The Asstt. Commissioner of Income Tax, Central Circle-2(3), Ahmedabad V. The Jayesh Steel Pvt.Ltd., Ahmedabad

ITSSA 50/AHD/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 1997 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 10 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 16-11-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 06-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VINOD TALWANI
• Assessee Lawyers: S N SOPARKAR
• Keywords: Unexplained cash credit; Bogus Share capital; Search and seizure; Document seized; Question of law; Documents seized
• Section: 69C; 143(3); 153A; 68; 132

Judgement Text

IT(SS)A NOS. 49& 50/AHD/2017 ACIT VS. THE JAYESH STEEL PVT LTD ASSESSMENT YEAR: 2008-09 & 2010-11 PAGE 1 OF 7 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: JUSTICE P P BHATT, PRESIDENT AND PRAMOD KUM AR, VICE PRESIDENT] IT(SS)A NOS. 49 & 50/AHD/2017 ASSESSMENT YEAR: 2008-09 & 2010-11 ASST. COMMISSIONER OF INCOME-TAX ..AP PELLANT CENTRAL CIRCLE-2(3), AHMEDABAD VS THE JAYESH STEEL PVT LTD ..........RESPON DENT 4 TH FLOOR, PARISEEMA COMPLEX, OPP. SWAGAT BUILDING, CG ROAD, AHMEDABAD [PAN : AAACJ 5006 C] APPEARANCES BY VINOD TALWANI, FOR THE APPELLANT S N SOPARKAR, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 31.10.2018 DATE OF PRONOUNCEMENT : 16.11.2018 O R D E R 1. THESE TWO APPEALS, FILED BY THE ASSESSING OFFICE R, ARE DIRECTED AGAINST THE CONSOLIDATED ORDER DATED 2 ND NOVEMBER 2016 PASSED BY THE CIT(A) IN THE MATTER O F ASSESSMENT UNDER SECTIONS 143(3) R.W.S. 153A(1)(B) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEARS 2008-09 AND 2010-11. 2. GRIEVANCES RAISED IN THESE APPEALS ARE COMMON, B UT FOR DIFFERENCE IN THE FIGURES, AND ARE AS FOLLOWS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN NOT APPRECIATING TH E PROVISIONS OF SECTION 153A OF THE I.T. ACT WHICH REQUIRES THE TOTAL INCOME TO BE BROU GHT UNDER TAX WITHOUT ANY RESTRICTIONS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN HOLDING THAT SUCH A SSESSMENT OR REASSESSMENT U/S 153A IS TO BE RESTRICTED ONLY TO THE INCRIMINATING MATER IALS FOUND DURING THE SEARCH. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN HOLDING THAT AS THE GROUND ON LEGALITY OF ADDITIONS IS ALLOWED, THE OTHER IT(SS)A NOS. 49& 50/AHD/2017 ACIT VS. THE JAYESH STEEL PVT LTD ASSESSMENT YEAR: 2008-09 & 2010-11 PAGE 2 OF 7 GROUNDS ON MERITS ARE CONSIDERED NOT NECESSARY TO B E ADJUDICATED AS THE SAME ARE PURELY ACADEMIC. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN DELETING THE ADDITI ON OF UNEXPLAINED CASH CREDIT U/S 68 OF RS.2,14,50,000/- (AY 2008-09) & RS.4,65,00,000/- (AY 2010-11). 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN TAW, THE LD. CIT(A) HAS ERRED IN LAW AND/OR ON FACTS IN DELETING THE ADDITI ON OF UNEXPLAINED EXPENSES U/S 69C OF RS.1,07,250/- (AY 2008-09) & RS. 2,32,500/- (AY 2010-11). 