TMI Blog2018 (5) TMI 1993X X X X Extracts X X X X X X X X Extracts X X X X ..... thed during the course of search. Thus, there is no need to interfere with the findings of the CIT(A) as the issue herein is already covered in favour of the assessee by the Hon'ble Delhi High Court decision of Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] - Decided against revenue. - I.T.A .No. 3169/DEL/2015, C.O .No. 482/DEL/2015 - - - Dated:- 18-5-2018 - Shri R. S. Syal, Vice President And Ms Suchitra Kamble, Judicial Member Appellant by: Ms. Rachna Singh, CIT DR , Respondent by: Dr. Rakesh Gupta, Adv. And Sh. Somil Agarwal, Adv ORDER Suchitra Kamble, These appeal and cross objection are filed by the Revenue and assessee against the order dated 26/02/2015 passed by CIT(A)-Dehradun for Assessment Year 2006-07. 2. The grounds of appeal are as under:- 1. That on the facts and circumstances of the case, Ld. CIT(A) was not justified in law and on facts in holding that the addition u/s 68 and section 36(l)(iii) of the I.T. Act, 1961 cannot be made in assessment completed u/s 153A unless some incriminating material was found during the course of search thus ignoring provisions of law as contained in proviso (b) of sub- section (1) of section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the assessee requiring it to furnish the return of income on or before 08/10/2012. In response to notice u/s 153A(1)(a), the assessee submitted the return of income on 10.12.2012 declaring income of ₹ 18,21,244/-. Accordingly, notice under section 143(2) was issued to the assessee on 17/01/2.013. A questionnaire along with notice under section 142(1) of the Income Tax Act, 1961 was issued to the assessee on 23/11/2012. In response to these notices, authorized person attended the proceedings on behalf of the assessee from time to time and filed written explanation. The assesse company is in the business of construction and development of properties under collaboration and after completion it is sold. It enters into collaboration agreements with the sellers of the properties and then demolishes the existing building at its own expenses. Thereafter, it develops, reconstructs and completes the fresh building at the said property after getting the plans sanctioned from the MCD. The shares of the fresh building are then divided between the owner and the company as per the agreement along with proportionate undivided, indivisible and impartible share of ownership rights in the la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961 cannot be made in assessment completed u/s 153A, unless some incriminating material was found during the course of search. Thus, the CIT(A) ignored provisions of law as contained in proviso (b) of sub Section 1 of Section 153A which require the A.O to assess re-assess the total income of the assessee as defined in Section 2(45) of the Income Tax Act, 1961. The Ld. DR relied upon the Allahabad High Court decision in case of CIT Vs. Shri Raj Kumar Arora ITA No. 56/2011 order dated 11/7/2014. 7. The Ld. AR submitted that the reliance of the Hon'ble Allahabad High Court decision in case of R. K. Arora by the Ld. DR is not proper as the same is not a Jurisdictional High Court. The Ld. AR submitted that the CIT(A) has rightly decided the issue and there is no need to interfere with the same. The Ld. AR relied upon the decision and the Hon'ble Delhi High Court in case of CIT Vs. Kabul Chawla ITA No. 709/2014 dated 28/8/2015. 8. We have heard both the parties and perused the material available on record. The CIT(A) in his order mentioned that the Assessing Officer in remand report categorically admitted that there is no incriminating material with relation to the tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. In case of Kabul Chawla (supra), Hon'ble Delhi High Court held in para 37 and para 38 as under: 37. On a conspectus of Section 153A(1) of the Act, read with the proviso 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 153A(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. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and the abated assessment or reassessment can be reiterated and the abated assessment or reassessment can be made . In clause (vii), it is stated Completed assessments can be interfered with by the AO while making the assessment under Section 153A only on the basis of some incriminating material unearthed during the course of search. It is further to note that the reliance upon the decision of CIT vs. Sri. Raj Kumar Arora (supra) by the Ld. DR will not be appropriate in the present case as the Hon'ble Delhi High Court has categorically stated that completed assessments can be interfered with by the AO while making the assessment under Section 153A only on the basis of some incriminating material unearthed during the course of search. Thus, there is no need to interfere with the findings of the CIT(A) as the issue herein is already covered in favour of the assessee by the Hon'ble Delhi High Court decision of Kabul Chawla. The appeal of the Revenue is dismissed and cross objection filed by the assessee is allowed. 9. In result, the appeal of the Revenue is dismissed and cross objection of the assessee is allowed. Order pronounced in the Open Court on 18th May, 2018. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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