TMI Blog2021 (7) TMI 701X X X X Extracts X X X X X X X X Extracts X X X X ..... 00/Lkw/2019, IT(SS) No. 95 & 96/Lkw/2019, IT(SS) No. 92 to 94 /Lkw/2019 - - - Dated:- 27-5-2021 - SHRI A.D JAIN AND SHRI T.S. KAPOOR, JJ. Appellant by Shri P.K. Kapoor, CA Respondent by Smt. Abha Kala Chanda, CIT DR ORDER SHRI T.S. KAPOOR, J. This is a group of fourteen appeals filed by the different assessees belonging to the same group relating to different assessment years against the orders of ld. CIT(A)-IV, Kanpur dated 22.07.2019 and 29.11.2018. The ld. CIT(A) has passed these orders against the orders of assessment passed by Assessing Officer u/s. 153A/153C of the Act. The ld. counsel of the assessees at the time of hearing argued only Ground No.2 in these appeals which for the sake of completeness is reproduced below: 2. Because the learned CIT(A) has erred in law and on facts in upholding the assessment ignoring the settled position of law that provisions of section 153A, in case where proceedings are not pending could not be applied in absence of any incriminating material. 2. The ld. AR at the outset submitted that the assessments in these cases were completed u/s. 153A/153C of the Act in view of a search and seizure on the group on 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Pr. CIT, Central IT, New Delhi vs. Meeta Gutgutia in SLP (Civil) Diary Nos. 18121 of 2018, reported in 257 Taxman 441 (SC). 5. Besides the above case laws reliance was also placed on the judgment dated 16.12.2020 of Lucknow Bench in the case of M/s Sigma Castings Ltd. vs. DCIT in ITA No. 510 to 512/Lkw/2019 wherein the Hon'ble Tribunal had decided a similar issue in favour of the assessee after taking into account the written submissions filed by the Revenue wherein the Revenue had relied on a number of case laws. 6. The ld. CIT (DR) on the other hand submitted that in a number of cases the issue has been decided in favour of the Revenue also and in a few cases against the order of High Courts Special Leave Petition has been admitted by Hon'ble Supreme Court and in this respect heavily placed reliance on the written submissions filed in the case of M/s Sigma Castings Ltd. vs. DCIT (Supra) and also relied on the case laws relied on by the ld. CIT(A). 7. We have heard the rival submissions and have gone through the material placed on record. We find that a search took place on 27.11.2015 and the cases belonging to various assessees of the group were reopened u/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant. However, considering the express provisions of section153A of the Act, undersigned would like to differ with the submission of the appellant, because section 153A of the Act clearly provides the power to AO to assess/reassess the cases of person searched u/s 132(1) of the Act for immediately six preceding years. Section 153A of the Act does not provide existence of incriminating material as essential requirement. In the opinion of the undersigned, the action u/s 132/132A of the Act would automatically trigger the provisions of section 153A of the Act for computation of total income of the appellant. This provision does not restrict the Assessing Officer to take action in those cases where assessment has already been completed. Since, the AO has rightly exercised his powers to assess/reassess the case u/s 153A of the Act. The undersigned find no force in the submission of the appellant and therefore, this ground is dismissed. 9. The above findings of both authorities clearly demonstrate that Assessing Officer had not made the addition on the basis of any incriminating material and rather he has made the addition on the basis of entries in the books of account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties by accepting undisclosed cash from beneficiaries. Name of such beneficiaries, date-wise receipt of cash and issuance of cheques from and to them, is recorded in this diary very vividly. The name of Sri Navin Jain and his family members such as his father Sri Naresh Kiunar Jain, Naresh Kumar Jain HUF, his mother Smt Shrimati Jain and his wife Neetu Jain also figure in this diary. Shri Navin Jain and his aforementioned family members have taken accommodation entries of tax exempt Long Term Capital Gain by the way of prearranged and manipulative trading in the shares Cityon Systems (India) Limited. This sale was stage managed by Sh. Shashwat Agarwal and his brothers as all the shares were purchased by the companies controlled by Sh. Shashwat Agarwal. 5.1 The above observations, noted by the Assessing Officer, clearly demonstrate that a diary identified as BK-2 was impounded during search seizure operation on 28/04/2015 in the case of search on the companies belonging to Shri Shashwat Agarwal wherein the name of Shri Navin Jain and his family members were mentioned. The Assessing Officer nowhere noted that the names of the assessees was also mentioned in such diary. Moreo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sake of completeness, the judgment of Hon'ble Delhi High Court in the case of Meeta Gutgutia is reproduced below: A search and seizure under section 132 urns conducted in the premises of the FNP group which comprised of various companies, partnerships and proprietorship concerns. The statement of an employee PG was recorded on oath under section 133A. The assessee was a director/partner/ shareholder in the group of companies/concerns. She was the proprietor of the concern FNP. On the basis of documents recovered during the search operation, a notice under section 153A was issued to the assessee. Thereafter, a notice and questionnaire under sections 143(2) and 142(1) were also issued. The Assessing Officer passed separate orders in respect of the assessment years 2000-01 to 2003-04. For the assessment year 2004-05, as in the preceding years, the assessee had claimed deduction on account of franchisee commissions paid to various parties. The Assessing Officer held that the addresses of the franchisees were not revealed and that there were discrepancies in the details of the accounts of the franchisees filed by the assessee. Consequently, the franchisee commission paym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the course of search under section 132 incriminating material justifying the reopening of the assessments for six previous years was found that the invocation of section 153 A qua each of the assessment year would be justified. 5.2 The above judgment of Hon'ble Delhi High Court has been upheld by Hon'ble Supreme Court as the SLP filed by Revenue has been dismissed which is reported at 96 Taxmann.com 468. Hon'ble Delhi High Court in above case has distinguished the case law of Dayawanti Gupta vs. CIT 390 ITR 496 (Del) which Learned D. R. had heavily relied. The case law of Hon'ble Allahabad High Court in the case of Raj Kumar Arora 367 ITR 517, though supports the contentions of the Revenue but since Hon'ble Supreme Court has decided the issue in favour of the assessee in the case of Meeta Gutgutia therefore, the judgment of jurisdictional High Court will not help the Revenue. The contention of the Revenue that since the Department has not accepted the decision of Hon'ble Supreme Court in the case of Kabul Chawla and Meeta Gutgutia as SLP in the case of CIT vs. Continental Warehousing Corporation 235 Taxman 568 (SC) has been admitted is also of no help ..... X X X X Extracts X X X X X X X X Extracts X X X X
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