Shri Ganpatraj Lalchand Chowdhary, Ahmedabad V. The ACIT, Central Circle-2(4), Ahmedabad

ITSSA 33/AHD/2015

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 3633 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 18 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 01-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 23-06-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 12-02-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AP ARNA AGRAWAL
• Keywords: Capital asset; Gift; Search and seizure; Question of law; Reassessment proceedings
• Section: 143(3); 142(1); 153A; 147; 148; 263; 132; 15

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER SR. NO. IT (SS) A NO. & ASSTT.YEAR APPELLANT RESPONDENT 1. 25 / AHD /201 5 ASSTT.YEAR: 2009-2010 SMT.PARVATI S. CHOWDHARY C/O. MEHTA LODHA & CO. 105, SAKAR-I OPP: GANDHIGRAM RLY.STATION ASHRAM ROAD AHMEDABAD 380009. PAN : AIWPC 1094 N ACIT, CENT.CIR.2(4) AHMEDABAD. 2. 2 6 /AHD/2015 ASSTT.YEAR: 2009-2010 ARCHANA SHRENIK CHOWDHARY C/O. MEHTA LODHA & CO. 105, SAKAR-I OPP: GANDHIGRAM RLY.STATION ASHRAM ROAD AHMEDABAD 380009. PAN : AGXPA 0311 P ACIT, CENT.CIR.2(4) AHMEDABAD. 3. 30/AHD/2015 ASSTT.YEAR: 2009-2010 SHANKARLAL LALCHAND CHOWDHARY C/O. MEHTA LODHA & CO. 105, SAKAR-I OPP: GANDHIGRAM RLY.STATION ASHRAM ROAD AHMEDABAD 380009. PAN : AHUPJ 0482 E ACIT, CENT.CIR.2(4) AHMEDABAD. 4. 31/AHD/2015 ASSTT.YEAR: 2009-2010 SHRENIKKUMAR S. LALCHAND CHOWDHARY C/O. MEHTA LODHA & CO. 105, SAKAR-I OPP: GANDHIGRAM RLY.STATION ASHRAM ROAD AHMEDABAD 380009. PAN : AVOPS 6115 M ACIT, CENT.CIR.2(4) AHMEDABAD. 5. 34/AHD/2015 ASSTT.YEAR: 2009-2010 SMT.PUSHPADEVI SAMPATRAJ CHOWDHARY C/O. MEHTA LODHA & CO. 105, SAKAR-I OPP: GANDHIGRAM RLY.STATION ASHRAM ROAD AHMEDABAD 380009. PAN : AGXPC 5489 J ACIT, CENT.CIR.2(4) AHMEDABAD. 6. 35/AHD/2015 ASSTT.YEAR: 2009-2010 RAJULDEVI GANPATRAJ CHOWDHARY C/O. MEHTA LODHA & CO. ACIT, CENT.CIR.2(4) AHMEDABAD. IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 2 105, SAKAR - I OPP: GANDHIGRAM RLY.STATION ASHRAM ROAD AHMEDABAD 380009. PAN : AGEPR 8667 A / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI PRAKASH D. SHAH, CA REVENUE BY : APARNA AGRAWAL, CIT-DR / DATE OF HEARING : 16/01/2018 / DATE OF PRONOUNCEMENT: 01/02/2018 / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: PRESENT APPEALS ARE DIRECTED AT THE INSTANCE OF DIF FERENT ASSESSEES AGAINST COMMON ORDER OF THE LD.CIT(A)-12, AHMEDABAD DATED 22.12.2014 PASSED FOR THE ASSESSMENT YEAR 2009-10. 2. SOLITARY GRIEVANCE OF THE ASSESSEES IS THAT THE LD.CIT(A) HAS ERRED IN CONFIRMING ADDITIONS IN RESPECTIVE HANDS OF THE ASS ESSEES ON ACCOUNT OF ALLEGED INVESTMENT IN JEWELLERY. 3. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD CAREFULLY. IT EMERGES OUT FROM THE RECORD T HAT THE LD.CIT(A) HAS DECIDED THE APPEALS OF TEN ASSESSEES BY IMPUGNED CO MMON ORDER. OUT OF THOSE TEN, FOUR APPEALS OF THE ASSESSEES HAVE ALREA DY BEEN DECIDED BY THE TRIBUNAL I.E. IT(SS)A.NOS.28, 29, 32 AND 33/AHD/201 5 IN THE CASES OF SHRIPAL SAMPATRAJ CHOWDHARY, YAMINI SHRIPAL CHOWDHARY AND S AMPATRAJ LALCHAND CHOWDHARY. 