TMI Blog2018 (10) TMI 1091X X X X Extracts X X X X X X X X Extracts X X X X ..... orporation [2015 (5) TMI 656 - BOMBAY HIGH COURT] is clearly applicable in respect of undisclosed income added by the AO despite the fact that there is no incriminating material found during the course of search - Decided against revenue. Addition on account of unexplained cash credit - Held that:- the assessee has filed regular return of income for AY 2005-06 on 01.09.2005 under section 139 of the Act and along with the return of income the assessee has disclosed this amount of ₹ 25,000/- in the balance sheet being liability in the name of Shri Gulab Adnani. Further, we also find that there is no proceeding pending before the AO on account of regular assessment and there is no incriminating material available with the assessing officer for framing this assessment under section 153A read with section 143(3) of the Act. The assessment originally made is unabated and once, there is no incriminating material found during the course of search in relation to the income added as undisclosed income, we delete the addition. Revision u/s 263 - undisclosed gift received - Held that:- We find from the assessment order and the order of PCIT revising the assessment, that there is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that a search and seizure action under section 132 of the Act was carried out by the department on Saf Yeast Group on 30.11.2006. The present assessee has been member of Saf Yeast group, was covered under search and seizure action under section 132 of the Act. Original return of income for AY 2001-02 was filed by the assessee under section 139(1) of the Act on 23.05.2001 declaring the income at ₹ 1,45,210/-. This return has become final and no proceedings whatsoever was pending as on the date of the search and seizure action carried out by the department under section 132 of the Act on very assessee s cases on 30.11.2006. The AO issued notices under section 153A of the Act and finally, completed the assessment under section 153A read with section 143(3) of the Act, vide order dated 27.11.2008 and made addition on account of deposits made with State Bank of Bikaner and Jaipur Saving Account No. 5222. According to AO, in the present Saving Bank Account there is peak of credit entries of deposits of cash of ₹ 7,24,098/- as on 03.05.2011 and giving benefit of opening capital balances of ₹ 2 lakhs and gross total income declare during the year under the original return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving bank account of State Bank of Bikaner and Jaipur saving Bank Account No. 5222 and the gift received from Shri Gulab M. Adnani, Shri Jammumal V. Pohani, Shri Jashanlal D. Somani are already disclosed to the department and the assessment has been unabated and no proceedings whatsoever was pending before the AO for this assessment year. The learned Counsel for the assessee relied on the decision of Hon ble Bombay High Court in the case of CIT vs. Continental Warehouse Corporation (2015) 374 ITR 645 (Bombay) for this proposition. When these facts were confronted to the learned Sr. Departmental Representative, Shri Manjunatha Swamy, he only relied on the assessment order and the order of CIT(A) but could not point out what was the incriminating material found during the course of search and which is used for making addition. 6. In view of the above facts and circumstances, we are of the view that the assessee has filed regular return of income for AY 2001-02 on 02.03.2009, wherein the gift received from the above said parties of ₹ 11.23 lakhs has been disclosed in the capital account which is enclosed with the return of income. Further, we also find that the bank balances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and there is no incriminating material available with the assessing officer for framing this assessment under section 153A read with section 143(3) of the Act. The assessment originally made is unabated and once, there is no incriminating material found during the course of search in relation to the income added as undisclosed income, the proposition argued by the learned Counsel for the assessee relying on the decision of Hon ble Bombay High Court in the case of Continental Warehouse Corporation (supra) is clearly applicable in respect of undisclosed income added by the AO despite the fact that there is no incriminating material found during the course of search. Following the Hon ble Bombay High Court and going by the facts of the case, we delete the addition. The appeal of the assessee is allowed. In ITA No. 3741/Mum/2011 for AY 2004-05 9. The facts and circumstances are exactly identical from AYs 200102 and 2003-04. The AO added an amount of ₹ 55,000/- on account of unexplained cash credit in the hands of the assessee being liability shown in the balance sheet in the name of Plas Chem . 