ZENITH BARTER PVT LTD,MUMBAI V. DCIT CC 4(1), MUMBAI

ITA 6616/MUM/2024

AI Insights

The case involves multiple appeals by Zenith Barter Private Limited against the Deputy Commissioner of Income Tax concerning the assessment years 2011-12 to 2016-17. The core issues revolved around the validity of the reopening of assessments under section 147 and the subsequent additions made under section 68 of the Income Tax Act. The Assessing Officer had reopened the assessments based on information suggesting that the assessee was involved with shell companies and had received accommodation entries. However, the Tribunal found that the additions made were not directly related to the reasons for reopening the assessments and were based on incorrect and unverified information. The Tribunal also noted procedural lapses, such as the issuance of notice under section 148 before obtaining necessary approvals, which further invalidated the reopening of the assessments.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 40872 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-03-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2015-2016
• Other Referred Cases: CIT vs. Jet Airways (I) Ltd., Ranbaxy Laboratories Ltd. Vs. Commissioner of Income Tax, PCIT vs. Abhisar Buildwell [P] Ltd., ITO v. Vikram Sujitkumar Bhatia, Nilesh Bharani in ITA No. 612/Mum/2020
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KISHOR DHULE
• Assessee Lawyers: VINOD KUMAR BINDAL; SATISH GUPTA
• Keywords: Unexplained cash credit; Unexplained expenditure; Bogus purchase; Reopening of assessment; Search and seizure; Accommodation entries; Notional interest; Competent authority; Reason to believe; Tangible material; Borrowed satisfaction; Penny stocks; Bogus
• Section: 147; 148; 143(3); 143(1); 132; 153A; 139(1); 68; 13; 153C; 133A

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, VP AND SHRI NARENDRA KUMAR BILLAIYA, AM ITA Nos. 6612 to 6617/Mum/2024 (Assessment Years: 2011-12 to 2016-17) Zenith Barter Private Limited 501, Fifth Floor, Sunsh Ine Plaza, Naigaum Cross Road, Dadar (E), Mumbai-400 014 Vs. Dy. CIT Room No. 418 & 420, 4th Floor, Kautilya Bhavan, C-41 to C-43, G Block, Bandra Kurla Complex, Bandra (E), Mumbai-400 051 PAN/GIR No. AAACZ 0878 L (Appellant) : (Respondent) Appellant by : Shri Vinod Kumar Bindal & Shri Satish Gupta Respondent by : Dr. Kishor Dhule Date of Hearing : 04.03.2025 Date of Pronouncement : 28.03.2025 O R D E R Per Saktijit Dey, VP: The captioned appeals, by the same assessee, arise out of separate orders of learned Commissioner of Income Tax (Appeals), Mumbai (‘ld. CIT(A) for short), pertaining to assessment years (A.Y.) 2011-12 to 2016-17. 2. Since, issues involved in these appeals are more or less common, they have been clubbed together and disposed of in a combined order, for the sake of convenience. ITA No. 6612/Mum/2024 (A.Y. 2011-12) 3. The assessee has raised multiple grounds in the memorandum of appeal. However, the core issue arising for consideration is regarding the validity of reopening of assessment u/s. 147 of the Act and the addition made in pursuance thereof. 2 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT 4. The relevant facts necessary for deciding these issues are briefly stated, herein after. The assessee is a resident corporate entity. For the assessment year under dispute, the assessee filed its return of income u/s. 139(1) of the Act, declaring total income at Rs.5,29,260/-. The return so filed was processed u/s. 143(1) of the Act on 10.01.2012. 5. Subsequently, the Assessing Officer (AO) received information from the Investigation Wing that in course of investigation conducted by Investigation Directorate of Kolkata Unit in case of various other companies located at Kolkata, it was found that those companies, in reality, are shell companies and their bank accounts have been utilized for providing accommodation entries. It was further found that one of the beneficiaries of such accommodation entries is the present assessee. Based on such information, the A.O. reopened the assessment u/s. 147 of the Act, after recording reasons. In course of assessment proceeding, the A.O. observed that during a search and seizure operation carried out u/s. 132 of the Act by the Directorate of Investigation, Mumbai, it was found that the assessee had availed unsecured loan from various entities as under :- 1. JMD Sounds Ltd. 2. Kumaon Engg. Co. Pvt. Ltd. 3. Nextgen Infotel Pvt. Ltd. 4. Kasturi Towers Ltd. 5. Sulabh Resources Pvt. Ltd. 6. He observed that these companies are basically bogus/paper entities without any genuine business activity and are used as fronts for providing accommodation entries. The A.O. further alleged that in course of investigation carried out by the Directorate