4. BRIEF FACTS OF THE CASE ARE THAT A SEARCH AND SE IZURE OPERATION WAS CARRIED OUT AT THE RESIDENTIAL PREMISES OF ALL THE ASSESSEES UNDER SECTION 132 OF THE INCOME TAX ACT ON 21.9.2011 AND 22.9.2011. IN ORDER TO GIVE LOGICAL END TO THE PROCEEDINGS, THE LD.AO HAS ISSUED NOTICES UN DER SECTION 153A OF THE IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 3 ACT ON 29.11.2013 REQUESTING ALL THE ASSESSES TO FI LE THEIR RETURNS OF INCOME. THE LD.AO THEREAFTER ISSUED A NOTICE UNDER SECTION 142(1) ALONG WITH ANNEXURES. HE OBSERVED THAT DURING THE SCOURS OF S EARCH GOLD JEWELLERY, DIAMOND JEWELLERY AND SILVER ARTICLES WERE FOUND FR OM THE RESIDENCE AS WELL AS FROM THE LOCKERS. THEREFORE, THE LD.AO HAS DIRECTE D THE ASSESSEE TO SUBMIT COPY OF THEIR WEALTH-TAX RETURNS, SUPPORTING EVIDEN CES, DATE OF ACQUISITION OF JEWELLERY ALONG WITH DETAILS OF JEWELLERY INCLUDING WEIGHT, NATURE ETC., CONFIRMATION FROM DONORS WHO HAVE GIFTED TO THE ASS ESSEES, SOURCE OF PURCHASE OF JWELLERY. ALL THESE ASSESSEES HAVE FIL ED DETAILED REPLIES WHICH HAVE BEEN REPRODUCED BY THE AO IN THE RESPECTIVE AS SESSMENT ORDERS. IN SHORT, THE CASE OF THE ASSESSEE IS THAT THEY HAVE F ILED THEIR RETURNS OF WEALTH-TAX SHOWING POSSESSION OF JEWELLERY. THERE IS A MINOR VARIATION IN THE DETAILS OF JEWELLERY SHOWN IN THE WEALTH-TAX RETURNS VIS--VIS FOUND DURING THE COURSE OF SEARCH. WITH REGARD TO SUCH VARIATION, IT WAS CONT ENDED THAT EXCESS IN GOLD JEWELLERY WAS MAINLY ON ACCOUNT OF RE-MAKING OF THE JEWELLERY FROM TIME TO TIME. SIMILAR EXPLANATION WAS GIVEN WITH REGARD TO ANY SHORTAGE IN THE SILVER ITEMS. THE LD.AO WAS NOT SATISFIED WITH EXPLANATIO N OF THE ASSESSEE AND MADE ADDITIONS. 5. ON APPEAL, THE LD.CIT(A) HAS CONFIRMED ADDITIONS BY DISCUSSING THE FACTS FROM THE CASE OF GANPATRAJ LALCHAND CHOWDHARY . THE LD.CIT(A) HAS OBSERVED FACTS WITH REGARD TO THE DETAILS OF JEWELL ERY WHICH ARE IDENTICAL IN OTHER CASES. 6. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT T HE TRIBUNAL HAS CONSIDERED IDENTICAL ISSUE IN THE CASE OF SHRIPAL S AMPATRAJ CHOWDHARY WHOSE APPEAL WAS ALSO DECIDED BY THE LD.CIT(A) WITH THE I MPUGNED ORDER. HIS NAME APPEARED AT SR.NO.3 OF THE CASE TITLE IN THE ORDER OF THE LD.CIT(A). THE LD.DR WAS UNABLE TO CONTROVERT THE ABOVE FACTS. IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 4 7. ORDER OF THE ITAT IN THE CASE OF SAMPATRAJ LALCH AND CHOWDHARY, IN ITA NO.32 AND 33/AHD/2015 READS AS UNDER: 1. IT(SS)A NOS. 32 & 33/AHD/2015 ARE APPEALS BY TWO DI FFERENT ASSESSEES PREFERRED AGAINST THE VERY SAME ORDER OF THE LD. CIT(A)-12, AHMEDABAD DATED 22.12.2014 PERTAINING TO A.Y. 2009-10. 2. SINCE THE FIRST APPELLATE AUTHORITY HAS DISPOSED OF THESE APPEALS BY A COMMON ORDER, THEREFORE, BOTH THESE APPEALS WERE HEARD TOG ETHER AND ARE DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE AND BREVIT Y. 3. AT THE VERY OUTSET, WE WOULD LIKE TO STATE THAT THE GRIEVANCE IS COMMON IN BOTH THESE APPEALS AND WHICH RELATES TO THE ORDER FRAMED U/S. 153A OF THE ACT WHEN NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF THE SEARCH PROCEEDINGS. 4. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT A SEA RCH AND SEIZURE OPERATION WAS CONDUCTED AT THE PREMISES OF THE ASSESSEES ON 22.09 .2011. DURING THE SEARCH PROCEEDINGS, GOLD, JEWELLERY AND OTHER VALUABLE ITE MS WERE FOUND FROM THE RESIDENCE & BANK LOCKERS OF THE ASSESSEES. 5. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, TH E ASSESSEE WAS ASKED TO FURNISH DETAILS WITH RESPECT TO JEWELLERY FOUND DURING SEAR CH PROCEEDINGS. THE ASSESSEE FILED A DETAILED REPLY WHICH READS AS UNDER:- 6. CASH AND JEWELLARY: GOLD AND DIAMOND JEWELLERY SILVER PARTICULARS PANCHNAMA DATE GROSS (GRAM) NET (GRAM) CART WT KG 58 BASANT BAHAR-BOPAL 22.09.2011 801.90 308.90 47.74 81.26 KALUPUR CO - OPERATIVE BANK- ANAND NAGAR LOCKER NO. 1412 31.10.2011 2736.60 1680.40 64.60 - KALUPUR CO - OPERATIVE BANK- ANAND NAGAR LOCKER NO. 11 434 31.10.2011 2858.75 21 77.30 130.30 - TAMILNAD BANK - LOCKER NO. 39 09.11.2011 3295.50 2640.35 16.78 -- IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 5 SUB TOTAL 9792.75 6806.95 259.42 81.26 KALUPUR CO - OPERATIVE BANK- ANAND NAGAR LOCKER NO. 243 14.11.2011 728.30 565.30 2.76 - TOTAL 10521.05 7372.25 262.18 81.26 A. FIRSTLY, IT IS SUBMITTED THAT DURING THE COURSE OF PROCEEDINGS UNDER SECTION 132, THE FOLLOWER JEWELLARY / ORNAMENTS AND VALUABLE OF MY F AMILY WERE FOUND AT OUR RESIDENCE AND BANK LOCKER. B. FOLLOWING PERSONS OF THE FAMILY HAVE FILED WEALTH T AX RETURN AND AS PER THE LATEST WEALTH TAX RETURN AT THE TIME OF SEARCH THE QUANTIT Y DECLARED IN THE WEALTH TAX RETURN IS AS UNDER:- NAME OF THE ASSESSEE . GOLD QUANTITY- GROSS (GRAM) GOLD QUANTITY-NET (GRAM) DIAMOND JEWELLARY (CT.) SILVER QUANTITY (KG) SAMPATRAJ LALCHAND CHOWDHARY 1679.2 1606.97 38.98 10.5 PUSHPADEVI CHOWDHARY 2412.35 1756.5 8.08 0 SHREEPAL CHOWDHARY 498.12 498.12 26.62. 37.8 YAMINI 1588.3 1714,918 53.13 0 SHRENIK CHOWDHARY 1542.9 1293.6 21.4 24.3 ARCHANA CHOWDHARY 2137.4 1685.2 13.13 4.5 SAMPATRAJ L.CHOWDHARY-HUF 827.2 781.7 44.119 43.5 TOTAL 10685.47 9337.008 205.459 120.6 C. IT IS SUBMITTED THAT I HAVE PURCHASE GOLD JEWELLARY OF 25,30 GMS CONSISTING OF 17.030 CT OF DIAMONDS ON 10.03.2011, WHICH WAS NOT COVERED IN WEALTH TAX RETURN FILED TILL DATE OF SEARCH. THE COPY OF INVOICE IS E NCLOSED AND MARKED AS ANNEXURE - 5. THE PAYMENT IS MADE OUT OF INTERNAL ACCRUALS. D. AFTER CONSIDERING THE WEALTH-TAX RETURN, JEWELLARY PURCHASED DURING THE YEAR UNDER CONSIDERATION, TOTAL JEWELLARY IS AS UNDER: N AME OF THE ASSESSEE GOLD QUANTITY- GROSS GOLD QUANTITY-NET (GRAM) DIAMOND JEWELLARY (CT) SILVER QUANTITY (KGS) IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 6 (GRAM) SAMPATRAJ L. CHOWDHARY 1704.5 1632.27 56.01 10.5 PUSHPADEVI CHOWDHARY 2412.35 1756.5 8.08 0 SHREEPAL CHOWDHARY 498.1 498.12 26.62 37.8 YAMINI 1588.3 1714.918 53.13 0 SHRENIK CHOWDHARY 