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TMI Blog2016 (7) TMI 448X X X X Extracts X X X X X X X X Extracts X X X X ..... thiness of the share subscribers, at the time of the original 143(3) proceedings. The Ld. CIT (A) has also mentioned that the Assessing Officer in 143(3) proceedings, after considering all the evidences/document, accepted the creditworthiness, identity and genuineness of the transactions and that no additions were made on account of unexplained credit u/s 68 of the Act. In the subsequent assessment order u/s 153A/143(3), the additions have been made without any reference to any incriminating material and therefore following the ratio laid down by the Hon'ble Delhi High Court in CIT Central-III vs Kabul Chawla (2015 (9) TMI 80 - DELHI HIGH COURT ) - Decided in favour of assessee. - ITA No. 3125/Del/2013, C.O. No. 202/Del/2013 - - - Dated:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll P. Ltd. 6. Sankalp Agencies P. Ltd. 7. Aggarwal Tower P. Ltd. 8. Agarwal Entertainment P. Ltd. 9. New Horizon Buildwell P. Ltd. 10. Fun City Developers P. Ltd. 11. Mittaso Projects P. Ltd. 12. Aggarwal Plaza P. Ltd. 4. For the year under consideration i.e. Assessment Year 2004-05, the AO issued notices to 21 entities. 5. Out of 21 entities, 19 entities filed their written confirmations and other related documents etc. However, remaining 2 entities namely Vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 3. The order of the CIT (A) is erroneous and is not tenable on facts and in law. 4. The appellant craves leave to add, alter or amend any/all of the grounds of appeal before or during the course of the hearing of the appeal. 8. In the CO, the assessee has raised the following grounds:- 1. That on the facts and circumstances of the case, the Commissioner of Income Tax (Appeals) has erred both in law and on facts in confirming the proceedings initiated under Section 153A of I.T. Act, which is bad in law in the absence my incriminating material belonging to the assessee being found during the course of search. 2. That on the facts and circumstances of the case, the Commissioner of Income Tax (Appeals) has erred b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s on the date will not stand abated. It was further submitted that no incriminating material was found during the course of search to show that the entries were not genuine. Ld. AR also drew our attention to the decision of the Hon ble High Court of Delhi in CIT Central-III vs. Kabul Chawla in ITA Nos. 707/2014, 709/2014 and 713/2014. 11. Ld. DR on the other hand supported the order of the AO. 12. We have carefully considered the material placed before us and the issue involved. Section 153A of the Act provides that where a search is initiated u/s 132 of the Act, the AO shall assess or reassess the total income of the six assessment years immediately preceding the assessment year relevant to the previous year in which the search is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o to assess income for six assessment years has to be confined to the undisclosed income unearthed during search and cannot include items which were already before the AO during the course of the original assessment proceedings . 13. It will be relevant at this stage to reproduce Para 37 of the judgment of the Hon ble High Court of Delhi in the case of CIT Central III vs. Kabul Chawla (supra) which lays down the entire law with regard to section 153A 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 under: I. Once a search takes place under Section 132 of the Act, notice under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9;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 finding 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 the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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