Shri Chhotelal Jain, JABALPUR V. Deputy Commissioner of Income Tax, Central Circle, JABALPUR

ITSSA 2/JAB/2021

• Counselvise Citation: [2022] 103 COUNSELVISE.COM (IT) 9123 (ITAT-JABALPUR)
• Duration Of Justice: 1 year(s) 5 month(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 01-11-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 03-08-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 01-06-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Income from undisclosed sources; Loose papers; Opportunity of being heard; Period of limitation; Difference of opinion; Accommodation entries; Block assessment; Onus to prove; Time period of passing order; Sham transactions; Change of opinion
• Section: 68; 263; 132; 271(1)(c); 139; 143(3); 153A; 143(1); 251; 143(2); 139(1); 153; 153C

Judgement Text

1 | P a g e IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR (through web-based video conferencing platform) BEFORE SHRI SANJAY ARORA, HON‟BLE ACCOUNTANT MEMBER & SHRI MANOMOHAN DAS, HON'BLE JUDICIAL MEMBER I.T.(SS)A. No. 02/JAB/2021 (Asst. Year: 2012-13) Appellant by : Shri Rahul Bardia, FCA Respondent by : Shri U.B. Mishra, CIT-DR Date of hearing : 04/08/2022 Date of pronouncement : 02/11/2022 O R D E R Per Sanjay Arora, AM: This is an Appeal by the Assessee directed against the Order dated 12/02/2021 by the Commissioner of Income Tax (Appeals)-3, Bhopal („CIT(A)‟, for short), partly allowing the assessee‟s appeal contesting his assessment under section 153A read with section 143(3) of the Income Tax Act, 1961 („the Act‟ hereinafter) dated 27/12/2017 for Assessment Year (AY) 2012-13. 2. The appeal, filed on 02/06/2021 at a delay of 50 days, was admitted as the period of delay falls within the period 15/3/2020 to 28/02/2022, to be excluded in reckoning the limitation period on account of pandemic as per the decision by the Apex Court in Suo Motu Writ (C) 03/2020, dated 10/01/2022. The appeal was accordingly admitted for being heard on merits. Chotelal Jain, 1 st Utsav Vihar, 242 Napier Town, Jabalpur (MP) [PAN : ACHPJ 1673 P] vs. Deputy CIT, Central Circle, Jabalpur. (Appellant) (Respondent) IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 2 | P a g e 3. Though, the appeal on quantum agitates a single addition for Rs. 5,95,326, it raises legal issues, which would therefore need to be addressed first as their acceptance may result in the impugned assessment/addition as being, on that basis, bad in law. 4. The assessee‟s legal challenge is two-fold. One, that the approval u/s. 153D, inasmuch as it is without application of mind (by the approving authority), is not a valid approval in law, failing the assessment. That apart, though to the same effect, is the fact that the underlying material, being the seized material and assessment record, was, as apparent from the communications exchanged for the purpose between the assessing authority and the competent (approving) authority, being the Joint CIT, Central Range, Bhopal (APB-1, pg. 19-20), not submitted along with the approval, for it to be therefore regarded as an informed approval, with due application of mind. Two, that no incriminating material was found during search, in absence of which no adjustment to the assessee‟s returned and already assessed income could be in law made, i.e., u/s. 153A(1), for the non-abated years. Reliance, toward the said propositions was made by Sh. Bardia, the ld. counsel for the assessee, which shall be referred to and considered while discussing the merits of the respective issues. 5.1 We shall consider both the issues in seriatim. The claim of no material accompanying the draft assessment order sent for approval by the Assessing Officer (AO), invalidating the approval, made relying on the decision in Sahara India (Firm) v. CIT [2008] 300 ITR 403 (SC), was effectively met by Shri Mishra, the ld. CIT-DR, by placing on record material exhibiting that the AO had in fact along with his Inspector camped at Bhopal from 15/12/2017 to 25/12/2017. In fact, two officers, being of the rank of Assistant Commissioner and Inspector, had, along with the AO, visited Bhopal from 07/12/2017 to 08/12/2017 to set-up the camp office (DPB pgs. 1-24). The sole purpose of camping at Bhopal, whereat the approving authority is headquartered, was to apprise him and discuss the draft IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 3 | P a g e orders in the instant, as indeed in 5-6 other cases in which searches were conducted by the Revenue on 17/11/2015, popularly known as „Jabalpur Hospital and Metro Group Cases‟. Though Shri Bardia would yet contend that it was not feasible to carry the entire search material, being voluminous, we are not impressed. The journey had been undertaken by train, and the sole purpose of the camp office was to discuss threadbare the various aspects attending the proposed assessments. We may hereby clarify that these facts were not brought forth by the Revenue in the case of Tarachand Khatri v. Asst. CIT [2021] 42 ITJ 200 (Jab), wherein a similar plea in respect of another search on 17/11/2015 found favour with the Tribunal, with it finding it flummoxing as to how the proposal dated 22/12/2017, made by the AO at Jabalpur, could possibly reach, along with material, perused and discussed, and approval granted, with no question asked, on the very same day, i.e., 22/12/2017. As it now transpires, the forwarding letter for approval, which in the instant case is dated 19/12/2017, was made and submitted at Bhopal itself. Though the said letter ought to have preferably mentioned this fact as well, i.e., of it having been made out and signed at the camp office at Bhopal, that by itself would not detract from the said fact, clearly established on the strength of travel tickets and hotel bills of the concerned officers, including the AO himself, fairly accepted by Shri Bardia during hearing. This would also meet the assessee‟s reliance on the order in Tarachand Khatri (supra) to that extent. 5.2 It is, of course, yet open for the assessee to contend non-application of mind, i.e., on facts, as was indeed by Shri Bardia, even as the onus to show the supervening circumstance, which give rise to the inference of the letters being exchanged, only to exhibit a semblance of consideration of the relevant material in approving the draft order, which prevailed with the Tribunal in Tarachand Khatri (supra), would be on the assessee. The claim of non-application of mind stands made before us with reference to each of the three adjustments made to the returned income in assessment, of which though only one survives the first appeal. IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 4 | P a g e It was, however, made clear by the Bench that due application of mind qua even one adjustment would qualify the approval u/s. 153D as a valid approval, as the same is qua an assessment and not qua an adjustment made in assessment and, two, that non-acceptance of the AO‟s case in appeal would be by itself not determinative of the aspect of non-application of mind (by the approving authority), being a jurisdictional aspect. 