1542.9 1293.6 21.4 24.3 ARCHANA CHOWDHARY 2137.4 1685.2 13.13 4.5 SAMPATRAJ L. CHOWDHARY -HUP 827.2 781.7 44.119 43.5 TOTAL 10710.75 9362.308 222 A 89 120.6 E. RECONCILIATION PARTICULARS GOLD QUANTITY - GROSS-(GRAMS) DIAMOND JEWELLARY (CT) SILVER QUANTITY JKGSL JEWELLARY FOUND DURING SEARCH PROCEEDINGS 10521.05 262.18 81.26 JEWELLARY AS PER PARA D 10710.75 222.49 120.6 EXCESS {SHORT) FOUND - 189.70 39.69 - 39.34 VALUE OF EXCESS FOUND 1389185 F. FROM THE ABOVE YOU MAY OBSERVE THAT THERE WAS EXCES S DIAMOND OF 32.69 CT IN POSSESSION COMPARISON WITH THE WEALTH TAX RETURN FI LED BY ALL THE MEMBERS OF THE FAMILY. THE EXCESS DIAMOND FOUND WAS SEIZED BY YOUR OFFICE ALONG-WITH GOLD JEWELLARY AS DIAMOND WAS MOUNTED TO GOLD JEWELLARY. G. EXCESS DIAMOND FOUND WAS DISCLOSED IN ASSESSMENT YE AR 2012-13 AS A PART OF DISCLOSURE GIVEN BY SHRI SHANKARLAL CHOWDHARY RELAT ED TO SHRI SAMPATRAJ L. CHOWDHARY.' 6. THE DETAILED SUBMISSIONS (SUPRA) MADE BY THE ASSESS EE DID NOT FIND ANY FAVOUR WITH THE A.O. THE A.O. WAS OF THE OPINION THAT MERE FILI NG OF WEALTH TAX RETURN DOES IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 7 NOT RULE OUT THE QUESTION OF GENUINENESS OF SOURCES OF ACQUISITION OF JEWELLERY IN QUESTION. THE A.O. CONCLUDED BY MAKING ADDITION OF UNACCOUNTED GOLD IN THE HANDS OF THE ASSESSEES. 7. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) B UT WITHOUT ANY SUCCESS. 8. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE VEHEME NTLY STATED THAT THE IMPUGNED ASSESSMENT IS BAD IN LAW INASMUCH AS NO INCRIMINATI NG MATERIAL WAS FOUND DURING THE COURSE OF THE SEARCH AND SEIZURE OPERATION. IT IS THE SAY OF THE LD. COUNSEL THAT WHATEVER JEWELLERY WAS FOUND HAS ALREADY EXPLAINED IN THE RESPECTIVE HANDS IN THEIR RESPECTIVE WEALTH TAX RETURNS. THEREFORE, NO ADDITI ON SHOULD SURVIVE. PER CONTRA, THE LD. D.R. STRONGLY SUPPORTED THE FINDINGS OF THE REVENUE AUTHORITIES. 9. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORD ERS OF THE AUTHORITIES BELOW. THERE IS NO DENIAL THAT NO INCRIMINATING MATERIAL W AS FOUND AT THE TIME OF SEARCH PROCEEDINGS. IT IS ALSO AN UNDISPUTED FACT THAT PRI OR TO THE DATE OF SEARCH, THE ASSESSEE HAD FILED WEALTH TAX RETURNS. THE ONLY EVIDENCE WHI CH CAME TO THE NOTICE OF THE SEARCH PARTY WERE THE WEALTH TAX RETURNS FILED BY T HE ASSESSEE. IN OUR CONSIDERED OPINION, THE WEALTH TAX RETURNS OF THE GROUP, BY AN Y STRETCH OF IMAGINATION, CANNOT BE CONSIDERED AS INCRIMINATING MATERIAL IN T HE HANDS OF THE ASSESSEES. EXCEPT FOR THIS, THERE IS NOTHING ON RECORD TO SUGGEST ANY INCRIMINATING MATERIAL/DOCUMENT/EVIDENCE. 10. THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CONTIN ENTAL WAREHOUSING CORPORATION 374 ITR 645 HAD DECIDED A SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. THE RELEVANT FINDINGS READ AS UNDER:- ONCE IT IS HELD THAT THE ASSESSMENT HAS ATTAINED FINALITY, THEN THE AO WHILE PASSING THE INDEPENDENT ASSESSMENT ORDER U/S. 153A R.W. S 143(3) OF THE IT. ACT COULD NOT HAVE DISTURBED THE ASSESSMENT/REASSES SMENT ORDER WHICH HAS ATTAINED FINALITY, UNLESS THE MATERIALS GATHERED IN THE COURSE OF THE PROCEEDINGS U/S. 153A OF THE INCOME TAX ACT ESTABLI SH THAT THE RELIEFS GRANTED UNDER THE FINALIZED ASSESSMENT/REASSESSMENT WERE CO NTRARY TO THE FACTS UNEARTHED DURING THE COURSE OF 153A PROCEEDINGS. IF THERE IS NOTHING ON RECORD TO SUGGEST THAT ANY MATERIAL WAS UNEARTHED DURING T HE SEARCH OR DURING THE 153A PROCEEDINGS, THE AO WHILE PASSING ORDER U/S. 1 53A R.W.S. 143(3) CANNOT DISTURB THE ASSESSMENT ORDER.' 10.2. THE HON'BLE HIGH COURT HAD AN OCCASION T O CONSIDER THE FOLLOWING QUESTIONS OF LAW: '1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE HON'BLE ITAT IS CORRECT IN NARROWING DOWN THE SCOPE OF ASSE SSMENT U/S. 153A IN RESPECT OF COMPLETED ASSESSMENTS BY HOLDING THAT ON LY UNDISCLOSED INCOME AND UNDISCLOSED ASSETS DETECTED DURING SEARCH COULD BE BROUGHT TO TAX? 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE HON'BLE ITAT IS CORRECT IN LAW IN HOLDING THAT THE SCOPE OF SEC. 153A IS LIMITED TO ASSESSING ONLY SEARCH RELATED INCOME, THEREBY DENYING REVENUE THE OPPORTUNITY OF TAXING OTHER ESCAPED INCOME, THAT COMES TO THE NOTI CE OF THE AO.? IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 8 3. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE HON'BLE ITAT WAS RIGHT IN LIMITING THE SCOPE OF SEC. 153A ONLY T O UNDISCLOSED INCOME WHEN AS PER THE SECTION THE AO HAS TO ASSESS THE TOTAL I NCOME OF THE SIX ASSESSMENT YEARS?'- AND THE HONBLE HIGH COURT OF BOMBAY FINALLY HELD A S UNDER:- WE, THEREFORE, DISMISS THE REVENUES APPEAL AND AN SWER THE SUBSTANTIAL QUESTION OF LAW AGAINST THE REVENUE AND IN FAVOUR O F ASSESSEE. 11. NOW, THE OTHER ISSUE WHICH HAS TO BE DECIDED IS WHE THER THE TIME LIMIT OF ISSUE OF NOTICE U/S. 143(2) IF FOUND EXPIRED CAN BE CONSTRUE D AS COMPLETED ASSESSMENT. TO THIS QUESTION, THE ANSWER IS GIVEN BY THE CO-ORDINA TE BENCH OF THE TRIBUNAL DELHI IN THE CASE OF PACL INDIA LTD. IN ITA NO. 2637/DEL/ 2010 AND THE SAME READS AS UNDER:- 7.AFTER HEARING BOTH THE SIDES ON THE ISSUE AND TAK ING INTO CONSIDERATION, RECORDS AVAILABLE THE FOLLOWING FACTS EMERGES AS UN DISPUTED. THE REGULAR RETURN OF INCOME WAS FILED ON 2.12.2003 AND THE SAM E WAS PROCESSED U/S 143(1)(A) OF THE ACT. THE TIME PERIOD FOR ISSUING N OTICE U/S 143(2) OF THE IT ACT FOR SELECTING CASE FOR SECURITY EXPIRED ON 31.12.20 04. THE FIRST SEARCH WAS CONDUCTED ON THE PREMISES OF ASSESSEE ON 22.9.2005 AND THE 2ND SEARCH WAS CONDUCTED ON 25.8.2006 AND IN BOTH THE SEARCHES, NO INCRIMINATING MATERIAL, DOCUMENT, UNACCOUNTED ASSETS AND BOGUS OF ACCOUNTS WERE FOUND AND SEIZED RELATING TO LAND DEVELOPMENT EXPENSES DEBITED IN PR OFIT AND LOSS ACCOUNT FOR THE YEAR. THE BOTH SEARCHES ON ASSESSEE DID NOT YIE LD ANY INCRIMINATING MATERIAL ON THE BASIS OF WHICH IT CAN BE SAID THAT ASSESSEE WAS INDULGENT IN DEBITING BOGUS LAND DEVELOPMENT EXPENSES IN ITS BOO KS OF ACCOUNT. THERE IS NO REFERENCE OF ANY MATERIAL FOUND IN THE SEARCH FOR M AKING