TMI Blog2022 (5) TMI 1155X X X X Extracts X X X X X X X X Extracts X X X X ..... rred in not including the aforesaid income of Rs. 6,26,650/- in the return of income filed on 11.10.2012 in pursuant to search conducted by Revenue u/s 132(1). The AO has now included the said income of Rs. 6,26,650/- in the assessed income vide assessment order dated 30.03.2013 passed u/s 153A read with Section 143(3) of the 1961 Act. There is no duplication or double addition perse made by the AO, as the fault lies with the assessee in not including the said accepted income of Rs. 6,26,650/- in the return of income filed on 11.10.2012. Of course, the assessee will be entitled for credit of all taxes paid on regular assessment , if any , pursuant to these accepted additions of Rs. 6,26,650/- made by the AO vide assessment order dated 21.12.2010 passed u/s 143(3), and hence no double jeopardy is been done to the assessee,as is alleged by the assessee. Thus, we hold that contentions of the assessee lacks merit and are hereby dismissed. - Decided in favour of revenue. - ITA No.141/Alld./2017 - - - Dated:- 19-5-2022 - Shri Vijay Pal Rao, Judicial Member And Shri Ramit Kochar, Accountant Member For the Appellant : None For the Respondent : Shri Ramendra Kumar Vishwakarma, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the matter the appellant reserves his right to take any fresh grounds of appeal before hearing of appeal. 3. The appeal was fixed for hearing before the Division Bench on 11th May, 2022, and adjournment application was moved by the assessee counsel on the ground that the Director of the company Shri Ajay Kumar who is looking after tax matter is not keeping well. It is also submitted in the aforesaid adjournment application that the case record is not available with the counsel. These are old appeals, which is pending adjudication before the tribunal for around five years. It is observed that this appeal had come for hearing earlier before the Division Bench on several occasions, but on every occasion the assessee has sought adjournment before the Division Bench on one ground or other. This appeal was earlier fixed for hearing(s) before Division Bench, on 14th October, 2020, 25th November, 2020, 5th January, 2021, 3rd February, 2021, 26th July, 2021, 8th September, 2021, 30th September, 2021, 8th November, 2021, 11th November, 2021, 9th December, 2021, 20th January, 2022 and finally on 11th May, 2021, and on all these occasions, the appeal could not be proceeded because eit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourn the hearing and proceeded to adjudicate this appeal on merits in accordance with law, after hearing ld. CIT-DR and after considering the entire material on record. 4. The brief facts of the case are that in pursuance of warrants of authorization issued by Director of Income Tax (Investigation), Kanpur, under Section 132 of the Income Tax Act, 1961, a search and seizure operations were carried out by Revenue on 3rd February, 2011 , at the residential and business premises belonging to the Vaish group of cases. Along with the search and seizure action conducted by Revenue u/s 132(1) of the 1961 Act, certain business premises of the group were also surveyed under Section 133A of the 1961 Act. The assessee was also searched by Revenue under Section 132(1) , on 3rd February, 2011 , under warrant of authorization dated 18th January, 2011. The assessee is engaged in the business of stone crushing. Statutory notices were issued by the AO under Section 153A , dated 16th February, 2012 and 17th July, 2012 , requiring the assessee to file return of income within 15 days from the date of service of the notice. The assessee filed return of income on 11.10.2012. The AO also issued notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 31,186/- made by the AO to the income of the assessee on account of unexplained cash credit by invoking provisions of Section 68 of the 1961 Act , and hence income assessed by the AO was to the tune of Rs. 78,82,390/-, vide assessment order dated 31.03.2013 passed by the AO u/s 153A read with Section 143(3) of the 1961 Act, as against the returned income of Rs.30,24,550/- 5. The assessee being aggrieved by assessment order dated 30.03.2013 passed by the AO u/s 153A read with Section 143(3), filed first appeal before Ld. CIT(A) and raised as many as 13 grounds of appeal . The ground Nos. 1 to 5 were relating to the validity/legality of the assessments made by the AO, which grounds of appeal stood dismissed by Ld. CIT(A), by holding as under: 7. I have examined the facts and circumstances of the case. I have considered the findings of the AO and the submission of the appellant. The appellant has raised three issues viz., that the action U/s 132 of the Act is not legal, there is malafide in completion of assessment proceeding as the AO is the same person who was also the authorized officer during the course of search and seizure operation. Regarding the first issue I find that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and also any other income which comes to his notice. The relevant observations are- When once the proceedings are initiated under section 153A of the Act, the legal effect is even in case where the assessment order is passed it stands reopened. In the eye of law there is no order of assessment. Re-opened means to deal with or begin with again. It means the Assessing Officer shall assess or reassess the total income of six assessment years. Once the assessment is reopened, the assessing authority can take note of the income disclosed in the earlier return, any undisclosed income found during search or and also any other income which is not disclosed in the earlier return or which is not unearthed during the search, in order to find out what is the total income of each year and then pass the assessment order. Hon ble Allahabad High Court decided a similar matter in the case of CIT Vs. Raj Kumar Arora (2014) 52 taxmann.com 172 (Allahabad) and laid down that Assessing Officer has power to reassess returns of assessee not only for undisclosed income found during search operation but also with regard to material available at time of original assessment. The relevant observat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, have considered the findings of the AO in the assessment order and the submission of the appellant and the case law cited by the appellant. It is noted that the Assessing Officer made disallowance under various heads to the tune of Rs. 6,26,650/- and completed the assessment u/s 143(3), vide order dated 21-12- 2010. The Assessing Officer while framing the assessment u/s 153A of the Act has added an amount of Rs. 6,26,650/- which was earlier added U/s 143(3) of the Act. It is relevant to consider the provision contained in Section 153A which reads as under: (1). Notwithstanding anything contained in Section, 139, Section 147, Section 148, Section 149, Section 151 and Section 153 in the case of a person where a search is initiated under Section 132 or books of account, other documents or any assets are requisitioned under Section 132A after 31st day of May, 2003, the Assessing Officer shall- (a) Issue notice to such person requiring him to furnish within such period, as may be specified in the notice, the return of income in respect of each assessment year falling within six assessment years referred to in clause (b), in the prescribed from and verified in the prescrib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all abate, in this connection, it is clarified that the appeals, review or rectification proceedings pending on the date of initiation of search or requisition shall not abate. This only means that the issued which stand concluded in assessments made earlier shall continue to remain intact subject to aforesaid jurisdictions. The other conclusion may be that in respect of matters abated and discussed in the assessments already made no further action is required in reassessments under S. 153A. 17. In view of the above legal position it is clear that there will be only one assessment order in respect of each of the six assessment year in which both the disclosed income and the undisclosed income would be brought to tax. In other words addition made in the original assessment u/s 143(3) vide order dated 2.12.2010, in the case of assessee for A.Y. 2008-09 shall be merged with the assessment u/s 153A there will be only one assessment order passed by the AO U/s 153A of the Act for A.Y. 2008-09. In view of the aforesaid discussion the action of the AO in adding an amount of Rs. 6,26,650/- which was earlier added U/s 143(3) of the Act is hereby upheld. Ground No. 6 of the appeal i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the group were also surveyed under Section 133A of the 1961 Act. The assessee was also searched by Revenue under Section 132(1) , on 3rd February, 2011 , under warrant of authorization dated 18th January, 2011. The assessee is engaged in the business of stone crushing. Statutory notices were issued by the AO, pursuant to search and seizure operations conducted by Revenue u/s 132(1) of the 1961 Act, on 03.02.2011. The assessee filed return of income u/s 153A , consequent to Search , on 11.10.2012 , declaring total income of Rs. 30,24,550/-. The AO framed assessment u/s 153A read with Section 143(3) of the 1961 Act, vide assessment order dated 30.03.2013, assessing total income of the assessee to the tune of Rs. 78,82,390/- . 9.2 The assessee had originally filed return of income with Revenue u/s 139(1) of the 1961 Act, on 30.09.2008 , declaring total income of Rs. 43,03,860/-. The said return of income was selected for framing scrutiny assessment by Revenue u/s 143(3) read with Section 143(2) of the 1961 Act, and the AO framed scrutiny assessment u/s 143(3) of the 1961 Act , vide assessment order dated 21.12.2010, assessing total income of the assessee to the tune of Rs. 49,30 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earch because the assessment for the year under consideration was not pending on the date of search and had abated. Au contraire, the ld. JM also relied on certain other judgments to fortify the assessee s contention on this count. 7.3. I have heard the both sides in extenso on this issue. Patently, there are two sets of view of the Hon ble High Courts on the scope of assessment u/s 153A of an assessment year which was not pending on the date of search either because of its prior completion or because of no time left for taking it up. The Hon ble Delhi High Court in the case of CIT vs. Kabul Chawla (2016) 380 ITR 573 (Del) has held that : `Completed assessments can be interfered with by the AO while making the assessment under Section 153A 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. Similar view has been reiterated by some other High Courts, including, the Hon ble Bombay High Court in CIT vs. Continental Warehousing Corporation (2015) 374 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the course of search. It is axiomatic as is fortified by Article 227 of the Constitution of India that the law declared by a jurisdictional High Court is binding on all the subordinate Courts and authorities or Tribunal functioning under its superintendence throughout the territories in relation to which it exercises jurisdiction. It is simple and plain that when discordant views are rendered by different High Courts, an inferior authority under one of such High Courts is bound to follow its jurisdictional High Court. Howsoever appealing or convincing the other view may appear, but in the judicial hierarchy, such a view has to make a place for the view of the jurisdictional High Court. It is only for the Hon ble Supreme Court to take a final call on the view of the jurisdictional High Court. Until that is done, the same remains binding on all the authorities under the jurisdiction of the High Court. Any contrary course of action of suo motu disregarding the view of the jurisdictional High Court destroys the fabric of judicial discipline leading to chaos. 