of Investigation, Mumbai, it was found that the assessee had paid on-money in cash in respect of purchase of a flat in Sunshine Tower project of M/s. Sunshine Housing & Infrastructure Pvt. Ltd. Thus, in course of reassessment proceeding, the A.O. called upon the assessee to 3 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT explain the genuineness and source of unsecured loans alleged to have been availed by the assessee during the year under consideration: S. No. Particulars Loan taken during the year Loan repaid during the year Interest Closing balance 1 JMD Sounds Ltd. 1,32,65,096 1,21,26,510 12,65,096 11,38,586 2 Kumaon Engg. Co. Pvt. Ltd. 55,86,850 58,685 5,86,850 55,28,165 3 Nextgen Infotel Pvt. Ltd. 55,90,137 59,014 5,90,137 55,31,123 4 Kasturi Towers Ltd. 15,61,644 6,164 6,164 15,55,480 5 Sulabh Resources Pvt. Ltd. 70,00,000 0 0 70,00,000 Total 3,30,03,727 24,48,247 7. Though the assessee denied of having entered into any bogus transaction for availing accommodation entry through unsecured loans, however, the A.O. remained unconceived. He observed that Sunshine Group of companies have taken loans from Kolkata based entities, which are dubious and paper companies. Thereafter, the A.O. proceeded to analyse the information received from the Directorate of Investigation, Mumbai and ultimately concluded that the alleged unsecured loans availed during the year by the assessee to the tune of Rs.3,54,51,974/-, are non genuine and in the nature of unexplained cash credit in terms of section 68 of the Act. He further held that while purchasing residential property, being Flat No. 36 in Sunshine Tower from M/s. Sunshine Housing & Infrastructure Pvt. Ltd., the assessee had paid on-money in cash amounting to Rs.4,41,500/- over and above the declared sale consideration of Rs.6 crores. Thus, he treated the amount of Rs.4,41,500/- as ‘unexplained expenditure’ and added to the income of the assessee. In nutshell, the A.O. made total addition of Rs.3,58,93,474/- and, accordingly, completed the assessment u/s. 143(3) r.w.s. 147 of the Act vide order dated 29.12.2018. 4 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT 8. Against the assessment order so passed, the assessee preferred an appeal before the first appellate authority, inter alia, challenging the validity of reopening of assessment as well as contesting the additions on merits. 9. Insofar as the challenge to the validity of reopening of assessment, the first appellate authority did not find merit in contentions of the assessee. Accordingly, he upheld the validity of the proceeding. However, insofar as merits of additions made u/s. 68 of the Act, amounting to Rs.3,58,51,974/-, the first appellate authority granted partial relief by sustaining the addition to the extent of Rs.3,30,03,727/-. Insofar as the addition made on account of unexplained expenditure amounting to Rs.4,41,500/-, the first appellate authority upheld the addition. 10. Before us, the ld. Counsel appearing for the assessee drew attention to the reasons recorded for reopening of assessment u/s. 147 of the Act. He submitted, as per the reasons recorded, the A.O. reopened the assessment to assess escaped income of Rs.50 lacs, representing alleged accommodation entries availed from certain Kolkata based companies as informed by ADIT Investigation Unit, Kolkata. Whereas, he submitted, in the assessment order, there is not even a whisper by the A.O. regarding the said escaped income. He submitted, the A.O. has made additions, which have no connection with the escaped income, finding place in the reasons recorded for reopening of assessment. Thus, he submitted, the reopening of assessment as well as the addition made is wholly invalid. In support of such contention, ld. Counsel relied upon the following decisions: 1. CIT vs. Jet Airways (I) Ltd. reported in 331 ITR 236 (Bom) 2. Ranbaxy Laboratories Ltd. Vs. Commissioner of Income Tax 336 ITR 136 (Del) 5 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT 11. Proceeding, further, he submitted, A.O. has reopened the assessment mechanically simply based on the information received from the Investigation Wing, without conducting any independent enquiry to find out whether in reality any income has escaped assessment. Thus, he submitted, the reopening of assessment having been made based on borrowed satisfaction, is invalid. Drawing our attention to the approval granted by the competent authority u/s. 151 of the Act, the ld. Counsel submitted, though, the approval was granted on 26.03.2018, that too, in respect of multiple assessee’s, however, the A.O. had actually issued the notice u/s. 148 of the Act on 24.03.2018, prior to receipt of approval. Thus, he submitted, the action of the A.O. vitiates the validity of reopening of