6.1 The first addition, for Rs. 25 lacs, is qua a registered sale deed dated 29/03/2012 toward purchase of property by Smt. Kosabai Jain, the assessee‟s mother. The same was included in the assessee‟s income without any enquiry being made with the purchaser, i.e., Smt. Jain, and jumping to the conclusion that the investment represents the assessee‟s benami property. We do not find the assessee‟s stand tenable. The reason is simple. The document was found from the assessee‟s residence. His mother admittedly has no source of income; no bank account; is not an assessee on the record of the Department, and no PAN. It is not uncommon in Indian households (society) to purchase property in the name of family members, particularly females, with a view to secure them, particularly where they have no other or independent source of income. As regards the date of investment being 15/10/2008, also emphasized by Shri Bardia before us, there is no mention of the same in the sale-deed, which would surely and normally be the case and, rather, it is the absence thereof that is an abnormality. Couple this with the fact that there is no explanation by the assessee for the delayed conclusion of the transaction, which is only after 1½ years, particularly considering that the entire purchase consideration had already been paid, raising serious doubts qua the genuineness of the transaction. Non-enquiry with the octogenarian lady, as well as it being regarded as a benami property of the assessee, is, under the circumstances, understandable. There is no question of jumping to the conclusion by the AO, or anything to suggest non-application of mind. On the contrary, it is the non-addition of Rs. 1.81 lacs, being the stamp duty and registration charges, admittedly paid IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 5 | P a g e during the relevant previous year (PB-1, pgs.72-77), unaccounted for, exhibit non- application of mind by the AO, as indeed by the ld. CIT(A), who has co-terminus powers. No case for non-application of mind is, on the balance, made out. 6.2 The second addition, again since deleted, is for Rs. 60 lacs, toward a credit dated 13/3/2012 in the name of M/s. Gladstone Merchants (P.) Ltd. The same stood added u/s. 68 on the basis of the said company, with it‟s postal address at Gandhi Nagar, New Delhi, is a paper company. The same in fact forms part of Rs. 73 lacs introduced as capital by the assessee during the relevant year in the books of his proprietory concern M/s. Shanti Marketing. The documents supporting the creditworthiness of the creditor and genuineness of the transaction was submitted. The business of the lending company has not been stated, much less shown. Even as much as the confirmation therefrom was not furnished. (refer para 12/pgs. 10-11 of the assessment order). How could, under the circumstances, one wonders the same be regarded as an addition made without application of mind, even if the „loan‟ was repaid subsequently, i.e., on 28/05/2013. 6.3 The third addition is for Rs. 5.95 lacs, being long-term capital gain (LTCG), claimed by the Revenue to be a qua penny stock, i.e., Twenty First Century Ltd. The said company was in fact found to be an unlisted company at the time of the purchase of shares. The company had no credentials and, yet it‟s shares were purchased at a premium, only to see a phenomenal rise in a period of one year, after which it is sold, as if by prescience; the share value falling thereafter. This pattern corresponds with that on the share transactions entered into by the assessee‟s family members as well, repeatedly over the years, with he in fact admitting and surrendering capital gain for Rs. 400 lacs in shares of CCL International Ltd., found, on the basis of the investigation by the Revenue, to be a part of bogus LTCG syndicate. There is surely no question of the same being without application of mind. IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 6 | P a g e 6.4 Surely, it is possible to, in retrospect or upon review, removed from the time – the authorities generally functioning under serious constraints of time and volume, be able to discern areas where further enquiry could be made. Several cases are on at any particular time, with each having several areas for enquiry and verification, with a number of areas of enquiry qua each of them. As such, no particular yardstick could be adopted, and there may be areas of deficiency with regard to any verification process in an assessment, and which for that reason would not make it as without application of mind. A review, as being done now, detached from the time and place, i.e., the obtaining circumstances, may yield insights, as well as opportunity, to apply experience and understanding gained over the period, but that would not detract from the work performed. Why, we observe an increasing improvement in the representation by the assesses, i.e., with every subsequent stage, assessment stage onwards, right up to the Apex Court, even as the full facts are in its knowledge, which cannot be construed as the earlier representations being without application of mind. All that the provision envisages is a review of the draft assessment order in search related cases with a view to ensure a better quality of assessment, i.e., to safeguard the interest of the Revenue, pointing to areas where further investigation could be made. Why, in the instant case, one could equally argue of addition of income in the hands of the mother, or of non-addition of cash credit u/s. 68, as being instances of non-application of mind. To point holes in the investigation/enquiry by the Revenue, by the assessees, who are in the intimate know of their affairs, under the pretext of non-application of mind, with a view to defeat the legislative intent, is not maintainable, if not depreciable, being rather an abuse of the process of law. As exhorted by the Apex Court time and again, the provisions of the Act are to be read and construed in a fair and reasonable manner. We, therefore, find little substance in the claim of non- application of mind by the assessee as made before us. IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 7 | P a g e 7.1 Next, we may discuss the addition in the sum of Rs. 5,95,326 u/s. 68. The same, returned as LTCG, has been regarded as bogus by the AO. A verification of the tax returns of the assessee and his family members for the preceding years, in the ensuing proceedings, i.e., consequent to search, revealed them to be habitually involved in earning LTCG from penny stock shares, i.e., AY 2011-12 onwards. The AO, after listing the details of the same (from AY 2011-12 to 2013-14 for different family members), at pages 4,5 of his order, observed as under:- 10. Bogus LTCG In M/s. Super Agencies and in M/s. Shanti Market company Assessee is involved in trading of pan masala, tobacco and general goods. Assessee and his family members are aggressively involved in sale and purchase of properties. The investments in purchase of property was generated from the hunted activity of sale and purchase of shares of penny companies with the help of brokers and bookies located at Kolkata and other places. They manage to hike the price of the shares of these worthless penny companies by manipulating transactions on terminal of BSE and NSE and as such they managed to pass on LTCG for their clients involved in the scam. The DI investigation Kolkata carried out a survey at the office premises of M/s. Anand Rathi Shares and Stock Brokers Limited, Kolkata on 08.04,2015 and found that company had activate engagement in bogus LTCG Syndicate. The company did transaction of more than Rs 144 rores of CCL International Ltd and there were many more such companies involved in this syndicate where transaction were in crores of rupees. Shri Chotte Lal Jain and his family was also involved in purchase and sale of the shares of CCL International Ltd. Shri Chotte Lal Jain in his statement recorded on 22.11.2015 surrendered Rs 4 Crores bifurcation of which according to his statement dated 26.11.15 is that he surrendered Rs 2.6 crores in F.Y- 2014-15 i.e A.Y 2015-16 on account of bogus LTCG from Sale of Shares of CCL International Limited and Rs 1.4 crores in F.Y 2015-16 i.e A.Y-2016-17 on account of loose papers