ASSESSMENT U/S 153A OF THE ACT. THUS THE BASIC CONTROVERSY BEFORE US RE MAINS ABOUT THE SCOPE OF ASSESSMENT U/S 153(A) WHEN THE RETURN HAS BEEN ACCE PTED U/S 143(1)(A) AND TIME PERIOD FOR ISSUING NOTICE U/S 143(2) HAS ELAPS ED. 8. IN OUR CONSIDERED VIEW, THERE IS NO DISPUTE WITH REGARD TO THE PROPOSITION THAT A.O HAS THE JURISDICTION U/S 153A OF THE ACT T O INITIATE ASSESSMENT/ REASSESSMENT PROCEEDINGS FOR ALL THE SIX YEARS TO C OMPUTE THE TOTAL INCOME OF THE ASSESSEE INCLUDING THE UNDISCLOSED INCOME WHERE ACTION HAVE BEEN TAKEN AGAINST THE ASSESSEE U/S 132(1) OF THE IT ACT. HOWE VER, THE QUESTION REMAINS THAT WHEN RETURN HAS BEEN PROCESSED U/S 143(1)(A) A ND THE TIME PERIOD FOR ISSUING NOTICE U/S 143(2) FOR SELECTING RETURN FOR SCRUTINY HAS ELAPSED THEN WHAT NATURE OF PROCEEDINGS COMMENCED AND CONCLUDED U/S 143(1)(A). HOW THESE ARE DIFFERENT FROM THE PROCEEDINGS COMMENCED AND CONCLUDED U/S 143(3) OF THE ACT. THERE IS NO DOUBT THAT ONCE THE PROCEEDINGS U/S 143(3) ARE COMPLETED AND CONCLUDED THEN THERE IS NOTHING WHICH WILL ABATE AS PER PROVISIONS OF SECTION 153A OF THE ACT. 9. IN OUR CONSIDERED OPINION, SECTION 153A REFERRED TO 'PENDING' 'ASSESSMENT' OR 'REASSESSMENT' AND NOT 'ASSESSMENT ORDERS'. THE ASSESSMENT MAY NOT BE PENDING EVEN THOUGH THERE IS NO FORMAL ORDER U/S I4 3(1)(A). THE MOMENT RETURN IS FILED AND ACKNOWLEDGEMENT OR INTIMATION I SSUED, THE PROCEEDINGS INITIATED BY FILING THE RETURN ARE CLOSED, UNLESS T HEY ARE AGAIN TRIGGERED BY ISSUING NOTICE U/S 143(2) OF THE IT ACT. IN THE CAS E UNDER CONSIDERATION, THE PERIOD FOR ISSUING THE NOTICE U/S 143(2) ELAPSED. T HE PROCESS HAS ATTAINED THE FINALITY WHICH CAN ONLY BE ASSAILED U/S 148 OR 263 OF THE IT ACT. SUCH IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 9 PROCEEDINGS CAN NEVER BE INITIATED U/S 143(2) WHEN THE TIME PERIOD FOR ISSUING NOTICE U/S 143(2) HAS EXPIRED. HON'BLE ITAT, MUMBAI C BENCH IN THE CASE OF ACIT VS. PRATIBHA INDUSTRIALIST LTD. REPORTED IN 23 ITR TRIBUNAL 766 MUMBAI HAS ALSO HELD AS UNDER :- 'ALTHOUGH BY PROCEEDINGS INITIATED UNDER SECTION 15 3A ALL SIX YEARS SHALL BECOME SUBJECT MATTER OF ASSESSMENT UNDER SECTION 1 53A THE ASSESSING OFFICER SHALL HAVE A FREE-HAND, THROUGH ABATEMENT, ONLY ON THE PROCEEDINGS THAT ARE PENDING, TO FRAME THE ASSESSMENTS AFRESH. BUT IN A CASE WHERE THE PROCEEDINGS HAVE REACHED FINALITY, ASSESSMENT UNDER SECTION 153A READ WITH SECTION 143(3) AND CERTAIN INCRIMINATING DOCUMENTS HAVE BEEN FOUND INDICATING UNDISCLOSED INCOME, THE ADDITION SHALL O NLY BE RESTRICTED TO THOSE DOCUMENTS OR INCRIMINATING MATERIAL, AND CLUBBED ON LY TO THE ASSESSMENT FRAMED ORIGINALLY, AS THE LAW DOES NOT PERMIT THE A SSESSING OFFICER TO DISTURB ISSUES ALREADY CONCLUDED. WHERE ON THE DATE OF INIT IATION OF SEARCH UNDER SECTION 132 OR REQUISITION OF BOOKS, NO PROCEEDING IS PENDING, BUT IN THE SEARCH, MATERIAL IS FOUND INDICATING INCRIMINATING MATERIAL, THE ASSESSING OFFICER EMBARKS ON A JURISDICTION, WHEREIN HE HAS T O CLUB THE TWO SAFE OF INCOMES, THE RETURNED INCOME AND THE UNEARTHED INCO ME AND ARRIVE AT THE TOTAL INCOME. 