TMI Blog2020 (11) TMI 262X X X X Extracts X X X X X X X X Extracts X X X X ..... grounds of appeal and no documentary evidence has been produced nor any evidence furnished to substantiate its claims. Before us also, no material is produced to show that the transaction in question is genuine although it is held by the AO that the same is not genuine. Assessee appeal dismissed. - ITA No. 212 & 589/Bang/2020 - - - Dated:- 16-10-2020 - Shri A. K. Garodia, Accountant Member And Smt. Beena Pillai, Judicial Member For the Assessee : Smt. Sheetal Borkar, Advocate For the Revenue : Shree Muzaffar Hussain, CIT DR ORDER PER ARUN KUMAR GARODIA, A. M.: Both these appeals are filed by the assessee and the same are directed against two separate orders of learned CIT (A) 11 Bengaluru dated 20.12.2019 13.01.2020 and the assessment year involved in both appeals is same i.e. A. Y. 2005 06. Both these appeals were heard together and are being disposed of by way of this common order for the sake of convenience. 2. The Grounds raised by the assessee in ITA 212/Bang/2020 are as under:- 1. The learned C.I.T. (A) has erred in passing the order in the manner which she did. 2. The learned C.I.T. (A) is erred in upholding the addition mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpugned order requires to be cancelled. 6. The learned C.I.T. (A) has failed to appreciate that the A.O. has not assessed the Total Income of the assessee in the assessment, and therefore, since no assessment has been done, the order passed by the learned A.O. must be cancelled and the additions made, be deleted. 7. The learned C.I.T. (A) ought to have appreciated that the appellant had filed the PAN of all the sundry creditors and has proven their identity, and the mere fact that the creditors have not responded cannot be a factor to assess the amount payable to them at the end of the year as unexplained cash credits u/s 68 of the Act. 8. Without prejudice, the disallowance is excessive, arbitrary, unreasonable and ought to be deleted. 9. The learned C.I.T. (A) erred in allowing the interest levied by the A.O. u/s 234B and 234C of the Act. 10. For these and other grounds that may be urged at the time of hearing of the appeal, the Appellant prays that the appeal may be allowed. (b) Additional Grounds 1. The learned A.O. has erred in law by issuing a notice u/ 5.148 to the Appellant. 2. The learned A.O. ought to have appreciated that he had no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... involved is about the addition of ₹ 487,88,586/- made by the AO again while passing fresh order as directed by the tribunal. In para 11 of this tribunal order available on page 48 of the paper book, the tribunal noted that in reassessment proceedings for the same year, the AO seemed to have examined the parties whom the assessee claimed to be sundry creditors and has accepted that except for four of them, all of them are genuine and allowable and in order to avoid multiplicity of proceedings on the very same issue, the tribunal remanded the matter to the AO for a fresh decision with the direction contained in para 12 of that tribunal order. As per the assessment order passed by the AO on 31.02.2015, the AO noted that the assessee was asked to prove genuineness of the sub contractors outstanding credit balances of ₹ 487,88,586/- and in reply, the assessee stated that the genuineness of the sub contractors had been confirmed during the course of second reassessment proceedings vide notice dated 19.03.2012`. After considering this second reassessment order dated 30.03.2013, the AO has given a categorical finding that during the second reassessment proceedings, the genuinen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 88,586/- in this second reassessment order dated 30.03.2013. Since, the impugned order of CIT (A) and the assessment order dated 31.03.2015 passed by the AO u/s 143 (3) r.w.s. 254 are in line with the direction of the tribunal in para 12 of the said tribunal order dated 20.09.2013 in first round as per copy available on pages 44 to 52 of the paper book, we hold that no interference is called for in the order of CIT (A) dated 13.01.2020. 7. In the result, the appeal of the assessee in ITA No. 212/Bang/2020 is dismissed. 8. Now, we take up the second appeal in ITA No. 589/Bang/2020. In this appeal, as per additional ground no. 2 raised by the assessee as reproduced above, this is the grievance of the assessee that the AO did not have jurisdiction to issue notice u/s 148 and he might have issued notice u/s 153C/153A because the material was found in case of search at the place of a third party. 