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE A.O. 7. IT IS, THEREFORE, PRAYED THAT THE ORDER OF TH E LD. CIT (A) BE SET ASIDE AND THAT OF THE A.O. BE RESTORED TO THE ABOVE EXTENT. 3. TO ADJUDICATE ON THESE APPEALS, ONLY A FEW UNDIS PUTED FACTS NEED TO BE TAKEN NOTE OF. A SEARCH AND SEIZURE OPERATION UNDER SECTION 132 WA S CARRIED OUT IN JAYESH STEEL GROUP OF CASES, OF WHICH THIS ASSESSEE IS ALSO A PART, ON 13 TH OCTOBER 2011. SO FAR AS THE PRESENT ASSESSMENT YEARS, I.E. 2008-09 AND 2010-11, ARE CON CERNED, THE RELATED INCOME TAX RETURNS WERE FILED ON 29 TH SEPTEMBER 2008 AND 14 TH OCTOBER 2010 RESPECTIVELY, THESE INCOME TAX RETURNS WERE PROCESSED, UNDER SECTION 143(1), ON 3 RD NOVEMBER 2009 AND 28 TH FEBRUARY 2011 RESPECTIVELY, AND THE TIME LIMIT FOR ISSUANCE OF NO TICES UNDER SECTION 143(2) WAS COMPLETED ON 30 TH SEPTEMBER 2009 AND 30 TH SEPTEMBER 2011 RESPECTIVELY. THESE ASSESSMENTS TH US ACHIEVED FINALITY EVEN BEFORE THE SEARCH OPERATION WAS CARRIED OUT. THERE IS NO DISPUTE THAT NO DISCRIMINATING MATERIAL WAS FOUND DURING THE SEA RCH OPERATION, SO FAR AS RELATABLE TO THE ADDITIONS MADE IN THE IMPUGNED ASSESSMENTS UNDER SE CTION 153A R.W.S. 143(3) ARE CONCERNED. YET, THE ASSESSING OFFICER, DURING THE IMPUGNED ASS ESSMENT PROCEEDINGS FOR THE ASSESSMENT YEAR 2008-09, MADE ADDITIONS OF RS 2,14,50,000, ON ACCOUNT OF SHARE CAPITAL HAVING BEEN TREATED AS UNEXPLAINED CREDITS, AND OF RS 1,07,250 AS COMMISSION PAID FOR THE ALLEGED BOGUS CAPITAL. IN THE ASSESSMENT YEAR 2010-11, SIMILAR AD DITIONS WERE MADE FOR RS 4,65,00,000 AND RS 2,32,500 RESPECTIVELY. AGGRIEVED BY THE ADDITIO NS SO MADE IN THE COURSE OF IMPUGNED ASSESSMENT PROCEEDINGS UNDER SECTION 153A R.W.S. 14 3(3), THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A). GRIEVANCES WERE RAISED, INTER ALIA , IN RESPECT OF JURISDICTION OF THE ASSESSING OFFICER TO DISTURB THE COMPLETED ASSESSME NT ON BASIS OTHER THAN INCRIMINATING MATERIAL FOUND DURING THE SEARCH OPERATIONS. ACCEPT ING THIS PLEA, THE CIT(A) QUASHED THE IMPUGNED ADDITIONS BY OBSERVING AS FOLLOWS: 6.1 THE SEARCH WAS CARRIED OUT ON 13/10/2011. THE TIME LIMIT FOR ISSUANCE OF NOTICE U/S 143(2) FOR THESE TWO ASSESSMENT YEARS UNDER APP EAL, THEREFORE, HAD INDISPUTABLY EXPIRED AS PER COLUMN 4, MUCH BEFORE THE DATE OF SE ARCH. THE LD. AR IS THEREFORE RIGHT, WHICH OF COURSE HAS ALSO NOT BEEN DISPUTED B Y THE AO, THAT THE ASSESSMENT FOR THE YEAR UNDER REFERENCE HAD ATTAINED FINALITY AS O N THE DATE OF THE SEARCH AND INDEED DID NOT ABATE WITHIN THE MEANING OF SECOND PROVISO TO SECTION 153A. THE LD. AR IS ALSO RIGHT IN PUTTING RELIANCE ON KABUL CHAWLA (SUP RA) AND ON JURISDICTIONAL HIGH COURT DECISION IN SAUMYA CONSTRUCTION (SUPRA) FOR