The Tax PublishersIT(SS)A Nos. 141 & 142/CTK/2018 & CO Nos. 20 & 21/CTK/2019 (Arising out of IT(SS)A Nos. 141 & 142/CTK/2018)
2020 TaxPub(DT) 1370 (Ctk-Trib)INCOME TAX ACT, 1961
Section 153A
Without referring any incriminating material by the AO, in the assessment order for the years under consideration, stated to be unearthed during the course of search, framing the assessment under section 153A, was therefore, void ab initio.
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Search and seizure - Assessment under section 153A - Unabated assessment - Addition(s) not based on incriminating material(s)
During the course of search, veracious document were found and seized by the search team. During the course of assessment, under section 153A AO referred those documents which were found during the course of search and seizure and it was noted by the AO that the disputed amount was recorded in the books of account of the assessee. CIT(A) after considering the submissions of the assessee as well as findings of AO, rejected the legal grounds raised by the assessee regarding no incriminating material was found during the course of search. CIT(A) had deleted the addition as per section 292C of the Act holding that there was no any undisclosed income by the assessee. Assessee submitted that the documents were found during the course of search and seizure which were already recorded in the books of accounts cannot be treated as incriminating materials.Held: It cannot be said that whatever the addition made by the assessing officer was already recorded in the books of accounts. There is no any whisper in the assessment order that there was any undisclosed materials discovered by the search team. The assessee had filed return under section 139(1) on 29-9-2009 and the search was taken place on 16-1-2014 and 25-2-2014. therefore, it would be treated as unabated assessment as no assessment was pending before the AO. Therefore, without referring to any incriminating material found during the course of search, the addition cannot be made. CIT(A) held that even if there is no incriminating material, the AO was empowered to make additions in an assessment framed under section 153A. When there were conflicting decisions of High Court none of which is the jurisdictional High Court, then the decision favouring the assessee should be followed. Assessment made under section 153A for an assessment year for which assessment had not been abated and even no incriminating material found during the course of search, was unsustainable in the eyes of low. Undisputedly, in the instant case, the assessment for the assessment years in question have already been completed on the date of search and the AO had not referred to any incriminating material found during the course of search in the assessment order. Nothing is found contrary to the stated position of the assessee, therefore, the assessment framed under section 153A was not sustainable. This Tribunal quash the orders of both the authorities below and held that without referring any incriminating material by the AO in the assessment order for the years under consideraiton, state to be unearthed during the cours of search, framing the assessment under section 1523A, was void abinitio.
Applied:CIT v. Vegetable Products Ltd. (1973) 88 ITR 192 (SC) : 1973 TaxPub(DT) 0421 (SC). Followed:CIT v. Kabul Chawla on 28-8-2015 (2015) 380 ITR 573 (Del) : 2015 TaxPub(DT) 3486 (Del-HC)Not Followed:E.N.Gopakumar v. CIT (2016) 75 Taxmann.com 215 (Ker) : 2016 TaxPub(DT) 4661 (Ker-HC) and CIT v. Raj Kumar Arora (2014) 52 Taxmann.com 172 (All) : 2014 TaxPub(DT) 3949 (All-HC).
