Shri Brajendra Sharma, Jhabua V. THE DCIT-CENTRAL (1), Bhopal

ITSSA 167/Ind/2021

AI Insights

The case involves multiple appeals by both the assessee, Shri Brajendra Sharma, and the revenue against the orders passed by the Commissioner of Income-Tax (Appeals)-3, Bhopal, which arose from the orders of the Deputy Commissioner of Income Tax (Central)-I, Bhopal. The appeals were related to the assessment years 2008-09 to 2013-14. The main legal issue was whether the additions made by the AO in the assessee's unabated assessments were valid under Section 153A of the Income Tax Act, 1961, in the absence of any incriminating material. The Tribunal found that the additions were made on the basis of regular entries in the books of account and not on any incriminating material discovered during the search and seizure operation conducted on the assessee's premises.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 122534 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 4 month(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 26-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 28-09-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 25-11-2021
• Other Referred Cases: CIT vs. Kabul Chawla, PCIT vs. Meeta Gutgutia, PCIT vs. Gahoi Dal & Oil Mills, Smt. Radhika Jain Bhopal vs. ACIT, PCIT vs. Saumya Construction, Jayaben Ratilal Sorathia vs. CIT, ACIT-3(1), Bhopal vs. Kulwant Singh, Smt. Dayawanti vs. CIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Search and seizure
• Section: 147; 6; 132; 15; 143(3); 153A; 143(2); 69A; 139(1); 13; 153

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE Ms. MADHUMITA ROY, JUDICIAL MEMBER & SHRI BHAGIRATH MAL BIYANI, ACCOUNTANT MEMBER (Conducted through Virtual Court) I.T .( SS )A . No s. 1 6 3, 16 4, 1 65 , 16 6 & 16 7/I nd /2 02 1 (As se ss me nt Y ea rs : 20 08 -0 9, 2 00 9- 10 , 20 10- 11 , 20 11 -1 2 & 20 12- 13 ) Sh ri Br aj en dr a S h ar ma 9, Si dd es hw ar C ol o n y, Jha bu a Vs. Th e De pu ty C o mm iss io ne r of In co me T ax Cir cl e (1) , Bh op al PA N No . AS QP S1 2 15 H (Appellant/Assessee) .. (Respondent/Revenue) IT(SS) A Nos.143 & 144/Ind/2021 (Assessment Years :2010-11 & 2013-14) Th e De pu ty C o mm iss io ne r of In co me T ax Cir cl e (1) , Bh op al Vs. Sh ri Br aj en dr a S h ar ma 9, Si dd es hw ar C ol o n y, Jha bu a PA N No . AS QP S1 2 15 H (Appellant/Revenue) .. (Respondent/Assessee) Assessee by : Shri Sumeet Neema, Sr. Advocate & Shri Gagan Tiwari, Advocate Revenue by : Shri P. K. Mishra, CIT.D.R. Dat e of H ea ri ng 22.02.2023 Dat e of P ro no un ce me nt 27.03.2023 O R D E R PER BENCH: All these appeals filed by the assessee/revenue are directed against the common order dated 18.08.2021 passed by the Ld. Commissioner of Income-Tax (Appeals)-3, Bhopal (‘CIT(A)’ in short), arising out of the common order dated 10.11.2015 passed by the DCIT(Central)-I, Bhopal under section 153A r.w.s. 143(3) of the Income Tax Act, 1961 (hereinafter IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 2 - referred as to ‘the Act’) for Assessment Years i.e. 2008-09, 2009-10, 2010- 11, 2011-12, 2012-13 & 2013-14. Assessee’s Appeals: 2. We first take up assessee’s appeals. The main challenge in these appeals is the validity of the assessments on the ground that in the absence of any incriminating material, addition in unabated assessment in the search matter is not sustainable. 3. A search and seizure action u/s 132 of the I.T. Act was carried out on the business and residential premises of the assessee on 20.6.2012 and notice u/s 153A of the I.T. Act was issued to the assessee on 28.5.2013 for the A.Y. 2007-08 to 2013-14. However, time limit for issuing notices u/s 143(2) had already expired on 30.9.2009, 30.9.2011 and 30.9.2011 for the A.Y. 2008-09 to 2010-11, under consideration, respectively. Thus, these A.Ys. are unabated assessment. As no incriminating material was unearthed during search proceeding, the addition in such unabated assessment is not sustainable as the case made out by the assessee. On the other hand, the Ld. DR relied upon the order passed by the authorities below. 4. We have considered the rival submissions made by the respective parties and we have gone through the materials available on record. We find that the impugned additions have been made on unsecured loans and sundry liabilities appearing in the balance sheet and return of income of the assessee. We find that for the A.Ys. 2008-09 to 2010-11, the assessee had filed return of income u/s 139(1) of the I.T. Act on 28.3.2009, 12.7.2010 and 25.2.2011 respectively and therefore, the time limit for issuance of IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 3 - notice u/s 143(2) of the I.T. Act expired on 30.09.2009, 30.09.2011 and 30.09.2011, respectively. Thus on the date of search i.e. 20.6.2012, the A.Ys. 2008-09 to 2010-11 were not pending. In that view of the matter, the