TMI Blog2018 (12) TMI 1587X X X X Extracts X X X X X X X X Extracts X X X X ..... .A. No. 2374/Mum/2018, I.T.A. No. 2375/Mum/2018 And I.T.A. No. 2376/Mum/2018 - - - Dated:- 26-12-2018 - S/Shri B.R. Baskaran (AM) Sandeep Gosain (JM) For the Assessee : Shri Vijay Mehta Shri Anuj Krisnadwalla For the Department : Shri Sunil Kumar Jha ORDER PER B.R. BASKARAN (AM) :- All these appeals filed by the assessee are directed against the orders passed by Principal CIT (Central)-I and they relate to A.Ys. 2008-09 to 2011- 12. Since identical issues urged in these appeals, they were heard together and are being disposed of by this common order. 2. The assessee is challenging the validity of revision order passed by Learned Principal CIT in all these appeals. 3. Facts relating to the case are discussed in brief. The assessee is engaged in the business of construction of residential premises at old Mahabalipuram road, Chennai. The assessee belongs to Hiranandan group, which was subjected to search u/s. 132 of the Act as well as survey action u/s. 133A of the Act on 11.3.2014. Thereafter, it was noticed that certain documents belonging to the assessee were found at the premises of those group concerns. Accordingly, proceedings u/s. 153C of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot accept the same for the reason that the Revenue has challenged the decision rendered by Hon'ble Bombay High Court in the case of Continental Warehousing/All Cargo Global Logistics Ltd (supra) by filing Special Leave Petition before Hon'ble Supreme Court. Accordingly he proceeded to pass revision order u/s. 263 of the Act on following issues:- (i) Assessment of the AY 2008-09 based on the financial statements without giving effect to the merger with Stonewood Construction Pvt. Ltd. (ii) Non-treatment of Interest Income and Miscellaneous Receipts as income from other sources . (iii) Non-verification of expenditure debited in the P L account and capitalization of the expenditure to the WIP. (iv) Non-verification of advances received from customers and customer deposits towards sale of flat. (v) Non-verification of interest expenditure. (vi) Non-verification of correctness of the work in progress and its valuation. (vii) Non-verification of ₹ 304.41 crores received through debentures issued to an overseas party. All the above said issues have been mentioned by Ld Pr. CIT in AY 2008-09. The issues listed as (ii) to (vii) are mentioned in AY 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT (ITA No.1872/Mum/2015 dated 24.6.2015) (b) M/s Hanspro.com Pvt Ltd vs. Pr. CIT(ITA No.3573/Mum/2016 dated 31.01.17) (c) Mrs.Shweta Avarsekar vs. Pr. CIT (ITA No.3186 3187/Mum/2016 dated 01-08-2016) He submitted that, in all the above cases, the revision orders passed for unabated assessment years u/s 153A of the Act have been set aside by the Tribunal on identical reasoning. 8. On the contrary, the Ld D.R submitted that the assessing officer is expected to make enquiry in respect of the items claimed by the assessee in the return of income. If the assessment order is passed without making inquiries or verification which should have been made, the same is deemed to be erroneous and prejudicial to the interests of revenue as per Explanation 2 to sec.263 of the Act. He submitted that the Explanation given under sec.153A(2) of the Act specifically states that all other provisions of the Act shall apply to the assessment made u/s 153A, 153B and 153C of the Act. The Ld D.R submitted that the above said Explanation shall be rendered otiose, if the interpretation given by Ld A.R is accepted. The Ld D.R placed his reliance on the decision rendered by Hon ble Supreme Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctional Hon ble Bombay High Court on the reasoning that the revenue has filed SLP before the Hon ble Supreme Court. He submitted that the same cannot be a reason to refuse to follow the binding decision of jurisdictional High Court. 10. We have heard rival contentions and perused the record. We notice that the assessments for the years under consideration were completed by the assessing officer u/s 153C r.w.s 143(3) of the Act, i.e., consequent to the search proceedings conducted in the hands of Hiranandani group of companies. These assessments fall under the category of unabated assessments as per the provisions of sec.153A of the Act, i.e., the assessments completed for the years under consideration do not abate. 11. The law relating to assessments for unabated assessment years has been explained by the Hon ble jurisdictional Bombay High Court in the case of Continental Warehousing Corporation (supra) and it has been held that the AO is entitled to make addition in unabated assessment years only on the basis of incriminating materials found during search. There is no dispute with regard to the fact that the search officials did not find any incriminating materials relatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this issue is other than the additions based on seized material. If it is so then according to the aforementioned decision of Hon'ble Bombay High Court in the case of CIT vs. Continental Warehousing Corporation (Nhava Sheva) Ltd .(supra), the AO would not have jurisdiction to bring such issue in the assessment completed u/s. 153A r.w.s 143(3) and nonconsideration thereof in the assessment order would not make the assessment order passed under section 143(3) r.w.s. 153A as erroneous and prejudicial to the interest of Revenue. 5. This view has been followed by Mumbai Bench of the Tribunal in the case of Mrs. Shweta Avarsekar vs DICT (Supra). Thus, from the facts of this case and legal discussion as made above, it is clear that the assessment order passed by the AO cannot be held to be erroneous or prejudicial to the interest of the Revenue for the reason as has been mentioned by Ld. Principal CIT. We find that the impugned order u/s 263 is contrary to law and facts and, therefore, the same is hereby quashed. 13. In the case of Hanspro.com P Ltd (supra) also, the Ld Pr. CIT revised the assessment order passed u/s 153C r.w.s 143(3) of the Act in respect of an unabat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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