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DCIT, Central Circle-13, New Delhi Versus Smt. Geeta Devi Aggarwal

2016 (10) TMI 588 - ITAT DELHI

Unexplained receipts - addition in a proceeding under section 153A - Held that:- Additions made by the AO are beyond the scope of section 153A of the Income Tax Act, 1961, because no incriminating material or evidence had been found during the course of search so as to doubt the transactions. It was noticed that as on the date of search i.e. 28.8.2008, no assessment proceedings were pending for the year under consideration and the AO was not justified in disturbing the concluded assessment witho .....

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y : S / Sh. Ved Jain, Adv. & Ashish Chadha, CA ORDER Per H. S. Sidhu, JM The Revenue has filed the Appeal and Assessee has filed the Cross Objection against the Order dated 09.1.2013 of the Ld. CIT(A)-I, New Delhi relevant to assessment year 2006-07. 2. The grounds raised in the Revenue s Appeal read as under:- 1. The order of the Ld. CIT(A) is not correct in law and facts. 2. On the facts and circumstances of the case the Ld. CIT(A) has erred in deleting the addition of ₹ 57,00,000/- .....

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ss Objection read as under:- 1. On the facts and circumstances of the case, the learned Commissioner of Income Tax (Appeals) [CIT(A)] has erred both on facts and in law in rejecting the contention of the assessee that the proceedings initiated under Section 153A against the appellant are in violation of the statutory conditions and the procedure prescribed under the law and as such the same is bad in law and likely to be quashed. 2. On the facts and circumstances of the case, the learned CIT(A) .....

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edure prescribed under the law, is bad and the same is liable to be quashed. 4. On the facts and circumstances of the case, the learned CIT(A) has erred both on facts and in law in rejecting the contention of the assessee that the assessment framed is against the spirit of Section 153A of the Act whereby the reassessment is to be confined to the additions and, disallowances consequent to the material found during the course of the search and does not give power to the AO to make additions and di .....

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₹ 12,96,251/-. Notice was issued u/s. 143(2) on 10.2.2010 and 26.7.2010 and u/s. 142(1) ON 11.8.2010. These notices were duly complied with and necessary details / clarifications were filed. The case was assessed at an income of ₹ 59,06,457/- after making certain disallowances vide his order dated 27.12.2010 u/s. 143(3) r.w.s. 153A of the I.T. Act, 1961. 5. Against the aforesaid assessment order dated 27.12.2010, assessee preferred an appeal before the Ld. CIT(A), who vide impugned o .....

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of the assessee stated that the issues in dispute relating to upholding the validity of the order of assessment passed u/s. 153A on 27.12.2010, 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 Commissioner of Income Tax vs. Kabul Chawla reported (2016) 380 ITR 573 (Del.) wherein the Hon ble High Court has held that if the additions are made, but not based on any incriminating material found during search operation, t .....

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d the scope of jurisdiction u/s. 153A of the I.T. Act. In support of his contention, he relied upon the following orders/judgments of the Hon ble High Court and the ITAT. i) Delhi High Court decision in the case of CIT-7 vs. RRJ Securities Ltd. passed in ITA No. 175-177/Del/2015 dated 30.10.2015. ii) Principal Commissioner of Income Tax-18 vs. Ms. Lata Jain 2016 (5) TMI 1273- Delhi High Court. iii) Principal Commissioner of Income Tax-18, vs. Ms. Lata Jain 2016 (5) TMI 292-Delhi High Court. iv) .....

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o be quashed. 9. On the other hand, Ld. DR relied upon the order of the authorities below and stated that the provision of section 153A has rightly been applied in the case of the assessee on the material available with them. He relied upon the following judgments of the Hon ble High Court and hence, requested that the appeal of the Assessee may be dismissed. - Filatex India Ltd. vs. CIT (2014) 49 taxmann.com 465 (Delhi) 10. We have heard both the counsel and perused the relevant records availab .....

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d the AO was not justified in disturbing the concluded assessment without there being any incriminating material being found in search. In fact, in the entire assessment order, the AO has not referred to any seized material or other material for the year under consideration having being found during the course of search in the case of assessee, leave alone the question of any incriminating material for the year under appeal. We also find that the case law cited by the Ld. CIT(DR) in the case of .....

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ld has 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 ITA Nos. 707, 709 and 713 of 2014 of decisions, the legal position that emerges is as 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 searched requiring him to file returns for six Ays immediately preceding the previous year relevant to the AY .....

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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 post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment can be arbitrary or made without any relev .....

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