addition in unabated assessment is beyond the scope of the Section 153A of the I.T. Act because of the particular reason that the additions made by the AO were not based on any incriminating documents but same is made on the “Deposit and unsecured loan appearing in the balance sheet of the assessee” which is appearing at Paragraph 14 of Page 18 of the assessment order passed by the Ld. AO already appearing in the return of income of the assessee originally filed u/s. 139(1) of the I.T. Act. On this aspect, the Ld. Counsel for the assessee relied upon the judgments passed in the matter of CIT vs. Kabul Chawla, reported in 380 ITR 573 (Del), PCIT vs. Meeta Gutgutia, reported in (2017) 395 ITR 526 (Delhi), PCIT vs. Gahoi Dal & Oil Mills (2021) 11 ITJ Online 314 (MP) & Smt. Radhika Jain Bhopal vs. ACIT, IT(SS)A No. 180 & 181/Ind/2016 order dated 20.10.2022 (ITAT, Indore) etc. 5. We have considered the judgments relied upon by the Ld. Counsel for the assessee. 6. First, we refer to the decision of Hon’ble Delhi High Court in the case of CIT vs. Kabul Chawla, reported in 380 ITR 573 (Del). Hon’ble Delhi High Court after detailed analysis has summarized the following legal position: “37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153 A(1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previous year relevant to the AY IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 4 - in which the search takes place. ii. Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as a fresh exercise. iii. The AO will exercise normal assessment powers in respect of the six years previous to the relevant AY in which the search takes place. The AO has the power to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words there will be only one assessment order in respect of each of the six AYs "in which both the disclosed and the undisclosed income would be brought to tax". iv. Although Section 153 A does not say that additions should be strictly made on the basis of 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." 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 AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessments can be interfered with by the AO while making the assessment under Section 153 A only on the basis of some incriminating material unearthed during the course of search or 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.” 7. Hon’ble Court has specifically observed for the purpose of Section 153A assessment, completed assessments can be interfered with by the AO only on the basis of 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 proceeding. We further find that the Hon’ble Gujarat high Court has also considered the decision of Hon’ble Delhi High Court in the case of CIT vs. Kabul Chawla (supra). Hon’ble Gujarat High Court on the identical situation framed the IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 5 - following question of law in the case of PCIT vs. Saumya Construction, reported in (2017) 81 taxmann.com 292 (Guj.): "[A] Whether the order of Tribunal is right in law and on facts in deleting the addition made in assessment made u/s 153A of the Act? [B] Whether the Tribunal is right in law in holding that the addition should be based on the incriminating material found during the course of search under new procedure of assessment u/s 153A which is different from earlier procedure u/s 158BC r.w.s. 158BB of the Act and by reading into the section, the words 'the incriminating material found during the course of search' which are not there in section 153A? [C] Whether the Tribunal erred in relying on the ITAT order in Sanjay Aggarwal v. DCIT (2014) 47 Taxmann.Com 210 (Del) which has interpreted undisclosed income unearthed during the search to imply incriminating material, as against the finding of the Delhi High Court in Filatex India Ltd. v. CIT- IV (2015) 229 Taxman 555 wherein it is held that during the assessment u/s 153A additions need not be restricted or limited to incriminating material found during the course of search?" 8. Hon’ble Court concurred with the decision of Hon’ble Delhi High Court. We deem it appropriate to take note of relevant part of the decision, which reads as under: “16. Section 153A bears the heading "Assessment in case of search or requisition". It is well settled as held by the Supreme Court in a catena of decisions that the heading of the section can be regarded as a key to the interpretation of the operative portion of the section and if there is no ambiguity in the language or if it is plain and clear, then the heading used in the section strengthens that meaning. From the heading of section 153, the intention of the legislature is clear viz., to provide for assessment in case of search and requisition. When the very purpose of the provision is to make assessment in case of search or requisition, it goes without saying that the assessment has to have