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2015 (12) TMI 1749 - AT - Income TaxScope of assessment u/s. 153A - undisclosed income and undisclosed assets detected during search could be brought to tax - Held that:- Undisputedly, during the course of the search and seizure operation, not a single piece of paper was found relating to the transactions. Moreover, the assessee filed original return on 31.10.2004 which was revised on 29.3.2006 pursuant to survey operations and in the revised return of income, the income offered during the survey operations were offered for taxation and the assessment has been made as such vide order dated 29.12.2006. Thus, it can be seen that there is no material found at the time of search which can be said to be an incriminating material to justify the impugned additions and it is also not the case of the Revenue that the additions have been made on the basis of the materials found at the time of search. No reason/justification in making the impugned additions. Order of the Ld. CIT(A) is accordingly set aside. The AO is directed to delete the impugned additions. Notice issued u/s. 143(2) - Held that:- We have given a thoughtful consideration to the chronological event relating to the filing of original return of income, revised return of income and notice issued u/s. 143(2) of the Act. Admittedly, the revised return of income was filed on 30.6.2006. As per the provisions of Sec. 143(2), the notice should have been issued on or before 1.7.2007. The notice was issued on 22.8.2007. Thus, the said notice u/s. 143(2) is bad in law which means that the revised return of income was accepted as such u/s. 143(1) which also means that a completed assessment can be opened only when some incriminating material was found during the course of the search. Levy of penalty u/s. 271(1)(c) - Held that:- Since we have held the assessment made u/s. 143(3) r.w. Sec. 153A of the Act is bad in law of even date and since we have directed the AO to delete the impugned additions, drawing support from the maxim Sublato fundaments credit Opus meaning – in the case the foundation is removed, super structure falls. Since the foundation i.e. assessment order has been removed, the super structure i.e. penalty falls. Appeal filed by the assessee is allowed.
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