assessment. He further submitted that the approval granted u/s. 151 of the Act, does not contain the signature of the competent authority, i.e., PCIT. Thus, approval itself is invalid. Without prejudice, ld. Counsel submitted that the assessment order is full of factual inaccuracies, which clearly reveal non-application of mind by the A.O. He submitted, though, the assessee had filed its return of income on 26.09.2011, the A.O., in the body of the assessment order has not only mentioned wrong date of filing of return of income, but has substituted the quantum of income actually declared by the assessee, with an imaginary figure of Rs.89,02,740/-. Thus, he submitted, the assessment order is invalid. Hence, it deserves to be quashed. 12. Per contra, the learned Departmental Representative ('ld. DR' for short) submitted, the reopening of assessment having been made based on tangible material coming through investigation carried out by the Investigation Wing, the validity of such proceeding cannot be questioned. He submitted, at the time of reopening of assessment, the A.O. is required to take a prima facie view with regard to the escapement of income. At that stage, A.O. is not required to conduct a full-blown enquiry to reach a conclusion regarding the 6 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT escapement of income. As regards the contention of the assessee that notice u/s. 148 of the Act was issued prior to the receipt of approval u/s. 151 of the Act, the ld. DR submitted, competent authority must have granted the approval prior to issuance of notice u/s. 148 of the Act. However, it might have been communicated to the A.O. subsequently. Thus, he submitted, reopening of assessment u/s. 147 of the Act should not be declared as invalid. 13. We have considered rival submissions and perused materials on record. We have also applied our mind to the judicial precedents cited before us. At the outset, we proceed to examine whether the reasons recorded by the A.O. for reopening of the assessment have any live link to the subject matter of assessment and the additions made. The reasons recorded by the A.O. for reopening the assessment u/s. 147 of the Act, which was communicated to the assessee and forms part of the paper book filed before us reads as under: “Information has been received from the ADIT(Inv.), Unit-2(1), Kolkata wherein it is mentioned that Utkarsh Goods Pvt. Ltd., Venkatesh sales Pvt. Ltd., Jalambe Cassettes Pvt. Ltd. Madhav Vanijya Pvt. Ltd. & Rigmadirppa Investment Pvt. Ltd. have opened their bank accounts in Axis Bank, Sarat Bose Road Branch, Kolkata wherein it is seen that high value RTGS/ Inter-Branch credit followed by transfer out immediately or succeeding day without even maintaining minimum balance. As per database with the department, Utkarsh Goods Pvt. Ltd., Venkatesh sales Pvt. Ltd., Jalambe Cassettes Pvt. Ltd. & Rigmadirppa Investment Pvt. Ltd. are shell companies. Prima-facie, it appears that the of these companies were used for the purpose of providing accommodation entries. M/s Zenith Barter Pvt. Ltd. is one the beneficiaries which has received funds to the tune of Rs.50 lakhs from during the F.Y. 2010-11 relating to the A.Y, 2011-12, Thus, there is Ihan reason to believe that the assessee has escaped assessment during the A.Y. 2011-12 to the tune of Rs.50 lakhs.” 14. A careful reading of the reasons recorded clearly reveals that as per the information received from ADIT (Inv.), Unit-2(1), Kolkata, it was found that the assessee is one of the beneficiaries of accommodation entries availed of Rs.50 lacs from certain entities, namely, Utkarsh Goods Pvt. Ltd., Venkatesh Sales Pvt. Ltd., Jalambe Cassettes Pvt. Ltd., Madhav 7 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT Vanijya Pvt. Ltd. & Rigmadirppa Investment Pvt. Ltd., in the Financial year 2010-11 relevant to A.Y. 2011-12. The A.O. has observed that as per the information received, these companies are bogus/shell entities and their bank accounts have been utilized for providing accommodation entries to various parties, including, the assessee. Thus, he has recorded that he has reason to believe that income amounting to Rs.50 lacs, representing the accommodation entries received from the aforesaid entities has escape assessment during the A.Y. 2011-12. Whereas, a careful and detailed reading of the impugned assessment order reveals that the A.O. has not even whispered a single word either regarding the amount of Rs.50 lacs, the alleged escaped income for A.Y. 2011-12, nor the entities from whom the amount was allegedly received during the assessment year, as per the reasons recorded. In the assessment order, the A.O. has referred to totally different entities, such as: 1. JMD Sounds Ltd. 2. Kumaon Engg. Co. Pvt. Ltd. 