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2021 (4) TMI 439 - ITAT CUTTACKAssessment u/s 153A - whether the Assessing Officer is justified to complete the assessment u/s.153A of the Act by making impugned additions for the assessment years under consideration even in the absence of any incriminating material deemed to be found during the search conducted u/s.132 ? - HELD THAT:- From the entire assessment order, the AO has not referred any seized materials, if any found during the course of search and seizure operation and we also observe that the assessee has not cooperated during the entire proceedings of assessment. If the assessee does not appear before the AO after giving several notices/opportunities then the AO can utilize the remedy provided in the Act. The AO has huge power to require the presence of the assessee before him as defined in the Income Tax Act. He can also impose the penalty but not done so. The books of accounts and other seized documents were available before him while completing the assessment. From the assessment order, it is clear that that in the opinion of the AO that there was no any incriminating material. Had it been found some incriminating material during the course of search, then the AO must have taken into cognizance while framing the assessment order but he did not refer to any incriminating materials/documents. Even the ld. CIT(A) in his order has not referred any incriminating material. He has simply made addition on adhoc basis as stated supra in para no.8. Further we notice that the AO has added the 20% of the aforesaid expenditure without referring to any seized/incriminating material. The impugned assessment year is abated assessment year and in case of abated assessment year for making addition there must be incriminating material as decided by various courts. Since these four years are unabated assessment years and no any incriminating material referred by the AO, therefore, the argument advanced by the ld. CITDR is not accepted. Thus the assessment is unabated and the Tribunal is bound by the judicial precedence we allow legal ground raised by the assessee for the assessment years 2009-2010 to 2012-2013 challenging the assessment framed u/s.153A of the Act in the absence of any incriminating materials nor observed by the AO while framing the assessment order. Accordingly, we set aside the orders of both the authorities below and held that assessment framed u/s.153A of the Act for all the four years under consideration are not sustainable being unabated assessment and, therefore, also no addition can be made while framing the assessment under section 153A of the Act having no incriminating material found during the course of search, which is clear from the assessment order. - Decided in favour of assessee. Addition of the total expenditure for films, drugs & chemicals and salary to staffs in the abated assessments - HELD THAT:- We found that the assessee could not furnish the details for the expenditure claimed on account of films, drugs & chemicals and salary to staffs, therefore, the AO restricted the disallowance to 20% of the total expenditure claimed, which has been upheld by the CIT(A) in the appellate order. Before us, the ld. AR of the assessee requested to restrict the disallowance to 10% as against 20% made by the AO, which has also not been objected by the ld.CIT-DR. Accordingly with the consent of both the parties and considering the observations made by both the authorities below, we restrict the disallowance to 10% as against 20% made by the AO and confirmed by the CIT(A). Thus, this ground of appeal of the assessee is partly allowed
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