T HE PROPOSITION THAT NO ADDITION IT(SS)A NOS. 49& 50/AHD/2017 ACIT VS. THE JAYESH STEEL PVT LTD ASSESSMENT YEAR: 2008-09 & 2010-11 PAGE 3 OF 7 UNFOUNDED ON AND DE HORS THE INCRIMINATING SEIZED D OCUMENTS COULD HAVE BEEN MADE BY THE AO WHILE REFRAINING U/S 153A/ 153C THOSE ASS ESSMENTS WHICH HAD REMAINED UNABATED WITHIN THE MEANING OF SECOND PROVISO TO SE CTION 153A. THE AO'S RELIANCE ON SHIVNATH RAI HAMARAIN (INDIA) LTD., 117 ITD 74 (DEL ) IN HIS REPORT DATED 21/10/2016, IS, IN MY CONSIDERED OPINION, TOTALLY MISPLACED IN VIEW OF THE SAME REMAINING NO LONGER A GOOD LAW AS EMPHATICALLY RULED BY BOTH DEL HI HC IN KABUL CHAWLA AND GUJARAT HC IN SAUMYA CONSTRUCTION (SUPRA). THE AR I S THUS RIGHT THAT THE AO ERRED IN 'INTERFERING WITH' ASSESSMENTS WHICH REMAINED UN ABATED AS ON THE DATE OF SEARCH. AS SUCH, WHEN THE EXAMINATION OF SEIZED MATERIAL BY THE AO DID NOT LEAD HIM TO ANY INCRIMINATING DOCUMENT/ENTRY FOR THE YEAR UNDER REF ERENCE, HE WAS INDEED DUTY-BOUND TO 'REITERATE' THE TOTAL INCOME WHICH HAD ATTAINED FINALITY BEFORE THE DATE OF SEARCH, AND HE INDEED EXCEEDED HIS JURISDICTION IN FIRSTLY TAKING UP THE ROVING ENQUIRIES UNFOUNDED ON INCRIMINATING SEIZED DOCUMENTS, AND SE CONDLY, IN MAKING THE IMPUGNED ADDITIONS. THIS VIEW IN KABUL CHAWLA (SUPRA) HAS BE EN REITERATED BY AHMEDABAD BENCH OF TRIBUNAL IN SAUMYA CONSTRUCTION (SUPRA), W HICH IN TURN, AND EVENTUALLY, HAS ALSO NOW BEEN APPROVED AND REITERATED BY THE HON. G UJARAT HIGH COURT. IN SAUMYA CONSTRUCTION, AHMEDABAD TRIBUNAL DISAPPROVED THE AO 'S ACTION OF MAKING ADDITION OF RS. 11,05,51,000/- U/S 68 AS UNEXPLAINED INVESTM ENT IN 'UNABATED' ASSESSMENT BEING REFRAINED U/S 153A ON THE GROUND THAT THE AO' S ACTION OF MAKING ADDITION U/S 68 WAS NOT BASED ON ANY INCRIMINATING SEIZED DOCUMENTS . TRIBUNAL, WHILE RELYING ON SANJAY AGARWAL 47 TAXMANN.COM 210 (DEL), OBSERVED T HAT THE AO WHILE REFRAINING 'UNABATED' ASSESSMENT U/S 153A, IS NOT AUTHORIZED T O 'GET INFLUENCED' BY ITEMS OF INCOME OTHER THAN THOSE BASED ON MATERIAL 'UNEARTHE D DURING THE COURSE OF SEARCH'. THIS VIEW OF THE HON. TRIBUNAL IS FURTHER APPROVED AUTHORITATIVELY BY HON. HIGH COURT BY OBSERVING THAT IN 'UNABATED' ASSESSMENTS B EING REFRAINED U/S 153A, IN THE ABSENCE OF INCRIMINATING SEIZED MATERIAL ENABLING T HE AO FOR THE YEAR UNDER REFERENCE TO ENQUIRE/MAKE ADDITION, THE AO IS DUTY-BOUND MERE LY TO 'REITERATE' THE CONCLUDED ASSESSMENT WHICH HAD ATTAINED FINALITY BEFORE THE D ATE OF SEARCH. I WOULD ONLY QUOTE FROM THESE DECISIONS OF HON. TRIBUNAL AND HON. HIGH COURT IN THE CASE OF SAUMYA CONSTRUCTION: SAUMYA CONSTRUCTION PVT LTD. IT(SS)A. NO. 3/AHD/201 4 DATED:- 21-8-2015 ......6. WE HAVE NOTED THAT, AS TEAMED COUNSEL FAI RLY ACCEPTS, THE GRIEVANCE OF THE ASSESSES IS NOT AGAINST FRAMING OF THE ASSESSME NT U/S 