Omprakash Gupta, Bhopal V. Assistant Commissioner of Income Tax (Central) II, Bhopal

ITSSA 280/Ind/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 2876 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 28-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 07-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHIMA GUPTA
• Assessee Lawyers: S S DESHPANDEY
• Keywords: Unexplained investment; Gift; Documents seized; Reassessment proceedings
• Section: 143(3); 153A; 80IB; 143(1); 132; 139

Judgement Text

[IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] , , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER IT(SS)A NOS.277 TO 281/IND/2017 ASSESSMENT YEARS: 2008-09 TO 2012-13 OMPRAKASH GUPTA 46, VAISHALI NAGAR KOTRA SULTANABAD BHOPAL / VS. ACIT (CENTRAL)- II BHOPAL ( APPELLANT ) ( REVENUE ) P.A. NO. AELPG3485J IT(SS)A NOS.283 TO 287/IND/2017 ASSESSMENT YEARS: 2008-09 TO 2012-13 RAJBALA GUPTA 46, VAISHALI NAGAR KOTRA SULTANABAD BHOPAL / VS. ACIT (CENTRAL)- II BHOPAL (APPELLANT) (REVENUE ) P.A. NO. AEMPG3917L APPELLANT BY SHRI S.S. DESHPANDEY, A.R. RESPONDENT BY SMT. ASHIMA GUPTA, D.R. DATE OF HEARING: 28.02.2019 DATE OF PRONOUNCEMENT: 28.02.2019 [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 2 / O R D E R PER BENCH: THIS BUNCH OF APPEALS FILED BY DIFFERENT ASSESSEES AR E DIRECTED AGAINST ORDERS OF THE CIT(A)-3, BHOPAL DATED 14.9.2017 FOR THE ASSESSMENT YEARS 2008-09 TO 2012-13 . SINCE THE ISSUES ARE COMMON THE APPEALS ARE HEARD TOGETHER AND DISPOSED OFF BY WAY OF COMMON ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. FIRST WE TAKE UP APP EAL FILED BY THE ASSESSEE IN IT(SS)A NO.277 TO 281/IND/2 017 FOR THE A.YRS. 2008-09 TO 2012-13. IT(SS)A NOS.277 TO 281/IND/2017: 2. THE FACTS ARE IN BRIEF THAT THERE WAS A SEARCH CONDUCTED IN THE BUSINESS PREMISES OF THE ASSESSEE AS WELL AS ON THE OTHER RELATED CONCERNS/BUSINESS ASSOCIATES ON 29.1.2014. SINCE THE VARIOUS CONCERNS AND INDIVIDUALS ARE INTERCONNECTED AND HAVE BUSINESS ASSOCIATIONS, THEY HAV E [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 3 BEEN PUT TOGETHER UNDER ONE COMMON NAME SIGNATURE GROUP. THE ASSESSEE IS AN INDIVIDUAL HAVING A BUSINE SS INCOME, RENTAL INCOME AND OTHER SOURCES. AFTER CONDU CTING THE SEARCH, THE A.O. HAS ISSUED NOTICES U/S 153A OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED AS THE ACT) DATED 12.9.2014 WERE ISSUED TO THE ASSESSEE TO FILE THE RE TURN OF INCOME FOR ASSESSMENT YEARS 2008-09 TO 2013-14. IN RESPONSE TO THE NOTICE ISSUED BY THE A.O. U/S 153A OF THE ACT, THE ASSESSEE HAS FILED RETURN OF INCOME FOR A.YR S. 2008-09 TO 2013-14 ON 7.11.2014. THE DETAILS OF THE RETURNS OF INCOME FOR A.Y. 2008-09 TO 2013-14 ARE AS UNDER: A.Y. DATE OF FILING OF RETURN U/S 139(1) RETURNED INCOME (IN RS.) DATE OF FILING OF RETURN BY THE ASSESSEE AGAINST NOTICE U/S 153A INCOM E DECLARED IN RETURN U/S 153A (IN RS.) ADDITIONAL INCOME OFFERED BY THE ASSESSEE (IN RS.) 2008 - 09 12.1.2009 1,35,860 7.11.2014 1,35,860 NIL 2009 - 10 8.1.2010 3,10,380 7.11.2014 3,10,380 NIL [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 4 2010 - 11 04.2.2011 7,68,640 7.11.2014 7,68,640 NIL 2011 - 12 1.10. 