TMI Blog2021 (7) TMI 676X X X X Extracts X X X X X X X X Extracts X X X X ..... ort of expenses claimed. 2. That the Ld. CIT(A) erred in law and on facts in deleting the addition of ₹ 3,18,84,338 /- made on account of disallowance of purchases without properly appreciating the facts and circumstances of the case where assessee failed to file any evidence in support of expenses claimed. 3. That the Ld. CIT(A) erred in law and on facts in deleting the additions on the basis of decision of Hon ble High Court in the case of CIT Vs Kabul Chawla as the Department s SLP against this order has been duly accepted by the Hon ble Supreme Court of India and the matter is still pending for adjudication. 4. The assessee company has e-filed its original return of income u/ s 139 (1) as under: S. No. Assessment Year Date of filing of the return u/s 139(1) Returned income 1. 2009-10 30.09.2010 ₹ 5,48,74,827 2. 2010-11 28.09.2010 ₹ 4,74,31,037 3. 2011-12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion P. Ltd. [2016] 387 ITR 529 (Guj) 9. On the other hand, the ld. DR though could not controvert the contention that there is no incriminating material found at the time of search, but he submitted that, once notice u/s 153(3) is issued to the assessee then it is incumbent upon the assessee to file the return of income and AO has all the powers to assess and reassess the total income for the year and same cannot be restricted to the seized material. He relied upon the judgment of Hon'ble High Court in the case of CIT vs. Anil Kumar Bhatia. 10. After considering the aforesaid submissions and on perusal of the orders before us, we find that it is an admitted fact that the time for completion of original assessments has ended and the assessment proceedings attained finality at the time of search for these years. It is also undisputed that additions made by the AO is not based on incriminating material found during the course of search, albeit it is based on the assessment record only. 11. In such a situation, additions made are beyond the scope of 153A proceedings. This proposition of law has been well settled and reiterated by the Hon'ble Delhi High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng or brought on the record of the AO. vii. Completed assessments can be interfered with by the AO while making the assessment under Section 153 A 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. 13. The Hon ble High Court has also taken note of the judgment of their earlier judgment in the case of CIT vs. Anil Kumar Bhatia reported in [2013] 352 ITR 493 (Del) and observe that this was not the issue before the Court. Again in the case of Pr. CIT Vs. Meeta Gutgutia's (supra), their Lordships have again reiterated the same principle and have also considered the case of Smt. Dayawanti Gupta reported in 390 ITR 496. 14. The relevant observations made by their Lordships are as under: 56. Section 153 A of the Act is titled Assessment in case of search or requisition . It is connected to Section 132 which deals with search and seizure'. Both these provisions, therefore, have to be read together. Section 153A is indeed an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rthed during the search, whereas in the present case there admittedly was none. Secondly, it is plain from a careful reading of the said two decisions that they do not hold that additions can be validly made to income forming the subject matter of completed assessments prior to the search even if no incriminating material whatsoever was unearthed during the search. 32. Recently by its order dated 6 th July 2015 in ITA No. 369 of 2015 (Pr. Commissioner of Income Tax v. Kurele Paper Mills P. Ltd.), this Court declined to frame a question of law in a case where, in the absence of any incriminating material being found during the search under Section 132 of the Act, the Revenue sought to justify initiation of proceedings under Section I53A of the Act and make an addition under Section 68 of the Act on bogus share capital gain. The order of the CIT (A), affirmed by the ITAT, deleting the addition, was not interfered with. 17. In Kabul Chawla (supra), the Court referred to the decision of the Rajasthan High Court in Jai Steel (India) v. Assn. CIT [2013] 36 taxmann.com 523 /219 Taxman 223. The said part of the decision in Kabul Chawla (supra) in paras 33 and 34 reads as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X
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