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TMI Blog2016 (6) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... s consolidated order. ITA No. 2170/Del/2014 for AY: 2009-10 2. Now we take up the appeal in ITA No. 2170/Del/2014, the grounds of which are reproduced as under: 1. That on the facts andcircumstances of the case and the provisions of law, the Ld Commissioner of Income Tax Appealshas failed to appreciate that the assessment order passed by the Ld AO u/s 144 is illegal, bad in law and wrong on facts. The additions made are unjust, unlawful and arbitrary and are made against the principles of natural justice. 2. That on the facts andcircumstances of the case and the provisions of law, the Ld Commissioner of Income Tax Appealshas failed to appreciate that the notice issued u/s 143(2) was time barred/not served on the appellant and hence illegal and bad in law, therefore, the assessment order passed thereof, is also illegal and bad in law. 3. That on the facts and circumstances of the case and the provisions of law, the Ld CIT Appeals has erred in not admitting the additional evidences i.e. Cash Flow Statement, Ledger, Cash Book, Bank Book, Stock Register, Vouchers/Bills, Details of party wise purchases, purchase return and sales returns, Bank Statements, Confirmations and Affida ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... round of Appeal No. 2(a) That on the facts and circumstances of the case and the provisions of law, the CIT/Assessing Officer was not justified to ignore that assessment u/s. 153C f the Income Tax Act be restricted to assessment in respect of seized documents of incriminating nature for the year under consideration and in absence of any incriminating seized document assessment framed u/s. 153C of the Income Tax Act for the year under consideration, is bad in law and deserves to be quashed. Additional Ground of Appeal No. 2(b) That on the facts and in the circumstances of the cse, learned Commissioner of Income Tax(A) erred in not quashing the impugned assessment framed u/s. 144 of the Income Tax Act, 1961 {notice issued u/s 143(2)} whereas the subject years falls u/s. 153C and no assessment is framed there-under. Additional Ground of Appeal No. 2(c) That the learned Commissioner of Income Tax (Appeals) has failed to appreciated that the facts and circumstances of the case and the provisions of the law the assessment framed is against the statutory case and the provisions of the Act and without complying the procedures prescribed under Income Tax Act i.e. mandatory requireme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e before her. 6. Aggrieved, with the finding of the Ld. Commissioner of Incometax( Appeals), both the assessee and Revenue are in appeal before the Tribunal. 7. At the outset, the Ld. Authorized Representative of the assessee, submitted that additional grounds of appeal taken by the assessee, a purely legal in nature and the omission of the grounds from the appeal was neither willful nor unreasonable and no new facts are required to be admitted for deciding the additional ground, same might be admitted. 7.1 On the other hand learned CIT (DR) opposed the admission of additional ground. 7.2 We have heard the rival submissions on the issue of admissibility of the additional ground. It is settled law that the ground which is purely legal in nature and no new facts for adjudication of that ground are required, can be raised before any appellate authorities for the first time. We find that in the additional ground raised before us, the assessee has challenged jurisdiction under section 144/143(3) of the Act, which being purely legal in nature, we admit the same. 8. The Ld AR of the assessee preferred first to argue the additional ground No. 2(b) and submitted that in the case of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o which the six assessment years are reckoned, as six assessment years immediately preceding the assessment year relevant to the previous year in which search was conducted. Since in the present case, search in the case of the assessees, at whose premises the documents belonging to the assessee have been seized, was conducted on 20/10/2008, the assessment years from 2003-04 to assessment year 2008-09 were only covered under 153C proceedings. 10. We have heard the rival submission and perused the material on record. The Tribunal in the case of Inlay Marketing Private Limited (supra) has decided the same legal issue and held that in case of person other than searched person the six immediately preceding assessment years for reassessment has to be from the assessment years in which satisfaction was recorded or seized document are handed over to the AO of the such other person. The relevant paras (31 & 32) of the aforesaid decision are reproduced as under: "31. In view of above decision and as per letter and spirit of section 153(1) of the Act, we are inclined to hold that since in this case satisfaction was recorded on 5.7.2010 and notice under Section 153C was issued on 