REFERRED : CIT v. Continental Warehousing Corporation, All Cargo Global Logistics Ltd. (2015) 374 ITR 645 (Bom) : 2015 TaxPub(DT) 2182 (Bom-HC), Pr. CIT v. Kurele Paper Mills (P) Ltd. (2016) 380 ITR 571 (Del) : 2016 TaxPub(DT) 1068 (Del-HC) 6-7-2015, Pr. CIT-2 v. Salasar Stock Broking Ltd. (G.A. No. 1929 of 2016/ITAT No. 264 of 2016), dated 24-8-2016 Calcutta High Court (copy enclosed), Smt. Sunita Bai v. Dy. CIT, Central Circle-I, Belgaum 2015 , (3) TMI 397--ITAT PANAJI--TMI--copy enclosed : 2015 TaxPub(DT) 4454 (Panaji-Trib), Suncity Alloys (P) Ltd. v. Asstt. CIT (2009) 124 TTJ 674 (Jodh) : 2009 TaxPub(DT) 2001 (Jod-Trib), Jodhpur Bench of the ITAT, Asstt. CIT v. Delhi Hospital Supply (P) Ltd. [ITA 3996/Del/2011], Pr. CIT v. Meetu Gutgutia, ITA No. 306/2017, order pronounced on 25-5-2017,Dayawanti Gupta v. CIT (2016) 390 ITR 496 (Del) : 2016 TaxPub(DT) 4888 (Del-HC), CIT v. Sinhgad Technical Education Society, (2017) Tax Pub (DT) 3941 (SC), Kamal Deo Sharma and Smt. Tripta Sharma vide IT(SS)A Nos. 34 to 40/RAN/2019 and IT(SS)A No. 27 to 33/RAN/2019, Dr. Sukanta Chandra Mallick, in IT(SS)A Nos. 86-91/CTK/2018, Order, dated 8-7-2019, Priya Holding (P) Ltd. v. Asstt. CIT, (2018) 90 Taxmann.com 408 (Ahd) : 2018 TaxPub(DT) 1023 (Ahd-Trib), Dy. CIT v. Rajiv Kumar (2018) 99 Taxmann.com 371 (Del) : 2017 TaxPub(DT) 4571 (Del-Trib), Pr. CIT v. Jignesh P. Shah (2018) 99 taxmann.com 111 (Bom) : 2018 TaxPub(DT) 6393 (Bom-HC), Mala Builders (P) Ltd. v. ACIT (2017) 88 Taxmann.com 801 (Chd) : 2016 TaxPub(DT) 4539 (Chd-Trib), E-City Projects Lucknow (P) Ltd. v. Asstt. CIT, Central Circle, Cuttack, ITAT Cuttack Bench, assessment year 2012-13, (IT (SS) A No. 02/CTK/2018) pronounced on 28-2-2018 (Order copy enclosed) : 2018 TaxPub(DT) 0954 (Ctk-Trib), Midas Capital (P) Ltd. Asstt.CIT, Central Circle, Cuttack, ITAT-Cuttack Bench, assessment year 2011-12 & 2012-2013, (IT (SS) A No. 04 & OS/CTK/2018) pronounced on 23/0312018, Vipin Khanna v. CIT (2002) 255 ITR 220 (PH) : 2002 TaxPub(DT) 0096 (P&H-HC), Smt Yamini Agarwal v. Dy. CIT (ITA Nos. 97 & 98/Kol/20 15) pronounced on 19-4-2017 : 2017 TaxPub(DT) 1943 (Kol-Trib)
FAVOUR : In assessee's favour.
A.Y. : 2009-10 & 2010-11
IN THE ITAT, CUTTACK BENCH
C.M. GARG, J.M. & L.P. SAHU, A.M.
Dy. CIT v. Basukinath Roadways (P) Ltd.
IT(SS)A Nos. 141 & 142/CTK/2018 & CO Nos. 20 & 21/CTK/2019 (Arising out of IT(SS)A Nos. 141 & 142/CTK/2018)
20 February, 2020
Appellant by: S.M. Keshkamat, Commissioner--Departmental Representative
Respondent by: S.K. Tulsiyan, Advocate
Per Bench
These are the two appeals filed by the Revenue against the order of Commissioner (Appeals)-2, Bhubaneswar, dated 26-6-2018. The assessee has also filed cross objections against the above order of Commissioner (Appeals).
2. Out of the above two Appeals, IT(SS)A No. 141/2018 (Assessment year 2009-2010) is barred by 22 days. In this regard, learned Departmental Representative has filed an application for condonation of delay. We have perused the application for condonation of delay, to which the learned Authorised Representative did not object, and found that the Revenue has stated sufficient reason for condonation of delay. Therefore, we condone the delay of 22 days in filing the above appeal and both the appeals of the Revenue were heard along with the cross objections of the assessee finally.
3. Since the cross objections filed by the assessee relates to legal issue involved challenging that there was no incriminating material found during the course of search, the materials referred by the assessing officer was recorded in the books of accounts and the learned Commissioner (Appeals) has deleted the additions as per section 292C of the Act, therefore, first we shall take up the cross objections of the assessee and the grounds raised therein are as under :--
Grounds raised in CO No. 20/CTK/2019 (Assessment year 2009-2010) :--
1. That, the learned Commissioner (Appeals) erred in dismissing the legal ground of the assessee that there being no incriminating material found in course of the search operation, no addition can be made in respect of unabated year in relation to the share capital of Rs. 14,73,00,000.
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