2011 13,33,780 7.11.2014 13,33,780 NIL 2012 - 13 17.11.2012 16,38,250 7.11.2014 16,38,250 NIL 2013 - 14 22.11.2013 8,36,860 7.11.2014 8,36,860 NIL 3. IN THE ASSESSMENT ORDER, THE A.O. OBSERVED THAT ON CE SEARCH IS CONDUCTED AND NOTICE IS ISSUED U/S 153A OF THE ACT, THE A.O. IS BOUND TO ISSUE NOTICE TO THE ASSESS EE TO FURNISH RETURN FOR EACH ASSESSMENT YEAR FALLING WITHI N 6 ASSESSMENT YEARS, IMMEDIATELY PRECEDING TO THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SEARCH IS CONDUCTED OR REQUISITION IS MADE. THE A.O. IS REQUIRED TO ASSESS OR REASSESS THE TOTAL INCOME OF THE AFORESAID YEARS. U/S 153A OF THE ACT, THE A.O. HAD BEE N GIVEN A POWER TO ASSESS OR REASSESS TOTAL INCOME OF ASSESSMENT YEARS IN QUESTION IN SEPARATE ASSESSMENT ORDERS. CONSEQUENTLY, EVEN THOUGH ASSESSMENT ORDER HAD BEEN PASSED U/S 143(1A) OR 143(3) OF THE ACT, THE A. O. REQUIRED TO REOPEN THOSE PROCEEDINGS AND REASSESS TOTAL [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 5 INCOME TAKING NOTICE OF UNDISCLOSED INCOME OR DURING THE COURSE OF SEARCH & SEIZURE OPERATION. WHERE ASSESSMEN T OR REASSESSMENT PROCEEDINGS HAD ALREADY BEEN COMPLETED AND ASSESSMENT ORDERS PASSED, THEN A.O. WOULD BE COMPETEN T TO REOPEN ASSESSMENT PROCEEDINGS ALREADY MADE, EVEN IF THERE IS NO INCRIMINATING MATERIAL FOUND DURING THE CO URSE OF SEARCH. BY OBSERVING THE ABOVE, THE ASSESSING OFFI CER PROCEEDED TO CONCLUDE THE ASSESSMENT AND ADDITIONS WER E MADE IN RESPECT OF UNEXPLAINED, UNSECURED LOANS, GIFTS , ON ACCOUNT OF FOREIGN TRAVEL, ON ACCOUNT OF UNEXPLAINED INVESTMENT IN SHARES AND ASSESSMENT WAS COMPLETED U/S 153A R.W.S. 143(3) OF THE ACT FOR THE ASSESSMENT YEAR S 2008-09 TO 2013-14 DATED 17.3.2016. 4. ON APPEAL BEFORE THE LD. CIT(A) THE ASSESSEE HAS SUBMITTED THAT THE RETURN OF INCOME FOR ASSESSMENT YE AR 2012-13 WAS FILED ON 7.11.2012 AND AS PER THE PROVISI ONS OF SECTION 143(2) OF THE ACT, THE LAST DATE ON WHICH THE [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 6 NOTICE FOR ASSESSMENT COULD HAVE BEEN ISSUED ON 13.9.2013. ALL THE OTHER RETURNS ARE FILED ON EARLIE R DATE AND THE TIME LIMIT FOR ISSUE OF NOTICE U/S 143(2) OF THE ACT IN ALL THOSE CASES HAVE EXPIRED. THE SEARCH IN THE CASE OF ASSESSEE WAS INITIATED ON 29.1.2014 AND ALL PROCEEDINGS PENDING AS ON THE DATE HAS ABATED. AS THE PROCEEDINGS FOR A.Y. 2012-13 AND PRIOR YEARS WERE NOT PENDING AS ON T HE DATE OF SEARCH, THE SAME WILL BE DEEMED TO HAVE BEEN COMPLETED WERE NOT ABATED. IT IS WELL SETTLED LAW TH AT IN THE CASE OF COMPLETED ASSESSMENTS, NO ADHOC ADDITIONS ARE PERMISSIBLE. ADDITIONS CAN ONLY BE MADE ON THE BASIS OF INCRIMINATING DOCUMENTS SEIZED DURING THE COURSE OF THE SEARCH. IN CASE OF THE ASSESSEE, NO INCRIMINATING PAPE RS WERE SEIZED. SAME IS OBVIOUS FROM THE FACT THAT NO ADD ITION HAS BEEN MADE IN THE ASSESSMENT, WHICH MAY BE BASED ON NOTHING MADE IN ANY SEIZED PAPER. LD. CIT(A) AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE, HE HAS [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 7 OBSERVED THAT ONCE THE ASSESSEE PARTICIPATED IN THE ASSESSMENT PROCEEDINGS BEFORE THE A.O., THE ASSESSEE CANNOT CLAIM THAT THE ISSUE OF NOTICE U/S 153A R.W.S. 143(3) OF THE ACT FOR A.YRS. 2008-09 TO 2013-14 IS NOT IN ORDER. ONCE THE ASSESSEE PUT TO NOTICE HAD FILED A RETURN OF INCOME IN RESPONSE TO THE NOTICES AND HAS ATTENDED THE ASSESSMENT PROCEEDINGS, IT CANNOT BE SAID THAT THE ISSU E OF NOTICE U/S 153A OF THE ACT IS NOT IN ORDER AND THE L EGAL PLEA RAISED BY THE ASSESSEE REJECTING THE ORDER OF THE A.O . IS CONFIRMED. 