12. IN THE CASE OF KABUL CHAWLA 380 ITR 573, THE HON BLE HIGH COURT HAS SUMMARIZED THE LEGAL POSITION 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 T HE AFOREMENTIONED DECISIONS, THE LEGAL POSITION THAT EMERGES IS AS UNDER: I. ONCE A SEARCH TAKES PLACE UNDER SECTION 132 OF T HE ACT, NOTICE UNDER SECTION 153 A(L) WILL HAVE TO BE MANDATORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR SIX AYS IMMEDIATELY PRECEDI NG THE PREVIOUS YEAR RELEVANT TO THE AY IN WHICH THE SEARCH TAKES PLACE. II. ASSESSMENTS AND REASSESSMENTS PENDING ON THE DA TE OF THE SEARCH SHALL ABATE. THE TOTAL INCOME FOR SUCH AYS WILL HAVE TO B E 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 TAK ES PLACE. THE AO HAS THE POWER TO ASSESS AND REASSESS THE 'TOTAL INCOME' OF THE AFOREMENTIONED SIX YEARS IN SEPARATE ASSESSMENT ORDERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS THERE WILL BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX AYS 'IN WHICH BOTH THE DISCLOSED AND THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX'. IV. ALTHOUGH SECTION 153 A DOES NOT SAY THAT ADDITI ONS 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 A O WHICH CAN BE RELATED TO THE EVIDENCE FOUND, IT DOES NOT MEAN THAT THE ASSES SMENT '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 O N THE BASIS OF SEIZED MATERIAL.' V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE CO MPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR REASSESSMEN T CAN BE MADE. THE WORD 'ASSESS' IN SECTION 153 A IS RELATABLE TO ABAT ED PROCEEDINGS (I.E. THOSE IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 10 PENDING ON THE DATE OF SEARCH) AND THE WORD REASSES S' TO COMPLETED ASSESSMENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, T HE JURISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND THE ASSESSMENT UNDER SECTIO N 153A MERGES INTO ONE. ONLY ONE ASSESSMENT SHALL BE MADE SEPARATELY FOR EA CH AY ON THE BASIS OF THE FINDINGS OF THE SEARCH AND ANY OTHER MATERIAL EXIST ING OR BROUGHT ON THE RECORD OF THE AO. VII. COMPLETED ASSESSMENTS CAN BE INTERFERED WITH B Y THE AO WHILE MAKING THE ASSESSMENT UNDER SECTION 153A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR R EQUISITION OF DOCUMENTS OR UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE CO URSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. 13. THE AFOREMENTIONED RATIO LAID DOWN BY THE HONBLE H IGH COURT OF DELHI HAS BEEN FOLLOWED BY THE HONBLE HIGH COURT OF DELHI IN THE CASE OF LATA JAIN IN INCOME TAX APPEAL NO. 274 & 276 OF 2016 WHEREIN THE HONBL E HIGH COURT HELD AS UNDER:- 5. THE SHORT POINT INVOLVED IS WHETHER THE ITAT WAS CORRECT IN CONCLUDING THAT THERE HAD TO BE INCRIMINATING MATERIAL RECOVERED DU RING THE SEARCH QUA THE ASSESSEE IN EACH OF THE YEARS FOR THE PURPOSES OF F RAMING AN ASSESSMENT UNDER SECTION 153 A OF THE ACT? 6. IT IS NOT IN DISPUTE THAT IN RESPECT OF THE RESP ONDENT