Appeal details
Counselvise Citation
[2016] 122 COUNSELVISE.COM (IT) 2145 (ITAT-AHMEDABAD)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
3 year(s) 5 month(s)
Appellant
Respondent
Appeal Type
Income Tax (Search & Seizure) Appeal
Pronouncement Date
07-07-2016
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
B
Next Hearing Date
04-07-2016
Assessment Year
2004-2005
Appeal Filed On
06-02-2013
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH (BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER & SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER) IT(SS)A. NOS 78 & 79/AHD/2013 (ASSESSMENT YEARS: 2004-05 & 2006-07) SHRI SURESHKUMAR PUKHRAJ BAGRECHA C/O. KOMAL TAX FAB PVT. LTD. OPP; RANIPURA PATIA, SARKHEJ ROAD, AHMEDABAD PAN NO. ABCPB2096E V/S ACIT CENT. CIRCLE-2(4), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NOS 80 TO 82/AHD/2013 (ASSESSMENT YEARS: 2004-05 TO 2006-07) SHRI VIKRAM PUKHRAJ BAGRECHA 1, SADBHAV SOCIETY, OPP; OM TOWERS, SHAHIBAUGH, AHMEDABAD PAN NO. ABHPB3674P V/S ACIT CENT. CIRCLE-2(4), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NOS 83 TO 84/AHD/2013 (ASSESSMENT YEARS: 2004-05 & 2005-06) SHRI SUDHIR PUKHRAJ BAGRECHA 1, SADBHAV SOCIETY, OPP; OM TOWERS, SHAHIBAUGH, AHMEDABAD PAN NO. ABHPB3814H V/S ACIT CENT. CIRCLE-2(4), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 2 IT(SS)A. NO. 85/AHD/2013 (ASSESSMENT YEARS: 2004-05) SAYARBEN SURESHKUMAR BAGRECHA 1, SADBHAV SOCIETY, OPP; OM TOWERS, SHAHIBAUGH, AHMEDABAD PAN NO. ABCPB2059D V/S ACIT CENT. CIRCLE-2(4), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NO. 86/AHD/2013 (ASSESSMENT YEARS: 2004-05) POOJA RAJESH BAGRECHA 1, SADBHAV SOCIETY, OPP; OM TOWERS, SHAHIBAUGH, AHMEDABAD PAN NO. ACLPN2861K V/S ACIT CENT. CIRCLE-2(4), AHMEDABAD (APPELLANT) (RESPONDENT) IT(SS)A. NO. 87AHD/2013 (ASSESSMENT YEARS: 2004-05) RAJESH SURESHKUMAR BAGRECHA C/O. RICO CORPORATION, 1/23, NEW MDHUPURA MARKET, AHMEDABAD PAN NO. AETPB4490E V/S ACIT CENT. CIRCLE-2(4), AHMEDABAD (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI P.M. MEHTA, AR RESPONDENT BY : SHRI RAJEEV AGARWAL, CIT/DR ( )/ ORDER DATE OF HEARING : 04 -07-20 16 DATE OF PRONOUNCEMENT : 07 -07-2016 IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 3 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. THE AFOREMENTIONED CAPTIONED BUNCH OF APPEALS BY TH E RESPECTIVE ASSESSEES ARE DIRECTED AGAINST SEPARATE ORDERS OF T HE LD. CIT(A)-III, AHMEDABAD DATED 30.11.2012 PERTAINING TO RESPECTIVE ASSESSMENT YEARS MENTIONED IN THE CAPTIONED APPEALS, HAVE COMM ON GROUNDS BY WHICH THE ASSESSEE HAS CHALLENGED THE VERY VALIDITY OF THE ASSESSMENT ORDER MADE U/S. 153A R.W.S. 143(3) OF THE ACT. 2. ALL THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 3. REPRESENTATIVES FROM BOTH SIDES WERE HEARD AT LENGT H. 4. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT A SEA RCH ACTION U/S. 132 OF THE ACT WAS CARRIED OUT IN THE GROUP CASES OF KOMAL GROUP ON 06.08.2009. NOTICE U/S. 153A WERE ISSUED AND SERVED UPON THE ASSESSEES AND THE ASSESSEES FILED RETURN OF INCOME ACCORDINGLY. STATUTORY NOTICES U/S. 143(2) AND 142(1) OF THE ACT WERE SUBSEQUENTLY ISSUED AND SERVED UPON THE ASSESSEE. 5. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, GI FTS RECEIVED BY THE ASSESSEES WERE EXAMINED. THE ASSESSEE WAS ASKED TO EXPLAIN THE GENUINENESS OF THE GIFTS. ASSESSEES FILED DETAILED REPLY IN THE LIGHT OF THE PROVISIONS OF SECTION 68 OF THE ACT, IDENTITIES OF THE DONOR, GENUINENESS OF THE TRANSACTION AND CREDITWORTHINESS WERE EXPLAINED. THE DETAILED REPLY OF THE ASSESSEE DID NOT FIND FAV OUR WITH THE A.O. THE A.O. WAS OF THE FIRM BELIEF THAT THERE EXISTS NO RE LATIONSHIP BETWEEN THE DONORS AND THE DONEES AND, THEREFORE, TREATED T HE GIFTS IN ALL THESE IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 4 CASES AS UNEXPLAINED CASH CREDIT AND MADE ADDITIONS IN THE RESPECTIVE HANDS. 6. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) B UT WITHOUT ANY SUCCESS. 7. HAVING HEARD THE RIVAL SUBMISSIONS, WE HAVE CAREFUL LY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE GIVEN A TH OUGHTFUL CONSIDERATION TO THE LEGAL PROPOSITION PUT FORWARD BY THE LD. COUNSEL. THE LD. COUNSEL VEHEMENTLY STATED THAT THE ORDER MA DE U/S. 153A OF THE ACT IS ILLEGAL AND BAD IN LAW BECAUSE THE ASSES SMENTS HAVE BEEN FRAMED BY THE A.O. WITHOUT ANY INCRIMINATING MATERI AL FOUND AT THE TIME OF SEARCH. 8. WE PROCEED BY DECIDING THE ISSUE OF ASSESSMENTS MAD E U/S. 153A QUA THE INCRIMINATING MATERIAL. FOLLOWING CHART WILL EX PLAIN THE DETAILS REGARDING THE COMPLETED ASSESSMENTS. SURESH PUKHRAJ BAGRECHA & OTHERS DATE OF SEARCH: 06/08/2009 ITSS NO. ASSESSMENT YEAR ROI FILED ON ASSESSED U NDER SECTION LAST DATE OF ISSUING NOTICES U/S. 143(2) SURESH PUKHRAJ BAGRECHA 78/AHD/2013 2004-05 11/11/2004 143(1) 30/11/2005 79/AHD/2013 2006-07 07.03.2007 143(1) 31.03.2008 IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 5 VIKRAM PUKHRAJ BAGRECHA 80/AHD/2013 2004-05 11/11/2004 143(1) 30/11/2005 81/AHD/2013 2005-06 25.01.2006 143(1) 31.01.2007 82/AHD/2013 2006-07 07.03.2007 143(1) 31.03.2008 SUDHIR PUKHRAJ BAGRECHA 83/AHD/2013 2004-05 26/10/2004 143(1) 31/10/2005 84/AHD/2013 2005-06 25.01.2006 143(1) 31.01.2007 SAYARBEN S BAGRECHA 85/AHD/2013 2004-05 19/10/2004 143(1) 31/10/2005 POOJA RAJESH BAGRECHA 86/AHD/2013 2004-05 22/12/2004 143(1) 31/12/2005 RAJESH SURESHKUMAR BAGRECHA 87/AHD/2013 2004-05 28/10/2004 143(1) 31/10/2005 9. A PERUSAL OF THE CHART SHOWS THAT PRIOR TO THE DATE OF SEARCH, THE AFOREMENTIONED ASSESSMENTS STOOD COMPLETED AND, THE REFORE, IF NO INCRIMINATING MATERIAL IS FOUND THEN THE CONCLUDED ASSESSMENTS COULD NOT BE REOPENED. THIS VIEW IS NOW SETTLED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE JUDGMENT OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CONTINENTAL WAREHOUSING CORPOR ATION 374 ITR 645 WHICH READS AS UNDER:- IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 6 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/REASSESSMENT ORDER WHICH HAS ATTAINED FI NALITY, UNLESS THE MATERIALS GATHERED IN THE COURSE