3. Nextgen Infotel Pvt. Ltd. 4. Kasturi Towers Ltd. 5. Sulabh Resources Pvt. Ltd. 15. He has further observed that as per the investigation carried out by the Directorate of Investigation, Mumbai, the assessee allegedly had paid on-money in cash for purchase of Flat No. 36 in Sunshine Tower project of M/s. Sunshine Housing & Infrastructure Pvt. Ltd. The assessment order further reveals that the two additions made by the A.O., on account of unexplained expenditure cash credit of Rs.3,54,51,974/- and the unexplained 8 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT expenditure representing on-money paid of Rs.4,41,500/-, have absolutely no nexus to the alleged income escaping assessment in terms of reasons recorded for reopening of the assessment u/s. 147 of the Act. 16. Even in course of hearing, the Department could not controvert the aforesaid factual position. Thus, the facts on record clearly reveal that the subject matter of assessment and the additions made have absolutely no nexus with the escaped income for the assessment of which the assessment was reopened u/s.147 of the Act, as per the reasons recorded. Thus, in our view, without assessing the escaped income for which the assessment was reopened u/s. 147 of the Act as per reasons recorded, the A.O. could not have proceeded to assess any other income, which has no nexus with the reasons recorded. In this context, we respectfully follow the ratio laid down by the Hon'ble Jurisdictional High Court in case of Jet Airways (I) Ltd. (supra) and Ranbaxy Laboratories Ltd. (supra). Thus, for this reason alone, the assessment order passed and the additions made, cannot be sustained. 17. After considering the submissions made and analysing the materials placed before us, we are further of the view that the assessment order has been passed mechanically with complete one application of mind. A reading of the assessment order reveals that it is fraught with a number of factual inaccuracies. Though, the assessee has filed return of income u/s. 139(1) of the Act on 26.09.2011, declaring income of Rs.5,29,260/-, however, 9 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT not only the A.O. has observed that the return of income was e-filed on 19.04.2018, in response to notice issued u/s. 148 of the Act, but he has even substituted the figure of total income declared by the assessee with an imaginary figure of Rs.89,02,740/-, based on which, the A.O. has computed the total income determined by him. Though, the assessee had raised a specific ground in this regard before the first appellate authority, however, without factually verifying the issue, learned first appellate authority has disposed of the ground in a performnary manner. We have further noted that the approval u/s. 151 of the Act granted by the competent authority was communicated to the A.O. through letter dated 26.03.2018 by ITO, Kolkata on behalf of PCIT-3, Kolkata, whereas, notice issued u/s. 148 of the Act, kept on record, reveals that it was issued on 24.03.2018, prior to the receipt of approval by the competent authority. This fact raises serious doubt regarding the validity of the reopening of assessment u/s. 147 of the Act. However, in the proceeding paragraphs, we have held that the assessment completed and additions made are invalid and unsustainable on account of absence of nexus/live link between the reasons recorded and the subject matter of assessment and additions made. Therefore, we refrain from deliberating on these issues any further. Thus, in the ultimate conclusion, we held that the assessment order and the additions made are unsustainable in law, hence, deserves to be quashed. Accordingly, we do so. 18. In the result, the appeal is allowed. 10 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT ITA Nos. 6613 to 6617/Mum/2024 (Assessment Years: 2012-13 to 2016-17) 19. Though multiple grounds have been raised by the assessee, however, the assessee has raised a preliminary legal issue, challenging the validity of the assessment orders passed u/s. 143(3) r.w.s. 153A of the Act and the additions made thereunder on the ground that the additions made are not based on any incriminating material found as a result of search and seizure operation conducted on the assessee. 