153A BUT IS CONFINED TO MAKING OF ANY ADDITIONS OR DISALLOWANCES OTHER T HAN ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING SEARCH OPERATIO NS. IN EFFECT THUS, ADDITIONS CANNOT BE MADE OTHER THAN ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING SEARCH OPERATIONS. THAT PLEA STANDS AP PROVED BY A COORDINATE BENCH OF THE TRIBUNAL, IN THE CASE OF SANJAY AGGARW AL VS. DCIT 1(2014) 47 TAXMANN.COM 210 (DEL)], BY OBSERVING AS FOLLOWS: 13. THE ABOVE EXTRACTED OBSERVATIONS OF THE HON. HI GH COURT, WHICH ARE THOUGH OBITER DICTA, MAKE THE POINT CLEAR THAT WHERE AN ASSESSMENT ORDER HAS ALREADY BEEN PASSED FOR A YEAR (S) WITHIN THE RELEVANT SIX ASSESSMENT YEARS, THEN ALSO THE AO IS DUTY BOUND TO REOPEN THOSE PROCEEDINGS AND REASSESS THE TOTAL INCOME BUT BY TA KING NOTE OF THE IT(SS)A NOS. 49& 50/AHD/2017 ACIT VS. THE JAYESH STEEL PVT LTD ASSESSMENT YEAR: 2008-09 & 2010-11 PAGE 4 OF 7 UNDISCLOSED INCOME IF ANY 'UNEARTHED DURING THE SEA RCH. THE EXPRESSION 'UNEARTHED DURING THE SEARCH IS QUITE S IGNIFICANT TO DENOTE THAT IN RESPECT OF COMPLETED OR NON-PENDI NG ASSESSMENTS, THE ASSESSING OFFICER IS ALBEIT DUTY BOUND TO ASSESS OR REASSESS THE TOTAL INCOME BUT THERE IS A CAP ON THE SCOPE OF ADDITIONS IN SUCH ASSESSMENT, BEING THE ITEMS OF INCOME UNEARTHED DURING THE SEA RCH'. IN OTHER WORDS, THE DETERMINATION OF TOTAL INCOME, IN RESP ECT OF THE ASSESSMENT YEARS FOR WHICH THE ASSESSMENTS ARE ALREADY COMPLET ED ON THE DATE OF SEARCH, SHALL NOT BE INFLUENCED BY THE ITEMS OF INC OME OTHER THAN THOSE BASED ON THE MATERIAL UNEARTHED DURING THE COURSE O F SEARCH-...,.... 7. WE SEE NO REASONS TO TAKE ANY OTHER VIEW OF THE MATTER THAN THE VIEW SO TAKEN BY THE COORDINATE BENCH. RESPECTFULLY FOLLOWI NG THE SAME, AND HAVING NOTED THAT THE ADDITIONS OF RS.11,05,51,000/- IS NO T BASED ON ANY INCRIMINATING MATERIAL FOUND DURING SEARCH OPERATIONS ON THE ASSE SSEE, WE DELETE THE SAID ADDITION.,....' SAUMYA CONSTRUCTION TA NO.24/2O16 DATED 14/3/2O16) (GUJARAT HC) '....18. IN THIS CASE, IT IS NOT THE CASE OF THE AP PELLANT THAT ANY INCRIMINATING MATERIAL IN RESPECT OF THE ASSESSMENT YEAR UNDER CO NSIDERATION WAS FOUND DURING THE COURSE OF SEARCH. AT THE RELEVANT TIME W HEN THE NOTICE CAME TO BE ISSUED UNDER SECTION 153A OF THE ACT, THE ASSESSEE FILED ITS RETURN OF INCOME. MUCH LATER, AT THE FAG END OF THE PERIOD WITHIN WHI CH THE ORDER UNDER SECTION 153A OF THE ACT WAS TO BE MADE, IN OTHER WORDS, WHE N THE LIMIT FOR FRAMING THE ASSESSMENT AS PROVIDED UNDER SECTION 153 WAS ABOUT TO EXPIRE, THE NOTICE HAS - BEEN ISSUED IN THE PRESENT CASE SEEKING TO MAKE THE PROPOSED ADDITION OF RS.11,05,51,000/-ON THE BASIS OF THE MATERIAL WHICH WAS NOT FOUND DURING THE COURSE OF SEARCH, BUT ON THE BASIS OF A STATEMENT O F ANOTHER PERSON. IN THE OPINION OF THIS