TMI Blog2022 (8) TMI 1226X X X X Extracts X X X X X X X X Extracts X X X X ..... in the course of search which were not produced or not already disclosed or made in the course of original assessment, we are of the considered view that in the instant facts, the Ld. CIT(A) has erred in facts and in law in upholding the additions for assessment years 2005-06 and 2006-07. Since we have set aside the assessment order on the issue of jurisdiction itself, we are not separately discussing the merits of the case. Appeal of assessee allowed. - ITA Nos. 287 & 288/Rjt/2015 And ITA Nos. 340 & 341/Rjt/2015 - - - Dated:- 26-8-2022 - Shri Waseem Ahmed, Accountant Member And Shri Siddhartha Nautiyal, Judicial Member For the Assessee : Shri D.M. Rindani, A.R. For the Revenue : Shri Aarsi Prasad, CIT-D.R. ORDER PER BENCH:- These are cross appeals filed by the assessee and the Revenue against the orders passed by the Ld. CIT(Appeals) for assessment years 2005-06 and 2006-07 in Appeal Nos. CIT(A)-11/457-R/CC.2/2014-15 and CIT(A)- 11/458-R/CC.2/2014-15 respectively. Since common issues are involved in both the assessment years, the same are being disposed of by way of a common order. Assessment year 2005-06 2. The assessee has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. The learned Commissioner of Income Tax (Appeals) - 11, Ahmedabad erred in upholding the validity of order passed u/s 153A r.w.s. 143(3) of the Act particularly in respect of deductions claimed originally and allowed in original order u/s 143(3) of the Act and not related to any incriminating material found during action u/s 132 of the Act. 2. The learned Commissioner of Income Tax (Appeals) - 11, Ahmedabad erred in confirming the action of the assessing officer in disallowing the claim of deduction u/s 80IA(4) in respect of following infrastructure projects undertaken by the appellant: Sr. No. of project referred by CIT (Appeals) Name of the project 1 GUDC Water Transmission (Limdi - Dhangadhra) 2 GUDC WS SS Mandvi Site 3 Bhavnagar-Trapaj Road 4 Limdi 46 to 58 Canal Project 5 SH - 17 STM Road 6 SH - 21 Budheal - Faridabad Road Project ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving as under: 5.2 Further, the decision of Hon. Special bench has to be seen in the context of the facts of a case. The essence of this decision is that the issues which have reached finality in original assessment should not generally be disturbed in the assessments under section 153A unless and until evidences were found during the course of search demanding necessity for the same. In the case under consideration, original assessment under section 143(3) was completed prior to insertion of the above explanation which has been substituted by the Finance (No.2) Act, 2009, with retrospective effect from 01.04.2000. The said Explanation starts with the phrase 'for removal of doubt..', meaning there by that it only clarifies which is always intended to be the meaning of the provisions of section 80IA(4) of the Act. Since, the original assessment was completed prior to insertion of this explanation the then Assessing Officer did not had the benefit or occasion to examine the claim of the assessee in the light of intention and meaning of the provision as clarified by the said Explanation. Subsequently a Search was conducted in the case of the assessee on 24.06.2010 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were just to make them suitable for his own purpose. The Hon'ble Tribunals and the courts in the cases of Anil kumar Bhatia 211 Taxman 453 (Delhi), Filatex Ltd. (2014) 49 Taxmann.com 465 (Delhi), Sunny Jacob Jewellers Wedding Centre 362 ITR 664(Kerala) and Hotel Mariya (2011)332 ITR 537 (Kerala) are in agreement that according to the provisions of Section 153A, the A.O. is obliged to issue notice u/s 153A in respect of 6 Assessment Years preceding the year in which search has been initiated. Thereafter, he has to assess or reassess the total income of these six years as provided u/s 153A (1)(b).. It was further clarified that only the assessments or re-assessments pending on the date of initiation of the search or requisition shall abate. The second proviso does not contain any word or words to the effect that no reassessment shall be made in respect of completed assessments. The courts have unanimous view that the language is clear in this behalf and therefore, literal interpretation should be followed. The Bombay Tribunal (special bench) held that such interpretation does not produce any manifestly absurd or unjust results as Section 153A (I) (b) and the first proviso clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnot be re-opened u/s 153A is not in accordance with the provisions of the Act. After having regard to the rulings of the courts, the provisions of the Act and the facts of the case, this ground of appeal is rejected. 6.2 A perusal of the contents of the Ld. CIT(Appeals) order seems to suggest that no incriminating material was found during the course of search so as to disallow the claim of the assessee under section 80-IA of the Act. The Ld. CIT(Appeals) in his order has categorically observed that it is not relevant whether any incriminating was found in any particular order and all of the relevant years. Therefore, ground of appeal that the assessments already made cannot be reopened under section 153A is not in accordance with the provisions of the Act . 7. Before us, the Ld. Counsel for the assessee challenged the validity of the assessment framed under section 153A of the Act in the absence of any incriminating material found during search action undertaken on the assessee, particularly when the assessment years 2005-06 and 2006-07 had attained finality and thus not abated. Before us, the Department has not been able to produce any material/evidence to prove t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rial found during search, Assessing Officer, in assessment under section 153A, would not be entitled to interfere with assessee's claim for deduction under section 80-IA, which was part of original assessment proceedings and such assessment had abated. The ITAT Rajkot Bench in the case of a Rajat Minerals v. DCIT 114 Taxman.com 536 (Ranchi-Trib) held that where no incriminating evidence against the assessee was found or seized during course of search, invocation of provisions of section 153A and making additions/disallowances on basis of tax evasion petition found much after search was unjustified. The Delhi High Court in the case of Pr. CIT v. Jaypee Financial Services Ltd 127 Taxman.com 419 (Delhi) , held that where AO during the course of post search proceedings under section 153A against assessee-share trader found certain evidences showing client code modification done by assessee which were not for genuine reasons and, accordingly, made addition on account of such client code modification, since impugned addition was not made by AO based on any incriminating material found during search against assessee and assessment was not pending on date of search, impugned additio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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