relation to the search or requisition. In other words, the assessment should be connected with something found during the search or requisition, viz., incriminating material which reveals undisclosed income. Thus, while in view of the mandate of sub-section (1) of section 153A of the Act, in every case where there is a search or requisition, the Assessing Officer is obliged to issue notice to such person to furnish returns of income for the six years preceding the assessment year relevant to the previous year in which the search is conducted or requisition is made, any addition or disallowance can be made only on the basis of material collected during the search or requisition. In case no incriminating material is found, as held by the Rajasthan High Court in the case of Jai Steel (India) (supra), the earlier assessment would have to be reiterated. In case where pending assessments have abated, the Assessing Officer can pass assessment orders for each of the six years determining the total income of the assessee which would include income declared in the returns, if any, furnished by the assessee as well as undisclosed income, if any, unearthed during the search or requisition. In case IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 6 - where a pending reassessment under section 147 of the Act has abated, needless to state that the scope and ambit of the assessment would include any order which the Assessing Officer could have passed under section 147 of the Act as well as under section 153A of the Act. 17. In the facts of the present case, a search came to be conducted on 07.10.2009 and the notice was issued to the assessee under section 153A of the Act for assessment year 2006-07 on 04.08.2010. In response to the notice, the assessee filed return of income on 18.11.2010. In terms of section 153B, the assessment was required to be completed within a period of two years from the end of the financial year in which the search came to be carried out, namely, on or before 31st March, 2012. Here, insofar as the impugned addition is concerned, the notice in respect thereof came to be issued on 19.12.2011 seeking an explanation from the assessee. The assessee gave its response by reply dated 21.12.2011 calling upon the Assessing Officer to provide copies of statements recorded on oath of Shri Rohit P. Modi and Smt. Pareshaben K. Modi during the search as well as the copies of the documents upon which the department placed reliance for the purpose of making the proposed addition as well as the copy of the explanation given by Shri Rohit P. Modi and Smt. Pareshaben K. Modi regarding the on-money received, copies of the assessment orders in case of said persons and also requested the Assessing Officer to permit him to cross-examine the said persons. The Assessing Officer issued summons to the said persons, however, they were out of station and it was not known as to when they would return. In this backdrop, without affording any opportunity to the assessee to cross-examine the said persons, the Assessing Officer made the addition in question. 18. In this case, it is not the case of the appellant that any incriminating material in respect of the assessment year under consideration was found during the course of search. At the relevant time when the notice came to be issued under section 153A of the Act, the assessee filed its return of income. Much later, at the fag end of the period within which the order under section 153A of the Act was to be made, in other words, when the limit for framing the assessment as provided under section 153 was about to expire, the notice has been issued in the present case seeking to make the proposed addition of Rs.11,05,51,000/- on the basis of the material which was not found during the course of search, but on the basis of a statement of another person. In the opinion of this court, in a case like the present one, where an assessment has been framed earlier and no assessment or reassessment was pending on the date of initiation of search under section 132 or making of requisition under section 132A, while computing the total income of the assessee under section 153A of the Act, additions or disallowances can be made only on the basis of the incriminating material found during the search or requisition. In the present case, it is an admitted position that no incriminating material was found during the course of search, however, it is on the basis of some material collected by the Assessing Officer much subsequent to the search, that the impugned additions came to be made. 19. On behalf of the appellant, it has been contended that if any incriminating material is found, notwithstanding that in relation to the year under consideration, no incriminating material is found, it would be permissible to make additions and disallowance in respect of all the six assessment years. In the opinion of this