found at his residence and at M/s. Shanti Marketing and M/s. Super Agencies shops situated at Ganjipura, Jabalpur. The earning of income of LTCG from Sale of shares of CCL International Limited is Rs. 37,90,959/- In AY 2015-16. The above LTCG is duly offered to tax by the assessee. During the course of search from the verification of Income Tax returns filed by Shri Chotte Lal Jain and his family members, it was found that they are habitually involved in scam of earning LTCG from the trading of shares of penny companies with the help of above mentioned syndicate. The details of LTCG earned during A.Y. 2011-12 to 2015-16 are as under: From the above chart it may be noticed that all the family members are involved in earning LTCG on the same pattern as in the case of CCL IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 8 | P a g e International Limited in respect of other penny companies viz. Multipurpose Resources, Oasis Cine Communications and 21 st Century Limited. The modus operandi is same that all the family members purchased shares of similar companies and kept till the period of more than 1 year to get the exemption under section 10(38). It is amazing that none of these members suffered loss on sale of shares in any year and they purchased the shares of selected penny companies wherein they were confident that they will earn LTCG at the time of sale of shares with the help of broker involved in syndicate of LTCG Scam. It is the fact that share market is very unpredictable and volatile, nobody can earn profit constantly in such trade whereas the Assessee showing LTCG in specific companies which are not familiar and at the same time having no substantial worth. All these facts indicate that Assessee and his family members earned LTCG right from assessment year 2011-12 to A.Y. 2015-16 fraudulently manipulating the prices of the shares with the help of syndicate and persons involved in the scam. The assessee was duly confronted with this issue an a letter dated 19-10-17 was issued call upon following information, as under: 1. How you purchased share from companies as mentioned above. 2. How you made payment to these companies Multipurpose resource, 21 st Century Ltd., Oasis Cine Communications for purchase of shares. 3. If cash state specifically. If by bank, proof of the bank Statement be furnished. 4. Whether these companies were listed companies when you purchased shares 5. If not how you come to know that its share are on sell (sale). 6. Proof of money receipt in the bank account (copy of statement be furnished) A.Y. 2011-12 2012-13 2013-14 C.L. Jain 1623580 (Multipurpose resource) 595326 (21 st Century Ltd. ) 547893 (Oasis Communications) The assessee has furnished reply vide letter dated 16-11-17 and 20-11-17. However he failed to file satisfactory reply specially to point to above queries. The shares purchases by the assessee is of a non listed company and are penny stock companies. How assessee purchased share is not known. No proper purchase detail furnished. Bank details/cheque no etc given for the purchase of shares is not furnished. Why these shares were purchased at premium. All these companies have no worth (no assets, negligible turnover etc). The assessee received huge profit on sale of these shares. In this connection I would like to invite attention to the H‟ble Bombay High Court Judgement in the case of Sanjay Bimalchand Jain v. Pr. CIT, wherein the H'ble High court had held: The assessee has not tendered cogent evidence to explain how the shares in unknown company worth Rs 5 has jumped to Rs 485 in no time. The fantastic sale price was not at all possible as there was no economic or financial basis to justify the price rise. The assessee has indulged in a dubious share transaction IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 9 | P a g e meant to account for the undisclosed income in the garb of LTCG. The gain has accordingly to be assessed as undisclosed credit u/s 68. Considering above, the LTCG earned by assessee In respect of three Penny Companies mentioned in the chart is added in the hands of assessee u/s 68 of the Act in A.Y 2011-12 Rs. 1623580/-, in A.Y 2012-13 Rs. 595326/- and in A.Y 2013-14 Rs. 547893/-. The assessee during the search surrendered Rs. 37,90,959/- for the A.Y. 2015-16 in respect of LTCG in respect of CCL International Limited. The assessee honored his surrender in his ITR on this count. Its clear that the assessee concealed furnished inaccurate particulars of Income hence penalty proceedings u/s 271(1)(c) of the Act, is initiated for the A.Y. 2015-15 separately. 7.2 In appeal, the same stood confirmed by the ld. CIT(A), holding as under:- “4.3 Ground No.3 & 4 for AY 2011-12 & 2012-13:- Through this ground of appeal, the appellant has challenged Rs. 16,23,580/- in AY 2011-12 and Rs. 5,95,326/- in AY 2012-13 on account of bogus LTCG. The AO during the course of assessment proceeding observed that assessee alongwith his family members was involved in purchasing shares of penny companies such as Multipurpose Resource, 21 st Century, Oasis Cine Communications, CCL International. The income earned by assessee on sale of shares of CCL has been shown in return of income, however, income earned from three other penny stocks of Multipurpose Resourse, 21 st Century Ltd and Oasis Cine Communication were not disclosed in return of income. Therefore, the AO during assessment proceedings required the assessee to furnish explanation on 6 different questions asked by the AO which are reproduced on page no 6 of the assessment order. The assessee did not furnish point wise reply before the AO and the AO, therefore, made addition to the income of the assessee. 4.3.1 I have considered the facts of the case, plea raised by the appellant and findings of the AO. On careful consideration of the facts of this case, it is seen that appellant has purchased shares of various penny scrips which are listed on BSE. The appellant neither before the AO nor before me has filed complete details of allotment of shares, details of LTCG paid, details of redemption of shares. On perusal of ITR filed by the appellant it is seen that appellant has also not paid any tax on income earned on sale of shares Rs. 16,23,580/- in AY 2011-12 and Rs. 5,95,326/- in AY 2012-13. Therefore, the AO was fully justified in making addition to the income of the appellant, thus, in absence of any satisfactory explanation and evidences the addition made by the amounting to Rs. 16,23,580/- in AY 2011-12 and Rs. 5,95,326/- in AY 2012-13 are Confirmed. Therefore, appeal on these grounds is Dismissed.” IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 10 | P a g e 8.1 Before us, the assessee‟s case was two-fold, i.e., both on facts as well as questioning the legality of the addition made inasmuch as the assessment for AY 2012-13 is not pending and, thus, not abated. On facts, it is submitted that no incriminating material qua the sale of the shares in Twenty First Century Ltd., on which the LTCG has been earned, was found in search. All the documents in relation to the purchase and sale of said shares had been, upon being called for by the AO, furnished in the assessment proceedings, and toward which Shri Bardia would take us through pages 47-58 of the assessee‟s paper-book-1 (APB-1), including the assessee‟s bank statement. Nothing adverse stands observed or found by him, even as apparent from his order. How could, under the circumstances, he continued, then, the capital gain, backed by valid documents, be impugned or regarded as bogus by the AO? The same has been duly disclosed in the tax return furnished u/s. 139(1) on 29/08/2012 (APB-1, pgs. 43-46), though, without doubt, being