5. ON BEING AGGRIEVED, ASSESSEE FILED AN APPEAL BEFORE THE TRIBUNAL. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE OF THE ASSESSEE THE LD. CIT(A) WAS NOT JUSTIFIED IN HOLDIN G THAT THE LD. A.O. WAS NOT JUSTIFIED IN MAKING ADDITION IN THE YEARS W HERE THE ASSESSMENT PROCEEDINGS WERE NOT PENDING AND NO INCR IMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE OF THE ASSESSEE THE LD. CIT(A) WAS NOT JUSTIFIED IN HOLDIN G THAT THE LD. A.O. WAS NOT JUSTIFIED IN MAKING ADDITION OF RS.3,00,000 /- TOWARDS UNSECURED LOANS RECEIVED TREATING THE SAME AS UNEXP LAINED. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE OF THE ASSESSEE THE LD. CIT(A) WAS NOT JUSTIFIED IN HOLDIN G THAT THE LD. A.O. WAS JUSTIFIED IN MAKING ADDITION OF RS.1,20,000/- T OWARDS ESTIMATED ALLEGED UNEXPLAINED EXPENSES MADE ON FORE IGN TOUR. [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 8 4. THAT THE ASSESSEE CRAVES LEAVE TO ADD, ALTER, DELET E OR MODIFY ANY GROUND(S) OF APPEAL DURING OR BEFORE THE HEARING OF THE APPEAL. 6. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT FOR THE ASSESSMENT YEARS 2008-09 TO 2012-13, THE TIME LIMIT FOR THE ISSUE OF NOTICE U/S 143(2) OF THE ACT HAS BEEN EXPIRED AND THEREFORE ALL THE ASSESSMENTS ARE CONCLUDED ASSESSMENTS AND THE ASSESSMENTS ARE NOT PENDING AS ON THE DATE OF SEARCH, THE SAME WILL BE DEEMED TO HAVE BE EN COMPLETED AND ARE NOT ABATED. 7. IT IS ALSO SUBMITTED THAT DURING THE COURSE OF THE SEARCH NO INCRIMINATING MATERIAL FOUND AND THEREFORE CONCLUDED ASSESSMENTS CANNOT BE REOPENED U/S 153A OF THE ACT. FOR THE ABOVE PROPOSITION HE HAS RELIED ON THE FOLLOWING DECISIONS: 1. CIT VS. KABUL CHAWLA 281 CTR 85 (DELHI), 2. PCIT VS. MEETA GUTGUTIA 395 ITR 296 (DELHI) 3. PCIT VS. SOUMYA CONSTRUCTIONS 387 ITR 529 (GUJ.) 4. CIT VS. DEEPAK AGRAWAL 251 TAXMANN PG.22 (BOM) 5. PCIT VS. LATA JAIN 384 ITR 543 (DELHI). [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 9 8. LD. D.R. RELIED ON THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CANARA HOUSING DEVELOPMENT COMPANY VS. DCIT CENTRAL CIRCLE-1, BANGALORE (2014) (49 TAXMAN.COM 98) (KAR). 9. SHE ALSO RELIED ON THE DECISION OF KERALA HIGH COUR T IN THE CASE OF E.N. GOPAKUMAR VS. CIT(CENTRAL) (2016) 75 TAXMAN.COM 215 (KERALA). 10. LD. D.R. FURTHER SUBMITTED THAT THE DECISION IN THE CASE OF CIT VS. VEGETABLE PRODUCTS (2016) 27 ITJ 151 (SC): (1973) 88 ITR 192 CANNOT BE SIMPLY APPLIED. FOR THAT SHE HAS RELIED ON THE DECISION OF THE CCV DILIP KUMAR (2018) 9 SCC PAGE 1. SHE HAS ALSO POINTED OUT THAT IN ALL THESE CASES, ASSESSMENT WAS COMPLETED U/S 143(1) OF TH E ACT. THEREFORE, THE A.O. IS JUSTIFIED TO REVIEW ALL THE ASSESSMENT YEARS. 11. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 10 OF THE AUTHORITIES BELOW. THE ASSESSEE IS AN INDIVIDU AL FILED RETURNS OF INCOME FOR ALL THE ASSESSMENT YEARS I.E. ASSESSMENT YEARS 2008-09 TO 2012-13 AND ASSESSMENTS ARE COMPLETED U/S 143(1) OF THE ACT. SUBSEQUENTLY, A SEARCH ACTION WAS CONDUCTED U/S 132 OF THE ACT IN THE BUSINESS GROUP OF THE ASSESSEE AND A.O. HAS ASKED THE ASSESSEE TO FILE RETURNS OF INCOME FOR ALL THE ASSESSM ENT YEARS BY ISSUE OF NOTICE U/S 153A OF THE ACT ON 12.9 .2014. IN RESPONSE TO THAT, ASSESSEE HAS FILED RETURNS OF INC OME FOR A.YRS. 2008-09 TO 2013-14 ON 7.11.2014. THE CASE OF THE ASSESSEE IS THAT THE RETURN FOR A.Y. 2012-13 WAS FILED ON 7.11.2012. AS PER SECTION 143(2) OF THE ACT, THE L AST DATE ON WHICH NOTICE FOR ASSESSMENT WOULD HAVE BEEN ISSUE D WAS 30.9.2013. ALL THE OTHER RETURNS ARE FILED ON EAR LIEST DATE AND THE TIME LIMIT FOR ISSUE OF NOTICE U/S 143(2 ) OF THE ACT IN ALL THOSE CASES HAS EXPIRED. THE SEARCH WAS INIT IATED IN THE BUSINESS PREMISES OF THE ASSESSEE ON 29.1.201 4 AND [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 11 THEREFORE THE TIME LIMIT FOR ISSUE OF NOTICE U/S 14 3(2) OF THE ACT IS LAPSED. ALL THE ASSESSMENT YEARS FROM 2008-09 TO 2012-13 ARE CONCLUDED AND NON ABATED ASSESSMENTS. THE A.O. CANNOT REOPEN THE ASSESSMENTS U/S 153A OF THE AC T. IN SO FAR AS THE ABOVE SUBMISSION IS CONCERNED FROM TH E ASSESSMENT ORDER AND EVEN FROM THE LD. CIT(A)S ORDER , THERE IS NOTHING ON THE RECORD WHICH SAYS THAT THE ADDITIONS MADE BY THE A.O. ARE BASED ON ANY INCRIMINATIN G MATERIAL. EVEN WHEN THE SAME WAS POINTED OUT TO LD. D. R., SHE IS NOT ABLE TO ESTABLISH THE FACT THAT ADDITIONS ARE BASED ON ANY INCRIMINATING MATERIAL, THEREFORE WE FIND T HAT THE ADDITIONS MADE BY THE A.O. FOR ALL THE YEARS ARE NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. IT IS ONLY BASED ON SUBSEQUENT SEAR CH BY ISSUE OF NOTICE U/S 153A OF THE ACT CALLING FOR THE VARIOUS DOCUMENTS FROM THE ASSESSEE ADDITIONS ARE MADE. IN SO FAR AS THE ARGUMENTS OF THE LD. COUNSEL FOR THE ASSESSEE I N [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 12 RESPECT OF CONCLUDED ASSESSMENTS CANNOT BE REOPENED, WE FIND THAT IN ALL THE ASSESSMENT YEARS FROM 2008-09 TO 2012-13, THERE IS NO SCOPE FOR THE A.O TO ISSUE A NO TICE U/S 143(2) OF THE ACT FOR THE REASON THAT THE TIME LIMIT IS ALREADY OVER BEFORE THE DATE OF SEARCH ITSELF I.E. ON 29.1.2014. THEREFORE, IN OUR OPINION, ALL THE ASSESS MENT YEARS FROM 2008-09 TO 2012-13 ARE CONCLUDED ASSESSMENT S AND NON ABATED ASSESSMENTS AND ANY ADDITION HAS TO BE MADE IN RESPECT OF THOSE ASSESSMENT YEARS, THERE MUST BE AN INCRIMINATING MATERIAL. IN THE PRESENT CASE, THERE I S NO INCRIMINATING MATERIAL AND THEREFORE, THE ADDITIONS MADE BY THE A.O. CANNOT SURVIVE. 12. THIS VERY ISSUE HAS BEEN CONSIDERED BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. CONTINENTAL WAREHOUSING CORPORATION (2015) 120 DTR (BOM) 89 AND HAS OBSERVED THAT U/S 153A OF THE ACT WHICH ENABLES CARRYING OUT A SEARCH OR EXERCISE OF A POWER OF REQUISIT ION, [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 13 ASSESSMENT IN FURTHERANCE THEREOF IS CONTEMPLATED. TH ERE IS A MANDATORY ISSUE OF NOTICE U/S 153(1A) OF THE ACT AND ASSESS AND REASSESS THE TOTAL INCOME OF 6 ASSESSMENT YE ARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO T HE PREVIOUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED OR REQUISITION IS MADE. THAT THE CRUCIAL WORD SEARCH AND REQUISITION APPEAR FOR THE SUBSTANTIVE PROVISION