9. In course of hearing, learned AR of the assessee submitted that as per the assessment order dated 30.03.2013, it is noted by the AO that a search action was conducted in the case of Sri Dayanand Pai and group on 12.04.2011 and thereafter on 19.03.2012, notice u/s 148 was issued to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Srinivas Rao Haskote (Supra) and in the case of G. Koteswara Rao vs. DCIT (Supra) after considering the submissions of the learned DR of the revenue that since no valuable article as noted in clause (a) or books of accounts etc. as noted in clause (b) of section 153C (1) were found in search, section 153C cannot be invoked in the present case and as a consequence, the tribunal orders cited by the learned AR of the assessee are not applicable in the present case. We first reproduce the provisions of section 153C for ready reference. It reads as under:- Assessment of income of any other person. 153C. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that,- (a) any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, relates to, a person other than the person referred to in section 153A, then, the books of account or documents or assets, seized or requisitioned shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n but no notice under sub-section (2) of section 143 has been served and limitation of serving the notice under sub-section (2) of section 143 has expired, or (c) assessment or reassessment, if any, has been made, before the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person, such Assessing Officer shall issue the notice and assess or reassess total income of such other person of such assessment year in the manner provided in section 153A. 12. As per these provisions of section 153C (1) as reproduced above, it is seen that this section can be invoked if in course of search, some valuable article as noted in clause (a) of this section as reproduced above or books of accounts etc. as noted in clause (b) of section 153C (1) as reproduced above were found in course of search and the same are belonging or related to a person other than the searched person, the same has to be handed over to the AO of such other person by the AO of the searched person after recording of satisfaction in this regard. Hence, it has to be seen that whether these requirements of section 153C are met ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent case. 13. Learned AR of the assessee also placed reliance on the tribunal order in assessee s own case for A. Y. 2005 06 in ITA Nos. 495 701/Bang/2011 dated 20.09.2013, copy available on pages 44 to 52 of the paper book. This appeal is in respect of the first reassessment order dated 29.12.2009 against which, first appeal was filed by the assessee before CIT (A) and the same was disposed of by CIT (A) on 28.02.2011 against which, cross appeals were filed by the assessee and the revenue before the tribunal and the same were disposed of by the tribunal as per this tribunal order dated 20.09.2013. In these appeals before the tribunal, the issue raised by the assessee before the tribunal was about the addition of ₹ 487,88,586/- confirmed by the CIT (A) and this issue was remanded by the tribunal to AO for a fresh decision as per the direction of the tribunal in para 12 of this tribunal order and accordingly, the AO passed fresh order on dated 31.03.2015 against which, fresh order of CIT (A) is dated 13.01.2020 and the present appeal in ITA No. 589/Bang/2020 is against this tribunal order. As pe para 14 of this tribunal order, an additional ground was also raised by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing an addition of ₹ 20.47.19.154/-. 15. Perusal of assessment order shows that during assessment proceedings u's 148 the partners of the firm were asked to furnish detail of land sold by firm during the last 6 years It was discovered that the appellant did not file return for AY 2006-07 and subsequent years even though the appellant derived taxable income. This fact was admitted by A Ramakrish.na, partner in appellant firm. 16. AO found that appellant debited ₹ 25,35,07.740/- in its P L a/c for FY 2004-05 These were debited under the head development expenses paid to sub contractors Enquiries revealed ₹ 18.95.26.555/- were paid in cash. Notices were issued to the sub contractors. Most of the said sub contractors filed return up to AY 2005-06 and not thereafter. This shows that payments made to these sub contractors was a onetime payment. Further 4 persons appeared before Investigation Wing and admitted that they were just name lenders and had not carried out any sub contract work for the appellant. 17. It may be noted that an addition of an amount of ₹ 4.87 38 586/- was already made in assessment order passed u/s 143(3) rws 147 on 29/12/ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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