TMI Blog2021 (7) TMI 447X X X X Extracts X X X X X X X X Extracts X X X X ..... y a member of NCDX/NBOT, complete KYC is done and all the documentary evidence in support of identity, PAN No., Address are taken. Details of bank account are also available. Yearly confirmation also taken from the clients since the accounts of the members of such exchange are subject to audit by the exchange also. Second contention of assessee that Ld. AO should have taken the figures of Pay-in and pay-out from NBOT, in entirety, certainly has a merit in it. When the Ld. Assessing Officer was not able to lay hand on the documentary evidence to satisfy himself about the fact that profit and loss earned by various clients are genuine and have been shown in their regular return of income, he resorted to complete the assessment on the basis of the figures of pay-in from NBOT. AO however did not considered the figure of pay-out. This action of the Ld. Assessing Officer was not justified as he cannot pick and choose the figures at his/her pleasure. Once it was decided to make the addition on the basis of gross transactions with NBOT then Ld. Assessing Officer was bound to consider both the figures of pay-in and pay-out. Cumulative amounts for the years under appeal are negative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. 4. Ld. Assessing Officer was not satisfied with the documents filed and also as there was no positive response to the notice issued u/s 133(6) of the Act by most of the clients. Ld. Assessing Officer concluded the assessment making various additions. These additions also included the additions made on account of profits earned by the clients on NBOT pro-account for the following amounts: Assessment Year Addition on account of profit of client in Pro-Account 2005-06 ₹ 3,02,48,520 2006-07 ₹ 4,63,10,950 2007-08 ₹ 6,85,53,750 2008-09 ₹ 4,99,82,340/- 5. Aggrieved assessee preferred an appeal before the Ld. CIT(A) challenging the additions made by the Ld. Assessing Officer and also raised legal ground that since no incriminating material was found during the course of search, no addition was required to be made by the Ld. Assessing Officer. Ld. CIT(A) held in favour of the assessee regarding grounds raised on merits and against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. We will first take up legal ground raised by the assessee in CO. Nos.05 to 08/Ind/2019 10. Ld. Counsel for the assessee reiterated the submission made in the synopsis filed before this Tribunal on 13.08.2919 27.05.2021. It was submitted that since no incriminating material was found during the course of search additions should not have been made in view of the decision of Hon ble Delhi High Court in the case of CIT vs. Kabil Chawla (2016) 380 ITR 573 which was subsequently followed by this Tribunal in the case of DCIT vs. Shri Satish Neema(2020)37 ITJ 308 (Trib. Indore) and in the case of Taj Grih Nirman Society vs. ACIT (2021) 40 ITJ 260 (Trib. Indore). Reliance was also placed on the judgment of Hon ble High Court of Delhi in the case of Pr. CIT vs. Meeta Gutgutia 3935 ITR 526 deciding against the revenue and the SLP against this judgment was dismissed by the Hon ble Supreme Court (2018) 96 Taxmann.com 468 (SC). 11. Per contra the Ld. DR vehemently argued supporting the orders of both lower authorities. 12. We have heard rival contentions and perused the records placed before us and carefully gone through the submissions filed by the assessee. Common legal g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 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 income would be brought to tax . Although Section 153 A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. Insofar as pending assessments are concerned, the jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... since the ratio laid down by the Hon ble Delhi High Court in the case of Kabul Chawla (supra) other decisions relied by the assessee are not applicable for these two assessment years. Thus, grounds raised in Cross Objections for A.Ys. 2005-06 2006-07 are allowed and for A.Ys. 2007-08 2008-09 are dismissed. 18. Now we take up the revenue s appeal for A.Y. 2005-06 to 2008-09 in IT(SS)A Nos. 203 to 206/Ind/2017. 19. As regards for A.Ys.2005-06 206-07 are concerned since we have already quashed the assessment proceedings allowing the legal grounds raised by the assessee in its Cross Objections No.05 06/Ind/2019 dealing on merits of the case will be merely academic in nature. Thus, revenue s appeal for A.Ys. 2005-06 2006- 07 are dismissed infractous being academic in nature. 20. As regards the revenue s appeal for A.Ys. 2007-08 2008-09 Revenue has challenged the finding of Ld. CIT(A) deleting the addition of ₹ 6,85,53,750/- and ₹ 4,99,82,340/- made by Ld. Assessing Officer for A.Ys. 2007-08 2008-09 respectively. 21. Ld. DR vehemently argued supporting the order of Ld. Assessing Officer as well as the written submissions filed on 19.08.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re made available for the Ld. Assessing Officer, we observe that in the impugned order at page 3 there is a list of 15 clients which dealt with the assessee during A.Ys. 2006-07 to 2008-09 who have not replied to the notice issued u/s 133(6) of the Act which thus could not help, the Ld. AO to find the exact position about the disclosure of profit and loss incurred by the clients. Similarly, in another list of 14 clients appearing at page 4 of the impugned order all the notices served were returned back which even included in few clients from Indore. Then again there is a list of 14 clients appearing at pages 5 6 of the impugned order out of which six have submitted that since the matter is a very old so they did not have the necessary documents and information and for the remaining 8 clients they have confirmed the account statement. In all out of 43 clients only 8 have confirmed the transactions and these 8 have also not submitted any documentary evidences to show that the alleged income/loss has been shown in their income tax returns. 25. Under these facts and circumstances so far as first contention of the Ld. Counsel for the assessee is concerned that profit and loss has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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