COURT, IN A CASE LIKE THE PRESENT O NE, WHERE AN ASSESSMENT HAS BEEN FRAMED EARLIER AND NO ASSESSMENT OR REASSESSME NT WAS PENDING ON THE DATE OF INITIATION OF SEARCH UNDER SECTION 132 OR M AKING OF REQUISITION UNDER SECTION 132A, WHILE COMPUTING THE TOTAL INCOME OF T HE ASSESSEE UNDER SECTION 1S3A OF THE ACT, ADDITIONS OR DISALLOWANCES CAN BE MADE ONLY ON THE BASIS OF THE INCRIMINATING MATERIAL FOUND DURING THE SEARCH OR REQUISITION. IN THE PRESENT CASE, IT IS AN ADMITTED POSITION THAT NO IN CRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH, HOWEVER, IT IS O N THE BASIS OF SOME MATERIAL COLLECTED BY THE ASSESSING OFFICER MUCH SUBSEQUENT TO THE SEARCH, THAT THE IMPUGNED ADDITIONS CAME TO BE MADE. 19. ON BEHALF OF THE APPELLANT, IT HAS BEEN CONTEND ED THAT IF ANY INCRIMINATING MATERIAL IS FOUND, NOTWITHSTANDING THAT IN RELATION TO THE YEAR UNDER CONSIDERATION, NO INCRIMINATING MATERIAL IS FOUND, IT WOULD BE PERMISSIBLE TO MAKE ADDITIONS AND DISALLOWANCE IN RESPECT OF ALL T HE SIX ASSESSMENT YEARS. IN THE OPINION OF THIS COURT, THE SAID CONTENTION DOES NOT MERIT ACCEPTANCE, INASMUCH AS, THE ASSESSMENT IN RESPECT OF EACH OF T HE SIX ASSESSMENT YEARS IS A SEPARATE AND DISTINCT ASSESSMENT UNDER SECTION 153A OF THE ACT, AN ASSESSMENT IT(SS)A NOS. 49& 50/AHD/2017 ACIT VS. THE JAYESH STEEL PVT LTD ASSESSMENT YEAR: 2008-09 & 2010-11 PAGE 5 OF 7 HAS TO BE MADE IN RELATION TO THE SEARCH OR REQUISI TION, NAMELY, IN RELATION TO MATERIAL DISCLOSED DURING THE SEARCH OR REQUISITION . IF IN RELATION TO ANY ASSESSMENT YEAR, NO INCRIMINATING MATERIAL IS FOUND , NO ADDITION OR DISALLOWANCE CAN BE MADE IN RELATION TO THAT ASSESS MENT YEAR IN EXERCISE OF POWERS UNDER SECTION 153A OF THE ACT AND THE EARLIE R ASSESSMENT SHALL HAVE TO BE REITERATED. IN THIS REGARD, THIS COURT IS IN COM PLETE AGREEMENT WITH THE VIEW ADOPTED BY THE RAJASTHAN HIGH COURT IN THE CASE OF JAI STEEL (INDIA), JODHPUR V. ASSISTANT COMMISSIONER OF INCOME TAX (SUPRA). BE SIDES, AS RIGHTLY POINTED OUT BY THE LEARNED-COUNSEL FOR THE RESPONDENT, THE CONTROVERSY INVOLVED IN THE PRESENT CASE STANDS CONCLUDED BY THE DECISION OF TH IS COURT IN THE CASE OF COMMISSIONER OF INCOME-TAX-1 V. JAYABE RATILAL SORA THIA (SUPRA) WHEREIN IT HAS BEEN HELD THAT WHILE IT CANNOT BE DISPUTED THAT CONSIDERING SECTION 153A OF THE ACT, THE ASSESSING OFFICER COM REOPEN AND/OR AS SESS THE RETURN WITH RESPECT TO SIX PRECEDING YEARS; HOWEVER, THERE MUST BE SOME INCRIMINATING MATERIAL AVAILABLE WITH THE ASSESSING OFFICER WITH RESPECT TO THE SALE TRANSACTIONS IN THE PARTICULAR ASSESSMENT YEAR. 20. FOR THE FOREGOING REASONS, IT IS NOT POSSIBLE T O STATE THAT THE IMPUGNED ORDER PASSED BY THE TRIBUNAL SUFFERS FROM ANY LEGAL INFIRMITY SO AS TO GIVE RISE TO A QUESTION OF LAW, MUCH LESS, A SUBSTANTIAL QUES TION OF LAW, WARRANTING INTERFERENCE. THE APPEAL, THEREFORE, FAILS AND IS, ACCORDINGLY, DISMISSED. 