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2018 (5) TMI 1922 - ITAT DELHICharging of the interest u/s 234A & 234B - assessee submitted that as per section 234A(3) of the Act, interests is to be charged starting from the month following expiry of time allowed to file return u/s 153A and the date of filing of the return - HELD THAT:- Submissions of the assessee to be correct because submission of assessee is not rebutted by Department. Ld. DR relied upon the judgement of the Hon’ble Delhi High Court in the case of Prannoy Roy & Anr. vs Commissioner Of Income Tax [2001 (12) TMI 68 - DELHI HIGH COURT] in which it was held that “interests u/s 234A would be payable only in a case where tax had not been deposited prior to the date of filing of the return. In this judgement, the amended provision inserted in section 234A(3) w.e.f. 01.06.2003 have not been considered. Therefore, this decision would not support the case of the Revenue. The charging of interest u/s 254A is to be restricted to 07 months only and cash seized to be adjusted against demand u/s 234B as discussed above. However, the same issue does not require detailed discussion because legal issue has already been decided in favour of the assessee that entire addition would stand deleted, therefore, this ground is left for academic discussion only. These grounds are accordingly allowed in terms above. Addition made in assessment u/s 153A - HELD THAT:- Original assessment stands completed on the date of the search and no incriminating material was found during the course of search, therefore, no addition could have been made to the income of the assessee which is already assessed. It is well-settled law that completed assessment can be interfered with by the AO by making assessment u/s 153A only on the basis of some incriminating material unearthed during the course of search which was not produced or not already disclosed or made known in the course of original assessment. Therefore, no addition could be made against the assessee. In view of the above decisions, we set aside the orders of the authorities below and delete all the additions. Levy of penalty u/s 271(1)(c) - HELD THAT:- After considering the rival contentions, we are of the view that penalty is not leviable in the matter. On quantum appeal, we have deleted all the additions therefore, penalty cannot be levied against the assessee. Further, the AO has issued a show cause notice which is bad in law because it did not specify under which limb of section 271(1)(c), penalty proceedings have been initiated i.e. whether for concealment of particulars of income or furnishing of inaccurate particulars of income. The issue is covered in favour of the assessee by the judgement of Karnataka High Court in the case of CIT vs SSA Emarald Meadows [2015 (11) TMI 1620 - KARNATAKA HIGH COURT] in which similar view was taken and departmental appeal is dismissed.
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