20. Briefly, the facts relevant for deciding these issues are, for the aforesaid assessment years, the assessee had filed its return of income in regular course u/s. 139(1) of the Act. As revealed from the orders passed for the impugned assessment years, on 06.10.2017, a search and seizure operation u/s. 132 of the Act was carried out in case of Sunshine Tower from M/s. Sunshine Housing & Infrastructure Pvt. Ltd., M/s. Evergreen Enterprises and other entities at their office and residence of many persons. Some other entities were also subjected to proceedings u/s. 133A of the Act. Even residential premises of the Directors of the group entities were also covered under search and seizure operation u/s. 132 of the Act. It is alleged by the department that in course of such search and seizure operation, various incriminating materials and evidences were recovered, disclosing involvement of the group in providing/receiving accommodation entries in the form of unsecured loan, bogus purchase and bogus capital gain in penny stocks. It has further been alleged that as 11 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT per the information, Sunshine group has taken certain unsecured loans from various Kolkata based concerns who were found to be not carrying out any genuine business activity. It has further been alleged that most of the entities are managed by some Kolkata based entry providers, such as, Shri Jagdish Purohit, Shri Pankaj Agrawal, Shri Raj Kumar Kedia. The A.O. has further observed that information received in course of pre-search enquiries and as a result of search, revealed that the assessee is one of the beneficiaries and, accordingly, search and seizure operation was also conducted on assessee. In course of which, it was found that the assessee had taken unsecured loans from dubious entities such as : 1. JMD Sounds Ltd. 2. Kumaon Engg. Co. Pvt. Ltd. 3. Nextgen Infotel Pvt. Ltd. 4. Kasturi Towers Ltd. 5. Sulabh Resources Pvt. Ltd. which are bogus concerns, without doing any genuine business activities. Based on such search and seizure operation, proceedings u/s. 153A of the Act were initiated on 11.01.2019. Pursuant to the notice issued u/s. 153A of the Act, the assessee participated in the assessment proceedings. In course of the assessment proceedings, the A.O. called upon the assessee to explain why the unsecured loan taken by way of accommodation entries and the notional interest thereon should not be treated as undisclosed income of the assessee and added to its income. In response to the query raised by the A.O., the assessee emphatically denied of having taken unsecured loan by way of accommodation entries. 12 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT However, rejecting assessee’s contention, the A.O. treated the unsecured loan availed by the assessee as ‘unexplained cash credit u/s. 68 of the Act’ and computed notional interest allegedly paid by the assessee on such loan and added to the income. These additions were made across all the assessment years in dispute before us. 21. At the outset, ld. Counsel appearing for the assessee submitted that as on the date of search carried out on assessee, the assessment proceedings for none of the years were pending. Therefore, there are no abated assessments. Drawing our attention to the discussions made in the assessment orders, the ld. Counsel submitted, the A.O. has not referred to even a single incriminating material having any connection with the assessment /additions made. Simply referring to the balance sheet of the assessee and the statement recorded by the Investigation Wing from third parties, with whom the assessee has absolutely no connection, the A.O. has made the additions in assessments completed u/s. 153A of the Act. He submitted, neither the balance sheet nor the statement recorded from a third party in course of some other proceeding, cannot be treated as incriminating material found as a result of search and seizure operation conducted in case of the assessee. Therefore, the additions made in absence of any incriminating material are unsustainable. In support of such contention, ld. Counsel relied upon the decision of Hon'ble Supreme Court in case of PCIT vs. Abhisar Buildwell [P] Ltd. [2023] 149 taxmann.com 399 [SC]. Proceeding further, he submitted, in case, the A.O. was of the view that the statements 13 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT recorded in course of search and seizure operation conducted in case of some third parties, such as, Shri Jagdish Purohit and others, he could have utilized such material by initiating proceedings u/s. 153C of the Act and not u/s. 153A of the Act. Without prejudice, he submitted, the statement recorded u/s. 132(4) of the Act is not in the nature of incriminating material. In support of such contention, he relied upon the following decisions: 1. ITO v. Vikram Sujitkumar Bhatia [2023] 149 taxmann.com 123 (SC) 2. Nilesh Bharani in ITA No. 612/Mum/2020 dated 28/03/2023. 22. Per contra, the learned Departmental Representative ('ld. DR' for short) submitted though the A.O. has not referred to any other incriminating material, except the balance sheet of the assessee and the statement recorded from some individuals however, they constitute incriminating material. He submitted, since the falsify of claim made by the assessee with regard to the unsecured loan is revealed from the balance sheet and the statements recorded from third parties in course of search and seizure operation, they constitute incriminating material. 