tax-exempt u/s. 10(38), as explicitly stated in the tax return, no tax was exigible and, therefore, not paid thereon. It was, therefore, wrong on the part of the ld. CIT(A) to hold that against the assessee. He, however, could not state anything in respect of the AO‟s reliance on the decision in the case of Sanjay Bimal Chand Jain (supra), or otherwise justify, on the basis of fundamentals, the quantum increase in sale price by over 30 times, resulting in an investment of Rs. 20,000 swelling to Rs. 6.15 lacs, i.e., over 3000 per cent, in a little over a year‟s time. Sh. Mishra, the ld. CIT-DR, placed on record the decision by the Hon‟ble Calcutta High Court in Pr. CIT vs. Swati Bajaj & Ors. (in IA No.GA/2/2022 in ITA/6/2022). The Hon‟ble Court has per the said elaborate decision, he explained, taken note of such penny stock companies and the modus operandi adopted in such cases, and found the invocation of s. 263 of the Act as valid, discussing the law in the matter. Attention of Shri Bardia was at this stage drawn to the decisions in CIT v. Durga Prasad More [1971] 82 ITR 540(SC) and Sumati Dayal v. CIT [1995] 214 ITR 801 (SC) (also referred to in Swati Bajaj & Ors. (supra)), wherein the Hon‟ble Apex Court emphasized on the relevancy of the surrounding IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 11 | P a g e circumstances, as well as on the preponderance of probabilities, i.e., in deciding on the genuineness of the credits or the agreement under reference, which was supported by documents, being agreements, contract notes, etc., to which Sh. Bardia could not offer any specific comment or answer, though relied on the decision in Soumitra Choudhary & Ors. v. Asst. CIT (ITA Nos. 256/Kol/2019 & 2421/Kol/2018, dated 15/03/2019) (APB-2, pgs. 21-48) by the Kolkata Tribunal, wherein one of the scrips on which LTCG arose was Twenty First Century Ltd. – which was clarified by Sh. Mishra to be one of the scrips involved in the decision in Swati Bajaj & Ors.(supra). Sh. Bardia would, in response, submit that, even so, it would not by itself imply that the transaction/s under reference was bogus, and may well be a genuine transaction. 8.2 Shri Bardia‟s second challenge was to the legal competence of the AO to make an addition which is not based on any seized material in a sec. 153A assessment, i.e., in respect of an unabated assessment, not pending as on the date of search. Toward the same, he would rely on the decision in Pr. CIT vs. Gahoi Dal & Oil Mills [2021] 11 ITJ online 314 (MP) (APB-2, pgs.5-20) and Soumitra Choudhary & Ors. (supra). In the former, the Hon'ble jurisdictional High Court had, following CIT vs. Kabul Chawla [2016] 308 ITR 573 (Del), reproducing the relevant para (# 37) thereof in its penultimate para, held as under: “10. In the given facts of present case as no incriminating documents during course of search are found, the order in appeal cannot be said to have suffered the illegality as would give rise to the proposed substantial question of law.” (emphasis, ours) It would be immaterial, he would upon being questioned in the matter, submit, whether the unabated assessment is u/s. 143(1), as in the instant case, or u/s. 143(3)/144. The reliance on Soumitra Choudhary (supra), he would add, has been for the reason that one of the scrips under reference is 21 st Century Ltd., i.e., the very scrip on shares in which capital gain arises to the assessee in the instant case. IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 12 | P a g e 8.3 The burden of proof in respect of an exempt provision, which is to be strictly construed, is, as explained by the constitution bench decision by the Apex Court in CC v. Dilip Kumar and Company & Ors. (CA 3327/2007, dated 30/7/2018), on the assessee. That the Tribunal is the final fact finding authority under the Act, and can for the purpose entertain issues or aspects arising before it for the first time, and is in deciding a matter before it not restricted to the grounds raised per the memorandum of appeal or even to the pleadings, is well-settled. The case law in the matter is legion, though we may refer to some (Hukumchand Mills Ltd. v. CIT [1967] 63 ITR 232 (SC); Udhavdas Kewalram v. CIT [1967] 66 ITR 462 (SC); CIT v. Mahalakshmi Textile Mills Ltd. [1967] 66 ITR 710 (SC)). The scrip of 21 st Century Ltd., involved in the instant case, was listed as a penny stock company in the report by the SEBI. Shri Bardia would, upon this, submit that even if so, i.e., a penny stock company, it would not mean that every transaction in it‟s scrip is not genuine and, therefore, by implication the assessee‟s transaction is bogus. 9. We have heard the parties, and perused the material on record. 9.1 Sections 153A & 153C read as under: Assessment in case of search or requisition. 153A. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, in the case of a person where a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A after the 31st day of May, 2003, the Assessing Officer shall- (a) issue notice to such person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect of each assessment year falling within six assessment years [and for the relevant assessment year or years] referred to in clause (b), in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139; (b) assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made [and for the relevant assessment year or years]: IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 13 | P a g e Provided that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years [and for the relevant assessment year or years]: Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment [and for the relevant assessment year or years] years referred to in this sub-section pending on the date of initiation of the search under section 132 or making of requisition under section 132A, as the case may be, shall abate: Provided also that the Central Government may by rules made by it and published in the Official Gazette (except in cases where any assessment or reassessment has abated under the second proviso), specify the class or classes of cases in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made [and for the relevant assessment year or years]. [Provided also that no notice for assessment or reassessment shall be issued by the Assessing Officer for the relevant assessment year or years unless- (a) the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more in the relevant assessment year or in aggregate in the relevant assessment years; (b) the income referred to in clause (a) or part thereof has escaped assessment for such year or years; and (c) the search under section 132 is initiated or requisition under section 132A is made on or after the 1st day of April, 2017. Explanation 1.-For the purposes of this sub-section, the expression "relevant assessment year" shall mean an assessment year preceding the assessment year relevant to the previous year in which search is conducted or requisition is made which falls beyond six assessment years but not later than ten assessment years from the end of the assessment year relevant to the previous year in which search is conducted or requisition is made. Explanation 2.-For the purposes of the fourth proviso, "asset" shall include immovable property being land or building or both, shares and securities, loans and advances, deposits in bank account.] (2) If any proceeding initiated or any order of assessment or reassessment made under sub-section (1) has been annulled in appeal or any other legal proceeding, then, notwithstanding anything contained in sub-section (1) or section 153, the assessment or reassessment relating to any assessment year which has abated under the second proviso to sub-section (1), shall stand revived with effect from the date of receipt of the order of such annulment by the Principal Commissioner or Commissioner: IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 14 | P a g e Provided that such revival shall cease to have effect, if such order of annulment is set aside. Explanation.