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Shri Dahyabhai Prahladbhai Patel Versus The Asst. CIT, Central Circle-1 (4) , Ahmedabad

2015 (9) TMI 1006 - ITAT AHMEDABAD

Validity of assessment under Section 153A/153C - Held that:- In the present case, the assessment pertaining to Assessment Years 2003-04 to 2007-08 had not been abated. This fact is not disputed by the Revenue. Therefore, in these years, the assessment ought to have been made on the basis of incriminating material as per the decision of the Hon’ble Special Bench in the case of All Cargo Global Logistics Ltd. vs. Dy. CIT, Central Circle-44 (2012 (7) TMI 222 - ITAT MUMBAI(SB)). The Revenue has not .....

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Ahd/2011, 582/Ahd/2011 - Dated:- 27-8-2015 - SHRI PRAMOD KUMAR AND SHRI KUL BHARAT, JJ. For The Appellant : Shri Vijay Ranjan, AR For The Respondent : Shri Shankar Lal Meena,CIT DR ORDER PER SHRI KUL BHARAT, JUDICIAL MEMBER : This bunch of five appeals by the Assessee are directed against the common order of Ld. Commissioner of Income Tax(Appeals)-I, Ahmedabad [ CIT(A) in short] dated 12/08/2011 pertaining to Assessment Years (AYs) 2003-04 to 2007-08. Since common issues and facts are involved i .....

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law and in the facts and circumstances of the appellant's case, the CIT(A) erred in dismissing the assessee's appeal. 2. On the facts and in the circumstances of the case, the CIT(A) erred in not accepting the Assessee's plea that it was not at all a fit case for invoking the provisions of Section 153A and he further erred in upholding the validity of impugned Assessment Order under Section 153A, dated 21st December, 2010. 3. Without prejudice, on the facts and in the circumstances .....

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be made. 5. Without prejudice, on the facts and in the circumstances of the case, the CIT(A) erred in upholding total disallowance of car expenses incurred by the Assessee for safeguarding and enhancing his share of income from the firm(s) in which he was a partner. 6. Without prejudice, on the facts and in the circumstances of the case, the ClT(A) erred in upholding Assessing Officer's presumption that some expenditure on agricultural operations was incurred over and above the expenditure s .....

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leave to add, alter, amend and/or withdraw any ground or grounds either before or during the course of hearing of the appeal. 3. Briefly stated facts are that a search u/s.132 of the Income Tax Act,1961 (hereinafter referred to as the Act ) was carried out in the case of Raja Group of Kadi, Dist.Mehsana on 05/02/2009. A warrant of authorization u/s.132 was also issued to the case of the assessee. Accordingly, a notice u/s.153A was issued on 17/08/2009 by the AO and in response thereto, the asses .....

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before the ld. CIT(A), who after considering the submissions of the assessee, partly allowed the appeal for AY 2003-04 (dismissed the appeals for AYs 2004-05 to 2007-08). Aggrieved by the order of the ld. CIT(A), the assessee is now in appeal(s) before us. 4. At the outset, the ld.counsel for the assessee submitted that the assessment orders framed for the AYs 2003-04 to 2007-08 deserves to be quashed on the ground that in these years assessments so framed was not on the basis of incriminating .....

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/2012. He further submitted that the view of the Special Bench has been affirmed by the Hon ble Bombay High Court in the case of CIT vs. Continental Warehousing Corporation (Nhava Sheva) Ltd. reported at (2015 58 taxmann.com 78 (Bombay). The ld.counsel for the assessee submitted that the AO has nowhere stated that the impugned additions have been made on the basis of the material found during the course of search. Therefore, the appeal was taken up for hearing to decide the legality of the asses .....

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what is not provided by the Act cannot be read into. 5. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below. The AO in the assessment order has made disallowances in paras-3 & 4 of his order are as under:- 3. Personal Expenses The assessee has earned business income from share of profit and interest on capital from M/s. Patel Oil Mill & Ginning Factory and M/s. P. Raja Cotton Industries during the year consid .....

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documentary evidences. In reply the assessee could neither justify the same nor produced any evidences. Since the assessee has not incurred the aforesaid expenses wholly or exclusively for the purpose of earning Business Income they cannot be allowed as per the provisions of section 37(1) of the Income tax Act. Therefore, the aforesaid expenses of Rs.62622/- are disallowed treating them of personal nature and added to the total income of the assessee. Penal proceeding u/s.271(l)(c) of the Income .....

