TMI Blog2014 (12) TMI 472X X X X Extracts X X X X X X X X Extracts X X X X ..... oncluded – AO has not specifically pointed to any availability of seized/ incriminating material related to the assessee found during the search proceedings conducted in case of MGPL or the directors of the group companies - There is no specific reference to any material or valuables that are relatable to the assessee and have become the basis for making the additions or disallowances, and prompt the assessing officer to re-agitate the issues which were otherwise settled in the unabated assessments - the various additions made by the AO in the assessment orders for the AY 2003- 04 is not justified and are directed to be deleted - there is no incriminating material found in the course of search - as there is already finding that no incriminating material had been found pertaining to assessee, very issuance of notice u/s 153C itself is bad - there is no merit in Revenue contention – Decided against revenue. - ITA. No. 1062/H/2014, 1063/H/2014 1064/H/2014 1288/H/2014 1289/H/2014 1290/H/2014 1291/H/2014 1292/H/2014 1293/H/2014 - - - Dated:- 10-12-2014 - Shri B. Ramakotaiah And Shri Saktijit Dey,JJ. For the Petitioner : Mr. Rajat Mitra For the Respondent : Mr. P. Murali ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of All Cargo Global Logistics Pvt. Ltd., by Special Bench of Mumbai ITAT reported in 137 ITD 287. Before getting into the judicial decision, it is pertinent to look into the relevant law on this issue, which is Section 153C as applicable to the facts of the case where search was conducted in the case of M/s. Midwest Granites Pvt. Ltd and based on certain findings, proceedings u/s. 153C initiated in this case. 153C. Assessment of income of any other person. [1] Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other than the person referred to in section 153A, then the books of account or documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed against each such other person and issue such other person notice and assess or reassess income of such other person in accordance with the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference, there is no indication as to the information on the valuables/ documents seized during from the search proceedings conducted in the case of M/s. Midwest Granites (P) Ltd(MGPL), and it's directors, and no such valuables or documents relatable/belong to the assessee. As could be seen from the assessment order, no addition was made based on the incriminating material found during the course of search proceedings conducted in case of MGPL , which is an associate concern of the assessee company. There are catena of judicial decisions wherein it has been held that additions made in course of assessment proceedings u/s. 153A should be derived from the incriminating material found during the course of search. The assessment proceedings u/s. 153C are also considered as proceedings u/s. 153A, since 153C is read with Sec. 153A. 4.7 (i) In the case of LMJ International Ltd., Hon'ble ITAT Kolkata, observed that the items of regular additions cannot be taken up in the assessment u/s. 153A/153C. The head note in the case read as under: Section 153C, read with Section 153A, of the Incometax Act, 1961, search and seizure - assessment of income of any other person - assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The additions/disallowances made in the regular assessment cannot be repeated in the assessment to be made u/s. 153C of the Act unless fresh material has been unearthed in course of search in respect of those additions/disallowances. (iv) Hon'ble Special Bench of ITAT, Mumbai, in the case of All Cargo Global Logistics (137 ITD 287), while dealing on the issue more elaborately, has categorically held that additions to the income that has already been assessed, the assessment u/s. 153A will be made on the basis of incriminating material. The essential observations of the order run as under: In assessments that are abated, the AO retains the original jurisdiction as well as jurisdiction conferred on him u/s. 153A for which assessments shall be made for each of the six assessment years separately; (b) In other cases, in addition to the income that has already been assessed, the assessment u/s. 153A will be made on the basis of incriminating material, which in the context of relevant provisions means - (i) books of account, other documents, found in the course of search but not produced in the course of original assessment, and (ii) undisclosed income or property ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee and have become the basis for making the additions or disallowances, and prompt the assessing officer to re-agitate the issues which were otherwise settled in the unabated assessments. Thus, considering the legal additional ground raised by the appellant, it is reasonable to hold that the various additions made by the assessing officer in the assessment orders for the asst. year 2003- 04 is not justified and are directed to be deleted. Since, the additional ground raised on legal issue has been decided in favour of the appellant, it is reasonable to hold that it is not necessary to adjudicate on the various additions made in assessment order, on merit. 3. Similar orders are passed in all other years. Revenue is aggrieved on the above and raised the following grounds. 1. On the facts and in the circumstances of the case and in law, the CIT(A) erred in deleting the additions by following the ratio laid down in the case of All Cargo Global Logistics 137 ITD 287 without going into the merits of the issues. 2. The appellant prays that the order of the CIT(A) on the above ground be set aside and that of the A.O. be restored. 4. After considering the rival contentions, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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