-For the removal of doubts, it is hereby declared that,- (i) save as otherwise provided in this section, section 153B and section 153C, all other provisions of this Act shall apply to the assessment made under this section; (ii) in an assessment or reassessment made in respect of an assessment year under this section, the tax shall be chargeable at the rate or rates as applicable to such assessment year. (*) [the words under parenthesis [ ] stand inserted by Finance Act, 2017, w.e.f. 01/4/2017] (emphasis, supplied) Assessment of income of any other person. 153C. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A, then the books of account or documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against each such other person and issue such other person notice and assess or reassess the income of such other person in accordance with the provisions of section 153A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of such other person: Provided that in case of such other person, the reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to sub-section (1) of section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person: Provided further that the Central Government may by rules made by it and published in the Official Gazette, specify the class or classes of cases in respect of such other person, in which the Assessing Officer shall not be required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made except in cases where any assessment or reassessment has abated. (2) Where books of account or documents or assets seized or requisitioned as referred to in sub-section (1) has or have been received by the Assessing Officer having jurisdiction over such other person after the due date for furnishing the return of income for the assessment year relevant to the previous year in which search is conducted under section 132 or requisition is made under section 132A and in respect of such assessment year- (a) no return of income has been furnished by such other person and no notice under sub-section (1) of section 142 has been issued to him, or IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 15 | P a g e (b) a return of income has been furnished by such other person but no notice under sub-section (2) of section 143 has been served and limitation of serving the notice under sub-section (2) of section 143 has expired, or (c) assessment or reassessment, if any, has been made, before the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person, such Assessing Officer shall issue the notice and assess or reassess total income of such other person of such assessment year in the manner provided in section 153A. 9.2 As a mere browse of section would show, there is no reference to any material found or seized during search. How, one wonders, then, the same is read into the proviso; it being trite law on the interpretation of statutes that the interpretive is to be on the basis of the language employed by the statute, being the edict of the Legislature, giving the words their natural and ordinary meaning. No words, not stated, could be read into the provision, which would in fact amount to the judiciary not interpreting the law but making the statute. In no case is the court to substitute its own impression and ideas in place of the legislative intent – which is the foundational basis of any interpretive exercise, as is available from the plain reading of the statutory provisions. If not in the words, where is the legislative intent to be found? A casus omissus cannot be lightly inferred. Reference for the purpose be made, inter alia, to Orissa State Warehousing Corp. Ltd. v. CIT [1990] 237 ITR 589 (SC); Padmasundara Rao (Decd.) v. State of Tamil Nadu [2002] 255 ITR 147 (SC); Britannia Inds. Ltd. v. CIT [2005] 278 ITR 546 (SC); CIT v. Baby Marine Exports [2007] 290 ITR 327 (SC)). This is called the golden rule of interpretation, so that no interpretive rule is necessary where the words of the statute, as in the instant case, are clear or unambiguous, as clarified once again by the Apex Court in CIT vs. Calcutta Knitwears [2014] 362 ITR 673 (SC) after a review of precedents. Taxing statutes are even otherwise to be strictly construed, more particularly, the charging provisions (Banarsi Debi v. ITO [1964] 53 ITR 100 (SC); K.M. Sharma v. ITO [2002] 254 ITR 772 (SC)) and, besides, the statute is to be read as a whole (Prakash Nath Khanna v. CIT [2004] 266 ITR 1 (SC)), so that the interpretation accorded is in sync and in harmony with the scheme of the Act. IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 16 | P a g e Prior to the insertion of sections 153A to 153D in Chapter-XIV (Procedure for Assessment), which are special provisions for assessments pursuant to a search initiated (u/s. 132) or requisition made (u/s. 132A) after May 31, 2003, by Finance Act, 2003, w.e.f. 01/06/2003, such assessments were governed by Chapter-XIV-B, titled „Special Provisions for assessment of search cases‟, comprising ss. 158B through 158BH, the applicability of which was, by simultaneous insertion of s. 158BI w.e.f. 01/06/2003, restricted to search or requisition made upto May 31, 2003. The scope of an assessment under the said sub-chapter was to assess the undisclosed income, i.e., which had not been disclosed or would not have been disclosed for the purposes of the Act, and which included an expense or deduction or allowance claimed which was found to be false (s. 158B). The Apex Court in Asstt. CIT vs. A.R. Enterprises [2013] 350 ITR 489 (SC) explained that the intention as to whether the income would have or would have not been disclosed, is a matter of fact, to be gathered from the entirety of the facts. It is, accordingly, up to May 31, 2003, only the income falling in the block period, defined u/s.158B as a period of 06 years prior to the previous year in which the search or requisition is initiated or made (10 years for search or requisition before 01/06/2001), up to the date thereof, that such income was to be assessed. This was with a view to eliminate scope of controversy as to the year for which the income was assessable, i.e., as long as it fell within the block period. The undisclosed income was to be computed on the basis of the evidence found as a result of search or requisition or such other materials or information available with the AO relatable such evidence (s.158BB). This procedure was, as afore-noted, abandoned w.e.f. 01/06/2003, so that any search or requisition on or after that date would be governed by the new provisions. The income assessable, though yet to be computed, and only understandably so, in accordance with the provisions of the Act, would be the „total income‟ of the assessee in respect of each of the six assessment years preceding the assessment year relevant to the previous year of the search or requisition. „Total income‟ stands defined u/s. 2(45) r.w.s.5 of the Act to include IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 17 | P a g e all income chargeable to tax for the relevant year, applying the rates of tax as applicable for the said year/s, within the time limit specified u/s. 153B. The provision being non obstante (qua certain specific provisions), any assessment pending as on the date of search or requisition, would abate. This would also avoid double proceedings; the object of both being the same, i.e., assessment