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2023 (4) TMI 991 - ITAT AHMEDABADAssessment u/s 153A - Undisclosed investment in share capital - assessee could not explain the source and creditworthiness of investors - CIT-A deleted the addition - HELD THAT:- In the case of PCIT v. Devangi [2017 (2) TMI 724 - GUJARAT HIGH COURT] after the search conducted at the assessee's premises, AO initiated proceedings u/s 153A on the basis of the incriminating material seized for the period of the assessment year 2004-05 onwards, and made the addition for the assessment years 2000-01 to 2004-05. Tribunal deleted the addition holding that only undisclosed income and undisclosed assets deducted during the search could be brought to tax and in assessee's case no incriminating material was found with respect to the assessment years 2000-01 to 2004-05, at the time of search. Gujarat High Court held that the Tribunal was correct in law in holding that the scope of section 153A was limited to assessing only search related income. We are also of the view that CIT(A) has not erred in holding that the share application money received by the assessee pursuant to allotment of search cannot be construed as incriminating material found during the course of search and hence additions cannot be made in the hands of the assessee u/s. 153A of the Act in case of unabated assessment year in absence of any incriminating material unearthed during the course of search. In the case of M/s. Garg Brothers Pvt. Ltd. [2018 (4) TMI 986 - ITAT KOLKATA] the ITAT held that no addition in Section 153A assessment for unexplained share capital in absence of incriminating material. Accordingly, in the case of Saumya Construction Pvt. Ltd. [2016 (7) TMI 911 - GUJARAT HIGH COUR] and various other judicial precedents reproduced above, we are of the considered view that CIT(A) has not erred in facts and in law in deleting the additions made by the AO u/s. 68 of the Act, in the instant set of facts. In the result, the appeal of the Department is dismissed.
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