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2015 (9) TMI 1459 - ITAT DELHI

2015 (9) TMI 1459 - ITAT DELHI - TMI - Assessment u/s 153A - Held that:- Section 153A does not authorise the making of a denovo assessment in this particular assessment year. While under the first proviso, the AO is empowered to frame assessment for six years , under the second proviso only assessments which are pending on the date of initiation of search abate. The effect is that completed assessments do not abate. The assessments can be said to be pending only if the AO is statutorily required .....

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gs . See Commissioner of Income Tax (Central) -III Versus Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT ]. Thus the addition has been rightly deleted and there is no reason for interference with the order of Ld. CIT(A). - Decided against revenue. - ITA No: 2511/Del/2011 - Dated:- 30-9-2015 - SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER. Appellant by : Ms. Nandita Kanchan, CIT DR. Respondent by : Shri V.K. Bindal, CA, Ms. Swety Kothari, CA. ORDER: This .....

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operations it was discovered that the assesssee had received gifts of ₹ 21 lacs from one Shri Jagdish Mangla on 11.1.2001. Summons was issued to Shri Jagdish Mangla but they could not be served upon him as he had already expired on 24.6.2002. It is the Department s contention that Shri Jagdish Mangla was an entry operator and the entries in the bank statement of the assessee (Account No. 988) were not related to any business dealings of Shri Mangla as claimed by the assessee but were acco .....

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ver deleted the entire addition of ₹ 21 lacs on the ground that a similar addition of ₹ 10 lacs was deleted by him in the case of M/s. K.K. Aggarwal & Sons (HUF) for AY 2001-02 wherein the assessee had received a gift of ₹ 10 lacs from Shri Jagdish Mangla. 2. Before us the Ld. AR for the assessee submitted that it is not the case of the Department that the addition of ₹ 21 lacs has been made on account of any incriminating material found during the course of search an .....

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roviso of section 153 A only the assessments which were pending on the date of initiation of search u/s 132 of the Act will abate and the assessment proceedings which have become final as on the date will not stand abated. It was further submitted that no incriminating material was found during the course of search to show that the gifts were not genuine. Ld. AR also drew our attention to the decision of the Hon ble High Court of Delhi in CIT Central-III vs. Kabul Chawla in ITA Nos. 707/2014, 70 .....

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assess or reassess the total income in respect of each assessment year falling within such six assessment years . The second proviso states that the assessment or reassessment relating to the said six assessment years pending on the date of initiation of the search u/s 132 shall abate. It is seen that in assessee s case search action was initiated and assessments u/s 153A were framed for six assessment years making various additions. It is assessee s claim that the addition of ₹ 21 lacs w .....

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ssments which are pending on the date of initiation of search abate. The effect is that completed assessments do not abate. The assessments can be said to be pending only if the AO is statutorily required to do something further. If the section 143(2) notice has been issued, the assessment can be said to be pending. However the assessment in respect of a return processed u/s 143(1) is not pending because the AO is not required to do anything further about such a return. The power given by the fi .....

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e Hon ble High Court of Delhi in the case of CIT Central - III vs. Kabul Chawla (supra) which lays down the entire law with regard to section 153A as under :- 37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is under: I. Once a search takes place under Section 132 of the Act, notice under Section 153 A (1) will have to be mandatorily issued to the person search .....

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tal income' 'of the aforementioned six years in separate assessment orders for each of the six years. In other words there will be only one assessment order in respect of each of the six AYs "in which both the disclosed and the undisclosed income would be brought to tax". iv. Although Section 153 A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other postsearch material or information available with the AO whic .....

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