23. We have considered rival submissions and perused the materials available on record. We have also applied our mind to the decisions relied upon. The following facts available on record are undisputed: i. On 06.10.2017, a search and seizure operation u/s. 132 of the Act was carried out on the assessee. 14 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT ii. As on the date of search, no assessment proceeding for A.Ys. 2012-13 to 2016-17 were pending. iii. The additions made are based on balance sheet of the assessee and statements recorded from third party individuals. Except these materials/evidences, the A.O., while making the additions, have not referred to any other incriminating materials/evidences. 24. On perusal of the impugned assessment order, it is very much clear that the additions made by the A.O. in all these years are on account of unexplained cash credit u/s. 68 of the Act, representing alleged bogus unsecured loans and payment of interest by the assessee on such loan. Therefore, the issue which arises for consideration is - whether these additions can be stated to have been made based on any incriminating material found as a result of search and seizure operation. Undoubtedly, the assessment order for the impugned assessment years have been passed u/s. 143(3) r.w.s. 153A of the Act. Thus, invoking of provision contended u/s. 153A of the Act, pre-supposes that the assessment is pursuant to search and seizure operation carried out in case of the assessee. It is fairly well settled proposition of law that in an unabated assessment proceeding u/s. 153A of the Act, any addition made has to be based on incriminating material found as a result of search and seizure operation. 25. As discussed earlier, facts on record reveal that the additions are primarily based on the balance sheet of the assessee and statements recorded in course of some other proceedings from some Kolkata based third party individuals. As far as balance sheet of 15 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT the assessee is concerned, they are based on books of accounts of the assessee, already disclosed to the department through return of income and its report filed for the relevant assessment years. It is also a fact on record that the loans availed by the assessee during the relevant assessment years are not only recorded in the books of accounts, but are also reflected in the balance sheet, which have been disclosed to the department in regular course. Therefore, in our view, they would not constitute incriminating material found as a result of search and seizure operation carried out on the assessee. The incriminating material has to be of such nature, which the assessee must not have disclosed to the department and which the department unearths in course of search and seizure operation conducted in case of the assessee. As far as the statements recorded from some Kolkata based third parties in course of proceedings unconnected to the search and seizure operation carried out in case of the assessee, in our view, they would not constitute incriminating material found as a result of search and seizure operation conducted u/s. 132 r.w.s. 153A of the Act in case of the assessee. 26. Therefore, in our view, the disputed additions made in the afore-said assessment years are not based on any incriminating material found as a result of search and seizure operation carried out u/s. 153A of the Act in case of the assessee. That being the factual position emerging on record, applying the binding ratio laid down by the Hon'ble Supreme Court in case of Abhisar Buildwell [P] Ltd. (supra), we have no hesitation in holding that 16 ITA Nos. 6612 to 6617/Mum/2024 (A.Ys.2011-12 to 2016-17) Zenith Barter Private Limited vs. Dy. CIT the impugned additions made by the A.O. are legally unsustainable. Accordingly, the A.O. is directed to delete the additions. In view of our decision above, all other issues raised by the assessee by way of main as well as additional grounds having rendered academic, do not require adjudication at this stage, hence, are kept open. 27. In the result, the appeals are allowed as indicated above. Order pronounced in the open court on 28.03.2025 Sd/- Sd/- (N. K. Billaiya) (Saktijit Dey) Accountant Member Vice President Mumbai; Dated : 28.03.2025 Roshani, Sr. PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. The CIT(A) 4. CIT - concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER, (Dy./Asstt. Registrar) ITAT, Mumbai "