ON T HE PROVISOS. THAT WOULD THROW THE LIGHT ON THE ISSUE OF APPLICABILITY OF THE PROVISION. TRUE IT IS THAT THE ASSESSMENT, WHICH HAS TO BE MADE IN PURSUANCE OF THE NOTICE IS IN RELATION TO THE 6 YEARS. AN ORDER WILL HAVE TO BE MADE IN THAT RECORD WHILE MAKING THE ORDER, THE INCOM E OR THE RETURN OF INCOME FILED FOR ALL THOSE ASSESSMENT Y EARS IS TO BE TAKEN INTO ACCOUNT. A REFERENCE WILL HAVE TO B E MADE TO THE INCOME DISCLOSED THEREIN. HOWEVER, THE SCOP E OF ENQUIRY THERE OF NOT CONFINED ESSENTIALLY REVOLVES ARO UND THE SEARCH OR THE REQUISITION U/S 132A OF THE ACT AS T HE [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 14 CASE MAY BE. THE PROVISO DEALS WITH THE CASES WHERE T HE ASSESSMENT OR REASSESSMENT, IF ANY RELATING TO ASSESSMEN T YEARS FALLING WITHIN THE PERIOD OF 6 ASSESSMENT YEARS R EFER TO IN SUB SECTION 1 OF SECTION 153A OF THE ACT WERE PENDING. IF THEY WERE PENDING ON THE DATE OF INITIATION OF SEAR CH U/S 132 OF THE ACT OR MAKING REQUISITION U/S 132A OF THE ACT AS THE CASE MAY BE, THEY ABATE. IT IS ONLY BINDING PRECE DENCE THAT WOULD ABATE AND NOT WHERE THERE ARE ORDERS MADE ON ASSESSMENT OR REASSESSMENT AND WHICH ARE IN FORCE ON TH E DATE OF INITIATION OF THE SEARCH OR MAKING THE REQUISITI ON. 13. IN THE CASE OF COMMISSIONER OF INCOME TAX (CENTRAL)-3 KABUL CHAWLA (2015) 61 TAXMAN.COM 412 (DEL.), THE HONBLE DELHI HIGH COURT HAS CONSIDERED THE SCOPE OF SECTION 132 OF THE ACT AND 153A(1) OBSERVED AS UNDER: [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 15 14. FROM THE ABOVE DECISION, IT IS VERY CLEAR THAT IN RESPECT OF CONCLUDED ASSESSMENTS ADDITIONS CANNOT BE MADE WITHOUT INCRIMINATING MATERIAL. [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 16 15. THE HONBLE DELHI HIGH COURT IN THE CASE OF PCIT VS. MEETA GUTGUTIA 395 ITR 296 (DELHI) HAS HELD THAT IT WAS ONLY IF DURING THE COURSE OF THE SEARCH U/S 132 O F THE ACT INCRIMINATING MATERIAL JUSTIFYING THE REOPENING OF THE ASSESSMENT YEARS FOR 6 PREVIOUS YEARS WAS FOUND THAT INVOCATION OF SECTION 153A OF THE ACT QUA EACH OF THE ASSESSMENT YEAR WOULD JUSTIFY. 16. IN THE CASE OF PRINCIPAL CIT VS. SOUMYA CONSTRUCTIONS 387 ITR 529 (GUJ.) THE HONBLE GUJARAT HIGH COURT HAS OBSERVED THAT THE ADDITION WAS BASED ON STATEMENT OF THE THIRD PERSON AND NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEAR CH, THEREFORE THE ADDITION DELETED BY THE TRIBUNAL WAS UP HELD. 17. IN THE CASE OF PCIT VS. LATA JAIN 384 ITR 543 (DEL) (SUPRA), THE HONBLE DELHI HIGH COURT HAS HELD THAT THE TRIBUNAL WAS RIGHT IN HOLDING THAT THERE HAD TO BE INCRIMINATING MATERIAL RECOVERED DURING THE COURSE OF [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 17 SEARCH QUA THE ASSESSEE IN EACH YEAR FOR THE PURPOSE OF FRAMING AN ASSESSMENT U/S 153A OF THE ACT. 18. FROM THE ABOVE ALL THE DECISIONS, IT IS VERY CLE AR THAT THE A.O. TO MAKE AN ADDITION U/S 153A OF THE ACT AND THERE MUST BE INCRIMINATING MATERIAL AVAILABLE TO THE A. O. DURING THE COURSE OF THE SEARCH. UNLESS THERE IS A N INCRIMINATING MATERIAL, THE CONCLUDED/NON ABATED ASSESSMENTS CANNOT BE DISTURBED AGAIN U/S 153A OF THE ACT. 19. IN SO FAR AS KERALA HIGH COURT DECISION IN THE CASE OF E.N. GOPAKUMAR (SUPRA) THE HONBLE KERALA HIGH COURT HAS