7.6. At this occasion, it is pertinent to mention that the undersigned authored the Delhi Tribunal order in Kabul Chawla [ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.50 crore in its Balance Sheet and no addition on the basis of any incriminating material was made by the AO, there was no scope left for making the addition even if the ratio in Rajesh Kumar Arora (supra) was followed. 7.10. The argument of ld. AR is primarily based on the judgment in Jet Airways (supra), in which the Hon ble Bombay High Court held that the AO may assess or re-assess the income u/s 147 of the Act in respect of any issue which comes to his notice subsequently in the course of proceedings though the reasons for such issue were not included in the notice but where the alleged escaped income that formed the basis of reasons for re-assessment ceased to exist, it was not open to independently assess some other income. The Hon ble High Court in that case was interpreting section 147, which provides that: If the Assessing Officer has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of section 148 to 153, assess or re-assess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of proceedings . I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 53A which required the Assessing Officer to assess or reassess the total income. 7.12. It is thus, clear that the only subject matter of addition by the AO u/s 153A of the Act in that case was the transaction of gift, which had originally been declared but the assessee could not prove its genuineness in the proceedings u/s 153A and further no incriminating material was found during the course of search. It was in that backdrop that the Hon ble High Court, deciding the issue in favour of the Revenue, answered the question by holding that the ITAT erred in holding that no addition could be made for gift in the assessment completed u/s 153A because no incriminating material was found during the course of search. It held that `we are of the opinion that in cases where the assessment or reassessment proceedings have already been completed and assessment orders have been passed, which were subsisting when the search was made, the Assessing Officer would be competent to reopen the assessment proceeding already made and determine the total income of the assessee. The Assessing Officer, while exercising the power under Section 153A of the Act, would make assessment and compute the tot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he special leave to file an appeal is granted, then the SLP gets converted into an appeal. On the other hand, the dismissal of a SLP can be either without assigning any reasons or with reasons. If no reasons are adduced by the Hon'ble Supreme Court and the SLP is dismissed, it does not amount to any declaration of law by the Hon'ble Supreme Court in terms of Article 141 of the Constitution having binding force on all Courts within territory of India nor does the judgment impugned before it gets merged with the order dismissing the SLP. This is not a dismissal of the appeal, but of the leave to file appeal. If the SLP is dismissed by means of reasoned order, then it is a declaration of law by the Hon'ble Supreme Court having binding force under Article 141 of Constitution but will still not attract the doctrine of merger. In Kunhayammed Ors. vs. State of Kerala Anr. (2000) 245 ITR 360 (SC), the Forest Tribunal considering the provisions of Kerala Private Forests (Vesting and Assignment) Act, 1971 held that the land of the appellants therein did not vest in the Government. The State of Kerala approached the Hon ble High Court through an appeal which was dismissed. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation stands disposed of. 7.16. It can be easily seen that the Hon'ble Supreme Court has simply dismissed the SLP filed by the Revenue finding no merit in the same. It is not a case of the Hon'ble Supreme Court either considering and deciding the issue on merits in an appeal or giving reasons at the stage of dismissal of SLP. Applying the principles laid down by the Hon'ble Supreme Court in the three cases discussed above, there remains no doubt whatsoever that the dismissal of SLP in Meeta Gutgutia (supra) with the remarks - `We do not find any merit in this petition. The special leave petition is, accordingly, dismissed - are no different from the remarks Special Leave Petition is dismissed on merits or Dismissed on merits , which have been held by the Hon ble Apex Court as dismissal of SLP without reasons, not leading to any declaration of law by the Hon'ble Supreme Court. In the hue of the above discussion, the judgment of the Hon ble Delhi High Court in Meeta Gutgutia (supra) cannot be construed to have either been affirmed by the Hon ble Supreme Court or merged in the order dismissing the SLP against it. This judgment, ergo, ranks pari passu with Ka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Section 153A starts with non obstante clause and states that notwithstanding anything contained in Section 139, Section 147, Section 151 and Section 153 , the AO has to assess or reassess the income of the assessee for all the six assessment year immediately preceding the assessment year relevant to the previous year in which search is conducted. In the instant case, the AO has only reiterated the additions of Rs. 6,26,650/- in assessment order dated 30.03.2013 passed by the AO u/s 153A read with Section 143(3) of the 1961 Act , as this addition of Rs. 6,26,650/ -was made by the AO while framing original assessment passed by the AO vide assessment order dated 21.12.2010 u/s 143(3) of the 1961 Act. The assessee has claimed that it has accepted the addition of Rs. 6,26,650/- made by the AO while framing original assessment order dated 21.12.2010 u/s 143(3) , as no appeal was filed by the assessee before ld. CIT(A) against the assessment order dated 21.12.2010 passed by the AO u/s 143(3). The search was conducted by Revenue u/s 132(1) , on 03.02.2011, which is post assessment order dated 21.12.2010 passed u/s 143(3) by the AO. The assessee has filed return of income on 11.10.2012, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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