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2014 (2) TMI 937 - AT - Income TaxValidity of additions of Completed Assessement Sustainability of Assessment u/s 153A r/w 143(3) of the Act Held that:- The decision in Shri Govind Agarwal vs. ACIT [2014 (2) TMI 810 - ITAT MUMBAI] and Jai Steel (India) vs. ACIT [2013 (6) TMI 161 - RAJASTHAN HIGH COURT] followed - The first proviso to section 153A empowers the AO to issue notice u/s 153A of the Act in respect of the AYs prior to the assessment year in which the search took place - The relevance of the existence of incriminating material is not provided in the provisions - As per the revenue there should not be any difference qua the completed assessments and the abated assessments for all six AYs in so far as the powers of the AO is concerned and he is empowered to issue notice u/s 153A and make additions either based in the incriminating material or otherwise. The case deals with the case of disturbing the 'completed assessment' - Earlier the assessment was completed u/s 143(1) of the Act - In case of the concluded assessments, the additions are made only based on the incriminating material discovered during the search action the AO made additions by reassessing u/s 153A on the completed assessment u/s 143(1) of the Act thus, the issue of notice u/s 153A of the Act is valid - In the absence of incriminating material, the role of the AO is only to reiterate the returned income filed in response to the notice u/s 153A of the Act The arguments relating to the validity of the notice u/s 153 are disapproved - the validity of the notice issued u/s 153A of the Act confirmed the additions made by the AO in the absence of any incriminating material are not sustainable Decided in favour of Assessee. Addition u/s 68 of the Act - Unexplained gifts received Held that:- The decision in M/s. Govind Agarwal (HUF) vs. DCIT [2014 (1) TMI 1394 - ITAT MUMBAI] followed - there is no reference to any seized material or any incriminating documents so as to suggest that addition made in the assessment order are based on any incriminating material found at the time of search - Once that is so and also that the assessment for the assessment year has attained finality before the date of search, then no addition can be made under section 153A - the disallowance made u/s 68 is uncalled for as the same is beyond the scope of section 153A / 153C of the Act - No incriminating material in support of the additions made u/s 68 of the Act was brought to notice by the Revenue thus, the addition made u/s 68 of the Act is set aside Decided in favour of Assessee. Applicability of the provisions of section 14A of the Act Held that:- Revenue contended that the AO erroneously applied the Rule-8D for the assessment year in question which actually applicable from the assessment year 2008-2009 - Considering the factual matrix of the case as well as the prayer of the Counsel for remanding the matter remitted back to the AO for fresh adjudication Decided in favour of Revenue.
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