HELD THAT EVEN WITHOUT THERE BEING ANY INCRIMINATING MATERIAL, THE A.O. IS EMPOWERED TO MAKE AN ADDITION U/S 153A OF THE ACT. THE SAME VIEW HAS BEEN EXPRESSED BY THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CANARA HOUSING DEVELOPMENT COMPANY (SUPRA). [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 18 20. IN THE ABOVE CIRCUMSTANCES, WHETHER THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. VEGETABLE PRODUCTS (SUPRA) HAS TO BE APPLIED OR NOT. THE LD. D.R. HAS SUBMITTED THAT THE DECISION HELD IN CIT VS. VEGETABLE PRODUCTS (SUPRA) CANNOT BE APPLIED IN EACH AND EVERY CASE IN THE LIGHT OF THE DECISION OF CCV DILIP KUMAR (SUPRA). IN THE PRESENT CASE, THE ASSESSEE HAS FILED AL L THE RETURNS BEFORE CONDUCTING THE SEARCH AND THE TIME LI MIT TO ISSUE NOTICE U/S 143(2) OF THE ACT ALREADY LAPSED AND A SEARCH IS CONDUCTED AND NO INCRIMINATING MATERIAL IS FOUND. THE A.O. CALLED FOR BOOKS OF ACCOUNTS AND OTH ER RELEVANT DOCUMENTS AND ASSESSMENT IS COMPLETED U/S 153 A R.W.S. 143(3) OF THE ACT. 21. THERE ARE MANY DECISIONS IN FAVOUR OF THE ASSESSEE, WHICH SAYS THAT ONCE ASSESSMENTS ARE CONCLUDED WITHO UT INCRIMINATING MATERIAL, ADDITIONS CANNOT BE MADE BY REOPENING U/S 153A OF THE ACT. THERE ARE TWO DECISI ONS, [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 19 ONE IS OF HON'BLE KERALA HIGH COURT IN THE CASE OF E.N . GOPAKUMAR (SUPRA) AND THE SECOND ONE IS OF HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CANARA HOUSING DEVELOPMENT COMPANY VS. DCIT CENTRAL CIRCLE-1, BANGALORE (SUPRA) IN FAVOUR OF THE REVENUE IN WHICH IT WAS HELD THAT NO INCRIMINATING MATERIAL IS NECESSARY TO REO PEN THE ASSESSMENTS AND TO MAKE AN ADDITION. IN THE PRESEN T CASE, DECISIONS OF HONBLE DELHI, GUJARAT AND BOMBAY HI GH COURTS ARE IN FAVOUR OF THE ASSESSEE. THE DECISIONS O F HON'BLE KERALA HIGH COURT AND KARNATAKA HIGH COURT ARE AGAINST THE ASSESSEE. WE FIND THAT AFTER EXAMINING THE FACTS AND CIRCUMSTANCES OF THE CASE, THE JUDGEMENT OF T HE HON'BLE SUPREME COURT IN THE CASE OF VEGETABLE PRODUCTS (SUPRA) HAS TO BE FOLLOWED. THE HON'BLE SUPREME COURT IN THE ABOVE CASE HAS HELD THAT IF TWO REASONABL E CONSTRUCTIONS OF A TAXING PROVISIONS ARE POSSIBLE, TH EN THAT [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 20 CONSTRUCTION, WHICH FAVOURS THE ASSESSEE MUST BE ADOPTED. 22. IN THE INTEREST OF JUSTICE, THE DECISION OF TH E HON'BLE SUPREME COURT IN THE CASE OF VEGETABLE PRODUCTS (SUPRA) HAS TO BE FOLLOWED. THEREFORE, WE RESPECTIVELY FOLLOWING THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA), HON'BLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL WAREHOUSING CORPORATION (SUPRA) AND ALSO HONBLE GUJARAT HIGH COURT IN THE CASE OF PCIT VS. MEETA GUTGUTIA (SUPRA), WE HOLD THAT NO ADDITION CAN BE MADE IN RESPECT OF CONCLU DED ASSESSMENTS U/S 153A OF THE ACT UNLESS THERE IS ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARC H. WE WOULD LIKE TO MAKE IT CLEAR THAT WHERE THE ASSESSM ENT IS COMPLETED U/S 143(1) OR 143(3) OF THE ACT UNLESS A.O. HAS A TIME TO ISSUE NOTICE U/S 143(2) OF THE ACT, A.O . CANNOT MAKE AN ADDITION U/S 153A OF THE ACT, UNLESS T HERE [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 21 IS AN INCRIMINATING MATERIAL FOUND DURING THE COURSE O F THE SEARCH. 23. THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF SAINATH COLONISERS VS. ACIT (CENTRAL)-II BHOPAL IN IT(SS)A NOS.289 TO 291/IND/2017 DATED 28.2.2019 HAS CONSIDERED THE SIMILAR ISSUE AND HAS HELD THAT IF THERE IS NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARC H AND THE TIME LIMIT FOR ISSUE OF NOTICE U/S 143(2) OF THE ACT EXPIRES, NO ADDITION CAN BE MADE U/S 153A OF THE ACT. FOR THE SAKE OF CONVENIENCE RELEVANT PORTION OF THE ORDER IS EXTRACTED HEREUNDER: 8. WE OBSERVE THAT THE ASSESSEE HAS FILED REGULAR R ETURN OF INCOME U/S 139 OF THE ACT FOR ASSESSMENT YEAR 2008- 09 TO 2010-11 ON 30.9.08, 31.3.2010 AND 12.10.2010 AFTER CLAIMING DEDUCTION U/S 80IB(10) AT RS.8,92,452/-, RS.2,66,948/- AND RS.2,4 4,417/- RESPECTIVELY. THE TIME LIMIT FOR ISSUANCE OF NOTIC ES U/S 143(2) OF THE ACT STOOD EXPIRED IN RELATION TO THE ASSESSMENT YEA R 2008-09 TO 2010-11 MUCH BEFORE THE DATE OF CONDUCTING THE SEAR CH I.E. 29.1.2014 AND THEREFORE THESE THREE ASSESSMENT YEAR S FALLS UNDER THE CATEGORY OF UNABATED/NON ABATED ASSESSMENTS. NOW IN THE GIVEN FACTS LD. COUNSEL FOR THE ASSESSEE HAS RELIED FEW JUDGMENTS AND LD. DEPARTMENTAL REPRESENTATIVE HAS RELIED TO F EW JUDGMENTS IN ITS FAVOUR. HOWEVER, THE HON'BLE APEX COURT IN THE CASE OF CIT V/S VEGETABLE PRODUCTS LTD 88 ITR 192 HAS HELD THAT IF TWO REASONABLE CONSTRUCTION OF A TAXING PROVISIONS ARE POSSIBLE, T HEN THAT CONSTRUCTION WHICH FAVOURS THE ASSESSEE MUST BE ADO PTED. IN THE LIGHT OF ABOVE JUDGMENT OF HON'BLE APEX COURT WE HA VE GONE THROUGH [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 22 THE JUDGMENTS REFERRED AND RELIED BY BOTH THE PARTI ES AND ARE INCLINED TO FOLLOW THE VIEW TAKEN BY HON'BLE COURTS ON THE ISSUE IN QUESTION BEFORE US FAVOURING THE ASSESSEE. 9. THE HON'BLE HIGH COURT OF GUJARAT IN THE CASE OF PCIT VS. DESAI CONSTRUCTION (SUPRA) CONFIRMED THE VIEW TAKEN BY THE TRIBUNAL UPHOLDING THE CONTENTION OF THE ASSESSEE THAT AS NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH WHIC H COULD HAVE ENABLED THE ASSESSING OFFICER TO RE-EXAMINE ITS CLA IM FOR DEDUCTION U/S 80IB WHICH WAS PART OF THE ASSESSMENT PRIOR TO THE SEARCH AND SUCH ASSESSMENT UNABATED. SIMILARLY HON'BLE HIGH C OURT OF BOMBAY IN THE CASE OF CONTINENTAL WAREHOUSING CORPO RATION AND ALL CARGO GLOBAL LOGISTICS LTD (SUPRA) CONFIRMED THE VI EW TAKEN BY THE SPECIAL BENCH OF I.T.A.T. MUMBAI BENCH DECIDED IN F AVOUR OF ASSESSEE DISMISSING THE REVENUES APPEAL HOLDING TH AT THERE WAS NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF S EARCH, THE TRIBUNAL WAS RIGHT IN HOLDING THE POWER CONFERRED U /S 153A BEING NOT EXPECTED TO BE EXERCISED ROUTINELY, SHOULD BE E XERCISED IF THE SEARCH REVEALED ANY INCRIMINATING MATERIAL. IF THA T WAS NOT FOUND THEN IN RELATION TO THE SECOND PHASE OF THREE YEARS , THERE WAS NO WARRANT FOR MAKING AN ORDER WITHIN THE MEANING OF T HIS PROVISION. 10. SIMILAR VIEW WAS ALSO TAKEN BY THE HON'BLE HIG H COURT OF DELHI IN THE CASE OF KABUL CHAWLA (2015) 61 TAXMANN 412. 