6.7.2010, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the date of search for calculating the assessment years for the purpose of reassessment as provided in section 153A(1) of the Act. The relevant para of the judgment are as under: "3. The question raised before the ITAT was with reference to the first proviso to Section 153C (1). The ITAT has relied upon the judgment of this Court in SSP Aviation Ltd. v. Deputy Commissioner of Income Tax (2012) 252 CTR (Del) 291, which in para 14 held that while in the case of the searched person, the date with reference to which the proceedings for assessment or reassessment of any assessment year within the period of the six assessment years shall abate shall be the date of initiation of the search under Section 132 or the requisition under Section 132A, in the case of the other person (like the Assessee in the present case) "such date will be the date of receiving the books of account or documents or assets seized or requisition by the Assessing Officer having jurisdiction over such other person. In the case of the other person, the question of pendency and abatement of the proceedings of assessment or reassessment to the six assessment years will be examined with reference to such date". 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingly the six preceding assessment years from the assessment year relevant to the previous year in which the seized material was handed over to the AO of the assessee would be assessment year 2005-06 to 2010-11. We, accordingly, hold that the relevant assessments which could be reassessed as per section 153C r.w.s. 153A(1) in the case of the assessee would be from AYs 2005-6 to 2010-11, thus the assessment completed under section 144 of the Act for the year under consideration i.e AY 2009-10, is illegal and invalid as same should have been completed under section 153C of the Act. 13. Since we have already held the entire proceedings under section 144 of the Act as illegal, we do not propose to adjudicate other grounds of the assessee. 14. In the result, appeal of the assessee is allowed. ITA No. 3305/Del/2014 of AY : 2009-10 15. Now, we take up the appeal of the Revenue in ITA No. 3305/Del/2014 raising following grounds of appeal: i. That the Commissioner of Income Tax (Appeals) erred in law and on facts of the case in deleting the addition of Rs. 10,17,446/- out of total addition of Rs. 10,61,130/- made by AO by increasing 30% of the income as taken last year without examini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llegal, bad in law and wrong on facts. The additions made are unjust, unlawful and arbitrary and are made against the principles of natural justice. 2. That on the facts and circumstances of the case and the provisions of law, the Ld CIT Appeals has failed to appreciate that the notice issued u/s 143(2) was time barred/not served on the appellant and hence illegal and bad in law, therefore, the assessment order passed thereof, is also illegal and bad in law. 3. That on the facts and circumstances of the case and the provisions of law, the Ld CIT Appeals has erred in not admitting the additional evidences i.e. Cash Flow Statement, Ledger, Cash Book, Bank Book, Stock Register, Vouchers/Bills, Details of party wise purchases and sales returns. Bank Statements, Confirmations and Affidavits etc. filed during the appellate proceedings. 4. That on the facts and circumstances of the case and the provision of law, the Ld CIT Appeal has erred in holding the conclusion that the 'audited books and transactions through bank' notwithstanding, the book results are required to be rejected, since the narrations are artificial, sham and not reflective of the actual business / commercial transa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d document, assessment framed u/s. 153C of the Income Tax Act for the year under consideration, is bad in law and deserves to be quashed. Additional Ground of Appeal No. 2(b) That on the fact sand in the circumstances of the case, learned CIT(A) erred in not quashing the impugned assessment framed u/s. 144 of the Income Tax Act, 1961 {notice issued u/s 143(2)} whereas the subject year falls u/s. 153C and no assessment is famed there-under. Additional Ground of Appeal No. 2(c) That the learned CIT(A) has failed to appreciate that on the facts and circumstances of the case and the provisions of the law the assessment framed is against the statutory provisions of the Act and without complying the procedures prescribed under Income Tax Act i.e. mandatory requirement of recording of satisfaction by the Assessing Officer of the searched person(s) and as such the assessment being bad in law deserves to be quashed. 22. The facts of the case are identical to the case of M/s Satkar Roadlines Private Limited in ITA No. 2170/Del/2014. In this case also on the basis of certain documents belonging to the assessee, seized in the course of search proceeding on 20/10/2008 at the premises of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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