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2015 (7) TMI 119 - ITAT CHENNAI

2015 (7) TMI 119 - ITAT CHENNAI - TMI - Legality of assessment u/s.153A - Held that:- There are certain additions made by the Assessing Officer on the basis of information which was available with the assessing authorities in the form of earlier returns of income and financial statement attached thereof. In our opinion, additions could be made in the case of completed assessments (assessment years which were not abated) only on the basis of incriminating material found during the course of searc .....

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ed in their respective return of income. Regarding jewellery, we make it clear that if the assessee has already disclosed jewellery in the regular return of income, it cannot be considered for addition in assessment completed u/s.143(3) of the Act r.w.s.153A of the Act. Accordingly, we direct the Assessing Officer to pass fresh order in the light of the order of the Special bench in the case of All Cargo Global Logistics Ltd (2012 (7) TMI 222 - ITAT MUMBAI(SB) ). With these observations, all the .....

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Prince). The assessee was not able to properly explain the source. The Assessing Officer stated that the gift has been received by the assessee from a person who is a close relative to him. According to the Assessing Officer, the assessee filed a gift deed on the stamp paper of I20/- which was purchased on 27.05.2006 and this document does not have complete address of the donor and the gift which was issued in the form of cash only. The assessee explained that he received the gift from Shri. T.P .....

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(3) r.w.s 153A of the Act. Accordingly, the penalty is deleted. - Decided in favour of assessee. - I.T.A. Nos.2739, 2740, & 2741/Mds/2014,I.T.A. Nos.2742, 2743 & 2744/Mds/2014,I.T.A. Nos.2745, 2746, 2747, 2748 & 2749/Mds/2014 - Dated:- 25-6-2015 - Shri Chandra Poojari & Shri V. Durga Rao, JJ. For the Petitioner : Shri. S. Sridhar, Advocate For the Respondent : Shri. Krishnamurthy, IRS, CIT. ORDER PER CHANDRA POOJARI, ACCOUNTANT MEMBER These appeals filed by three different assessees are agai .....

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ere was no incriminating material found during the course of search action u/s.132 of the Act. Further, it was stated by the assessee that the issue is squarely covered by the order of the Special Bench in the case of All Cargo Global Logistics Ltd 137 ITD 287 (Mum) (SB). 3. The brief facts of the case are that there was search action in these group on 2.11.2010 and consequent to this, search notice u/s.153A was issued to the assessees and the assessments were framed. For better understanding, w .....

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) : 9,65,007/- Disallowance u/s.40A(3) : 24,588/- Gross Total Income : 32,08,267/- Less: Deduction u/c VIA as claimed : 1,00,000/- Total income : 31,08,267/- ITA No.2741/Mds/2014 for the assessment year 2008-09 Gross total income as per return 41,88,425 Add unproved an unexplained gifts 66,195 Disallowance of depreciation 3,34,647 Unexlained cash credit 14,793 4,15,635 Assessed Income 46,04,060 Less Deduction under Chapter VIA 1,00,000 Taxable income 45,04,060 Sheeba Prince ITA No.2742/Mds/2014 .....

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assessment year 2011-12 Total income declared by the assessee 1,34,69,681 Addition u/s.69A 10,63,043 Total income 1,45,32,724 Princeson Jose ITA No.2745/Mds/2014 for the assessment year 2005-06 Total income (as returned) 90,52,420 Add Income from undisclosed sources (as discussed) 5,30,000 Total Income 95,82,420 ITA No.2746/Mds/2014 for the assessment year 2006-07 Total income (as returned) 2,02,97,344 Add Income from undisclosed sources (as discussed) 46,000 Total Income 2,03,43,344 ITA No.2747 .....

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ed income as discussed above 20,000 Total Income 2,14,68,066 According to the ld. Authorised Representative for assessees additions made by the Assessing Officer were only on the basis of particulars disclosed by the assessees in their original returns of income which were filed before the due date of filing return of income and also before date of search and there was no incriminating material found during the search to suggest additions. Further, he submitted that certain additions in assessme .....

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ent of Madras high court in the case of Mariam Aysha vs. CIT 104 ITR 381 wherein it is held that consent of the assessee cannot give jurisdiction to Assessing Officer and the taxing authorities can act only if there is power under the statute to do so. He further relied on the order of the co-ordinate bench in ITA Nos.559,560, 561, 562, 563 & 564/Mds/2014 for the assessment years 2004-05 to 2009-10 in the case of A.R. Murugadoss vide order dated 16.06.2014, wherein the Tribunal held that in .....

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05-06 in the case of Rm.K. Viswanatha Pillai & Sons and others vide order dated 05.02.2015 for the above propositions. He also relied on the order of Special Bench in the case of All Cargo Global Logistics Ltd. 4. On the other hand, the ld. Departmental Representative placed reliance on the order of the Commissioner of Income Tax (Appeals) and submitted that there were excess cash and jewellery found and the addition was made on this count also in certain assessment years and re-assessment w .....

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ssment years which were not abated) only on the basis of incriminating material found during the course of search. Admittedly, the Assessing Officer did not found any incriminating material warranting addition. Being so, we are inclined to direct the Assessing Officer to make addition only on the basis of incriminating material if any found during the course of search. Further, regarding addition on account of cash disclosed by Sheeba Prince for the assessment year 2011-12, if the said cash belo .....

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e case of All Cargo Global Logistics Ltd (cited supra). With these observations, all these appeals filed by the assessees are remitted to the Assessing Officer to make addition only on the basis of seized material found during course of search action in these cases. Thus, the appeals of the assessees are partly allowed for statistical purposes. 6. Coming to the ITA No.2745/Mds/2014, the issue in this appeal is with regard to levy of penalty u/s.271(1) (c) of the Act. 7. The facts of the case are .....

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dition of I5,30,000/- subject to not to initiate penalty proceedings. Since the assessee did not prove the genuineness of the gift, the same was added to assessee s total income and penalty proceedings u/s.271(1) (c) of the Act were initiated and levied penalty of I1,61,733/-. Aggrieved the assessee preferred an appeal before the Commissioner of Income Tax (Appeals). 8. On appeal, the Commissioner of Income Tax (Appeals) confirmed the penalty by observing that the assessee failed to offer satisf .....

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nuineness of the gifts. In view of the above, the action of the Assessing Officer is justified in levying the penalty of I1,61,733/- u/s.271(1) (c) of the Act. As per the provisions of section 271(1) (c), if the Assessing Officer or the Commissioner of Income Tax or Commissioner of Income Tax (Appeals), in the course of any proceedings under the Act, is satisfied that any person has either concealed the particulars of his income or (ii) furnished inaccurate particulars of such income, he may, in .....

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amined is the record which the Assessing Officer imposing penalty had before him and if that record can sustain the finding that there has been concealment, that would be sufficient to sustain the penalty. The assessee has returned the income at I93,02,420/- (including agricultural income of I2,50,000/-). However, during the assessment proceedings, the Assessing Officer has made additions to the tune of I5,30,000/- to the returned income of I93,02,420/- while doing so, the Assessing Officer has .....

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