ASSESSEE FOR THE AYS IN QUESTION THE INITIAL ASSESSMENT PROCEEDINGS TOOK PL ACE UNDER SECTION 143(3) OF THE ACT. THEREAFTER THEY WERE SOUGHT TO BE REOPENED BY ISSUING NOTICE UNDER SECTION 147 OF THE ACT AND RE-ASSESSMENT ORDERS WER E PASSED UNDER SECTION 147 READ WITH SECTION 143(3) OF THE ACT. DURING BOT H THE AFOREMENTIONED PROCEEDINGS THE QUESTION WHETHER THE GOLD AND SILVE R UTENSILS WERE THE CAPITAL ASSETS OR PERSONAL EFFECTS OF THE ASSESSEE WAS EXAM INED. THEY WERE HELD NOT TO BE THE PERSONAL EFFECTS. 7. IT HAS BEEN NOTICED BY THE ITAT IN THE IMPUGNED ORDER THAT FOR THE A.YS IN QUESTION NO INCRIMINATING MATERIAL QUA THE ASSESSEE WAS FOUND. 8. IN THAT VIEW OF THE MATTER, AND IN LIGHT OF THE DECISION OF THIS COURT IN CIT VS. KABUL CHAWLA (2016) 380 ITR 573 (DELHI), THE COURT IS OF THE VIEW THAT THE IMPUGNED ORDER OF THE ITAT SUFFERS FROM NO LEGAL IN FIRMITY AND NO SUBSTANTIAL QUESTION OF LAW ARISES FOR DETERMINATION. 14. AS MENTIONED ELSEWHERE, THERE IS NOT A WHISPER OF A NY INCRIMINATING MATERIAL FOUND AT THE TIME OF SEARCH WHICH COULD BE CONSIDERED AS THE BASIS FOR FRAMING ASSESSMENTS U/S. 153A OF THE ACT. 15. DRAWING SUPPORT FROM THE JUDGMENTS MENTIONED ELSEWH ERE, WE DO NOT FIND ANY LEGALITY IN THE ASSESSMENT SO MADE BY THE A.O. WE H AVE NO HESITATION TO SET ASIDE THE FINDINGS OF THE LD. CIT(A) AND DIRECT THE A.O. TO DELETE THE IMPUGNED ADDITIONS. IN OUR CONSIDERED OPINION, THE ASSESSMEN TS MADE WITHOUT ANY INCRIMINATING MATERIAL IS ILLEGAL AND BAD IN LAW AN D ARE ACCORDINGLY QUASHED. 16. IN THE RESULT, APPEALS FIELD BY THE ASSESSEES ARE A LLOWED. IT(SS)A NO.25/AHD/2015 AND 5 OTHERS 11 8. THERE IS NO DISPARITY ON FACTS. THE LD.CIT(A) H AS CONSIDERED THE FACTS FROM THE CASE OF SHRI GANPATRAJ LALCHAND CHOWDHARY. WE HAVE ALSO CONSIDERED VERY FACTS FROM THAT CASE AND VARIATION IN THE GOLD JEWELLERY IN HIS CASE WAS TO THE EXTENT OF 269.10 GRAMS. SIMILARLY, VARIATION IN SILVER ARTICLES WAS OF 13.43 KG. THIS WAS EXCESS JEWELLRY FOUND AT THE TIME OF SEARCH THAN THE ONE DISCLOSED IN THE WEALTH-TAX RETURNS FILED BY TH E ASSESSEES VIZ. GANAPAT L. CHOWDHARY. SIMILARLY, IN THE CASE OF SMT.PARVATI S . CHOWDHARY VARIATION WAS OF ONLY 41.96 GRAMS OF GOLD JEWELLERY. IT SUGG ESTS THAT DETAILS WITH REGARD TO POSSESSION OF JEWELLERY WERE ALREADY DISCLOSED T O THE DEPARTMENT. NO INCRIMINATING MATERIAL WAS FOUND WHICH CAN JUSTIFY ACTION UNDER SECTION 153A OF THE ACT. THE AO HAS NOTHING TO EXPOSE THE ASSES SEE ON ACCOUNT OF JEWELLERY WHICH WAS ALREADY DISCLOSED TO THE DEPART MENT, AND WITH REGARD TO THAT NO INCRIMINATING MATERIAL WAS FOUND. THIS ASP ECT HAS BEEN CONSIDERED BY US IN THE ORDER OF SHRIPAL SAMPATRAJ CHOWDHARY EXTR ACTED (SUPRA). FOLLOWING ORDER OF THE CO-ORDINATE BENCH, WE ALLOW ALL THESE APPEALS, AND DIRECT THE AO TO DELETE IMPUGNED ADDITIONS. 9. IN THE RESULT, ALL APPEALS OF THE ASSESSEES ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON 1 ST , FEBRUARY 2018 AT AHMEDABAD. SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER