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2022 (6) TMI 1302 - AT - Income TaxValidity of Assessment u/s 153C - evidences incriminating from search - loan given to family members - as argued seized material was not incriminating material and these were transactions which were recorded in the regular books and consequently no assessment u/s.153C of the Act is liable to be made - HELD THAT:- A perusal of the Annexure-A annexed to the satisfaction note, reproduced hereinabove, by the AO of the person searched shows that in the seized material SMLO-52, there is a ledger which contains the loan taken from IFCI Factors Ltd. Admittedly, the ledger account is part of the regular books of the assessee and the same cannot be treated as an incriminating material. However, the information that the loan has been given to Shri Vikash Gupta and his family members out of the said loan taken by the assessee company from IFCI Factors Ltd. has come out of the evidence found in the course of search. The evidence in relation to the impugned assessment years have been found in the course of search on Shivom Minerals Ltd. but relating to the assessee. When evidence relating to the assessee has been found and the same has been made available by the AO of the person searched to the AO of the person in respect of whom the evidence has been found then the AO of the person in respect of whom the evidence has been found would have to examine the same. Here, clearly evidence in the form of ledger and the transactions of giving the loan to Shri Vikash Gupta and his family members have been found and handed over to the AO of the assessee. Whether the said evidence is incriminating or not would have no bearing insofar as the AO of the searched person is concerned, but the evidence having been provided to the AO of the person in respect of whom the evidence has been found, it is the duty of such AO to examine and verify the same. For the purpose of verification the only option available to the AO is to initiate the proceedings u/s.153C of the Act, for that relevant assessment years to which those evidence relate. That is exactly what the AO has done in the present case. Once the assessment is opened u/s.153C provisions of the regular assessments would come into play and such additions and disallowance as is possible under regular assessment would have to be done by the AO. Again that is what the present AO has done. This being so, clearly evidence in relation to the relevant assessment years having been found in the course of search conducted in the premises of M/s Shivom Minerals Ltd. and its group, that such evidence having been provided to the AO of the assessee to whom such evidences were related to, the proceedings initiated u/s.153C of the Act are valid insofar as such evidence relates to the assessment years to which the evidences were found. Once the proceedings u/s.153C of the Act are initiated rightly, the consequential assessment is a forlorn conclusion. In these circumstances, we find no error in the order of the AO and that of the ld.CIT(A) on this issue. In view of the above, the additional grounds filed by the assessee stand rejected.
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