TMI Blog2021 (9) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... kla , Member ( J ) And Prashant Maharishi , Member ( A ) For the Appellant : Satpal Gulati , CIT-DR For the Respondents : Rakesh Joshi , CA ORDER Amit Shukla , Member ( J ) 1. The aforesaid appeals have been filed by the Revenue against common order dated 29.09.2014, passed by Ld. CIT (Appeals)-XIII, New Delhi for the quantum of assessment passed u/s. 153A for the Assessment Years 2009-10 and 2010-11. In the grounds of appeal, the Revenue has raised following grounds:- A.Y. 2009-10 1. On the facts and in the circumstances of the case, the CIT(A) has erred in deleting addition of ₹ 73,47,29,400/- made u/s. 68 of the IT Act on account of unexplained share capital and premium. 2. On the facts and in the circumstances of the case and in law, the CIT(A) has erred in holding that on the prevailing facts of the case the onus on the part of the assessee u/s. 68 of the Act stands discharged. 3. The order of the CIT(A) is erroneous and is not tenable on facts and in law. 4. The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of the hearing of the appeal. A.Y. 2010-11 1. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee company and also at different places of the group concern including blank lockers and the person related to the assessee company in the business activities. Accordingly, notices u/s. 153A was issued for six years on 06.05.2013 requiring the assessee to furnish the return of income u/s. 153A. In response the assessee has filed its return of income on 17.07.2013. The ld. Assessing Officer without even referring to any seized document or any incriminating material found during the course of search, has proceeded to make the assessment on the basis of perusal of the audited balance sheet as discussed by him in paragraph 3 of the assessment order. He has noted that on perusal of the audited balance sheet of the assessee as on 31.03.2009, it is seen that the assessee has subscribed share capital which has increased to ₹ 3,58,10,060/- from ₹ 27177120/-. During the year under consideration, the assessee has issued 863294/- equity shares of the value of ₹ 10/- at a premium of ₹ 1790/- per share. Thus, the assessee company has shown receipt of ₹ 154,52,96,260/- as security premium. During the course of assessment proceedings, the assessee company was requeste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 06/05/2013 3 Return filed U/s 139 29/09/2009 23/09/2010 4 Last Date of issue Notice U/s 143(2) 30/09/2010 30/09/2011 8. From the above chart, he submitted that it is clear that notice u/s. 143(2) of the Act could have been served upon the assessee till 30/09/2010 30.09.2011 for A Y 2009-10 2010-11 respectively as per the law prevailing on the said date, but no such notice was given. Since no assessment was made thereafter u/s. 143(3)/144 of the Act within the time allowed for the same, the assessment thus completed u/s. 143(1) and had became final assessment before the date of search. On taking up proceedings u/s. 153A, the assessments for A.Y. 2009-10 A.Y. 2010-11 did not abate as per 2nd proviso to Section 153A. Legally speaking, no addition could be made, which was not based on incriminating material seized during search in the case of a concluded assessment. Thus, from the order itself and from records, it is very clear that on the date of search is 22/11/2011 both the assessment years ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment Years 2009-10 and 2010-11 cannot be treated as abated assessments. Further, it is also an admitted position that the additions which have been made by the Assessing Officer u/s. 68 is neither based on any seized documents or any incriminating material found during the course of search. He has proceeded with the assessment on the basis of facts and material already on record and duly disclosed in the return of income which had attained finality. Ld. counsel has already explained that none of the additions are based on incriminating material/document which has not been rebutted by the ld. CIT-DR also, therefore, these additions needs to be seen whether they can be roped in, e within the scope of section 153A in the light of the judicial principles laid down by the Hon'ble Jurisdictional High Court and Hon'ble Apex Court. Even the ld. CIT(A) has admitted that there was no incriminating material albeit has heavily relied upon the Hon'ble Delhi High Court judgment in the case of Shri Anil Bhatia (supra). 13. In our opinion, Ld. CIT(A) has wrongly interpreted the decision of Hon'ble Delhi High Court in the case of Shri Anil Bhatia (supra). In this case in par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epted in view the decision of jurisdictional High Court. 16. Further, Hon'ble Jurisdictional High Court in the case of Principal Commissioner of Income-tax, Central -2, New Delhi v. Meeta Gutgutia [2017] 395 ITR 526 (Delhi) has held as under: ...the legal position, as will be discussed shortly, is that there can be no addition made for a particular assessment year without there being an incriminating material qua that assessment year which would justify such an addition...the court is unable to accept the submissions of revenue that there was incriminating material other than what has been discussed in the orders of the assessing officer, commissioner (appeals) and the tribunal for the assessment years in question...[paras 38 39] It was also noted by the assessing officer - and this has not been disputed by the assessee - that a sum of ₹ 1.10 crores was offered by the assessee as income in the year of search, although it was repeatedly urged by that the documents seized and furnished by pertained to the assessment years other than the year of search, clearly, no such question was put to it should have been easy for the investigating officer to ask 'pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al to show that there was a failure by the assessee to disclose any franchisee income for those earlier years. The disclosure by the assessee on account of 'undisclosed franchisee commission' was relevant only for the year of search and not for the earlier years. [paras 49 50] Section 153A is indeed an extremely potent power which enables the revenue to re-open at least six years of assessments earlier to the year of search. It is not to be exercised lightly, it is only if during the course of search under section 132 incriminating material justifying the re-opening of the assessments for six previous years is found that the invocation of section 153a qua each of the assessment years would be justified. [paras 56 57] The court is of the view that the tribunal was justified in holding that the invocation of section 153a by the revenue for the assessment years 2000-01 to 2003-04 was without any legal basis as there was no incriminating material qua each of those assessment years. [para 71] 17. Further, Hon'ble Supreme Court in case of CIT Vs. Sinhgad Technical Education Society (397 ITR 344) (SC) wherein exactly similar legal/technical ground was taken for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order, the position that emerges therefrom is discussed in para 10. It was specifically recorded that the counsel for the Department could not point out to the contrary. It is for this reason the High Court has also given its imprimatur to the aforesaid approach of the Tribunal. That apart, learned senior counsel appearing for the respondent, argued that notice in respect of Assessment Years 2000-01 and 2001-02 was even time barred. 19) We, thus, find that the ITAT rightly permitted this additional ground to be raised and correctly dealt with the same ground on merits as well. Order of the High Court affirming this view of the Tribunal is, therefore, without any blemish. Before us, it was argued by the respondent that notice in respect of the Assessment Years 2000-01 and 2001-02 was time barred. However, in view of our aforementioned findings, it is not necessary to enter into this controversy. 18. The sequitur of the judgment which can be culled out is that, seized incriminating material has to pertain to the assessment year in question and have co-relation, document-wise, with the assessment year. 19. Recently, Hon'ble Delhi High Court in case of PCIT Vs. Alli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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