TMI Blog2019 (9) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... quisition of these plots were not found recorded in the books of account. The pattas of these plots constituted incriminating material, therefore, there is no merit in the contention of the AR that the addition should be deleted by following the decision of the Coordinate Bench. So far as the merit of the addition is concerned, we found that the A.O. has correctly taken value of these plots so determined by the JDA, the registered value of plots as per JDA pattas and Sub-Registrar, Jaipur-4. Thus, we confirm the addition so made by the A.O. subject to further direction to the A.O. to reduce this addition only to the extent of any investment, if any, shown by the assessee in regular books of account before the date of search in respect of any of these plots so acquired. - ITA No. 147/JP/2019, ITA No. 148/JP/2019 - - - Dated:- 20-8-2019 - Shri Ramesh C Sharma, AM And Shri Vijay Pal Rao, JM For the Assessee : Shri G.M. Mehta (CA) For the Revenue : Shri Varinder Mehta (CIT-DR) ORDER PER: R.C. SHARMA, A.M. These are the appeals filed by the assessees against the separate orders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e A.O. observed that the assessee had purchased two plots, plot nos. B-142 and B-143, Shivaji Nagar, Jaipur, allegedly in the year 1997. The A.O. further observed that certain plots in Shivaji Nagar, Jaipur were claimed to have been purchased in the year 1997 at a purchase cost in the range of ₹ 20,000-25,000. However, it was found that these plots appeared for the first time in the balance sheets of AY 2013-14 of all the Tomar family members who had allegedly purchased these plots in 1997. The following are the assessees who purchased the plots in Shivaji Nagar, Jaipur, allegedly, in 1997:- S. No. Name of the assessee Plots addresses 1. Anurag Tomar B-140 B-141, Shivaji Nagar, Jaipur 2. Swati Tomar B-142 B-143, Shivaji Nagar, Jaipur 3. Shobha Tomar B-144 B-145, Shivaji Nagar, Jaipur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... miniscule ₹ 20,116/- and ₹ 18,855/- for plot nos. B-142 and 143 respectively. There is no way in which it can be ascertained that only this cost was paid by the assessee for the purchase of the said plots. It was only to deflate the purchase cost of this plot that the assessee obtained the back-dated pattas from Baba RN Gaur, Grah Nirman Sahakari Samiti Ltd. If not, then the reason for furnishing false information during the assessment proceedings has not been furnished by the assessee. From the circumstantial evidence available, the reason is the intention of the assessee to deflate the purchase cost. Actually, the assessee has made an undisclosed investment of ₹ 6,86,686/-in plot no. B-142 and ₹ 6,86,686/- in plot no. B-143. The fact remains that the assessee obtained back dated receipts of cost and other expenses also, as admitted by her in her submission dated 28-11-2016. The cost in these receipts was purposely deflated. Therefore, after the enquiries done from the state government authorities by this office, the lease deed obtained from the Sub Registrar, Jaipur-IV can only be the basis of quantification of the undisclosed investment by the assessee i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -143) were purchased by the assessee in the year 201213 (with backdated pattas of 1997). On both the plots, assessee had incurred following expenses/ payments in getting them converted into urban plot of land: Plot No. B-142 (293.33 Sq. yards) S.No. Date/year Head of payment Amount P.B. page 1. 2012-13 Cost of plot (to Housing Society) 20,116 6 2. 28.02.2014 Regularization etc to JDA 14,667 7 3. 03.03.2014 Lease deed stamps to JDA 27,480 8 4. 14.03.2014 Registration charges ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t were sold by the assessee on 6th October 2016 for ₹ 5,75,000/- and ₹ 3,75,000/-(evaluated price ₹ 4,97,987/- and ₹ 3,18,825/-) respectively (P.B. Page 14 to 21), the sale price is much lower than the addition made for the rate at which JDA had re-allotted the same plot to the assessee through registered deed. Therefore, the rates fixed by JDA cannot form basis of presumption that assessee had paid higher sums in purchase of both the plots. 13. Without prejudice to the above contention, the ld AR has submitted that said plots of land (No.B-140 and B-141) were kept by the assessee for more than three years on which he had made payments to JDA for conversion into urban plot of land. The converted plots of land were sold by the assessee 6th October 2016 but no cost inflation u/s. 48 of IT Act was allowed. The details of cost incurred, sale price and DLC rate of both plots is as under: Plot No. Cost incurred (up to March 2014) Sold on Sale price DLC rate Addition made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of purchase. The A.O., therefore, concluded that these plots were actually purchased in the A.Y. 2013-14 under consideration. After purchase of these plots, the assessee got these plots registered with the Jaipur Development Authority (JDA). For the purpose of taxability of these undisclosed investments, the A.O. has taken registered value of these plots as per the JDA Patta and Sub-Registrar, Jaipur-4. The additions so made were confirmed by the ld. CIT(A). 17. In the first ground of the appeal, the assessee alleged that no incriminating material was found during the search, therefore, no addition was warranted. For this purpose, he placed reliance on the decision of the Coordinate Bench in the case of Smt. Pallavi Tomar Vs ACIT order dated 24/07/2018 belonging to the very same group wherein addition so made was deleted by the Tribunal. The ld AR has also relied on the decision of the ld. CIT(A) in case of the other family members of the same group wherein similar additions were deleted but revenue was not in appeal before the Tribunal. 18. We had carefully gone through the order of the Coordinate Bench in the case of Smt. Pallavi Tomar as well ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enquiries conducted during the course of assessment proceedings and had made the addition. Therefore, the addition made by the AO for the assessment year completed u/s 153A is undisputedly not based on any incriminating material found or seized during the course of search and seizure action u/s 132 of the Act. Once, the Assessing Officer has completed the assessment u/s 153A without any reference to the incriminating material found then, no addition cannot be made to the returned income of the assessee. 