OF THE PROCEEDINGS U/S. 153A OF THE INCOME TAX ACT ESTABLISH THAT THE RELIEFS GRANTED U NDER THE FINALIZED ASSESSMENT/REASSESSMENT WERE CONTRARY TO THE FACTS UNEARTHED DURING THE COURSE OF 153A PROCEEDINGS. IF THERE IS NOTHING ON RECORD TO SUGGEST THAT ANY MATERIAL WAS UNEARTHED DURING THE SEARCH OR DURING THE 153A PROCEEDINGS, THE AO WHILE PASSING ORDER U/ S. 153A 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 ASSESSMENT U/S. 153A IN RESPECT OF COMPLETED ASSESSMENTS BY HO LDING THAT ONLY 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, TH EREBY DENYING REVENUE THE OPPORTUNITY OF TAXING OTHER ESCAPED INC OME, THAT COMES TO THE NOTICE OF THE AO.? 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 TO UNDISCLOSED INCOME WHEN AS PER THE SECTION THE AO H AS TO ASSESS THE TOTAL INCOME 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 OF ASSESSEE. IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 7 10. 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 CONSTRUED AS COMPLETED ASSESSMENT. TO THIS QUESTION , THE ANSWER IS GIVEN BY THE CO-ORDINATE BENCH OF THE TRIBUNAL DELH I IN THE CASE OF PACL INDIA LTD. IN ITA NO. 2637/DEL/2010 AND THE SA ME READS AS UNDER:- 7.AFTER HEARING BOTH THE SIDES ON THE ISSUE AND TAK ING INTO CONSIDERATION, RECORDS AVAILABLE THE FOLLOWING FACT S EMERGES AS UNDISPUTED. THE REGULAR RETURN OF INCOME WAS FILED ON 2.12.2003 AND THE SAME WAS PROCESSED U/S 143(1)(A) OF THE ACT. TH E TIME PERIOD FOR ISSUING NOTICE U/S 143(2) OF THE IT ACT FOR SELECTI NG CASE FOR SECURITY EXPIRED ON 31.12.2004. THE FIRST SEARCH WAS CONDUCT ED ON THE PREMISES OF ASSESSEE ON 22.9.2005 AND THE 2ND SEARC H WAS CONDUCTED ON 25.8.2006 AND IN BOTH THE SEARCHES, NO INCRIMINA TING MATERIAL, DOCUMENT, UNACCOUNTED ASSETS AND BOGUS OF ACCOUNTS WERE FOUND AND SEIZED RELATING TO LAND DEVELOPMENT EXPENSES DEBITE D IN PROFIT AND LOSS ACCOUNT FOR THE YEAR. THE BOTH SEARCHES ON ASSESSEE DID NOT YIELD ANY INCRIMINATING MATERIAL ON THE BASIS OF WHICH IT CAN BE SAID THAT ASSESSEE WAS INDULGENT IN DEBITING BOGUS LAND DEVEL OPMENT EXPENSES IN ITS BOOKS OF ACCOUNT. THERE IS NO REFERENCE OF A NY MATERIAL FOUND IN THE SEARCH FOR MAKING ASSESSMENT U/S 153A OF THE AC T. THUS THE BASIC CONTROVERSY BEFORE US REMAINS ABOUT THE SCOPE OF AS SESSMENT U/S 153(A) WHEN THE RETURN HAS BEEN ACCEPTED U/S 143(1) (A) AND TIME PERIOD FOR ISSUING NOTICE U/S 143(2) HAS ELAPSED. 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 TO INITIATE ASSESSMENT/ REASSESSMENT PROCEEDINGS FOR ALL THE SI X YEARS TO COMPUTE THE TOTAL INCOME OF THE ASSESSEE INCLUDING THE UNDISCLOSED INCOME WHERE ACTION HAVE BEEN TAKEN AGAINST THE ASS ESSEE U/S 132(1) OF THE IT ACT. HOWEVER, THE QUESTION REMAINS THAT W HEN RETURN HAS BEEN PROCESSED U/S 143(1)(A) AND THE TIME PERIOD FO R ISSUING NOTICE U/S 143(2) FOR SELECTING RETURN FOR SCRUTINY HAS EL APSED THEN WHAT IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 8 NATURE OF PROCEEDINGS COMMENCED AND CONCLUDED U/S 1 43(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 