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2020 (2) TMI 158

..... ginal assessment - Addition of Reduction of value of stock/inventory on account of brokerage and compensation - assessee failed to substantiate the above expenses u/s.37(1) either at the assessment stage or at the appellate stage - HELD THAT:- . Since in the present case both the above additions are admittedly made during the course of inquiries at assessment stage under section 153A and original assessment was already completed on 25.07.2009 by proceeding the return under section 143(1), therefore, issue is covered by Judgments of Hon’ble Delhi High Court in the case of CIT vs., Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] and Pr. CIT vs., Meeta Gut Gutia [2017 (5) TMI 1224 - DELHI HIGH COURT] . The Departmental appeal stand dis .....

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..... that was available at time of original assessment. 2. Briefly the facts of the case are that the A.O. passed the assessment order under section 153A/143(3) Dated 25.03.2013. In the Order, as against the returned loss of ₹ 1,94,170/-, the A.O. assessed the assessee at the loss of ₹ 1,94,170/-. However, the A.O. reduced the value of inventory/stock-in-trade capitalized by the assessee by making the following additions/disallowances. (i) Disallowance on account of brokerage - ₹ 1,80,84,869/- (ii) disallowance on account of compensation- ₹ 9,25,47,870/- 2.1. The assessee challenged the both the additions before the Ld. CIT(A) and it was submitted that both the additions are beyond the scope of provisions of Section 153A .....

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..... s has not been allowed to be accumulated towards the value of stock in trade and reduced accordingly. However, since no such expenditure was claimed in the profit and loss account, no addition has been made in the total income and assessed at a loss of ₹ 1,94,170/-. The Ld. CIT(A), in view of these facts found that on the date of search i.e. on 19.10.2010, no proceedings were pending as processing under section 143(1) was completed on 25.07.2009. It was also found that the impugned disallowances are not based on any documents found and seized during the course of search or emanating out of any undisclosed income, cash, or investment etc., not disclosed by the assessee. Nothing in this regard has also been mentioned by the AO in the as .....

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..... making the assessment under section 153A only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in the course of original assessment 5.2. This similar view has been taken by the Hon'ble Delhi High Court in its recent decision in the case of Pr. CIT vs. Meeta Gutgutia 395 ITR 526 (Del.), in which, following the Judgment in the case of Kabul Chawla (supra), it was held as under : 69. What weighed with the Court in the above decision was the habitual concealing of income and indulging in clandestine operations and that a person indulging in such acti .....

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