6. The Hon ble Delhi High Court in case of CIT v. Kabul Chawla vide while considering an identical issue has held in para 37 and 39 as under:- 37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153 A(1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previous year relevant to the AY in which the search takes place. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur of the Assessee and against the Revenue. 7. A similar view has been taken by the Hon ble Jurisdiction High Court in case of Jai Steel India v ACIT (supra) wherein it has been held in para 22 to 30 as under:- 22. In the firm opinion of this Court from a plain reading of the provision along with the purpose and purport of the said provision, which is intricately linked with search and requisition under Sections 132 and 132A of the Act, it is apparent that: (a) the assessments or reassessments, which stand abated in terms of II proviso to Section 153A of the Act, the AO acts under his original jurisdiction, for which, assessments have to be made; (b) regarding other cases, the addition to the income that has already been assessed, the assessment will be made on the basis of incriminating material and (c) in absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. Though such a claim by the assessee for the first time under Section 153A of the Act is not completed, the case in hand, has to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to reopen the assessment under Sections 147 and 148, have been removed by the non obstante clause with which sub-section (1) of Section 153A opens. The time-limit within which the notice under Section 148 can be issued, as provided in Section 149 has also been made inapplicable by the non obstante clause. Section 151 which requires sanction to be obtained by the Assessing Officer by issue of notice to reopen the assessment under Section 148 has also been excluded in a case covered by Section 153A. The time-limit prescribed for completion of an assessment or reassessment by Section 153 has also been done away with in a case covered by Section 153A. With all the stops having been pulled out, the Assessing Officer under Section 153A has been entrusted with the duty of bringing to tax the total income of an assessee whose case is covered by Section 153A, by even making reassessments without any fetters, if need be. 21. Now there can be cases where at the time when the search is initiated or requisition is made, the assessment or reassessment proceedings relating to any assessment year falling within the period of the six assessment years mentioned above, may be pendi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment, where the total income determined in the original assessment order and the income that escaped assessment are clubbed together and assessed as the total income. In such a case, to reiterate, there is no question of any abatement of the earlier proceedings for the simple reason that no proceedings for assessment or reassessment were pending since they had already culminated in assessment or reassessment orders when the search was initiated or the requisition was made. (Emphasis supplied) 24. The said judgment also in no uncertain terms holds that the reassessment of the total income of the completed assessments have to be made taking note of the undisclosed income, if any, unearthed during the search and the income that escaped assessments are required to be clubbed together with the total income determined in the original assessment and assessed as the total income. The observations made in the judgment contrasting the provisions of determination of undisclosed income under Chapter XIVB with determination of total income under Sections 153A to 153C of the Act have to be read in the context of second proviso only, which deals with the pending assessment/re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent proceedings is liable to be abated. The principles of interpretation of taxing statutes do not permit the Court to interpret the Second Proviso to Section 153A in a manner that where the assessment or reassessment proceedings are complete, and the matter is pending in appeal in the Tribunal, the entire proceedings will abate. 20. There is another aspect to the matter, namely that the abatement of any proceedings has serious causes and effect in as much as the abatement of the proceedings, takes away all the consequences that arise thereafter. In the present case after deducting bogus gifts in the regular assessment proceedings, the proceedings for penalty were drawn under Section 271(1)(c) of the Act. The material found in the search may be a ground for notice and assessment under Section 153A of the Act but that would not efface or terminate all the consequence, which has arisen out of the regular assessment or reassessment resulting into the demand or proceedings of penalty. (Emphasis supplied) The said judgment which essentially deals with second proviso to Section 153A of the Act also supports the conclusion, which we have reached hereinbefore. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14. Thus, we found that in both these cases, assessments were abated meaning thereby these were pending as on the date of search. We further observe that during the course of search, Pattas of these two plots were found and the amount paid for acquisition of these plots were not found recorded in the books of account. The pattas of these plots constituted incriminating material, therefore, there is no merit in the contention of the ld AR that the addition should be deleted by following the decision of the Coordinate Bench. So far as the merit of the addition is concerned, we found that the A.O. has correctly taken value of these plots so determined by the JDA, the registered value of plots as per JDA pattas and Sub-Registrar, Jaipur-4. Thus, we confirm the addition so made by the A.O. subject to further direction to the A.O. to reduce this addition only to the extent of any investment, if any, shown by the assessee in regular books of account before the date of search in respect of any of these plots so acquired. We direct accordingly. 20. As the facts and circumstances in the case of Dr. Anurag Tomar in ITA No.148/JP/2019 are pari materia to the facts in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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