or, as the case may be, re-assessment of „total income‟. The period of 6 years was, w.e.f. 01/04/2017, extended up to 10 years, provided certain conditions are satisfied, being: a) The AO has in his possession books of account or other documents or evidence which revealed income in the form of an asset; b) The income referred to in (a) has escaped assessment, and is likely to be in the sum of Rs.50 lacs or more; and c) the search or requisition takes place after 31/03/2017. This, it may be noted, is in complete contradistinction to „block assessment‟ u/s. 158BC, which was for the „undisclosed income‟ for the block period, subject to a flat rate of 60%. Further, if, for any reason the assessment (or reassessment) proceedings u/s.153A(1) fail, or the assessment order thereunder is annulled, the abated proceedings, subject to the annulment being not set-aside, shall stand revived. The idea clearly being not to adversely impact the proceedings that were under-way as on the date of search or requisition. Section 153C provides for assessment in case of a person other than the person searched or requisitioned, wherein any valuable belonging to or any books of account seized or requisitioned pertaining to any other person, i.e., other than the person searched or requisitioned, is found where the AO is satisfied that the said valuable or document has a bearing on the total income of such other person. Both the sections, i.e., ss. 153A & 153C, override ss. 139, 147/148, 149, 151 & 153 of the Act. The jurisdictional fact under the new scheme is: IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 18 | P a g e a) for an assessment u/s. 153A, a search initiated or requisition made on or after 01/06/2003 and qua a search or requisition on or after 01/04/2017, also material available with the AO revealing income (in the form of an asset) that as escaped assessment amounting to (or likely to amount to) Rs. 50 lacs or more; b) for an assessment u/s. 153C, a search or requisition on or after 01/06/2003 in case of another person, wherein a valuable belonging to or a document pertaining to the assessee is seized or requisitioned, and the AO of the person searched/requisitioned is satisfied that the same has a bearing on the total income of the assessee. For the year of search or requisition, a regular assessment shall ensue on the assessee, be it the person searched/requisitioned or the other person, as the case may be, furnishing a return u/s. 139 or on being called upon to u/s. 142(1). The jurisdictional fact for an assessment u/s. 158BC, on the other hand, is a search or requisition yielding income which has not been or would not have been disclosed to the Revenue, i.e., „undisclosed income‟ by definition. This is completely absent in the extant proceedings, forming part of Chapter-XIV itself. The exception is for the relevant assessment year/s, i.e., falling beyond 06 years (upto 10 years) preceding the assessment year relevant to the previous year in which search or requisition takes place. We say so as for these years, the AO shall assume jurisdiction only on the basis of materials available with him and, further, on the aggregate escaped assessment income being likely to be at Rs.50 lacs or more. This, though, a later development, i.e., for search or requisition on or after 01/04/2017, has a correspondence with the earlier procedure under Chapter-XIV- B. There is, thus, a complete departure from the erstwhile procedure, which stands explained in detail by the Board per its Circular No. 717, dated 14/08/1995 (refer paras 39.1 to 39.3). The new procedure is, similarly, explained per the Board Circular 07/2003, dated 05/09/2003 (para 65.1 to 65.12). The amendment by Finance Act, 2008 (w.e.f. 01/06/2003) stand explained per Board Circular 01/2009, dated 27/03/2009 (paras 30.1 to 30.6), and that by Finance Act, 2017 (w.e.f. 01/4/2017), by Circular No. 02/2018, dated 15/02/2018 (paras 61.1 to 6.7). All of them stand perused, to find them as consistent with the statute, and in force. IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 19 | P a g e The provision of s. 153A admits of no controversy; its language being plain and clear, even as explained per the Board Circulars. In fact, in none of the decisions, it has been even claimed that the said language is not clear or is ambiguous. Accordingly, it was the unanimous view of the higher Courts that a notice u/s. 153A is to be issued for the relevant year/s irrespective of the pendency or otherwise of the assessments for the specified years, on a search or requisition on or after 01/06/2003 ([2007] 290 ITR 114 (Jhar); [2011] 336 ITR 112 (Orissa); [2011] 337 ITR 399 (Del); [2012] 346 ITR 130 (All); [2013] 355 ITR 226 (Raj) [2014] 367 ITR 517 (All); [2016] 387 ITR 8 (Ker); [2019] 419 ITR 169 (Guj)), to cite some. 9.3 A condition precedent for seized incriminating material is, thus, wholly alien to an assessment u/s. 153A, as indeed to that u/s. 153C, as even in the case of the latter all that the AO (of the person searched or requisitioned) is to be satisfied is that the income reflected per the valuables belonging to or the documents pertaining to the other person has a bearing on the total income of the other person. Reference in this context may be made to the decision in SSP Aviation Ltd. v. Dy. CIT [2012] 346 ITR 177 (Del), wherein the Hon‟ble Court, apart from the clear terms of s. 153C, also drew on the difference in the language of the erstwhile s. 158BD, to hold that there was no warrant to state that the material found or seized in search must disclose „undisclosed income‟ of the other person, i.e., to whom such material belongs. It noted the absence of any reference to „undisclosed income‟ in s. 153C. The reason for the same, we may add, is not far to seek and, rather, apparent. The jurisdiction assumed by the AO in either case, i.e., s. 153A or s. 153C, and irrespective of whether assessment stands completed or is underway, is to assess the „total income‟ for the years for which the jurisdiction stands assumed. Not only that, the interpretation being accorded, besides importing the condition of the erstwhile procedure of Chapter-XIV-B, also glosses over the patent difference between the jurisdictional fact for an assessment u/s. 153A and IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 20 | P a g e that u/s. 153C r/w s. 153A. This is as the latter mandates a satisfaction of the AO qua: a) the valuable or article belonging/pertaining to another person (the noticee); and b) the same having bearing on his „total income‟ for the relevant year/s. The condition for existence of material, qua an assessment u/s. 153A, is, thus, essential only for proceeding thereunder for any year, specified as „relevant year‟ therein and, further, upon a satisfaction of the AO concerned of it representing escaped assessment income and, two, for at least Rs. 50 lacs, provided the search or requisition is after 31/3/2017. 