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2021 (3) TMI 820 - AT - Income TaxAssessment u/s 153A - Addition u/s 68 - absence of any incriminating material found during the course of search - HELD THAT:- AO in the instant case, made addition for A.Y. 2003-04 and ₹ 50 lakhs for A.Y. 2004-05 by invoking the provisions of section 68 since the assessee could not substantiate with evidence to his satisfaction regarding the identity and credit worthiness of the investor companies who have invested in the share capital of the assessee and the genuineness of the transaction. We find, the ld.CIT(A) upheld the action of the AO. It is the submission of the ld. Counsel for the assessee that since the addition made by the AO and sustained by the CIT(A) for both the years are not based on any incriminating material found during the course of search, and is based on post-search enquiries, therefore, such addition deserves to be deleted. We find some force for the assessee. A perusal of the assessment order as well as the order of the CIT(A) for both the years clearly shows that the addition is not based on any incriminating material found as a result of search, but, the same is based on post search enquiries made by the AO. It is also pertinent to mention that the AO while making the addition has relied on the enquiries conducted for examining investments made in the case of M/s Vikas Telecom Ltd and in M/s DD Resorts Pvt. Ltd. since the companies who have made investment in the assessee company have also made investments in the above two companies - no seized document was referred to by the AO in the body of the assessment order. Be that as it may, the addition in the instant case is not based on any incriminating material and based on post search enquiries which is evident from the assessment orders as well as the orders of CIT(A) for both the years. Under these circumstances, we have to see whether such addition can be sustained in unabated assessment completed u/s 153A of the Act. As in the case of Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] has held that in the absence of any incriminating material found during the course of search, no addition can be made u/s 153A of the Act in case of a completed assessment. Appeals filed by the assessee are allowed.
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