TMI Blog2016 (12) TMI 1862X X X X Extracts X X X X X X X X Extracts X X X X ..... ific query from the bench to the learned Departmental Representative, to point out the specific incriminating material on the basis of which the addition has been made, the learned Departmental Representative fairly submitted, in the assessment order there is no reference to any such incriminating material. Thus, prima facie it is established that there is no incriminating material unearthed as a result of search which could reveal undisclosed income of the assessee. In the present case, admitted factual position is, there is no incriminating material found at the time of search and seizure operation which could demonstrate that the money received towards share application and allotment of shares is not genuine. In the aforesaid circumstances, the initiation of proceedings under section 153A, in our view, is not permissible since these issues are subject matter of original assessment proceedings, completed before the date of search. - Decided in favour of assessee. Addition u/s 68 - unexplained cash credit at the hands of the assessee represents share application money received from Preksha Exports Pvt. Ltd. - HELD THAT:- As treated as unexplained cash credit at the hands o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ef facts which are common on all these appeals are the assessee a company is engaged in the business of trading and investment in shares and securities. A search and seizure operation under section 132 of the Act was conducted on 10th November 20016 in the business and residential premises of the companies / directors and related persons dealing with Balaji Group. In the course of search and seizure operation, the Department found that the Flagship company of the Balaji Group is Balaji Yarn Ltd., which is engaged in the business of trading in non ferrous metals and chemicals. It was found that the group had set up steel manufacturing plants in the name and style of Karnataka Strips Pvt. Ltd. and United Galva Pvt. Ltd. at Bellary in Karnataka. According to the Department, while setting up these two companies, other entities of the Balaji Group have invested in share capital of the newly set up companies. It is alleged by the Department that search action revealed that various investment companies of the group had obtained subscription of shares by way of pay orders in the names of various persons of doubtful means after depositing cash in the bank account of such persons. It was obs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and for assessment year 2002 03, return of income has been processed under section 143(1). He submitted, in the course of search and seizure operation, no incriminating material has been found by the Department. He submitted, the assessee, in the return of income filed for these two assessment years, has disclosed all material facts relating to share application money. Taking us through the assessment order, the learned Authorised Representative submitted, the Assessing Officer has not referred to any incriminating material having nexus to the addition made by the Assessing Officer. Therefore, the initiation of proceedings under section 153A, in the absence of any incriminating material against the assessee is without jurisdiction. He submitted, on this preliminary ground, the assessment orders passed for the assessment year 2001 02 and 2002 03 have to be quashed. In support of such contention, the learned Authorised Representative relied upon the following decisions: i) CIT v/s Continental Warehousing Corp. (Nhava Sheva) Ltd., 374 ITR 645; ii) CIT v/s Murli Agro Products Ltd., ITA no.36 of 2009 (Bom.); iii) CIT v/s Kabul Chawla, ITA no.707 of 2014 (Del.); iv) Jai Stee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Departmental Representative fairly submitted, in the assessment order there is no reference to any such incriminating material. Thus, prima facie it is established that there is no incriminating material unearthed as a result of search which could reveal undisclosed income of the assessee. It is evident, in the proceedings initiated under section 153A, the Assessing Officer was only re examining the genuineness of the share application money. In our view, this is not the intent and purpose of section 153A. The ITAT, Mumbai Special Bench, in case of All Cargo Global Logistics Ltd. v/s DCIT, [2012] 18 ITR 106 (Trib.), while examining the power of the Assessing Officer under section 153A of the Act has held, in case of assessments pending on the date of searh the Assessing Officer retains the power to make original assessment and assessment under section 153A. In other words, he can assess both income which could have been assessed in the original assessment as well as income unearthed as a result of search and seizure operation and any other material brought on record. However, in case of a non abated assessment, the assessment under section 153A, has to be made on the basis of boo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unexplained cash credit under section 68 of the Act. Though, the assessee challenged the addition before the learned Commissioner (Appeals), however, the learned Commissioner (Appeals) also confirmed the addition. 13. Learned Authorised Representative submitted, the share application money of ₹ 14,25,000 was received from Preksha Exports Pvt. Ltd. and the concerned party has disclosed the amount not only in its books of account but has also reflected in its return of income. He submitted, a confirmation from the concerned party was also submitted before the Assessing Officer. He submitted, the same Assessing Officer had also completed the assessment in case of share applicant under section 143(3) r/w section 153A of the Act. He, therefore, submitted, there is no reason to consider the share application money as non genuine and treat it as unexplained cash credit at the hands of the assessee. Learned Departmental Representative relied upon the reasoning of the Assessing Officer and the learned Commissioner (Appeals). 14. We have considered the submissions of the parties and perused the material available on record. As could be seen, the amount of Rs. 14.25 lakh was t ..... 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