9.4 We are, thus, unable to appreciate the condition of incriminating or seized material for an assessment u/s. 153A. The nature of the material, i.e., whether „incriminating‟ or not, may itself stand to be ascertained only later, i.e., upon being confronted to the assessee, who may well explain the same, so that it could not be regarded as „incriminating‟ any longer, taking away the jurisdiction, assuming so, already assumed. How could that be? The law in fact does not contemplate hearing the assessee prior to the issue of a notice u/s. 153A(1). Then, again, the assessee‟s explanation may not stand the test of scrutiny or be inconsistent with it‟s conduct or other material or evidences available with the AO. That is, the question as to whether the material is „incriminating‟ may itself become a bone of contention between the parties or be subject to determination. Why, even the erstwhile procedure (Chapter-XIV-B) did not require any satisfaction to be recorded in respect of undisclosed income by the AO of the person searched or requisitioned. Reference here once again be made to the decision by the Apex Court in A.R. Enterprises (supra). In other words, the concept of undisclosed income, which has been done away with, is read into the new provision (s.153A), and that too by introducing the concept of ‘incrimination’, itself undefined and tenuous, on which therefore a decision is to be taken by the AO prior to the issue of notice u/s. 153A(1), without allowing the assessee opportunity of being heard! Why, there is IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 21 | P a g e no reference to any material found or seized during search in s. 153A, except in respect of the relevant years, and which itself makes it clear that Legislature specifically refers thereto when the same is to be taken into account or consideration, as again in s.153C, which cannot be invoked de hors any material. In fact, even in the earlier procedure, the scope of this material stands clarified and, further, in broad terms (s. 158BB), and is not restricted to either the so-called incriminating or seized material, which (the latter) would not apply to a case of requisition u/s. 132A. The new provision, which rather seeks to liberalise the procedure by requiring assessment of all income chargeable to tax in case of a person/s searched or requisitioned, is being interpreted, de hors the clear language of the provision, in an even more restrictive manner, i.e., when the condition of „incriminating material‟ is co-opted, defeating the whole rationale and purpose of the change in procedure. The interpretation, as a reading of the decision in Kabul Chawla (supra), the principal decision which stands relied upon, does not explain the interpretation with reference to the language of the provision, or the basis for stating so. All it says is that the assessment u/s. 153A cannot be arbitrary. Now, this is neither here nor there. This is as it is not and could be nobody‟s case that an assessment made without there being incriminating material, would be per se arbitrary. Why, the condition is made applicable even where the initial „assessment‟ is u/s. 143(1), i.e., where the return has only been processed. It does not explain as to how the said condition is consistent with the mandate for assessment of total income, i.e., once a notice u/s. 153A, or even s.153C(1) r/w s.153A(1), is issued? To state therefore that though a notice would stand to be issued, but no addition or disallowance, which is not based on seized material, could be made, is a contradiction in terms, as the said notice is only for the assessment of the total income. The only caveat, which is rather implicit, is that a particular aspect of an assessment cannot be revisited once the same has been the subject matter of scrutiny and finding in an assessment. The reason for the same is that the AO does not have the power of review. He therefore cannot visit IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 22 | P a g e concluded matters, which would amount to a „change of opinion‟, which also explains the said doctrine, which forms part of well-settled law (CIT v. Kelvinator of India Ltd. [2010] 320 ITR 561 (SC)); Prudent Finance (P.) Ltd. v. Asst. CIT [2016] 389 ITR 488 (Guj)). Where, however, there is material found in relation thereto, which impinges adversely on an aspect of assessment, it would be well within the power of the AO to revisit the same, and take a decision in light of the new materials as well as explanation/s furnished in its respect. This caveat, which could be conveyed by stating that „change of opinion‟ or „review‟ is barred, is not the same thing as precluding an assessment or restricting the assessment of income to that assessed or processed earlier unless there is some material found and seized. It needs to be here also clarified that an addition in an assessment, be it a regular assessment u/s. 143(3) or s.144 or reassessment or in pursuance to a search/requisition, can only be on the strength of materials, i.e., evidence, except of course where the same is wholly legal or conceptual in nature. The disallowance of a claim though; the burden being on the assessee, as indeed for claiming exemption of income, it is the assessee who has to lead the evidence. This, again, as in the case of ‘review’, is though unstated, yet, an implied condition of assessment under Act, as it would be otherwise arbitrary. Now, it may well be that the burden to prove a claim is on the assessee, which is not substantiated by him. Limiting an assessment to an „incriminating‟ material found and seized in search or requisition, would preclude disallowance of such an unsubstantiated claim by the assessee and, besides, be inconsistent with the given mandate for assessment of total income. The only limitation, in view of absence of the power of review, would be where this claim had been enquired into and accepted by the AO in an earlier assessment. A processing of a return u/s. 143(1), where there is no scope for making an adjustment (other than though specified in the provision itself, being in the nature of errors/mistakes of fact or of law, on which there could be conceivably no two views) or for hearing the assessee in the matter, as explained by the Apex Court in Asst. CIT v. Rajesh Jhaveri Stock Brokers (P.) Ltd. [2007] 291 ITR 500 IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 23 | P a g e (SC), is not an „assessment‟. How, one wonders, could the same be excluded from being verified in s.153A proceedings, as has been held to be the case where the time period for the issue of notice u/s. 143(2) has expired, on the ground that it is not a pending, but a concluded „assessment‟. Our view, afore-stated, is supported by a series of decisions, viz. Kesarwani Zarda Bhandar v. UoI (in WP 1078/2010, dtd. 11/8/2010(All)); CIT vs. Raj Kumar Arora [2014] 367 ITR 517 (All); CIT v. Dr. P. Sasikumar [2016] 387 ITR 8 (Ker); Zinzuwadia & Sons v. Dy. CIT [2019] 419 ITR 169 (Guj), to again cite some. In all these cases, it has been clarified that in case of s. 153A, the search or requisition is the trigger point. Once the trigger operates, the AO is to issue notice u/s. 153A and assess or reassess the total income of the assessee for the specified years. 