TMI Blog2021 (4) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... Del./2018, ITA No.1491/Del./2018, ITA No.1601/Del./2018, ITA No.1492/Del./2018 - - - Dated:- 11-3-2021 - Shri Amit Shukla, Judicial Member And Shri O.P. Kant, Accountant Member For the Assessee : Shri Ashwani Kumar, Adv. For the Department : Shri Satpal Gulati, CIT (DR) ORDER PER O.P. KANT, AM: These Cross Appeals by the Revenue and the assessee are directed against a common order dated 29/12/2017 in the case of the assessee along with other group entities, passed by the Learned CIT(Appeals)-23, New Delhi [in short the Ld. CIT(A) ] for assessment years 2009-10 and 2010-11 respectively. The appeals being connected to same assessee, these were heard together and disposed off by way of this consolidated order for convenience. 2. The grounds raised in the appeal of the Revenue (ITA No. 1600/Del/2018) and appeal of the assessee (ITA No. 1491/Del/2018) for assessment year 2009-10 are reproduced as under: 2.1 Grounds of appeal of the Revenue: 1. The order of learned CIT(A) is not correct in law and on facts. 2. On the facts and circumstances of the case, Ld. CIT(A) has erred in law in by relying upon the order of the Hon ble High Court in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. Commissioner of Income-tax (Appeals)-23, New Delhi is against law and facts on the file in as much as he was not justified to initiate penalty proceedings u/s 271(1 )(c) of the Act for alleged concealment and furnishing of inaccurate particulars of income on the ground that the top management of the Appellant Company was allegedly involved in planned and deliberate activities thereby resulting in alleged under reporting (because of alleged siphoning off) of the profits of the Appellant Company and alleged, non-reflection of true state of affairs in the books of account. 3. Briefly stated facts of the case are that the assessee company was engaged in manufacturing of steel products and filed its regular return of income on 10/11/2010 declaring income of ₹ 258,11,09,012/-. Subsequently, a search and seizure action under section 132 of the Income-tax Act, 1961 (in short the Act ) was carried out at the premises of the assessee on 13/06/2014 along with other group concerns. Consequently, notice under section 153A of the Act was issued on 04/02/2015 and in response thereon, the assessee filed a copy return of income dated 10/11/2010. The scrutiny proceedings under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecause no incriminating material was found during the search qua the additions made during this A.Y. The appellant relied upon various judgments as stated in the written submission. During the hearing the AR mainly relied upon the ratio of Hon bie Delhi High Court in case of Kabul Chawla 61 taxmarin.com 412 (Del-HC). 10.2 In CIT (C)-III vs. Kabul Chawla (Delhi) [2015] 61 taxmann.com 412 (Delhi),234 Taxman 300 the Hon ble jurisdictional High Court of Delhi have held that an assessment has to be made under this section only on the basis of seized material and in absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made, and 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 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, and concluded that since no incriminating material was unearthed during the search, no additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s no appeal before this Court by the Assessee. It is another matter that the ITAT rejected the plea of the Revenue that for the said AY the CIT (A) wrongly deleted five of the additions made by the AO for that AY on such incriminating material. Consequently, this Court has to only examine the justification for invocation of Section 153A by the Revenue for AYs 2000-01 to 2003-04. (emphasis supplied). 10.3.1 In view of the above stated judicial pronouncements, it is held that the AO was not within the jurisdiction bestowed on him by law to make the impugned addition and, therefore, ground no.2 is allowed and the impugned (re-assessment order) under reference is accordingly quashed, the additions confirmed (as above) and enhancement made (as above) would not have operational effect (due to allowing of this ground.) 7.1 The Revenue is aggrieved with the above finding of the Learned CIT(A). As far as grounds no. 2 3 of the appeal of the Revenue is concerned, we have to examine, whether the ratio of the decision in the case of the Kabul Chawla (supra) is applicable on the facts of the assessee in the year under consideration. In the said decision, the Hon ble High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd transport expenses paid to M/s Mewar transport company. There is no reference of any incriminating material found during the course of the search action under section 132 at the premises of the assessee. (iii) The Ld. CIT(A) in para 10.3.2 of the impugned order has also clearly mentioned that source of the information leading to addition was only tax evasion petition and therefore, he directed the Assessing Officer to examine the case for reopening under section 147/148 of the act. 7.3 Thus, the only source of information is the tax evasion petition received during assessment proceeding. The Learned DR also could not rebut the finding of the Ld. CIT(A) that no incriminating material was found during the course of the search under section 132 of the Act and the case is squarely covered by the decision of the Hon ble High Court in the case of Kabul Chawla (supra). 7.4 In view of the above discussion, we uphold the finding of the Ld. CIT(A) on the issue in dispute and the grounds No. 1 and 2 of the appeal of Revenue are accordingly dismissed. 8. The ground No. 3 4 of the appeal of the Revenue being general in nature are dismissed as infructuous. Hence, the appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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