TMI Blog2019 (7) TMI 1050X X X X Extracts X X X X X X X X Extracts X X X X ..... he course of search, the Assessing Officer is justified in making the addition in non abated assessment orders under Section 153 A read with Section 143 (3) of the Act of 1961 . 3. Assessment years are 2005-2006 to 2011-2012. 4. The Tribunal was in seisin with appeals and cross appeals arising from respective orders passed by Commissioner Income Tax (Appeals). The appeals before CIT (Appeals) were directed against the addition of income by the Assessing Officer taking production on presumptive basis and working out estimated income. 5. The factum of addition not being based on any incriminating material found during the search is not disputed. 6. This aspect is borne out from the record duly taken note of by the CIT (Appeals), reproduced below : In I.T.A.No.21/2019 4.1.4. DECISION: I have carefully considered the facts of the case, the finding of the Assessing Officer, written submissions of the appellant, the remand report and the rejoinder thereon as well as the material placed on record. The impugned addition of ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng through the written submissions and assessment carefully, following facts/points have been observed by me:- (i) The appellant is maintaining regular books of account. The books of account are audited under Section 44AB. The Auditor has not made any qualifying remark about the production/sale recorded by the appellant in its books of account. The Assessing Officer has not pointed out any defect/deficiency in the books of account maintained by the appellant. The Assessing Officer has also not rejected book results u/s 145(3). (ii) As search u/s 132(1) was carried out on 07.10.2010 at the various premises of the assessee and its group concerns/persons. However, no document/loose paper showing unaccounted production, suppression of sale or out of books purchases was found either at the premises of appellant or its directors. There is no other positive evidence to show that the assessee used 10 machines during the period relevant to A.Y. 2005-06, 06-07 and 07-08 and 8 machines during the period relevant to A.Y. 2008-09 for making unaccounted production of the 'Gutka'. (iii) The appellant has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant only for the purpose of computing Excise duty on the basis of deemed production per machine given in the notification. (vi) At paragraph No.4.33 of the assessment order, the Assessing Officer has relied upon the declaration forms in Form No.1 filed by the appellant in the O/o the Dy. Commissioner of Central Excise, Gwalior during the F.Y. 2008-09 to 2010-11. As the Assessing Officer himself has mentioned in assessment order that these forms have been filed in respect of F.Y. 2008-09 to 2010-11 hence I am of the considered opinion that these declaration forms have no relevance to the production of Gutka in F.Y. 2004-05, 2005-06, 2006-07 2007-08. As far as the production of the F.Y. 2008-09, 09-10 2010-2011 is concerned, the A.O has also accepted the production declared by the appellant. Hence I am of the considered opinion that these declaration forms have no relevance as far as the production of the F.Y. 2004-05, 05-06, 06- 07 07-08 is concerned. (vii) It has been explained by the appellant that the machinery found during the course of search were all recorded in the books of account and no unaccounted investment in the machinery has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 153 A (1) of the Act stipulates : (1) Assessment in case of search or requisition.- Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, in the case of a person where a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A after the 31st day of May, 2003, the Assessing Officer shall - (a) issue notice to such person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect of each assessment year falling within six assessment years referred to in clause (b), in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139; (b) assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng him to file returns for six AYs immediately preceding the previous year relevant to the AY in which the search takes place. (ii) Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as a fresh exercise. (iii) The AO will exercise normal assessment powers in respect of the six years previous to the relevant AY in which the search takes place. The AO has the power to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. 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 relevance or nexus with the seized material ..... X X X X Extracts X X X X X X X X Extracts X X X X
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