NO THING 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 I43(1)(A). THE MOMENT RETURN IS FILED AND ACKNO WLEDGEMENT OR INTIMATION ISSUED, THE PROCEEDINGS INITIATED BY FIL ING THE RETURN ARE CLOSED, UNLESS THEY ARE AGAIN TRIGGERED BY ISSUING NOTICE U/S 143(2) OF THE IT ACT. IN THE CASE UNDER CONSIDERATION, THE PE RIOD FOR ISSUING THE NOTICE U/S 143(2) ELAPSED. THE PROCESS HAS ATTAINED THE FINALITY WHICH CAN ONLY BE ASSAILED U/S 148 OR 263 OF THE IT ACT. SUCH PROCEEDINGS CAN NEVER BE INITIATED U/S 143(2) WHEN THE TIME PER IOD FOR ISSUING NOTICE U/S 143(2) HAS EXPIRED. HON'BLE ITAT, MUMBAI C BENCH IN THE CASE OF ACIT VS. PRATIBHA INDUSTRIALIST LTD. REPORT ED 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 SEC TION 153A THE ASSESSING OFFICER SHALL HAVE A FREE-HAND, THROUGH A BATEMENT, ONLY ON THE PROCEEDINGS THAT ARE PENDING, TO FRAME THE ASSE SSMENTS AFRESH. BUT IN A CASE WHERE THE PROCEEDINGS HAVE REACHED FI NALITY, ASSESSMENT UNDER SECTION 153A READ WITH SECTION 143(3) AND CER TAIN INCRIMINATING DOCUMENTS HAVE BEEN FOUND INDICATING UNDISCLOSED IN COME, THE ADDITION SHALL ONLY BE RESTRICTED TO THOSE DOCUMENT S OR INCRIMINATING MATERIAL, AND CLUBBED ONLY TO THE ASSESSMENT FRAMED ORIGINALLY, AS THE LAW DOES NOT PERMIT THE ASSESSING OFFICER TO DISTUR B ISSUES ALREADY CONCLUDED. WHERE ON THE DATE OF INITIATION OF SEARC H 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 IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 9 OF INCOMES, THE RETURNED INCOME AND THE UNEARTHED I NCOME AND ARRIVE AT THE TOTAL INCOME. 11. IN THE CASE OF KABUL CHAWLA 380 ITR 573, THE HONBL E 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 EXPLA INED IN THE AFOREMENTIONED DECISIONS, THE LEGAL POSITION THAT E MERGES 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 PRECEDING THE PREVIOUS YEAR RELEVANT TO THE AY IN W HICH 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 HAV E 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 'TO TAL INCOME' OF THE AFOREMENTIONED SIX YEARS IN SEPARATE ASSESSMENT ORD ERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS THERE WILL BE ONLY ON E ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX AYS 'IN WHICH BOTH TH E 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 INFORMATIO N AVAILABLE WITH THE AO WHICH CAN BE RELATED TO THE EVIDENCE FOUND, IT D OES NOT MEAN THAT THE ASSESSMENT 'CAN BE ARBITRARY OR MADE WITHOUT AN Y RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOUSLY AN ASSESS MENT HAS TO BE MADE UNDER THIS SECTION ONLY ON THE BASIS OF SEIZED MATERIAL.' V. IN ABSENCE OF ANY INCRIMINATING MATERIAL, THE CO MPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR REAS SESSMENT CAN BE IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 10 MADE. THE WORD 'ASSESS' IN SECTION 153 A IS RELATAB LE TO ABATED PROCEEDINGS (I.E. THOSE PENDING ON THE DATE OF SEAR CH) AND THE WORD REASSESS' TO COMPLETED ASSESSMENT PROCEEDINGS. VI. INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED, T HE JURISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND THE ASSESSMENT UND ER 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 A O. VII. COMPLETED ASSESSMENTS CAN BE INTERFERED WITH B Y THE AO WHILE MAKING THE ASSESSMENT UNDER SECTION 153A ONLY ON TH E BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSED INCOME OR P ROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH WERE NOT PRODUCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL A SSESSMENT. 