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2020 (12) TMI 1336 - AT - Income TaxValidity of assessment u/s 153A - Whether no incriminating evidence / material was found during the course of search? - HELD THAT:- From the facts, it emerges that the original return was filed by the assessee on 04/09/2008 and the search took place on 16/04/2013. Admittedly, no assessment proceedings were pending against assessee on the date of search and it was not a case of abated assessment. Upon perusal of the assessment order, it is quite evident that Ld. AO has not referred to any incriminating material against the assessee and the additions made therein are also not based on any incriminating material. The business expenditure claimed that is sought to be disallowed was already claimed in the original return of income. The facts of the case, in our considered opinion are squarely covered in assessee’s favor by the decision in CIT V/s Continental Warehousing Corporation (Nhava Sheva) Ltd. [2015 (5) TMI 656 - BOMBAY HIGH COURT] as well in Gurinder Singh Bawa [2015 (10) TMI 1761 - BOMBAY HIGH COURT] which has held that in the absence of any incriminating material, the unabated assessments could not be disturbed. Similar is the view of Hon’ble Delhi High Court in CIT V/s Kabul Chawla[2015 (9) TMI 80 - DELHI HIGH COURT]. Thus we are inclined to setaside the additions so made in the hands of the assessee in the assessment order. The ground thus raised stand allowed. Disallowance of business expenditure - business had not been commenced - HELD THAT:- Upon due consideration, we find that the premises was taken on lease since 2006 and the business could not be commenced by the assessee till AY 2014-15 which would substantiate the fact that there was not any temporary dormancy or lull period for the business. No fresh material has been placed before us to disturb these findings rendered by learned first appellate authority. However, in our considered opinion, the expenditure which was quite necessary to maintain assessee’s corporate personality would be an allowable expenditure since without incurring the same, the assessee could not have remained into existence. Therefore, we direct Ld. AO to identify such expenditure and allow the same to that extent. The assessee is directed to furnish the requisite details, in this regard.
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