court, the said contention does not merit acceptance, inasmuch as, the assessment in respect of each of the six assessment years is a separate and distinct assessment. Under section 153A of the Act, an assessment has to be made in relation to the IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 7 - search or requisition, namely, in relation to material disclosed during the search or requisition. If in relation to any assessment year, no incriminating material is found, no addition or disallowance can be made in relation to that assessment year in exercise of powers under section 153A of the Act and the earlier assessment shall have to be reiterated. In this regard, this court is in complete agreement with the view adopted by the Rajasthan High Court in the case of Jai Steel (India), Jodhpur (supra). Besides, as rightly pointed out by the learned counsel for the respondent, the controversy involved in the present case stands concluded by the decision of this court in the case of JayabenRatilalSorathia (supra) wherein it has been held that while it cannot be disputed that considering section 153A of the Act, the Assessing Officer can reopen and/or assess the return with respect to six preceding years; however, there must be some incriminating material available with the Assessing Officer with respect to the sale transactions in the particular assessment year. 20. For the foregoing reasons, it is not possible to state that the impugned order passed by the Tribunal suffers from any legal infirmity so as to give rise to a question of law, much less, a substantial question of law, warranting interference. The appeal, therefore, fails and is, accordingly, dismissed.” 9. Apart from that the Hon’ble Delhi High Court in the case of PCIT vs. Meeta Gutgutia, reported in (2017) 395 ITR 526 (Delhi) on the identical issue has held as under: “Sec. 153A is titled "Assessment in case of search or requisition". It is connected to s. 732 which deals with 'search and seizure'. Both these provisions, therefore, have to be read together. Sec. 153A is indeed an extremely potent power which enables the Revenue to reopen at least six years of assessments earlier to the year of search. It is not to be exercised lightly. It is only if during the course of search under s. 132 incriminating material justifying the reopening of the assessments for six previous years is found that the invocation of s. 153A qua each of the assessment years would be justified. If no incriminating material was found during the course of search in respect of an issue, then no additions in respect of any issue can be made to the assessment under ss. 153A and 153C.—CITvs. Kabul Chawla (2015) 281 CTR (Del) 45 : (2015) 126 DTR (Del) 130: (2016) 380ITR 573 (Del) followed. (Paras 56 & 60) There is no statement In the present case which can be said to constitute an admission by the assessee of a failure to record any transaction in the accounts of the assessee for the assessment years in question. On the contrary, the assessee herein stated that, she is regularly maintaining the books of accounts. The disclosure made in the sum of Rs. 1.10 crores was only for the year of search and not for the earlier years. As already noticed, the books of accounts maintained by the assessee in the present case have been accepted by the AO. In response to question No. 16 posed to PG, he stated that there was no possibility of manipulation of the accounts. There was no justification at all for the AO to proceed on surmises and estimates without there being any incriminating material qua the assessment year for which he sought to make additions of franchisee commission. The Tribunal was justified in holding that the invocation of s. 153A by the Revenue for the asst. yrs. 2000-01 to 2003-04 was without any legal basis as there was no incriminating material qua each of those assessment years.— - Smt. Dayawanti IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 8 - through LH Smt. Sunita Gupta vs. CIT (2016) 290 CTR (Del) 361 : (2016) 143 DTR (Del) 209 : (2017) 390 ITR 496 (Del) distinguished. (Paras 67, 69 & 71) Conclusion : It is only if during the course of search under s. 132 incriminating material justifying the reopening of the assessments for six previous years is found that the invocation of s. 153A qua each of the assessment years would be justified; if no incriminating material was found during the course of search in respect of an issue, then no additions in respect of any issue can be made to the assessment under s. 153A.” 10. After careful consideration of the entire aspect of the matter, we find that when the re-assessment order was passed under Section 153A of the Act on the basis of the deposit and unsecured loan appearing in the balance sheet of the assessee which is particularly mentioned at Page 18 of Paragraph 14 of the order passed by the Ld. AO and not on the basis of