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2015 (10) TMI 1266 - AT - Income TaxValidity of proceedings u/s. 153C - roving enquiries or routine disallowances - AO invoked the provisions of Section 144 and made various additions - Held that:- No merit in Revenue’s grounds in AYs. 2004-05, 2005-06 and 2008-09. There is no incriminating material as far as assessee is concerned. Nothing was brought on record either in the assessment order or before the CIT(A) or during the proceedings before us that there is any incriminating material identified as belonging to assessee. Therefore, the proceedings per se u/s. 153C should not arise. Even if for the sake of argument consider that proceedings u/s. 153C are appropriate, the AO cannot make any routine disallowance in the search assessments in the absence of any incriminating material. AO would be entitled to make additions u/s. 153A. As the jurisdiction for completion of assessment u/s. 153C is limited, AO cannot make roving enquiries or routine disallowances which are not warranted otherwise - Decided against revenue. Coming to AY. 2009-10, as already stated above, the proceedings are not u/s. 153C. Since AO has neither followed the procedure u/s. 144 nor CIT(A) has considered assessee’s request for examining the Books of Accounts, we are of the opinion that the deletion by CIT(A) of the disallowance of the personal expenditure and also confirmation of the amount as unexplained cash credit is without any basis. Even though Ld. CIT(A) noted that assessee failed to produce the genuineness of these transactions before the AO and before CIT(A), there seems to be no enquiry made by any of the authorities to come to the said conclusion. In view of this, we are not in a position to uphold the order of CIT(A) in AY. 2009-10 and therefore the Revenue’s grounds on disallowance of personal expenditure are to be considered as allowed for statistical purposes.
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