11. WE THEREFORE IN THE GIVEN FACTS AND CIRCUMSTANC ES OF THE CASE AND RESPECTFULLY FOLLOWING THE JUDGMENTS REFERRED A ND RELIED BY THE LD. COUNSEL FOR THE ASSESSEE ARE OF THE CONSIDERED VIEW THAT NO ADDITION/DISALLOWANCE WAS CALLED FOR ASSESSMENT YE AR 2008-09 TO 2010-11 AS NO INCRIMINATING MATERIAL WAS FOUND DURI NG THE COURSE OF SEARCH AT THE PREMISES OF THE ASSESSEE AS THE TIME LIMIT OF ISSUANCE OF NOTICE U/S 143(2) OF THE ACT STOOD EXPIRED MUCH BEFORE THE DATE OF CONDUCTING SEARCH U/S 132 OF THE ACT. ACCORDINGLY ALL THE THREE APPEALS OF THE ASSESSEE ARE ALLOWED. 24. IN SO FAR AS THE ARGUMENTS OF THE LD. D.R. IN RESPECT OF FOLLOWING THE RATIO OF THE HON'BLE SUPREME COURT IN THE CASE OF VEGETABLE PRODUCTS (SUPRA), THE LD. D.R. BY RELYING ON THE DECISION IN THE CASE OF CCV DILIP [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 23 KUMAR (SUPRA) HAS SUBMITTED THAT THE RATIO LAID DOWN IN THE CASE OF VEGETABLE PRODUCTS (SUPRA) CANNOT BE APPLIED. WE FIND THAT IN THE CASE OF CCV DILIP KUMAR (SUPRA) HAS CONSIDERED THE EXEMPTION PROVISIONS AND HELD THAT EXEMPTION PROVISIONS HAS TO BE CONSIDERED STRICTLY AND IN A CASE OF AMBIGUITY VIEW WHICH FAVOURS THE REVENUE MUST BE ADOPTED. THEREFORE, THE ABOVE DECISION RELIED BY THE LD. D.R. HAS NO APPLICATION TO THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF VEGETABLE PRODUC TS (SUPRA). THEREFORE, ARGUMENT OF THE LD. D.R. IS REJE CTED. 25. IN VIEW OF THE ABOVE, THE ORDER PASSED BY LD. CIT(A) IS REVERSED AND THE APPEALS FILED BY THE ASSESSE E ARE ALLOWED. 26. IN THE RESULT, THE APPEALS FILED BY THE ASSESSEE IN ITA NOS.277 TO 281/IND/2017 ARE ALLOWED. [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 24 ITA NOS. 283 TO 287/IND/2017: 27. THESE APPEALS FOR ASSESSMENT YEARS 2009-10 TO 2012-13 ARE CONCLUDED AND NON ABATE ASSESSMENTS. THE A.O. HAS NO TIME TO ISSUE NOTICE U/S 143(2) OF THE A CT AND UNTIL AND UNLESS THERE IS AN INCRIMINATING MATERIAL FOUN D DURING THE COURSE OF SEARCH NO ADDITION CAN BE MADE. NOWHERE IN THE ASSESSMENT ORDER SHOWS THAT ADDITIONS AR E BASED ON THE INCRIMINATING MATERIAL EVEN IN THE ORDER OF THE LD. CIT(A). ADDITIONS ARE ONLY MADE DURING THE COUR SE OF ASSESSMENT PROCEEDINGS BY CALLING THE ASSESSEE FOR VARI OUS DETAILS SUCH AS BOOKS OF ACCOUNTS VARIOUS DOCUMENTS AND ASSESSMENT WAS COMPLETED. THEREFORE ONCE THE ASSESSMENTS ARE CONCLUDED/NON-ABATED, ADDITION CANNOT BE MADE UNLESS THERE IS AN INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH. THIS LEGAL ASPECT HAS ALRE ADY BEEN CONSIDERED BY US IN THE ABOVE APPEALS IN IT(SS)A NO.277 TO 281/IND/2017. IN VIEW OF OUR DECISION AB OVE THE [IT(SS)A NOS.277 TO 281/IND/2017 & IT(SS)A NOS.283 TO 287/IND/2017 RAJBALA GUPTA, BHOP AL] [OM PRAKASH GUPTA & RAJBALA GUPTA, BHOPAL] 25 SAME IS TO APPLY IN TO TO IN ALL THE OTHER PRESENT APP EALS ALSO. WE THEREFORE, IN VIEW OF OUR DECISION IN THOS E APPEALS, THE ORDERS OF THE LD. CIT(A) ARE REVERSED AND THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED. 28. IN THE RESULT, ALL THE APPEALS FILED BY THE DIFF ERENT ASSESSES ARE ALLOWED FOR ALL THE ASSESSMENT YEARS 2008-0 9 TO 2012-13 IN ITA NOS.277 TO 281/IND/2017 & 283 TO 287/IND/2017. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 28. 02.2019. SD/- (MANISH BORAD) SD/- (V. DURGA RAO) A CCOUNTANT MEMBER JUDICIALMEMBER INDORE; DATED : 28/02/2019 VG/SPS COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR, INDORE