TMI Blog2018 (2) TMI 965X X X X Extracts X X X X X X X X Extracts X X X X ..... that there should be uniformity in treatment and when facts and circumstances for different years were identical particularly in the case of the same assessee. While upholding the principles of res judicata the FAA has not demonstrated as to how the facts of AY. 2009-10 were different from the facts of other three AY's. especially of AY. 2008-09. This one more reason to reverse the order of the FAA. - Decided in favour of assessee. - I.T.A./1366/Mum/2016, I.T.A./3486/Mum/2016 And I.T.A./3487/Mum/2016 - - - Dated:- 7-2-2018 - Sh.Rajendra,Accountant Member And C. N. Prasad,Judicial Member For The Revenue : Shri Y.K. Bhaskar-DR For The Assessee : Shri K. Gopal/Ms.Neha Paranjpe ORDER PER Rajendra A. M. - Challenging the order dated 28/4/2016 of the CIT(A)- 47,Mumbai,the assessee has filed present appeals for the above mentioned AY. s (AY. s) . The assessee is engaged in the business of construction of residential/commercial buildings. Details of filing of returns, returned incomes, assessment dates etc. , can be summarised as under: A. Y. ROI filed on Returned Income Assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Assessee-compay is part of Gitanjali Group. A search action u/s. 132 (1) and survey action u/s. 133A of the Act were initiated in the group cases on 29 /11/2011. During the proceedings, seized material belonging to the assessee was found and accordingly proceedings u/s. 153C were initiated. The Assessing Officers (AO. s)completed the scrutiny assessments, as stated in the first paragraph of our order. They disallowed the expenses under the heads personnel expenses, office expenses, depreciation, bank charges and interest etc. , comprising business loss. 4. During the appellate proceedings for the AY. 2011-12, the First Appellate Authority (FAA) observed that the assessee had shown other income at ₹ 1. 19 crores, that it had claimed expenses against the said income declaring loss of ₹ 31. 54 lakhs, that the AO had examined the eligibility of expenses u/s. 57 (iii) of the Act, that he had observed that various expenses claimed by the assessee had resulted in business loss, that the AO had given a finding that assessee had not shown any business income during the year, that the assessee had submitted that expenses were incurred for the purpose of general day-to-day ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terial relevant to the abovementioned three AY. s there was no valid satisfaction to the effect that undisclosed income belonged to the assessee, that the AO had made no addition on the basis of seized material, that while finalising the assessment he disallowed the claim of expenditure u/s. 37 (1) of the Act, that the disallowance made by the AO and all the AY. s was based on regular books of accounts, that the same did not have any nexus with the seized material, that the assessment proceedings u/s. 153C of the act were bad in law. He relied upon the case of Sinhgad Technical Education Society (378 ITR 84) of the honorable Bombay High Court that was later on confirmed by the honorable Supreme Court (397 ITR 344). He further contended that the return for the AY. 2008-09 was processed and accepted u/s. 143 (1)of the Act, that no assessment was pending when the AO passed the order u/s. 153C, that the order passed by him was bad in law. He relied upon the cases of Continental Ware - housing Corporation (374 ITR 645), Lavnya Land Private Ltd. (397 ITR 246), Nikki Drugs and Chemicals Private Ltd. (386 ITR 680) and Gurinder Singh Bawa (386 ITR 483). With regard to AY. s 2010-11 and 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of section 153CA A perusal of the above section clearly shows that there should be some relation between the seized material and the assessed income where special procedure has to be followed u/s. 153C of the Act. The section was introduced to cover the other persons , where incriminating documents/assets were seized during the search and seizure proceedings of the main person. It is not uncommon that during actions carried out u/s. 132 (1) of the Act, certain papers/ documents/books of accounts/assets belonging to the persons, other than the person searched, are found. If the seized documents/assets represent the undisclosed income of the other person then the incriminating material, including the assets are transferred to the AO having jurisdic -tion over that other person. But the basic and foremost thing is the documents/ asset should be incriminating. If the documents/assets do not represent the undisclosed income of the other person, then there would be no justification for passing order u/s. 153C. Here, would like to refer to the case of the Hon ble Apex Court. The facts of the case were that the assessee was an educational institution registered u/s. 12AA of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to AY. 2004-05 or thereafter. The Tribunal rightly permitted this additional ground to be raised and correctly dealt with the ground on the merits as well. The High Court was right in affirming this view of the Tribunal. We have gone through the documents seized by the Department authorities during the search proceedings. We find that the documents do not disclose any undisclosed income on part of the assessee for any of the above AY. s . The AO had disallowed business losses and that clearly prove that seized documents were of no relevance for the AO to make the disallowance. We allow the additional grounds raised by the assessee for all the three AY. s and decide the same in its favour. Thus, the assessment orders passed by the AO. s fail on the touch-stone of jurisdictional validity for AY. 2008-09, 2010-11 and 2011-12. The cases relied upon by the assessee, before us, also support the views taken by us. Therefore, we hold that the orders passed by the AO. s and confirmed by the FAA are not valid either on jurisdictional question or on merits. So, revering the orders of the FAA, we allow the appeals filed by the assessee-company. Before concluding we will like to ment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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