preceding the previous year relevant to the assessment year in which the search takes place. (ii) Assessments and reassessments pending on the date of the search shall abate. The total income for such assessment years will have to be computed by the Assessing Officers as a fresh exercise. (iii) The Assessing Officer will exercise normal assessment powers in respect of the six years previous to the relevant assessment year in which the search takes place. The Assessing Officer has the power to assess and reassess the "total income" of the six years in separate assessment orders for each of the six years. In other words, there will be only one assessment order in respect of each of the six assessment years in which both the disclosed and the undisclosed income would be brought to tax. (iv) Although section 153A of the Act does not say that additions should he strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the Assessing Officer, which can be related to the evidence found, it does not mean that the assessment can be arbitrary or made without any relevance or nexus with the seized material. Obviously, an assessment has to be made under this section only on the basis of the seized material. (v) In the absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word "assess" in section 153A of the Act is relatable to abated proceedings (i.e., those pending on the date of search) and the word "reassess" to completed assessment proceedings. I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 15 of 17 (vi) In so far as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under section 153A of the Act merges into one. Only one assessment shall be made separately for each assessment year on the basis of the findings of the search and any other material existing or brought on the record of the Assessing Officer. (vii) Completed assessments can be interfered with by the Assessing Officer while making the assessment under section 153A of the Act 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 course of search which were not produced or not already disclosed or made known in the course of original assessment. 5. In the result, the appeal filed by the assessee is partly allowed for statistical purposes.” 8. Now, on perusal of the judicial pronouncements referred above and on examining the facts of the case of the instant appeal, we find that notice u/s 143(2) of the Act was not issued for AY 2013-14 for selecting the original e-return filed by the assessee on 28.09.2013 and therefore, AY 2013-14 is a completed assessment year. Now, on perusal of the assessment order we find that for the additions made in the said order ld. AO has not referred to any incriminating material nor there is any indication of any seized material on the basis of which ld. AO has framed the assessment order for making the additions. Both the additions u/s 14A & 10(38) of the Act are made after going through the computation of income filed by the assessee and enquiries conducted in the assessment proceedings are merely on the basis of the information supplied by the assessee in the computation of income and during assessment proceedings. Therefore, respectfully following the judicial precedence, we are of the considered view that the completed assessment years can be abated only after making I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 16 of 17 reference to any incriminating material found during the course of search, Thus, we fail to find any merit in the assessment order framed by ld. AO and the same is invalid and liable to be quashed. We, accordingly set aside the finding of ld. CIT(A) and quash the assessment order dated 28.12.2016 framed in the case of the assessee for AY 2013-14 and allow the legal ground nos. 1 to 3 raised by the assessee in the instant appeal. 9. Now, we take up the remaining ground nos. 4 to 9 raising issues on merit. Since we have already quashed the assessment proceedings u/s 153A r.w.s. 143(3) of the Act dated 28.12.2016 holding it to be invalid and bad in law, no additions will stand for and therefore, it will be merely an academic exercise to adjudicate the issues on merit and therefore the grounds raised on merits are held to be infructuous. 10. In the result, the appeal filed by the assessee is allowed. Kolkata, the 18 th October, 2022. Sd/- Sd/- [Rajpal Yadav] [Manish Borad] Vice President Accountant Member Dated: 18.10.2022 Bidhan (P.S.) I.T.(S.S.)A. No.: 124/Kol/2018 Assessment Year: 2013-14 Shri Vinay Kumar Agarwal. Page 17 of 17 Copy of the order forwarded to: 1. Shri Vinay Kumar Agarwal, C/o. Salarpuria Jajodia & Co., 7, C.R. Avenue, Kolkata-700 072. 2. ACIT, Central Circle-3(1), Kolkata. 3. CIT(A)-21, Kolkata. 4. CIT- 5. CIT(DR), Kolkata Benches, Kolkata. True copy By order Assistant Registrar ITAT, Kolkata Benches Kolkata