7. IN VIEW OF THE ABOVE, AND IN VIEW OF BY NOW SETT LED LEGAL POSITION AS ENUNCIATED BY JURISDICTIONAL HC, THE AO, IN RE-ASSESSMENTS OF ANY OF UNABATED AND FINALLY CONCLUDED ASSESSMENTS FRAMED U/S 153A/153C, IS NOT AUTHORIZED TO 'INTERFERE EXCEPT ON THE BASIS OF AND EXCEPT HAVING BEEN PROMPTED BY INCRIMINATING SEIZED DOCUMENTS RELATABLE TO THAT ASSESSMENT YEAR. IT IS DEAF THAT THE ADDITIONS AS UNEXPLAINED SHARE CAPITAL MADE BY THE AO ORE NOT BASED ON ANY SEIZED DOCUMENTS. AS SUCH, AS PER EVEN THE AO IN THE ASSESSMENT ORDER, THE ADDITIONS ARE B ASED ON 'POST-SEARCH' ENQUIRY ON AND VERIFICATION OF INFORMATION WHICH WAS ALREADY A VAILABLE IN THE PRE-SEARCH RETURN OF INCOME FILED BY THE APPELLANT WHICH HAD ATTAINED FINALITY AS ON THE DATE OF SEARCH. IT IS ALSO CLEAR THAT THE ASSESSMENT UNDER REFERENCE H AD ATTAINED FINALITY AND THEREFORE REMAINED UNABATED AS ON THE DATE OF SEARCH. THESE F ACTS ARE NOT DISPUTED BY THE AO IN HIS REPORT DATED 21/10/2016. THUS AND THEREFORE, TH E LD. AR IS ABSOLUTELY RIGHT IN CONTENDING THAT THE ADDITIONS, DE HORS ANY INCRIMIN ATING SEIZED DOCUMENTS, MADE BY THE LD. AO IN THESE UNABATED ASSESSMENTS REFRAINED BY HIM U/S 153A, ARE WITHOUT REQUISITE AUTHORITY IN LAW AND ARE THEREFORE NOT SU STAINABLE IN LAW. IN VIEW OF THIS, AND RESPECTFULLY FOLLOWING THE JURISDICTIONAL HIGH COUR T MANDATE, I HAVE NO HESITATION IN DELETING THE ADDITIONS AS UNDER: AY ADDITIONS DELETED 2008-09 RS.2,15,57,250/- 2010-11 RS.4,67,32,500/- 8. THE APPELLANT WOULD GET RELIEF OF EQUIVAL ENT AMOUNT. LEGAL GROUND NO.(II) IS THUS ALLOWED FOR BOTH THE YEARS UNDER APPEAL. IT(SS)A NOS. 49& 50/AHD/2017 ACIT VS. THE JAYESH STEEL PVT LTD ASSESSMENT YEAR: 2008-09 & 2010-11 PAGE 6 OF 7 4. THE ASSESSING OFFICER IS AGGRIEVED OF THE RELIEF SO GRANTED BY THE CIT(A) AND IS IN APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. 6. THE QUESTION THAT REALLY CALLS FOR OUR CONSIDERA TION IS WHETHER, IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH OPER ATIONS AS A RESULT OF WHICH THE ASSESSMENTS UNDER SECTION 153A ARE FRAMED, THE COMP LETED ASSESSMENTS CAN BE DISTURBED BY MAKING THE ADDITIONS ON THE BASIS OF MATERIAL OTHER THAN INCRIMINATING MATERIAL FOUND DURING THE SEARCH OPERATIONS. 7. THIS ISSUE IS NO LONGER RES INTEGRA . UPHOLDING THE STAND OF THIS TRIBUNAL THAT DURING THE POST SEARCH ASSESSMENT PROCEEDINGS UNDER SECTIO N 153 A IN RESPECT OF COMPLETED ASSESSMENTS ADDITIONS CANNOT BE MADE OTHER THAN ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING SEARCH OPERATIONS, HONBLE JURISDICTI ONAL HIGH COURT, IN THE CASE OF PCIT VS SAUMYA CONSTRUCTIONS PVT LTD [(2016) 387 ITR 529 (G UJ)] HAS OBSERVED AS FOLLOWS: .IT IS NOT THE CASE OF THE APPELLANT