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TMI Blog2015 (6) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... ents advanced by the parties on the issue, material available on record and the decisions relied upon in this regard. 5. The facts in brief are that the assessee belongs to Jakson Group of Companies headed by Shri S. K. Gupta and is in the area of assembly of DG Sets. The search operation was conducted on 10.02.2010 in the group. Notice u/s 153A was issued and in response the assessee filed return of Rs. 25,72,304/- and assessment was framed u/s 153A r.w. s.143(3) of the Act. During the course of assessment proceedings the assessee questioned the validity of initiation of proceedings u/s 153A of the Act on the basis that no incriminating material was found during the course of search and the assessment u/s 143(3) was already framed before the date of search. The AO did not agree with the assessee and rejected the objection with this finding that there was no requirement that an assessment made u/s 153A of the Act should based on any material seized in the course of search. The AO also made disallowance of Rs. 12,32,226/- on account of scrap sale for the purposes of deduction u/s 80IB of the Act and disallowance of Rs. 61,412/- u/s 14A of the Act in the assessment framed. 6. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6/2011 (All. H.C.) ix) DCIT vs. Apoorva Extrusion Pvt. Ltd. & ors. ITA Nos. 3308/Del/2010 (A.Y. 2002-03) & ors. Order dated 09.10.2014. 9. Having gone through the orders of the authorities below, we find that the Learned CIT(Appeals) has rejected the contentions of the assessee on the issue of validity of assessment framed under sec. 153A read with sec. 143(3) of the Income-tax Act, 1961 in absence of incriminating material found during the course of search and in the absence of the pendency of the assessment as on the date of search on the basis that for framing assessment under sec. 153A, no such requirement is there and the only requirement is that search has been conducted under sec. 132 of the Act. 10. Having gone through the decisions cited by the learned AR including the decision of Special Bench of the ITAT in the case of AL Cargo Global Logestic Ltd. vs. CIT (supra), we find that the ratio laid down therein, supports the contentions of the assessee on the issue. It reads as under: "58. Thus, question No. 1 before us is answered as under :- (a) In assessments that are abated, the AO retains the original jurisdiction as well as jurisdiction conferred on him u/s 153A f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat there are sufficient indirect hints given by the Hon'ble Delhi High Court in the case of Anil Kumar Bhatia (supra) about not making of any addition in respect of an assessment year for which the assessment is already completed unless some incriminating material is found during the course of search. This can be seen from the following observations of the Hon'ble High Court :- "20. A question may arise as to how this is sought to be achieved where an assessment order had already been passed in respect of all or any of those six assessment years, either under Section 143(1)(a) or Section 143(3) of the Act. If such an order is already in existence, having obviously been passed prior to the initiation of the search/requisition, the Assessing Officer is empowered to reopen those proceedings and reassess the total income, taking note of the undisclosed income, if any, unearthed during the search." 9. The above extracted observations of the Hon'ble High Court, which are though obiter dicta, make the point clear that where an assessment order has already been passed for a year(s) within the relevant six assessment years, then also the A.O is duty bound to reopen those pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obal Logistics Ltd. (supra). The other judgment relied by the Ld. DR in the case of Madugulu Venu (supra) also talks about the need for making fresh assessment in respect of the assessment years for which the assessments are not pending on the date of search but does not set out the scope of such assessment, which is the issue before us." 13. We, thus, find that the decision of the Hon'ble Jurisdictional Delhi High Court in the case of Anil Kr. Bhatia (supra) supports the case of the assessee that in absence of incriminating material found during the course of search an addition u/s 153A of the Act cannot be made in the assessment framed thereunder. The decisions relied upon by the ld. CIT, DR in the cases of Canara Housing Development Company vs. DCIT (supra) of Hon'ble Karnataka High Court and Filatex India P. Ltd. vs. CIT (supra) of Hon'ble Delhi High Court having distinguishable facts are not applicable in the present case. In the case of Filatex India Pvt. 12 Ltd. (supra), the question raised on the applicability of provisions u/s 153A was that "whether the Tribunal erred on facts and in law in not holding that re-computation of book profit, de-hors any material f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ple assessments, once sec. 153A of the Act is applicable. Section 153A(1) postulates one assessment; putting the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which search was conducted or requisition was made. 14. In para no. 3 of the judgment the Hon'ble Delhi High Court while discussing the cited decisions in the cases CIT vs. Chetan Das (2012), 254 CTR (Del) 292 and CIT vs. Anil Kr. Bhatia (2012), 211 Taxman 453 (Del) cited by the ld. AR of the assessee appellant, has noted certain observations made and findings given by the Hon'ble Court therein. Thereafter in para no. 4 of the judgment, the Hon'ble High Court has held as under: "The first question, we notice was not raised by the appellant before the AO, CIT(A) and before the Tribunal. The appellant claims that the contention being legal can be raised at any stage. We have examined sec. 153A of the Act and find that the submission/contention has no merit". 15. When we peruse the facts of the case in the case of Filatax India Ltd. and the question raised therein it comes out that in that case admittedly during the course of search incriminating m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng incriminating is found on account of such search or requisition, then the question of re-assessment of the concluded assessment does not arise, which would require more reiteration and it is only in the context of the abated assessment under second proviso which is required to be assessed. 17. In the case of SSP Aviation Ltd. vs. DCIT (supra) where the validity of assessment framed u/s 153C was challenged it was held that if the AO is satisfied that any money, bullion, Jewellery or other valuable article or thing or books of account or documents seized in the course of the search belongs to a person other than the person who was searched, then such assets or books of accounts or documents shall be handed over by him to the AO having jurisdiction over such other person. Once, that is done, the AO having jurisdiction over such other person shall proceed against him for making an assessment or reassessment of his income in accordance with the provisions of sec. 153A. The petitioner therein was not searched u/s 132 of the Act, however, some documents belonging to it were found during the search carried out in the premises of Puri Group of Companies. 18. We, thus, find that the rat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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