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ncome. In reply the assessee vide his submission filed on 26.11.2010, produced abstracts of 7/12 and copies of bills for agriculture income from various parties. However he failed to justify the expenses incurred at lower side. Accordingly it will be reasonable to estimate the expenses incurred @20% of the Agriculture Income. Therefore the assessee might have incurred the difference of ₹ 223861/- (20% of ₹ 1119304 Less expenses of ₹ 50000/- already claimed) from his undisclosed .....

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d by the Id. Assessing Officer u/s 153A is bad in law and is, therefore, liable to be quashed. 1.2 The appellant submits that during the course of search no incriminating materials in the form of books of accounts/documents or any unexplained money, bullion, jewellery or any other valuable asset was found. This proves that as a result of the search carried out u/s 132 in the case of the appellant, no material or evidence was found to justify reassessment for the present year under consideration. .....

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for a specific purpose only i.e. for unearthing concealed income. The fact which may require appreciation at this stage is that even in the assessment order framed u/s.153A for aforesaid assessment year there is no mention at all of any seized material or of any statement recorded during search proceedings. It is, therefore, submitted that on account of this special and very important factual matrix of this case, the provisions of section 153A were not applicable. Consequentially the assessment .....

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No. 2660 to 2665/Del/2009 as held as under: The power given by the 1st 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 disclosed in the original assessment proceedings. (iv) Decision of Mumbai ITAT in case of Anil P Khimani Vs DCIT wherein Hon'ble Mumbai ITAT vide its order dated 16/07/2010 in ITA No. 2855 to 2860/Mum/2008 held as under: Income Tax - Section 153A - Search con .....

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ame are deleted - Assessee's appeal allowed. (v) Decision of Mumbai ITAT in case of Helios Food Additives P Ltd. vs. DCIT wherein Hon'ble Mumbai ITAT vide its order dated 16/07/2010 in ITA No.3900 & 3901/Mum/2009 held as under: "If the assessment u/s 153A is equated with the regular assessment to be made u/s 143(3) then that is against the legislative spirit as in the case of search and seizure operation, the Income tax authorities have physical access to the assessee's plac .....

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ssing Officer u/s 153A is bad in law and deserves to be quashed. 5.2. However, the ld. CIT(A) rejected the contentions of the assessee in para-2.1 of his order by observing as under:- 2.1 I have carefully considered the Assessment Order and submission filed by the Appellant. The Appellant has mainly argued that when no incriminating material have been found during the course of search, proceeding. u/s.153A cannot be initiated. I have considered provisions of the Section 153A of the/Act and when .....

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ue which have been relied upon by the Appellant in case of Rajesh Hiralal Thakkar vs. DCIT (ITA No.3218, 3219, 3220, 3221, 3222/Ahd/2007) vide order dated30th November, 2010 after considering the decision of Shaymlata Ksushik V/s ACIT 114 ITD 305 has held as under: "Having heard both the sides, we have carefully gone through the orders of authorities below. For assumption of jurisdiction u/s. 153Aof the l. T. Act only requirement is that person concerned should be searched. The requirement .....

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years under The new procedure as provided u/s.153A of the IT. Act. In case, for some of the assessment years, assessment has already been completed in that event the Assessing Officer shall also make fresh assessment under section 153A of the Act. Even the new procedure would not affect the pending appeal against the original assessment. The ITAT, 'C' Bench, Delhi in the case of Ms. Shyam Lata Kaushik -vs.- ACT, Central Circle, Faridabad reported in [2008] 114 ITD 305(Delhi) held as unde .....

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tion 153A(b) for making an assessment or reassessment. It was not the complaint of the assessee that any income, which was already subjected to assessment under section 143(3) or under section 148 completed prior to the search in respect of six assessment years referred to in section 153A(b) and in the second proviso to section 153A had also been included in the assessment framed under section 153A. In such circumstances, the plea of the assessee could not be accepted". 8.1. It is also pert .....

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g an undisclosed income or not is immaterial. In such a situation it is mandatory for the A.O. to issue notice u/s. 153A (a) for filing the Returns of Income and frame the assessments in terms of section 153A. The decision of ITAT CBench Delhi in the case of Ms. Shyamlata Kaushik (supra) is squarely applicable to facts of assessee's case. We, therefore, decline to interfere. Consequently ground No.1 to 4 for the Assessment Years 1999-2000 to 2003-04 and ground No.9 for the Assessment Year 20 .....

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