THAT ANY IN CRIMINATING MATERIAL IN RESPECT OF THE ASSESSMENT YEAR UNDER CONSIDERATION WAS FOUND DURING THE COURSE OF SEARCH. AT THE RELEVANT TIME WHEN THE NOTICE CAM E TO BE ISSUED UNDER SECTION 153A OF THE ACT, THE ASSESSEE FILED ITS RETURN OF I NCOME. MUCH LATER, AT THE FAG END OF THE PERIOD WITHIN WHICH THE ORDER UNDER SECTION 153A OF THE ACT WAS TO BE MADE, IN OTHER WORDS, WHEN THE LIMIT FOR FRAMING TH E ASSESSMENT AS PROVIDED UNDER SECTION 153 WAS ABOUT TO EXPIRE, THE NOTICE H AS BEEN ISSUED IN THE PRESENT CASE SEEKING TO MAKE THE PROPOSED ADDITION OF RS.11 ,05,51,000/- ON THE BASIS OF THE MATERIAL WHICH WAS NOT FOUND DURING THE COURSE OF SEARCH, BUT ON THE BASIS OF A STATEMENT OF ANOTHER PERSON. IN THE OPINION OF TH IS COURT, IN A CASE LIKE THE PRESENT ONE, WHERE AN ASSESSMENT HAS BEEN FRAMED EA RLIER AND NO ASSESSMENT OR REASSESSMENT WAS PENDING ON THE DATE OF INITIATION OF SEARCH UNDER SECTION 132 OR MAKING OF REQUISITION UNDER SECTION 132A, WHILE COM PUTING THE TOTAL INCOME OF THE ASSESSEE UNDER SECTION 153A OF THE ACT, ADDITIO NS OR DISALLOWANCES CAN BE MADE ONLY ON THE BASIS OF THE INCRIMINATING MATERIA L FOUND DURING THE SEARCH OR REQUISITION. 8. ONCE IT IS NO IN DISPUTE THAT THE ADDITIONS IN Q UESTIONS ARE NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH OPER ATION, AS IS THE UNDISPUTED FACTUAL POSITION IN THIS CASE, THE VERY FOUNDATION OF THE ADDITIONS CEASES TO BE SUSTAINABLE IN LAW. THAT IS PRECISELY WHAT THE LEARNED CIT(A) HAS HELD. 9. IN VIEW OF THE ABOVE DISCUSSIONS, AS ALSO BEARIN G IN MIND ENTIRETY OF THE CASE, WE APPROVE THE CONCLUSIONS ARRIVED AT BY THE LEARNED C IT(A) AND DECLINE TO INTERFERE IN THE MATTER. IT(SS)A NOS. 49& 50/AHD/2017 ACIT VS. THE JAYESH STEEL PVT LTD ASSESSMENT YEAR: 2008-09 & 2010-11 PAGE 7 OF 7 10. AS THE ADDITIONS STAND DELETED ON THE SHORT LEG AL GROUND DISCUSSED ABOVE, THERE IS NO OCCASION TO DEAL WITH THE MERITS. THAT ASPECT OF TH E MATTER, GIVEN THE FINDINGS ABOVE, IS WHOLLY ACADEMIC AT THIS STAGE. 11. IN THE RESULT, THE APPEALS ARE DISMISSED. PRONO UNCED IN THE OPEN COURT TODAY ON THE 16 TH DAY OF NOVEMBER, 2018. SD/- SD/- JUSTICE P P BHATT PRAMOD KUMAR (PRESIDENT) (VICE PRESIDENT) AHMEDABAD, DATED THE 16 TH DAY OF NOVEMBER, 2018 COPIES TO: (1) THE APPELLANT (2) THE RESPOND ENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ....PROCESSED BY HONBLE VP ON HIS LAPTOP - .08.11.2018........... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: ...08.11.2018.... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S.: 16.11.2018... 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: ..16.11.2018. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : . 16.11.2018. 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER : . 8. DATE OF DESPATCH OF THE ORDER: ......