TMI Blog2020 (9) TMI 909X X X X Extracts X X X X X X X X Extracts X X X X ..... GRA] has held that the documentary evidences were seized in the case of the search but in fact they were impounded in the course of survey in the premises of the assessee hence the very basis assuming jurisdiction r.w.s. 153C becomes untenable, therefore, the very order passed u/s. 153A is held to be void. In the light of the above facts and findings and judicial pronouncements, we consider that addition of ₹ 1.8 crores made in the unabated assessment u/s. 153A of the Act on the basis of document impounded during the course of survey at the associated premises of the firm is not valid, therefore, we set aside the order of ld. CIT(A) on this issue and allow the appeal of the assessee. Since we have quashed addition made in the assessment framed u/s. 153A of the Act based on the document found and impounded during survey u/s. 133 A of the Act, therefore, we do not find any need to adjudicate the remaining grounds of appeal on merit. - Decided in favour of assessee. - IT(SS)A Nos. 394, 395, 396 & 397/Ahd/2017 - - - Dated:- 19-8-2020 - Shri Mahavir Prasad, Judicial Member And Shri Amarjit Singh, Accountant Member For the Assessee : Shri Sunil Talati And Shri R.B. Tank, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted that assessee was having capital balance of ₹ 2,64,41,387/- and interest free fund to the amount of ₹ 8,10,19,417/- as against total investment made in the partnership firm to the amount of ₹ 3,61,93,058/- for the year under consideration. The Id. counsel has also placed reliance on the decision of Co-ordinate Bench in the case of SureshbhaiRanchhodbhai Patel vs. ACIT vide ITA No, 328/Ahd/2012 dated 12-06-2017. On the other hand, Id. departmental representative has supported the order of lower authorities. 8. We have heard both the sides and perused the material on record. After considering the material on record, it is observed that assessee's own fund as well as interest free fund were more than investment made in partnership firm, therefore, disallowance on account of interest u/s. 14A is not sustainable in view of the decision of the Co-ordinate Bench as cited above by the assessee. The relevant part of the decision of the Co-ordinate Bench is reproduced as under:- 5. We have carefully considered the orders of the authorities below qua the issue. There is no dispute that the assessee was deriving share profit from the partnership firms. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Income Tax (Appeal)-12 Ahmedabad, erred in facts and in law in upholding the addition of ₹ 1,80,00,000 made by the Assessing Officer u/s 69 of Income Tax Ad, 1961. 11. A Search u/s. 132 of the Act was carried out in the group cases of Shayona group on 15-10-2013 in which the residence of the assessee, Sh. Suresh Ranchhodbhai was also covered. During the search a survey u/s. 133A was also conducted on shop no. 22/23 Shayona Complex Ghatlodiya Ahmedabad and document pertaining to land transactions was found and impounded as MOU (SamjutiKarar) between assessee Sh. S.R. Patel (Purchaser) and Sh. Rameshbhai N . Desai (Seller) of land of 33898 sq. yd @ ₹ 13501 per sq. yd. at survey no. 210/2 in village Motera for agreed consideration of ₹ 4,57,41,388/-. It is stated that the assessee has paid cash of ₹ 1.8 crores towards part payment of the agreed consideration. The assessee was asked to explain the source of cash paid. The assessee has explained that the document was mere an understanding to be finalized based on the terms and conditions as mentioned in the said understating. The assessee has stated that aforesaid impounded banakhat was cancelled as Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ameshbhai Desai of ₹ 1.8 crores and only on the basis of said agreement the assessing officer has come to the conclusion that assessee had unaccounted cash payment of ₹ 1.80 crores to the prospective seller Mr. Rameshbhai Desai. The Id. counsel has contended that both the assessing officer and the Id. CIT(A) has ignored the cancellation agreement as both the agreements were on the non-judicial stamp paper and both were duly notarized. The Id. counsel has also contended that at the time of search us. 132(4) the assessee has clearly stated that the said Banakhat was cancelled. The Id. counsel has further submitted that the assessing officer has not disclosed the fact to the assesse that Mr. Rameshbhai Desai has not made compliance to the summon. The assessing officer has kept it behind the back of the assessee just to make addition without saying the assessee to produce Mr. Rameshbhai Desai. The assessing officer has completely ignored the fact that no sale deed was executed with the assessee. The assessing officer has ignored the documentary evidences that the said person was not the owner of the land and the title of the land was in dispute. On the other hand, the Id. d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s. 153 A of the act. After perusal of the provision of section 153 A of the Act, we do not find any merit in the finding of Id. CIT(A). The section 153 A proceeds on the basis of search u/s. 132 or requisition u/s. 132A of the act. There is no reference to survey u/s. 133 A of the Act and power u/s. 153 A could only have been exercised in the case of search or requisition. In the case of the assessee there was unabated assessment, therefore, completed assessment could not be disturbed in absence of contrary material found during search. The Jurisdictional High Court in the case of Pr. CIT vs. Shaumya Construction Pvt. Ltd. (2016) 387 ITR 529 held that assessment u/s. 153A in the case of unabated assessment should be connected with money found during the course of search and the Hon'ble Jurisdictional Gujarat High Court in the case of Pr. CIT Vs. Arvind Joshi Co. ITA 1394/2019 dated 12 Feb, 2019 has held that the assessing officer whiling framing assessment has not relied upon any incriminating material found during search in the case of unabated assessment u/s. 153A(l)(b) unless such assessment is based upon incriminating document seized/impounded during the course of search ..... X X X X Extracts X X X X X X X X Extracts X X X X
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