the incriminating material unearthed during the course of search, which ought to have been the main basis of re-opening of an unabated assessment, we find substance in the case made out by the assessee that the addition made by the Ld. AO under Section 153A of the Act under the present facts and circumstances of the case is bad in law and thus liable to be quashed. We further note that the ratio laid down in the judgment passed by the Hon’ble Gujarat High Court in the case of PCIT vs. Saumya Construction, reported in (2017) 81 taxmann.com 292 (Guj.) and the judgment passed by the Hon’ble Delhi High Court in CIT vs. Kabul Chawla (supra) is applicable to the instant case and respectfully relying upon the same, we quash the order of addition passed by the Ld. AO under Section 153A of the Act. 11. The identical issue involved in IT(SS)A Nos. 164 & 165/Ind/2021 has already been dealt with by us in IT(SS)A No. 163/Ind/2021 for A.Y. 2008-09 and in the absence of any changed circumstances the same shall apply mutatis mutandis. Hence, this ground of appeal in all appeals are allowed. IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 9 - IT(SS)A No. 166/Ind/2021 (A.Y. 2011-12) 12. The assessee has not pressed Ground Nos. 1 to 4 of the appeal preferred before us. However, addition to the tune of Rs.5,30,660/- on account of undisclosed investment made by the assessee has been challenged before us. 13. We have heard the rival contentions made by the respective parties and we have also perused the relevant materials available on record. After perusal of the entire documents placed before us, we find that the amount of addition in respect of undisclosed investment was already admitted before the Settlement Commission. Furthermore, the source of this investment in the form of additional income has been offered to tax before the Settlement Commission. In fact, during the pendency of assessment proceedings, the appellant filed Settlement Application under Section 254C of the Act before the Settlement Commission, Mumbai on 24.02.2015, the details whereof has been annexed to the paper book filed before us. The relevant documents whereof is annexed at Page No. 145 of the said paper book onwards; the appellant disclosed the following before the Settlement Commission: “the Applicant has also developed a form wherein he is developing and selling plants and also have agriculture income. that the total receipts from such plant is Rs.31,47,007/- and expenses were Rs.22,16,347/-. The Net income of Rs.9,30,660/- is not being offered for tax as it is exempt” The applicant has also spent Rs.8980660 for house construction out of which Rs.8450000/- have been shown in the regular accounts. The Rs.930660/- income from nursery and plants is sufficient to pay for this construction expenditure and a balance fund of Rs.400000/- was carried over to next financial year.” 14. After the rejection of the Settlement Application, the assessment proceeding was initiated by the Ld. AO on 10.11.2015 and the impugned addition has been made as unexplained investment in house construction IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 10 - admitted before the Settlement Commission. The same was further confirmed by the First Appellate Authority. However, it appears that the source of such investment has been duly explained by the assessee before the Settlement Commission. The assessee has shown during the year the additional income of Rs.9,30,660/- as exempted including the undisclosed investment of Rs.5,30,660/-. The remaining amount of Rs. 4 Lakhs has been carried forward to the next financial year. In that view of the matter, we do not find any reason to sustain the addition on the same since the same has already been disclosed before the Settlement Commission and tax whereon was also duly paid. The addition is, therefore, found to be not sustainable and thus deleted. Assessee’s this ground of appeal is allowed. IT(SS)A No. 167/Ind/2021 (A.Y. 2012-13) 15. The identical issue involved in IT(SS)A No. 167/Ind/2021 for A.Y. 2012-13 has already been dealt with by us in IT(SS)A No. 166/Ind/2021 for A.Y. 2011-12 and in the absence of any changed circumstances the same shall apply mutatis mutandis. Hence, this ground of appeal in this appeal is also allowed. Revenue’s Appeals: 16. Now we take up revenue’s appeals. IT(SS)A No. 143/Ind/2021 (A.Y. 2010-11) 17. The revenue has raised six grounds in this appeal. 