10. The facts and circumstances are exactly identical relating to searc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there is no proceeding pending before the AO on account of regular assessment and there is no incriminating material available with the assessing officer for framing this assessment under section 153A read with section 143(3) of the Act. The assessment originally made is unabated and once, there is no incriminating material found during the course of search in relation to the income added as undisclosed income, the proposition argued by the learned Counsel for the assessee relying on the decision of Hon ble Bombay High Court in the case of Continental Warehouse Corporation (supra) is clearly applicable in respect of undisclosed income added by the AO despite the fact that there is no incriminating material found during the course of search. Following the Hon ble Bombay High Court and going by the facts of the case, we delete the addition. The appeal of the assessee is allowed. In ITA No. 3742/Mum/2011 for AY 2005-06 13. The only issue in this appeal of assessee is as regards to the order of CIT(A) confirming the addition made by the AO of ₹ 25,000/- on account of unexplained cash credit. 14. The facts and circumstances are exactly identical relating to search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urred in AYs 1995-96, 1998-99, 2000-01 and 200405 while recording the value of Flat owned by the assessee resulting in short credit in the capital account and the assessee filed reconciliation statement. The CIT(A) confirmed the addition by stating that the assessee has failed to satisfactorily explain the credit entry of ₹ 4.97 lakhs by observing in Para 12.3 as under: - 12.3 On a careful examination of the remand report and the submissions made by the appellant, it is seen that the appellant has not discharged the onus of explaining the addition made in the capital account amounting to ₹ 4,97,000/-. Even after admitting the additional evidence during the appeal proceedings and after providing adequate opportunities, the appellant has failed to satisfactorily explain the addition to the capital account amounting to ₹ 4,97,000/-. Therefore, in the facts and circumstances of the case, the addition of ₹ 4,97,000/- is hereby upheld u/s 68 of the Act.. Aggrieved, now assessee is in appeal before the Tribunal. 17. Before us, the learned Counsel for the assessee drew our attention to balance sheet as on 31.03.2005, which carried forward the value of f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the revenue Reasons assigned by him are wrong and insufficient to justify that said order is erroneous and prejudicial to the interest of the revenue. 2. On the facts and circumstances of the case and in law the learned Commissioner of Income Tax erred in arriving at the conclusion that there is omission on the part of the assessee to disclose gift received by his minor children in as much as there is no provision in the Act or column in the return of income to disclose gift received by minor children. Provisions of the Act ought to have been properly construed and regard being had to facts of the case no such conclusion should have been arrived at. Reasons assigned by him are wrong and insufficient to justify such conclusion so arrived at. 3. On the facts and circumstances of the case and in law the learned Commissioner of Income Tax erred in rejecting contention of the appellant that order made under section 143(3)/153A of the Act is illegal, bad in law, and contrary to the provisions of the Act in as much as there is no seized material in the case of appellant and therefore no valid order could have been made under section 143(3)/153A of the Act. Provisions of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as filed originally and validly under Section 263 of the Act. 5. In the circumstances in the absence of any material disclosing that the issue of deemed dividend had been willfully derived or had been deemed or otherwise withheld from the assessment an addition under Section 153A was warranted - based on the proposition taught by this Court in judgment dated 28.08.2015 in ITA 707/2014 titled: CIT vs Kabul Chawla. Therefore, we concur with the ITAT's opinion in this regard. The search and seizure proceedings in such cases are undoubtedly meant to bring to tax amount that are to be determined on the basis of materials seized in the course of such searches; permitting anything over and above that would virtually amount to letting the Revenue have a third or fourth opinion as it were. Searches to quote the view of Attorney-general (NSW) vs. Quin (1990) HCA 21 in another context are not the key which unblocks the treasury of the Revenue s jurisdiction in regard to matters that had attracted attention in the regular course of assessment. 23. In view of the above decision of Hon ble High court, we are of the view that the assessment framed by AO is neither erroneous nor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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