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TMI Blog2016 (4) TMI 517X X X X Extracts X X X X X X X X Extracts X X X X ..... 153A, return declaring income of Rs. 33,93,10,591/- was filed on 23.12.2011. The original return of income u/s. 139(1) was filed on 26.10.2005 declaring Rs. 33,93,10,591/-. The assessment was completed at Rs. 34,43,30,085/-, by adding an amount of Rs. 50,19,494/- on account of excess claim of depreciation vide Order dated 31.12.2012 passed u/s. 153A(1)(b)/143(3) of the Income Tax Act, 1961. 3. Against the aforesaid assessment order dated 31.12.2012, assessee preferred an appeal before the Ld. CIT(A), who vide impugned order dated 25.7.2013 has partly allowed the appeal of the assesee. 4. Aggrieved with the order of the Ld. CIT(A), the Revenue is in appeal before us. 5. At the time of hearing, Ld. DR relied upon the order of the AO and reiterated the contentions raised in the Grounds of Appeal. 5.1 On the contrary, Ld. Counsel of the assessee stated that the issue in dispute is squarely covered in favor of the assessee by the decision dated 28.8.2015 of the Hon'ble Delhi High Court passed in the case CIT(Central)-III vs. Kabul Chawla in ITA No. 707, 709, 713/Del/2014 wherein the Hon'ble High Court has held that if the additions are made, but not based on any incriminating materi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome in respect of each assessment year falling within six assessment years referred to in clause (b), in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139; (b) assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made : Provided that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years: Provided further that assessment or reassessment, if any, relating to any assessment year falling within the period of six assessment years referred to in this [sub-section] pending81 on the date of initiation of the search under section 132 or making of requisition under section 132A, as the case may be, shall abate : [Provided also that the Central Government may by rules made by it and published in the Official Gazette (except in cases where any assessment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould he based on 'incriminating material'. However, one may state that the Delhi High Court (supra) in para 23 has left the issue open. Not without reason, the Hon'ble Andhra Pradesh High Court in Gopal Lal Bhadruka & Ors (2012) 77 DTR 146 has observed that Section 15BBI was introduced by the Finance Act, 2003. The said provision also stated that Chapter XIVB did not apply after 315.2003. It has categorically held in para 17 that while the provisions of Charter XIV-B of the Act limit the enquiry by the AO to those materials found in the course of search and seizure operations, no such limitation is found insofar as sections 153A/153C of the Act arc concerned. The AO can take into consideration material other than what was available during the search and seizure operation for making an assessment of the undisclosed income of the assessee. 6.2 It is further reiterated that the word 'incriminating' does not find mention in section 153A or Section 153C. Nor has the said word been defined in the, Act. If it means only what has been seized, then Sections 153A/153C does not provide for the same. There could be times when some material maybe found but not seized. So ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the word 'assess' has been used in the context of abated proceedings and 'reassess' has been used for completed assessment proceedings, which would not abate as they are not pending on the date of initiation of the search or making of requisition and which would also necessarily support the interpretation that/or the completed assessments, the same can be tinkered only hosed on the incriminating material found during the course of search or requisition of documents. In other words, the Hon'ble Rajasthan High Court has held that the assessment/reassessment can only be based on incriminating material. Same is tile stand taken by the jurisdictional Tribunal in MGF Automobiles Ltd. v JCJT, ITA No: 4212/Del/2011 in an order dated 28.6.2013 as well as others viz. Hon'ble ITAT Mumbai in ACIT v M/s Pratibha Industries Ltd in ITA No. 2197 to 2199/Mum/2000 and in the case of Gurinder Singh Bawa v DCIT in ITA No. 2075/Mum/2010. These decisions have also been relied upon by the assessee . 6.4. Thus respectfully following the above on the issue of notice u/s 153A and the necessity of making assessment/ reassessment on incriminating material, I am of the opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevance or nexus with the seized material. Obviously an ITA Nos. 707, 709 and 713 of 2014 of assessment has to be made under this Section only on the basis of seized material." v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessments can be interfered with by the AO while making the assessment under Section 153 A only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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