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TMI Blog2010 (1) TMI 653X X X X Extracts X X X X X X X X Extracts X X X X ..... to assessee firm were found during the course of said search, hence, notice u/s 153C read with section 153A was issued in this case on 22.3.2006, whereby the assessee was required to file the return within 30 days from the date of service of such notice. However, no return was filed within 30 days so stipulated. Subsequently, the assessee vide its letter Dated 21.8.2006 submitted that returns filed earlier u/s 139 for various years could be considered as filed incompliance to said notice. The A.O., however, rejected this plea of the assessee and required the assessee to file separate return. Subsequently, notice u/s 142(1) Dated 31sl August, 2007, was issued requiring the assessee to produce the accounts or documents specified in Annexure to this letter before the AO. on 13,9.2007. Notice u/s 143(2) was also issued alongwith such notice issued u/s 142(1). The assessee, however, filed return of income on 15.10.2007 declaring income of Rs. 1,15,840/-. The AO., thereafter, noticing the fact of deliberate action of the assessee not to give an adequate opportunity to the A.O. completed the assessment proceedings on 31.12.2007, by making addition on account of undisclosed sale considera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t there were certain points in connection with the return of income submitted by you for the assessment year 2005-06, on which the A.O. required some further information, the Id. CIT DR admitted that it was an incorrect fact as the assessee had filed return of income only on 15.10.2007. This fact was also corroborated by the Learned counsel for the assessee. The Id. CIT (A), thereafter, contended that in Notice issued u/s 153A read with section 153C time of 30 days had been given to the assessee to file the return of income. However, the assessee did not file the return separately and instead submitted that returns filed u/s 139 originally could be treated as filed in response thereto, hence such letter of the assessee was to be deemed as a return filed u/s 153A read with section 153C, and, therefore, notice u/s 143(2) issued on 31.8.2007 was valid. He farther contended that such notice was also served within 12 months, hence, for this reason also, there existed no infirmity. He farther contended that there were two aspects u/s 142(1) of the Act i.e. the A.O. could require the assessee to file a return of income in case the assessee had not filed the return within the time allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as seized documents to support the order of the A.O. 9. The Learned counsel, on the other hand, submitted that the seized documents were only of planning nature and the interpretation of the same made by the Assessing Officer was a case of suspicion or presumption only. He further referred to pages 64 to 87 of the paper book containing detailed submissions made before the Revenue authorities, wherein the various aspects of the issue involved had been clarified. On a query from the Bench, as to on what basis, the A.O. made addition only @ 25 % to arrive at quantum of undisclosed sale proceeds. The Learned counsel for the assessee submitted that it was purely an ad hoc decision without any material/basis. The Id. Departmental Representative, in the rejoinder, contended that Kachchi cash book was found wherein the transactions of receipt of On money had been recorded by the partners of the firm, hence, the same should have been explained. However, the assessee gave evasive replies. The Id. CIT DR also drew our attention to page 60 to 63 of the paper book to show the contents of the seized papers and the basis adopted by the Assessing Officer for making such addition, The Ld.Au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d notice u/s 153A read with section, 153C on 22.3.2006 and, thereafter, till 31.8.2007 he has not 'bothered to take other measures as provided in the statute to gel the return of income filed. It is further noted that even in the notice issued u/s 142(1), he has required the assessee to produce the accounts or documents and not the return of income. Similarly, in the notice issued u/s 142(1) on 3.10.2007, he has called certain information only. In the background of these facts, this contention of the Revenue, in our opinion, lacks substance because if the assessee has not filed the return, the A.O. is more responsible for not taking a timely action and at this stage, the assessee cannot be solely held responsible for such a situation. Our this view further finds strong support from the decision of Hon'tie Delhi High Court in the case of CIT vs. Divine and Finance Limited & Others, (2008) 298 ITR 268. The Hon'ble Court observed as under ;- "No question of law, far less any substantial question of law arises for our consideration. We may, however, briefly reflect upon a submission made by learned counsel for the respondent to the effect that the assessee hadt by its letter Dated Mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quence of search had to be assessed in accordance with the provisions of sections 158BC/158BD under Chapter XIVB of the Act. The provisions of section 153A serve the same purpose. Rather, if we take note of Explanation 1 to Section 153A, then it becomes apparent that provisions of section 143(2) have to be applied in its fullest scope in respect of assessment or reassessment to be made u/s 153A. Having stated so, we find that in the case of block assessment proceedings under Chapter XIV, the provisions thereof, being similar, in this regard, there was a controversy regarding no requirement of service of notice u/s 143(2) or non-applicability of time limit of service of notice u/s 143(2). However, recently, the Hon'ble Delhi High Court in the case of CIT vs. Pawan Gupta as reported in 318 ITR 322, after considering the decision of the Hon'ble Supreme Court in the case of R.Dalmia as reported in 236 ITR 480/and the decision of the Hon'ble Gauhati High Court in the case of Vandana Gogoi, as reported in 289 ITR 28 has held that service of notice u/s 143(2) was mandatory even in case of block assessment and, non-service of such notice would make the assessment order void. In that case a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly 25 % of the quantum of undisclosed sales consideration arrived by him and no basis for adoption of such rate is evident in the assessment order. We further find that the Ld. CIT(A) has also examined this issue in detail and we are in agreement with such findings of the Ld. CIT(A). For the sake of ready reference, we reproduce the same as under :- "I have considered the submissions of the AR, the assessment order and the copy of seized paper and other documents furnished before the A,0. during assessment proceedings. It is found that the assessee had submitted before the A.O. that the construction appearing in such paper was not made. Copy of approved map was produced before the A.O. and the A.O.. was also informed that he could physically verily the same. The A.O. has disregarded the submissions of the assessee without mentioning any reasons for not accepting the said explanation. It is obvious from the approved map that the shops mentioned in the seized paper are different than the shops mentioned in the approved map. Thus, it cannot be held that the said loose paper could have formed basis of calculating the sale of the assessee. It is further observed that the paper contains ..... X X X X Extracts X X X X X X X X Extracts X X X X
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