TMI Blog2018 (11) TMI 1115X X X X Extracts X X X X X X X X Extracts X X X X ..... tions were conducted in the case of M/s Sri M. Sambasiva Rao and others, Hyderabad and its group of cases on 16/07/2008. Notice u/s 153A of the Income-tax Act, 1961 ( in short the Act ) was issued to the assessee. In response to the said notice, the assessee filed return of income declaring an income of ₹ 1,34,900/-. In response to the notices u/s 143(2) and 142(1), the assessee furnished the details. 2.1 AO observed that the assessee had shown an amount of ₹ 20 lakhs towards advance for sale of land in the balance sheet annexed to return of income, but, he could not adduce any evidence like copy of agreement, mode of payment, identity of the purchaser etc. inspite of availing sufficient time. The AO, therefore, presumed that the assessee did not have any evidence towards his claim of advance and, hence, treated the same as unexplained receipt in the hands of assessee and added the same to the returned income of assessee. 3. When the assessee preferred an appeal before the CIT(A), the CIT(A) confirmed the action of AO. 4. Aggrieved by the order of CIT(A), the assessee is in appeal before us raising the following grounds of appeal: 1. The Ld. CIT(A) erred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,00,000/- based merely on the basis of information available on record submitted during the assessment proceedings, therefore, the addition made by the AO is not based on seized/incriminating material, therefore, the proceedings u/s 153A as void. He, therefore, pleaded to delete the addition made on this account. 6. The ld. DR, on the other hand, relied on the orders of revenue authorities. 7. Considered the rival submissions and perused the material on record. The contention of the assessee is that unless and until there is incriminating material relating to the assessee found during the course of search, there cannot be any assessment under section 143(3) read with section 153A as far as the assessment concluded u/s 143(3) is concerned. In this connection, he relied on the decision of coordinate bench of this Tribunal in the case of M/s Engineers Syndicate India Pvt. Ltd. in ITA Nos. 1805 to 1808 1870/Hyd/2014, vide order dated 31/05/2018 (wherein both the Members are party), wherein the coordinate bench has held as under: 11. Having regard to the rival contentions and the material on record, we find that the assessee has filed a chart showing the status of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the incriminating evidence found during the search and no further. Section 153A of the I.T. Act, 1961 did not make any distinction between the assessment conducted u/s 143(1) and section 143(3). The issue was no longer res integra ii) Hon'ble Gujarat High Court in the case of Pr.CIT vs. Dipak Jashvantlal Panchal reported in (2017) 397 ITR 153 (Guj.) has held as under: Section 153A of the Income-tax Act, 1961, bears the heading assessment in case of search or requisition . The heading of the section can be regarded as a key to the interpretation of the operative portion of the section and if there is no ambiguity in the language or if it is plain and clear, then the heading used in the section strengthens that meaning. From the heading of the section the intention of the Legislature is clear, viz., to provide for assessment in case of search and requisition. When the very purpose of the provision is to make assessment in case of search or requisition, it goes without saying that the assessment has to have relation to the search or requisition. In other words, the assessment should be connected with something found during the search or requisition, viz., incrimin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection strengthens that meaning. The trigger point for exercise of powers under section 153A is a search under section 132 or a requisition under section 132A of the Act. The assessment should be connected with something found during the search or requisition, i.e incriminating material which reveals undisclosed income. Where an assessment has been framed earlier and no assessment or reassessment was pending on the date of initiation of search u/s 132 or making of requisition u/s 132A, while computing the total income of the assessee u/s 153A of the Act, additions or disallowances can be made only on the basis of the incriminating material found during the search or requisition . vi) Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla reported in (2016) 380 ITR 573 (Del.) held as under: The legal position that emerges on a perusal of section 153A and section 132 of the Income-tax Act, 1961, is as under: (i) Once a search takes place under section 132 of the Act, notice under section 153A(l) will have to be mandatorily issued to the person in respect of whom search was conducted requiring him to file returns for six assessment years immediately preceding the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment years 2002-03, 2005-06 and 2006-07. On the date of the search the assessments already stood completed. Since no incriminating material was unearthed during the search, no additions could have been made to the income already assessed 13. We find that in almost all the above decisions, the decision of the Hon'ble Delhi High Court in the case of Anil Kumar Bhatia (cited Supra) was considered and in the case of Kabul Chawla, the Hon'ble Delhi High Court observed as under:- 9. The Assessee then appealed to the ITAT. One of the issues considered by the ITAT was whether the completed assessment on the date of the search would stand on the same footing as the pending assessments which in terms of the second proviso to Section 153A(1) of the Act would abate. It was noticed that in Anil Kumar Bhatia (supra), this Court had left open the question whether in order to frame an assessment in terms of the first proviso to Section 153A(1) of the Act in respect of those AYs for which the assessments had already been completed, there was a requirement that some incriminating material should be unearthed during the search. Nevertheless there were some observations in An ..... X X X X Extracts X X X X X X X X Extracts X X X X
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