TMI Blog2022 (7) TMI 552X X X X Extracts X X X X X X X X Extracts X X X X ..... de through banking channel and as mentioned hereinabove, loan taken from M/s Index Securities and Research Pvt Ltd. have been repaid by the assessee. Interest payment was subject to tax deducted at source. Considering these plethora of evidences, we have no hesitation to conclude that the assessee has conclusively discharged the burden cast upon it by provisions of section 68 - We, accordingly, direct the Assessing Officer to delete the impugned additions from the respective Assessment Years. - Decided in favour of assessee. - ITA No. 1144, 1145, 1146, 1147/DEL/2019 - - - Dated:- 11-7-2022 - Shri N.K. Billaiya, Accountant Member, And Ms. Astha Chandra, Judicial Member For the Assessee : Shri Vinod Kumar Bindal, CA, Ms. Pinky Sharma, ITP For the Department : Ms. Aashna Paul, CIT- DR ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER:- The above captioned four appeals by the assessee are preferred against four separate orders of the CIT(A) - 24, New Delhi dated 30.01.2019 pertaining to assessment years 2013-14 to 2016-17 respectively. 2. The captioned appeals have common issues and the underlying facts in issues are identical. Therefore, we are disposing o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... six years previous to the relevant AY in which the search takes place. The AO has the power to assess and reassess the 'total income' of the. aforementioned six years in separate assessment orders for each of the six years. In other words there will be only one assessment order in respect of each of the six AYs in which both the disclosed and the undisclosed income would be brought to tax . iv. Although Section 153 A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material. v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isition under sections 132 and 132A of the Act, it is evident that the object of the section is to bring to tax the undisclosed income which is found during the course of or pursuant to the search or requisition. However, instead of the earlier regime of block assessment whereby, it was only the undisclosed income of the block period that was assessed, section 153A of the Act seeks to assess the total income for the assessment year, which is clear from the first proviso thereto which provides that the Assessing Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years. The second proviso makes the intention of the Legislature clear as the same provides that assessment or reassessment, if any, relating to the six assessment years referred to in the sub-section pending on the date of initiation of search under section 132 or requisition under section 132A, as the case may be, shall abate. Sub- section (2) of section 153A of the Act provides that if any proceeding or any order of assessment or reassessment made under sub-section (1) is annulled in appeal or any other legal provision, then the assessment or reassessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... termining the total income of the assessee which would include income declared in the returns, if any, furnished by the assessee as well as undisclosed income, if any, unearthed during the search or requisition. In case where a pending reassessment under section 147 of the Act has abated, needless to state that the scope and ambit of the assessment would include any order which the Assessing Officer could have passed under section 147 of the Act as well as under section 153A of the Act. xxx 19. On behalf of the appellant, it has been contended that if any incriminating material is found, notwithstanding that in relation to the year under consideration, no incriminating material is found, it would be permissible to make additions and disallowance in respect of an the six assessment years. In the opinion of this court, the said contention does not merit acceptance, inasmuch as. the assessment in respect of each of the six assessment years is a separate and distinct assessment. Under section 153A of the Act, assessment has to be made in relation to the search or requisition, namely, in relation to material disclosed during the search or requisition. If in relation to an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kabul Chawla (supra). The decision of this Court in Pr. Commissioner of Income Tax v. Kurele Paper Mills P. Ltd. (supra) which was referred to in Kabul Chawla (supra) has been affirmed by the Supreme Court by the dismissal of the Revenue's SLP on 7th December, 2015. The decision in Dayawanti Gupta 64. That brings us to the decision in Dayawanti Gupta (supra). As rightly pointed out by Mr. Kaushik, learned counsel appearing for the Respondent, that there are several distinguishing features in that case which makes its ratio inapplicable to the facts of the present case. In the first place, the Assessees there were engaged in the business of Pan Masala and Gutkha etc. The answers given to questions posed to the Assessee in the course of search and survey proceedings in that case bring out the points of distinction. In the first place, it was stated that the statement recorded was under Section 132(4) and not under Section 133A. It was a statement by the Assessee himself. In response to question no. 7 whether all the purchases made by the family firms, were entered in the regular books of account, the answer was: We and our family firms namely M/s Assam Supari Tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etions in ITA No. 306/2017. 68. In para 23 of the decision in Dayawanti Gupta (supra), it was observed as under: 23. This court is of opinion that the ITAT's findings do not reveal any fundamental error, calling for correction. The inferences drawn in respect of undeclared income were premised on the materials found as well as the statements recorded by the assessees. These additions therefore were not baseless. Given that the assessing authorities in such cases have to draw inferences, because of the nature of the materials - since they could be scanty (as one habitually concealing income or indulging in clandestine operations can hardly be expected to maintain meticulous books or records for long and in all probability be anxious to do away with such evidence at the shortest possibility) the element of guess work is to have some reasonable nexus with the statements recorded and documents seized. In tills case, the differences of opinion between the CIT (A) on the one hand and the AO and ITAT on the other cannot be the sole basis for disagreeing with what is essentially a factual surmise that is logical and plausible. These findings do not call for interference. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 2013-14. 7. Coming to the merits of the case, the entire basis for the impugned additions in the captioned Assessment Years is the loan taken from M/s Index Securities and Research Pvt Ltd. by the assessee. 8. In the judgment of the Hon'ble High Court of Delhi in the case of PCIT, Central -2 Vs. M/s Index Securities and Research Pvt Ltd. ITA No.566/2017 with ITA No. 571/2017 order dated 24.09.2017, the quarrel was in respect of the addition made by the Assessing Officer amounting to Rs. 48.51 crores representing the share application money received from 16 investors for Assessment Year 2008-09, addition of Rs. 55 crores representing share application money received from two investors, Rs. 3.24 crores representing unsecured loan received from one lender. The Assessing Officer had made addition of Rs. 50 crores representing share application money received from one investor for Assessment Year 2010-11. 9. The total addition was more than Rs. 150 crores. Such being the case of the Revenue before the Hon'ble High Court of Delhi, in the appeals under consideration, the Revenue cannot say that M/s Index Securities and Research Pvt Ltd. does not have capacity to lend ..... X X X X Extracts X X X X X X X X Extracts X X X X
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