18. We first take up Ground No. 1, 2, 4 and 5, all of which involve the issue of “incriminating material”. Ground No. 1 relates to the addition of IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 11 - Rs. 7,84,950/- on account of cash-deposits in bank accounts. In Para No. 4.3 of appeal-order, Ld. CIT(A) has clearly observed that the addition is not based on any incriminating document found in search; it is only arising out of regular bank account duly disclosed in the income-tax returns filed by assessee before the date of search. Ground No. 2 relates to the addition of Rs. 3,21,320/- made by AO by treating the “agricultural income” as “Income from Other Sources”. In Para No. 4.4 of appeal-order, Ld. CIT(A) has clearly observed that the addition is not based on any incriminating document found in search. Ld. AR submits that the agricultural income is already disclosed by assessee in regular returns filed before search and the same had been subjected to regular assessments. Ground No. 4 relates to the addition of Rs. 35,75,000/- made by AO on account of unexplained cash credits u/s 68. The relevant cash-credits are part of regular books of account of assessee and there is no incriminating material found during the course of search with respect to those loans. The Ld. AO has made addition on the basis of post-search enquiries made during assessment-proceedings. Ground No. 5 relates to the addition of Rs. 69,55,000/- made by Ld. AO on account of alleged “on-money” payments towards purchase of properties. The Ld. AO has estimated fair market value of purchased properties and thereby made this addition. There is no incriminating material found during search in this respect, then addition has been made during assessment- proceeding on mere estimation. Thus, all of these additions involved in Ground No. 1, 2, 4 and 5 have been made in unabated AY 2010-11 without having recourse to any incriminating material. As discussed earlier at length, such additions are legally not sustainable. Therefore, we approve the deletion of addition done by Ld. CIT(A) and dismiss the grounds raised by revenue. IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 12 - 19. In Ground No. 3, the revenue claims that the Ld. CIT(A) has erred in deleting the addition of Rs. 3,74,209/- made by AO on account of undisclosed investment. On perusal of finding made by Ld. CIT(A) on page No. 61 of appeal-order, we find that the Ld. CIT(A) has observed that the assessee has made disclosure of the impugned income before Settlement Commission and paid tax thereon. When it is so, we suffice it to say that once the income is already offered/taxed in Settlement Commission, same income cannot be taxed again. Therefore, in our view, Ld. CIT(A) has rightly deleted the addition; we approve his action and dismiss this ground of revenue. 20. Lastly in ground No. 6, the revenue claims that the Ld. CIT(A) has erred in deleting the addition of Rs. 57,50,000/- made by AO on account of payment to Shri Manveer Singh Grover against purchase of property. On perusal of Para No. 4.8 of appeal-order, we observe that Ld. CIT(A) has made a finding that the impugned asset was purchased out of funds relatable to the income disclosed by SR Ferro (firm) before Settlement Commission. Ld. CIT(A) has then concluded that once the income has been taxed in the hands of SR Ferro of which the assessee is a partner, subsequent utilization of that income by firm or partner cannot be re-taxed; otherwise it amounts to double taxation. We agree with such conclusion made by Ld. CIT(A). Therefore, this ground raised by revenue does not have any merit and is dismissed. 21. With this revenue’s IT(SS)A No. 143/Ind/2021 (A.Y. 2010-11) is dismissed. IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 13 - IT(SS)A No. 144/Ind/2021 (A.Y. 2013-14) 22. The revenue has raised four grounds in this appeal. 23. In ground no.1, the revenue claims that the Ld. CIT(A) has erred in deleting addition of Rs. 2,13,54,920/- made by Ld. AO in respect of unexplained cash found u/s 69A of the Act. Ld. DR vehemently supported the assessment order as against which the Ld. AR defended the order of first appellate authority. We have heard the rival contentions made by the respective parties and we have also perused the relevant materials available on record. After perusal of the entire documents placed before us, we find that during the course of search proceeding, physical cash of Rs. 2,13,54,920/- was found for which the Ld. AO has made this addition. On perusal of order of first appeal, we observe that the Ld. CIT(A) has deleted addition for the very reason that the source of impugned cash balance has been explained by assessee from following sources: i. Cash as per regular books of account of assessee – Rs.26,42,970/- ii. Cash belonging to Shri Sudhir Sharma/S.R. Ferro group which is out of income surrendered in Settlement Commission –Rs.1,85,63,449/- iii. Personal Cash balance of assessee – Rs.1,48,501/- Regarding (i), Ld. CIT(A) has found that the books of account of assessee till the date of search as well as closing of 31.03.2013 clearly reveal that the assessee was having cash balance of Rs. 26,42,970/- on the date of search. In fact, the Ld. CIT(A) has also extracted the details of cash- account on page no. 74 of appeal-order. Regarding (ii), the assessee has filed a