9.5 We may, next, consider the judicial precedents being relied upon by the assessee. The principal decision, as afore-stated, is CIT v. Kabul Chawla [2016] 380 ITR 573 (Del). The same stands pursued, to find, with respect, that even as much as the provision (s. 153A) has neither been reproduced nor interpreted or dilated upon, i.e., is de hors the language thereof. It‟s findings, summarized at para 37 of the judgment, also reproduced by the Hon'ble jurisdictional High Court in Gohoi Dal & Oil Mills (supra) (APB-2, pg.19), are as under: “37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned 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 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 IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 24 | P a g e each of the six AYs 'in which both the disclosed and the undisclosed income would be brought to tax'. (iv) Although Section 153A 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 153A only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in the course of original assessment." On what basis, then, one wonders, does the Hon'ble Court hold that an assessment u/s. 153A could be made in the case of a concluded assessment only on the basis of incriminating material unearthed in search? As afore-noted, no reason – which is the kernel of any judgment, it‟s soul so to speak, stands stated, much less explained therein. Further still, and in any case, it is thus clear that the condition (of discovery of incriminating material during search) is stated to be for a case where an assessment has already been made. Inasmuch as the processing of a return u/s. 143(1) is not an assessment, the same is not applicable to the instant case. The said decision, as indeed Gohoi Dal & Oil Mills (supra), cannot thus be read to mean what it does not say, or read something more than what it actually says. In fact, the words „or made known in the course of original assessment‟ (para IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 25 | P a g e 37(vii)), clearly indicates that the Hon'ble Court had in mind, and is referring to the regular assessment proceedings. Rather, in that view of the matter, concluding it‟s findings so, referring to s. 143(1) processing in the decisions following the said decision, would be inconsistent with the said decision or, where indeed stated so in the said judgment itself, make it internally inconsistent or incongruent to that extent. Continuing further, for the sake of completeness of our discussion, we are unable to find, even as observed during hearing, to no response by Shri Bardia, as to what is the ratio decidendi of the decision in Kabul Chawla (supra). We say so as it is only this that is binding as a judicial precedent. As explained by the Apex Court in Mavilayi Service Co-Operative Bank Ltd. v. CIT [2021] 431 ITR 1 (SC), it is the statement of principle of law applicable to the legal problems disclosed by the facts alone that is the binding ratio of the case, the judgment based on the combined effect of the statements of the principles of law applicable to the material facts of the case cannot be described as the ratio decidendi of the judgment. It, accordingly, held that the ratio decidendi in Citizen Cooperative Society Ltd. would not depend upon the conclusion arrived at on the fact in that case; a case being an authority for what actually decides in law and not for what may seem to be logically follow from it. Furthermore, it needs to be brought-forth that the Apex Court has admitted SLP against the decision/s advocating that an assessment u/s. 153A in respect of unabated assessments could be based only on incriminating material, as in Pr. CIT v. Dharampal Premchand Ltd. [2018] 408 ITR 170 (Del), rendered following Kabul Chawla (supra)(at [2018] 405 ITR (St.) 27). It is well settled that on leave being granted by the Apex Court u/s. 136 of CoI, the finality of the judgment appealed against is put in jeopardy. Though it continues to be binding and effective between the parties, i.e., unless it is a nullity or unless the Court passes a specific order staying or suspending the operation or execution of the judgment under IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 26 | P a g e challenge (refer Kunhayammed and Ors. v. State of Kerala [2000] 245 ITR 360 (SC)). The precedential value of such a judgment thus gets highly compromised. 9.6 Finally, we may consider the reliance on the decision in the case of Gahoi Dal & Oil Mills (supra). Inasmuch as the same follows the decision in Kabul Chawla (supra), all the aspects qua precedence and ratio thereof, as discussed hereinbefore, would, by necessary implication, apply qua this decision too, so that it would not assist the assessee‟s case. Two, even as observed by the Bench during hearing, the Hon'ble Court clarifies in no uncertain terms that no substantial question of law in its view arises from the order of the Tribunal, for it to answer the same. The appellate jurisdiction of a Hon‟ble High Court arises only in respect of a substantial question of law as admitted by it (s. 260A). Where, therefore, it does not admit or otherwise formulate a question of law arising for its consideration and adjudication, its decision thereon cannot be said to be one u/s. 260A of the Act. Reference in this context be made to the decisions in Maharaja Amrinder Singh v. CWT [2017] 397 ITR 752 (SC) and Santosh Hazari v. Purushottam Tiwari [2001] 251 ITR 84 (SC)). Thirdly, we have also found the decision in Kabul Chawla (supra), which stands adopted, as distinguishable on facts inasmuch as the impugned assessment does not follow any assessment in the instant case. The reliance by the assessee on Gahoi Dal & Oil Mills (supra) would thus be of no assistance to the assessee‟s case. 9.7 Finally, we may discuss the addition of LTCG on merits. The same has been added on the ground of it not representing a genuine capital gain and, accordingly, assessed u/s. 68 as income from undisclosed sources. The same, in our clear view, admits of no two views. Once it is confirmed that the scrip under reference is of a penny stock company, the inference of the transaction being not genuine follows in consequence. No materials (viz. toward a sound business, product lines, a customer base, market share, etc.) or even explanation/s, it may be added, rebutting this have been led at any stage, including before us, with, rather, as afore- IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 27 | P a g e noted, Shri Bardia acceding to the company, i.e., 21 st Century Ltd. being a penny stock company. We have already noted the absence of any explanation toward an increase in share price by 30 times in a little over a year. The AO has referred to the incidence of capital gain accruing to the assessee and his family members, year after year, on scrips of such nondescript, even unlisted (at the time of purchase of shares) companies. It is this that led him to inquire, to no answer, as to how the assessee came to know of the unlisted company for it to have purchased it‟s shares. These companies are Kolkata – which has over the past years become notorious for hosting such paper companies, with a network of brokers soliciting clients to “sell” such „capital gains‟ or such like accommodation entries by arranging the paper-work, based. It is in fact this that has led to enquiries by the SEBI as well as indeed by the Revenue, making searches on such companies and brokers. The finding of the said company, as indeed CCL International Ltd., being one such company, i.e., a paper-company, engaged in sham transactions, is in fact result of one such exercise. We, therefore, have no hesitation in confirming the assessment of the impugned gain as income from other sources. We find ourselves, in so deciding, as fully supported by the decision in Sanjay Bimal Chand Jain (supra) and Swati Bajaj (supra), relied upon by the Revenue, as indeed by Durga Prasad More (supra) and Sumati Dayal (supra) (refer paras 7.1, 8.1). The order in Soumitra Choudhary (supra) is without noticing the decision by the Hon‟ble jurisdictional High Court in Swati Bajaj (supra), as indeed the fact of the company under reference having been found as a penny stock company. 9.8 We decide accordingly. 10. In the result, the assessee‟s appeal is dismissed. Order pronounced in open Court on November 02, 2022 Sd/- Sd/- (Manomohan Das) (Sanjay Arora) Judicial Member Accountant Member Dated: 02/11/2022 IT(SS)A No. 02/JAB/2021 (AY: 2012-13) Chotelal Jain v. Dy. CIT 28 | P a g e vr/- Copy to: 1. The Appellant: Chotelal Jain, 1 st Utsav Vihar, 242, Napier Town, Jabalpur (MP) 2. The Respondent: Dy. CIT, Central Circle, Jabalpur. 3. Principal CIT, Ce ntral, Bhopal. 4. CIT( A)-3, Bhopal (MP) 5. The CI T-DR, I TAT, Jabalpur. 6. Guard File. By order (VUKKEM RAMBABU) Sr. Private Secretary,