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TMI Blog2016 (3) TMI 1057X X X X Extracts X X X X X X X X Extracts X X X X ..... an investment company. A search u/s.132 of the Act was conducted in the case of Gujarat Ambuja Group on 01.09.2008 and subsequent dates and warrant of authorization u/s.132 of the Act was also issued in the case of company. Subsequently, notice u/s.153A was issued on 25.05.2009 and in response to which assessee filed its return of income for A.Y. 2007-08 on 29.06.2009, declaring total income at Rs. Nil. The case was selected for scrutiny and thereafter assessment was framed u/s.143(3) r.w.s. 153A of the Act vide order dated 21.12.2010 and the total income was determined at ₹ 1,99,02,409/-. Aggrieved by the order of Assessing Officer, Assessee carried the matter before the ld. CIT(A) who vide order dated 03.06.2011 dismissed the appeal of the assessee. Aggrieved by the order of ld. CIT(A), Assessee is now in appeal before us and has raised following grounds: 1. Ld. CIT (A) has erred in law in confirming the action of AO in framing assessment by invoking the provisions of section 153A of the Act that is bad in law. Ld. CIT (A) ought to have quashed the impugned assessment order since no income could have been taxed u/s 153A of the Act. 2. Ld. CIT (A) has erred in la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terconnected. He submitted that ground nos. 1 2 are with respect to framing assessment u/s.153A of the Act and ground nos. 3 to 7 are on the merits of addition. 4.1 Before us, ld. A.R. submitted that during course of search, no incriminating documents were found but Assessing Officer proceeded to make addition u/s.2(22)(e) of the Act. He submitted that it is a settled law that the completed assessments can be interfered by the Assessing Officer while framing assessment orders u/s.153A only on the basis of some incriminating materials unearthed during search and in absence of any incriminating material no assessment can be framed u/s.153A and for the aforesaid proposition, he placed reliance on the decision of Hon ble Delhi High Court in the case of CIT vs. Kabul Chawla (2015) 61 taxmann.com 412 (Del) and the decision of Ahmedabad Tribunal in case of Intas Pharmaceuticals Ltd. vs. DCIT in IT(SS)A Nos. 807-809/Ahd/2010. He also placed on record the copy of the aforesaid decisions. He, therefore, submitted that the assessment framed u/s.153A needs to be quashed. 4.2 With respect to Ground no.3 to 7 on the merits of addition which are with respect to addition u/s.2(22)(e), he s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of search falling on 23.10.2007. The assessee s case has through out been that there is no incriminating material; whatsoever as prescribed u/s.153A so as to give rise to the proceedings in question. In these facts, we notice that the Special bench of the tribunal in All India Cargo Logistics (supra) answered the very reference and held in para 58 that only pending assessments abate in case of a search being conducted and an Assessing Officer retains the original jurisdiction as well as the one conferred on him u/s.153A for which assessments shall be made for each of the six assessment years separately. The Special Bench thereafter comes to non abated i.e. assessments which are not pending as per above said 2nd provision and holds that the assessment therein u/s.153A will be made on the basis of books of account or other documents not produced in the course of original assessment but found in the course of search and undisclosed income or property discovered in the course of search. This is not the Revenue s case; or for that no such material is placed on record that the search in question unearthed any such undisclosed material in assessee s case. We are inferring in these fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eted assessments can be interfered by the Assessing Officer u/s.153A only on the basis of some incriminating material unearthed during course of search which was not produced or was not already disclosed or not made in the course of original assessment. Hon ble Delhi High Court after considering the various decisions cited in the order has concluded as under: 37. On a conspectus of Section 153A(1) of the Act. read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153A(1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previous year relevant to the AY in which the search takes place. ii. Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as a fresh exercise. iii. The AO will exercise normal assessment powers in respect of the six years previous to the relevant AY in which the search takes place. The AO has the power to asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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