copy of application to Settlement Commission and also averred in an affidavit to show that the impugned cash was belonging to Shri Sudhir Sharma / S.R. Ferro for which the due tax has been already paid by S.R. IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 14 - Ferro and this factual position is also found by Ld. CIT(A). Regarding (iii), Ld. CIT(A) has found that the assessee is a regular income tax-payer and has shown approximate income of Rs. 93,15,138/- during the period 2008 till 2012; therefore the balance of Rs.1,48,501/- found with assessee is very reasonable and acceptable. After giving these categorical findings, Ld. CIT(A) has accepted that the cash found at the time of search was fully explained and thereby he has deleted addition. Ld. DR could not rebut these findings of Ld. CIT(A). Therefore, we do not find any infirmity in the conclusion taken by Ld. CIT(A) which is based on clinching evidences. Being so, we do not find any merit in the ground raised by the revenue; the same is hereby dismissed. 24. In ground No. 2, the revenue claims that the Ld. CIT(A) has erred in deleting the addition of Rs. 27,02,584/- made by Ld. AO on account of unexplained jewellery. On perusal of order of Ld. CIT(A), we find that during the course of search-proceeding gold jewellery of 657.210 gms and silver jewellery of 200 gms was found in possession of assessee for which the AO has made addition. Ld. CIT(A), however, found that this much of jewellery is acceptable in view of CBDT Circular No. 1916 dated 11.05.1994 and in terms of various court decisions and having regard to the status of assessee. We do not find any infirmity in the decision of Ld. CIT(A) which is based on CBDT circular and judicial precedents. Therefore, this ground of revenue is found meritless and dismissed. 25. In ground No. 3, the revenue claims that the Ld. CIT(A) has erred in deleting the addition of Rs. 2,01,000/- made by AO on account of unexplained cash deposit in bank account u/s 69A of the Act. Ld. DR argued that the AO has made a valid addition since the assessee has not been able to explain the source of deposits. Per contra, Ld. AR referred to IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 15 - the order of first-appeal wherein Ld. CIT(A) has observed that the assessee was having substantial income from share in partnership firm and agriculture out of which the assessee had made deposits in bank account and the proportion of such deposit is minuscule as compared to the very high level of income earned by assessee. Relying upon the decision of ITAT, Indore in ACIT-3(1), Bhopal vs. Kulwant Singh in IT(SS)A No. 57 to 63/Ind/2008, the Ld. CIT(A) has deleted the addition. We do not find any infirmity in the decision of Ld. CIT(A) whereby he has found that the assessee was having a large scale of income and the deposit in bank account is commensurate, in fact miniscule, as compared to the level of income earned by assessee and already assessed by revenue-authorities. It is also not a case of revenue-authorities that the assessee was not having cash balance left out of the income for making these deposits in bank. Being so, we uphold the decision taken by Ld. CIT(A) and dismissed the ground raised by Revenue. 26. In ground no.4, the revenue claims that the Ld. CIT(A) has erred in deleting the addition of Rs. 3,22,306/- made by AO on account of undisclosed investment. On perusal of finding made by Ld. CIT(A) on page No. 63 of appeal- order, it is manifest that the assessee has declared the alleged investment of Rs. 3,22,306/- (consisting of Laptop of Rs.32,450/- and House construction of Rs. 2,89,856/-) before Settlement Commission and also offered an undisclosed income of Rs. 3,25,000/- resulting into acquisition of this investment to Settlement Commission; that is the precise reason for deletion of addition by Ld. CIT(A). We agree with the conclusion taken by Ld. CIT(A) that once the income is already offered/taxed in Settlement Commission, same income cannot be taxed again. Therefore, in our view, the Ld. CIT(A) has rightly deleted the addition; we approve his action and dismiss this ground of revenue. IT(SS)A Nos. 163 to 167/Ind/2021 & 143 to 144/Ind/2021 [Shri Brajendra Sharma Asst.Years.– 2008-09 to 2013-14 - 16 - 27. With this revenue’s IT(SS)A No. 144/Ind/2021 (A.Y. 2013-14) is also dismissed. 28. In the result, assessee’s appeals in IT(SS)A Nos. 163 to 165 & 167/Ind/2021 are allowed; assessee’s appeal in IT(SS)A No. 166/Ind/2021 is partly allowed and revenue’s both appeals are dismissed. This Order pronounced on 27/03/2023 Sd/- Sd/- (BHAGIRATH MAL BIYANI) (MADHUMITA ROY) ACCOUNTANT MEMBER JUDICIAL MEMBER Indore; Dated 27/03/2023 S. K. Sinha, Sr. PS True Copy आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. िवभागीय ितिनिध, / DR, ITAT, Indore 6. गाड फाईल / Guard file. आदेशान ु सार/ BY ORDER, (Sr. Private Secretary) ITAT, Indore