TMI Blog2016 (7) TMI 1211X X X X Extracts X X X X X X X X Extracts X X X X ..... PONENT : MR TEJ SHAH, ADVOCATE COMMON ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. In these appeals, Revenue has framed following questions for our consideration. [A] Whether on the fact and circumstances of the case and in law the ITAT is justified in holding that the action of the AO to disallow deduction claimed u/s 80IA in the proceeding u/s 153A is bad in law as there was no incriminating document found during the search ? [B] Whether on the fact and circumstances of the case and in law the ITAT is justified in holding that in the reassessment u/s 153A, in respect of unabated proceeding, the addition has to be restricted to the issues found during the search action only and no action is permissible in respect of escaped income unearthed during 153A proceeding ? [C] Whether on the fact and circumstances of the case and in law the ITAT erred in not discussing the issue on merit in respect of disallowance of deduction claimed u/s 80IA( 4) in view of the Explanation to section 80IA inserted in 2009 retrospectively w.e.f. 01.04.2000 ? [D] Whether on the fact and circumstances of the case and in law the ITAT erred in not appreciating th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed income' or whether a particular income could be said to be relatable to the material found during the course of search, etc. which led to prolonged litigation. To overcome that difficulty, the legislature by Finance Act 2003, decided to discard Chapter XIV B provisions and introduce Sections 153A, 153B and 153C in the IT Act. 9) What Section 153A contemplates is that, notwithstanding the regular provisions for assessment/reassessment contained in the IT Act, where search is conducted under Section 132 or requisition is made under Section 132A on or after 31/5/2003 in the case of any person, the Assessing Officer shall issue notice to such person requiring him to furnish return of income within the time stipulated therein, in respect of six assessment years immediately preceding the assessment year relevant to the previous year in which the search is conducted or requisition is made and thereafter assess or reassess the total income for those assessment years. The second proviso to Section 153A provides for abatement of assessment/reassessment proceedings which are pending on the date of search/ requisition. Section 153A (2) provides that when the assessment made und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, unless the materials gathered in the course of the proceedings under Section 153A of the Incometax Act establish that the reliefs granted under the finalised assessment/ reassessment were contrary to the facts unearthed during the course of 153 A proceedings. 13) In the present case, there is nothing on record to suggest that any material was unearthed during the search or during the 153A proceedings which would show that the relief under Section 80 HHC was erroneous. In such a case, the A.O. while passing order under Section 153A read with Section 143(3) could not have disturbed the assessment order finalised on 29.12.2000 relating to Section 80 HHC deduction and consequently the C.I.T. could not have invoked jurisdiction under Section 263 of the Act. 29. We are not in agreement with Mr. Pinto that these observations are made in passing or that they are not binding on us because the essential controversy before the Bench was somewhat different. He urges that was only in relation to the legality and validity of the order of the Commissioner under section 263 of the IT Act. Had that been the case, the Division Bench was not required to trace out the history of sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve provision and the provisos. That would throw light on the issue of applicability of the provision. It being enacted to a search or requisition that its construction would have to be accordingly. That is the conclusion reached by the Division Bench in Murli Agro (supra) with which we respectfully agree. These are the conclusions which can be reached and upon reading of the legal provisions in question. 5. We are informed that against this judgment of Bombay High Court, the Revenue has preferred SLP, which is pending. We would have considered waiting for the outcome of such appeal. However, it was brought to our notice that this Court in case of Pr. Commissioner of Incometax4 v. Saumya Construction Pvt. Ltd. in Tax Appeal No.24 of 2016 in a judgment dated 14.03.2016, had also considered the similar issue as can be seen from para 3 of the judgment which reads as under: 3. Mr. Nitin Mehta, learned senior standing counsel for the appellant, submitted that the Tribunal has grossly erred in holding that addition can be made under section 153A only if incriminating material is found during the course of the search, that too, in relation to each of the six assessment year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akes the intention of the legislature clear as the same provides that assessment or reassessment, if any, relating to the six assessment years referred to in the subsection pending on the date of initiation of search under section 132 or requisition under section 132A, as the case may be, shall abate. Subsection (2) of section 153A of the Act provides that if any proceeding or any order of assessment or reassessment made under subsection (1) is annulled in appeal or any other legal provision, then the assessment or reassessment relating to any assessment year which had abated under the second proviso would stand revived. The proviso thereto says that such revival shall cease to have effect if such order of annulment is set aside. Thus, any proceeding of assessment or reassessment falling within the six assessment years prior to the search or requisition stands abated and the total income of the assessee is required to be determined under section 153A of the Act. Similarly, subsection (2) provides for revival of any assessment or reassessment which stood abated, if any proceeding or any order of assessment or reassessment made under section 153A of the Act is annulled in appeal or a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 53A of the Act for assessment year 200607 on 04.08.2010. In response to the notice, the assessee filed return of income on 18.11.2010. In terms of section 153B, the assessment was required to be completed within a period of two years from the end of the financial year in which the search came to be carried out, namely, on or before 31st March, 2012. Here, insofar as the impugned addition is concerned, the notice in respect thereof came to be issued on 19.12.2011 seeking an explanation from the assessee. The assessee gave its response by reply dated 21.12.2011 calling upon the Assessing Officer to provide copies of statements recorded on oath of Shri Rohit P. Modi and Smt. Pareshaben K. Modi during the search as well as the copies of the documents upon which the department placed reliance for the purpose of making the proposed addition as well as the copy of the explanation given by Shri Rohit P. Modi and Smt. Pareshaben K. Modi regarding the onmoney received, copies of the assessment orders in case of said persons and also requested the Assessing Officer to permit him to crossexamine the said persons. The Assessing Officer issued summons to the said persons, however, they were out ..... X X X X Extracts X X X X X X X X Extracts X X X X
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