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TMI Blog2025 (3) TMI 1265X X X X Extracts X X X X X X X X Extracts X X X X ..... ain exempted u/s 10(38) as undisclosed income. 3. That on the facts and circumstances of the case, both the AO and ld. CIT (A) erred in rejecting the documentary evidences found and seized during the course of search from which it was clearly manifest that the assessee certainly purchased and sale equity shares of scripts Sun Asian. No incriminating documents found during the course of search proceedings. 4. That on the facts and circumstances of the case, both the AO and ld. CIT (A) erred have not brought on record any concrete material on record before holding the LTCG claimed at Rs. 48,92,782/- u/s 10(38) of the Act as bogus and entire addition is based on hypothetical presumption. Thus, the addition so made deserves to be deleted. 5. The appellant craves leave to add or to amend the foregoing ground of appeal, if it becomes necessary to do so in the interest of justice. 3. The brief facts of the case are that the assessee is an Individual who had filed his original return of income under section 139(1) of the Income Tax Act, 1961 on 31.07.2014 for the assessment year 2014-15 declaring total income at Rs. 7,50,190/-. A search under section 132 of the I.T. Act, 1961 was ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT Act, 1961 without appreciating true and correct facts of the case and documentary evidences brought on record by the assessee. 5. Aggrieved from the order of the ld. CIT(A) the assessee has preferred this appeal before us on the grounds as reiterated in para 2 above. In support of the grounds of appeal the ld. AR of the assessee has relied upon the following written submission:- "That search actions were carried out at the residential as well as business premises of assessee and his family on 17.12.2015. (AY 2016-17). The impugned order of assessment dated 28.12.2017 passed by the Assessing Officer is wholly incorrect in law as well as facts and circumstances of the case and without jurisdiction, therefore, the same is liable to be cancelled. The appellant respectfully submits that the observations, findings and/or allegations made by the Assessing Officer in his order of assessment and the inferences and conclusions drawn by him based on these findings are factually incorrect, patently erroneous, based on mere assumptions and presumptions, surmises and conjectures, pure guess, doubts and suspicions, irrelevant extraneous and considerations. The relevant provisions of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relation to any assessment year, no incriminating material is found, no addition or disallowance can be made in relation to that assessment year in the exercise of powers under section 153A of the Act and the earlier assessment shall have to be reiterated. In the present case, no certain incriminating documents or loose papers related to the appellant were found and seized during the course of search. In case of assessment under section153A, the addition or disallowance can only be made from the materials found during the time of search. It is in violation of the principles of natural justice, arbitrary, mechanical and without any independent application of mind and the AO has not discharged the burden of proof, proving that the income determined and sought to be taxed were not from the materials seized during the time of search. Since in the instant case, no incriminating materials were seized during the time of search and therefore, no addition or disallowance can be made in an assessment under section 153A of the Act and, therefore, the impugned assessment order were bad in law. The appellant further submits the reading of provisions of section 153A would reveal that the time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 147/148 and those powers are saved - Held, yes [Paras 8, 12 to 14] [In favour of assessee]" b. CIT v. continental Warehousing Corpn. Ltd. [2015] 58 taxmann.com 78/232 Taxman 270/374 ITR 645 (Bom.) The Hon'ble Bombay High Court in the case of Continental Warehousing Corporation (Nhava Sheva) Ltd. (supra), wherein considering the judgment of the Special Bench of the Mumbai Tribunal in the case of All Cargo Global Logistics 137 ITD 287 (SB) (Mum.), considered this issue that, once assessment has attained finality, then the assessing officer while passing independent assessment order under section 153A/143(3) of the Act could not disturb the assessment order which has attained finality unless the material gathered in the course of search under section 132/153A of the Act established that the finality attained in the assessment were contrary to the facts unearthed during the course of search. c. CIT vs. Kabul Chawla [2015] 61 taxmann.com 412/234 Taxman 300/[2016] 380 ITR 573 (Delhi) Held that no assessment/reassessment proceedings were pending on 30- 03-2-12 when search action took place and hence no assessment was abated. The addition made by the AO is not based on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmission at para 4 submitted as under :- "4. It is noted that CIT (A) has not recorded his specific findings on the ground raised before him regarding the proceedings u/s 153A." He, further, cited the following case laws for consideration : Smt. Asha Rajendra Gupta vs. ACIT In ITA No. 7712/Mum/2019 Aakruti Ketan Mehta vs. ITO dated 31.01.2024 Meenu Ajay Pathak vs. ITO dated 18.07.2023. ITO 24(2)(1), Mumbai, Piramal vs. Kailash Chandra Gupta (HUF) In ITA No. 4013/Mum/2023 dated 26.07.2024. 7. We have heard the rival contentions, perused the material available on record and gone through the orders of the lower authorities and the case laws cited by both the parties. Before us, the ld. A/R for the assessee has contended that the impugned assessment order is nullity, being without jurisdiction, in as much as, even when no incriminating material whatsoever found in course of search which could suggest any undisclosed income so as to initiate proceedings u/s 153A of the Act. Furthermore, it has even been contended that in case of assessment under section153A, the addition or disallowance can only be made from the materials found during the time of search. It is in viola ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal Jodhpur in the case of Pradeep Soni, Pushpa Devi Soni, Leela Devi, Parvati vs. DCIT, CENTRAL CIRCLE-01, JODHPUR {2024 (2) TMI 1162 - ITAT JODHPUR} {ITA Nos. 530/Jodh/2023, 531/Jodh/2023, 532/Jodh/2023 and 533/Jodh/2023} has held that: "Merely the statement cannot be made base to make the addition and the decision of the apex court that in search assessment u/s 153A, AO cannot assess or reassess the total income filed under s. 153A of the Act unless some incriminating material was found during the search. Revenue has not demonstrated the nature of material found in the course of search which led to impugned additions in the absence of any incriminating material. The cost of land incurred and recorded in the books has been duly accepted and reduced from the fair value derived by the valuer in the order passed under section 154 of the Act. The sustained addition is based on the valuation report of the DVO which is also considering the CPWD rates instead of PWD rates. Thus, the addition made towards the alleged difference in cost of construction made in the order of the assessment deserves to be deleted as the addition on cost of construction is based on valuation report whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dditions 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 proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessments can be interfered with by the AO while making the assessment under Section 153 A only on th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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