TMI Blog2019 (9) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... can be made while framing the assessment under section 153A. As admittedly no incriminating material relating to these assessment years or as a matter of fact for any of the assessment years were found during the course of search and accordingly, the originally assessed income. Accordingly the addition is directed to be deleted being beyond the scope of assessment u/s 153A - Decided in favour of assessee. - ITA No. 3198/Del/2013 - - - Dated:- 29-3-2019 - Shri Amit Shukla, Judicial Member And Shri Prashant Maharishi, Accountant Member For the Assessee : Shri Sanjay Kumar,CA, Shri Akarsh Garg, Advocate For the Department : Shri J.K. Mishra . DR ORDER PER AMIT SHUKLA, J.M.: The aforesaid appeal has been filed by the assessee against impugned order dated 8.2.2013 passed by Ld. CIT(A) XXXIII, New Delhi for the quantum of assessment passed u/s 153A / 143(3) for the assessment year 2006-07. In the revised grounds of appeal assessee has raised following grounds :- 1. BECAUSE the ld. CIT (A) has erred in law and on facts in confirming the addition of ₹ 1.01 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egular course of assessment proceedings. The details of fresh share application money received by the assessee is given as under :- S.No. Name of the Party Amount of Share application money and share premium 1 Ashish Gupta ₹ 50,00 0 2 B.S. Yadav ₹ 50,000 3 Emkay Commercial Company Ltd. ₹ 4.0,00,000 4 Emkay Commercial Company Ltd. ₹ 30,00,000 5 Raziel Tieup Pvt. Ltd. ₹ 10,00,000 6 Esmarie Mercantiles Pvt. Ltd. ₹ 10,00,000 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Pvt. Ltd. [2016J 380 ITR (St.) 65 in S.L.P. (C) No. 34554 of 2015 7. Judgment of Hon'ble Gujarat High Court dt. 14.03.2016 in the case of Pr. CIT Vs. Saumya Construction P. Ltd. [2016] 387 ITR 529 {Guj}. 5. He further submitted that during the course of the original assessment proceedings, the entire balance sheet, profit and loss account were subject to detailed scrutiny by the AO which is evident from various notices and replies filed by the assessee as given in the paper book from pages 1 to 61. Once the entire issue and the fresh share application money received by the assessee during the year as appearing in the balance sheet has been examined by the AO, then without their being any seized material, no further addition can be made based on same material. Thus, addition made by the AO and as sustained by the Ld. CIT(A) should be deleted on this ground. 6. On the other hand, Ld. DR though did not controvert the contention that there is no incriminating material found at the time of search, but he submitted that, once notice u/s 153(3) is issued to the assessee then it is incumbent upon the assessee to file the return o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. Obviously an assessment has to be made under this Section only on the basis of seized material. v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessments can be interfered wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upra) is concerned, in para 11of the decision it was observed: 11. Section 153A (1) (b) provides for the assessment or reassessment of the total income of the six assessment years immediately preceding the assessment year relevant to the previous year in which the search took place. To repeat, there is no condition in this Section 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 Assessing Officer which can be related to the evidence found. This, however, does not mean that the assessment under Section 153A can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material. 58. In Kabul Chawla {supra), the Court discussed the decision in Filalex India Ltd. {supra) as well as the above two decisions and observed as under: 31. What distinguishes the decisions both in CIT v. Chetan Das Lachman Das {supra), and Filatex India Ltd. v. CIT-IV {supra) in their application to the present case is that in both the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 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. 34. The argument of the Revenue that the AO was free to disturb income de hors the incriminating material while making assessment under Section 153A of the Act was specifically rejected by the Court on the ground that it was not borne out from the scheme of the said provision which was in the context of search and/or requisition. The Court also explained the purport of the words assess and reassess , which have been found at more than one place in Section 153A of the Act as under: 26. The plea raised on behalf of the assessee that as the first proviso provides for assessment or reassessment of the total income in respect of each assessment year falling within the six assessment years, is merely reading the said provision in isolation and not in the context of the entire section. The words 'assess' or 'reassess'-have been used at more than one place in the Section and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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