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2016 (2) TMI 1214 - AT - Income TaxAssessment u/s 148 v/s 153C - search operation conducted - sale of bus after expiry of bus route permit - Held that:- This is the second round of search conducted by the Revenue authorities subsequent to the material found in the case relatable to the assessee. In the first round of litigation, the search was conducted in the premises of Velmurugan group of companies where the material relating to the assessee was found. Therefore, assessment u/s 153C was completed on 31.12.2008. Since the block assessment was already completed, AO, on the basis of material found during the search operation on 18.03.2010 in the case of Shri K. Paneerselvam, reopened the block assessment completed on 31.12.2008 by issuing notice under Section 148. Therefore, by issuing notice under Section 148 AO reopened the block assessment which was completed on 31.12.2008 under Section 153C of the Act. In fact, after reopening, the block assessment was made only under Section 153C of the Act. In view of the above factual situation, this Tribunal do not find any reason to interfere with the order of the lower authority. On merit of the addition the agreement for sale of bus is a composite one, including the route permit. Merely because there was a time gap for renewal of the route permit, this Tribunal is of the considered opinion that it cannot be construed as what was sold by the assessee is only the bus and not route permit. Though renewal was initially rejected by the Regional Transport Authority, the same was subsequently renewed by the Appellate authority. Therefore, the legal presumption is that the route permit continues without any interruption. Tribunal is of the considered opinion that the assessee sold the bus along with route permit for a sale consideration of ₹ 70,75,000/-. It may be a case of the assessee that the entire sum of ₹ 70,75,000/- was not received and what was received was only ₹ 50,00,000/- as per the receipt found during the search operation. As rightly observed by the CIT(Appeals), the assessee followed mercantile system of accounting, therefore, the right to receive the balance amount out of ₹ 70,75,000/- is accrued to the assessee, therefore, the same has to be taken as income for computation. Accordingly, after deducting ₹ 3,50,000/- declared by the assessee, AO has rightly added ₹ 67,25,000/- which was confirmed by the CIT(Appeals) - Decided against assessee
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