TMI Blog2010 (2) TMI 845X X X X Extracts X X X X X X X X Extracts X X X X ..... t in the file although not communicated to the assessee - S. 153A does not authorize the making of a de novo assessment. While under the 1st Proviso, the AO is empowered to frame assessment for six years, under the 2nd Proviso, only the assessments which are pending on the date of initiation of search abate. The effect is that complete assessments do not abate. There can be two assessments for the same assessment year. Assessments which are not pending before the AO on the date of search but are pending before an appellate authority will survive – Held that:- returns had been processed u/s 143(1), the assessments were not "pending" and as no material was found during the search, the additions could not be sustained, additions deleted and al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der. Reasons assigned by him for adjudicating the ground of appeal against the assessee are wrong and insufficient in as much as requirement of recording reasons for the transfer of case is a mandatory direction and non communication thereof to the assessee is not saved by showing that the reasons exist in the file although not communicated to the assessee. 2. On the facts and the circumstances of the case and in law since nothing incriminating was found in the course of the search relating to the Assessment Year in question and thereby disturb the assessment cannot be warranted under the provisions contained in sec. 153 A. Provisions of the Act ought to have been properly construed and resort to sec. 153 A ought not to have been nmade. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wals on the house hold expenditure. The house hold expenditure of Rs.17,000/- debited to Capital A/c appears to be very low. The assessee's representative has stated that the assessee and his family are supported by his in-laws. However, the AR's submission are not acceptable, convincing and reliable. Because, assesee's in-laws are residing at Andheri, whereas the assessee is residing at Dahisar. Therefore, considering the size of the assesee's family i.e. assessee himself, his wife and two school going children, the yearly withdrawals for maintenance of family of four members, the household expenditure is estimated at Rs.1,20,000/- for the year. So, by reducing the withdrawals shown in the Capital A/c, the balance is added in the net taxab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench (2008) 119 TTJ (Kol) 214. He also relied on the decision of the Delhi Bench of the Tribunal in the case of Anil Kumar Bhatia vs. ACIT for the proposition that section 153A does not authorise denovo assessment and non pending assessment do not abate and that the additions must be confined to such material. On merits, Mr. Jain submitted that the AO has not raised any query whatsoever, on the issue of low withdrawals during the course of assessment proceedings. Thus he submits that the entire addition is made just on surmises. He submits that the assessee was residing at Dahisar premises, owned by his wife and hence estimation of expenditure was on the higher side. He submitted that the assessee's father was a farmer and necessary pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... val contentions were heard. On a careful consideration of the facts and circumstances of the case and a perusal of the papers on record and the orders of the authorities below and the case laws cited, we hold as follows. 13. A perusal of the assessment orders in all these cases, clearly demonstrate that the sole addition in question is on account of low withdrawals. This had not been made, based on any material found either during the course of search or during the course of assessment proceedings. Under the circumstances, we examine the legal position. The Delhi Bench of the Tribunal in the case of Anil Kumar Bhatia vs. ACIT held as follows:- "S. 153A provides that where a search is initiated u/s 132 the AO shall "assess or reasses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessments do not abate. There can be two assessments for the same assessment year. Assessments which are not pending before the AO on the date of search but are pending before an appellate authority will survive. (ii) An assessment can be said to be "pending" only if the AO is statutorily required to do something further. If a s.143(2) notice has been issued, the assessment is pending. However, the assessment in respect of a return processed u/s 143(1) is not "pending" because the AO is not required to do anything further about such a return. (iii) The power given by the Proviso to "assess" income for six assessment years has to be confined to the undisclosed income unearthed during search and cannot include items which are disclose ..... X X X X Extracts X X X X X X X X Extracts X X X X
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