12. THE AFOREMENTIONED RATIO LAID DOWN BY THE HONBLE H IGH COURT OF DELHI HAS BEEN FOLLOWED BY THE HONBLE HIGH COURT O F DELHI IN THE CASE OF LATA JAIN IN INCOME TAX APPEAL NO. 274 & 276 OF 2016 WHEREIN THE HONBLE HIGH COURT HELD AS UNDER:- 5. THE SHORT POINT INVOLVED IS WHETHER THE ITAT WAS CORRECT IN CONCLUDING THAT THERE HAD TO BE INCRIMINATING MATER IAL RECOVERED DURING THE SEARCH QUA THE ASSESSEE IN EACH OF THE Y EARS FOR THE PURPOSES OF FRAMING 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 PROCEEDI NGS TOOK PLACE UNDER SECTION 143(3) OF THE ACT. THEREAFTER THEY WE RE SOUGHT TO BE REOPENED BY ISSUING NOTICE UNDER SECTION 147 OF THE ACT AND RE- ASSESSMENT ORDERS WERE PASSED UNDER SECTION 147 REA D WITH SECTION 143(3) OF THE ACT. DURING BOTH THE AFOREMENTIONED P ROCEEDINGS THE QUESTION WHETHER THE GOLD AND SILVER UTENSILS WERE THE CAPITAL ASSETS OR IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 11 PERSONAL EFFECTS OF THE ASSESSEE WAS EXAMINED. 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 SUFFER S FROM NO LEGAL INFIRMITY AND NO SUBSTANTIAL QUESTION OF LAW ARISES FOR DETERMINATION. 13. NOW, LET US EXAMINE THE AFOREMENTIONED RATIOS LAID DOWN BY THE HONBLE HIGH COURTS IN THE LIGHT OF THE DOCUMENTS F OUND AT THE TIME OF SEARCH WHICH MAY BE CONSIDERED AS INCRIMINATING FOR MAKING THE IMPUGNED ASSESSMENTS. SURPRISINGLY, THERE IS NOT EV EN A WHISPER OF ANY INCRIMINATING MATERIAL FOUND AT THE TIME OF SEA RCH WHICH COULD BE CONSIDERED AS THE BASIS FOR FRAMING ASSESSMENTS U/S . 153A OF THE ACT. AS, THERE IS NO ALLEGED INCRIMINATING MATERIAL WHIC H COULD HAVE PROMPTED THE A.O. TO DISTURB THE CONCLUDED ASSESSME NT. THEREFORE, WE DO NOT FIND ANY LEGALITY IN THE ASSESSMENTS SO MADE BY THE A.O. WE HAVE NO HESITATION TO SET ASIDE THE FINDINGS OF THE LD. CIT(A) AND DIRECT THE A.O. TO DELETE THE IMPUGNED ADDITIONS FROM THE HANDS OF THE AFOREMENTIONED ASSESSEES MADE U/S. 153A OF THE ACT IN THE RESPECTIVE ASSESSMENT YEARS MENTIONED HEREINABOVE. IN OUR CONS IDERED OPINION, THE ASSESSMENTS MADE WITHOUT ANY INCRIMINATING MATE RIAL IS ILLEGAL AND BAD IN LAW AND ARE ACCORDINGLY QUASHED. 14. SINCE, WE HAVE QUASHED THE ORDERS OF THE RESPECTIVE ASSESSMENT YEARS; WE DO NOT FIND IT NECESSARY TO GO INTO THE M ERITS OF THE IMPUGNED ADDITIONS MADE BY THE A.O. IN THE RESPECTI VE HANDS. IT(SS)A NOS. 78 TO 87/AHD/2013 . A.YS. 2004-0 5 TO 2006-07 12 15. IN THE RESULT, ALL THESE APPEALS BY THE ASSESSEE AR E ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 07 - 07 - 201 6. SD/- SD/- (RAJPAL YADAV) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD
