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TMI Blog2016 (8) TMI 764X X X X Extracts X X X X X X X X Extracts X X X X ..... ls) [hereinafter called CIT(A)] for assessment years 20078-08 2008-09 against the assessment order dt 28-3- 2013 passed by the AO u/s 143(3) r.w.s. 153C of the Act. The issue involved in these appeals is identical, therefore, these appeals were heard together and are disposed of by this common order. 3. The solitary ground raised in this appeal is with regard to disallowance u/s 14A. The main argument of the Ld. Counsel is that in this case, the impugned assessments have been framed u/s 153C, as a result of search operation u/s 132 carried out on Patel Engg group of companies on 11-04- 2007. It was submitted that in this case original returns were filed u/s 139(1) which were accepted by the revenue and attained finality before receipt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he absence of requisite jurisdiction. The impugned assessment has been made by invoking Section 153C of the Act, which prescribes that the assessment is to be made in the manner provided in Section 153A of the Act. In order to appreciate the controversy, it is pertinent to observe that Section 153A of the Act postulates the assessment in cases of search or requisition under section 132 or under section 132A of the Act respectively. The said section envisages that the Assessing Officer shall assess or reassess the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search was conducted. The second proviso to section 153A(1) of the Act also prescribes that assessment or re-as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d during the course of search. As per Hon'ble High Court, no addition could be made in respect of the assessment that had become final in the event no incriminating material was found during the course of search. The Hon'ble High Court also noticed its earlier judgment in the case of Murali Agro-products Ltd. (supra) and elaborately culled out the scope and ambit of the assessment and reassessment of total income under section 153A(1) of the Act read with the proviso thereof, and ruled that an unabated assessment under section 153A(1) would not encompass an addition, if no incriminating material is found during the course of search, because in such a case, the original assessment had become final. This proposition has been canvassed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which both the disclosed and the undisclosed income would be brought to tax . iv. Although Section 153A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post- search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material. v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153A is relat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial and is dehors any incriminating material found in the course of search. The entire discussion on this point in paras-6 7 of the assessment order does not refer to any material found during the course of search, leave alone any incriminating material. Therefore, in this factual background. I do not find any justification for the Assessing Officer to make the ii*.ned addition in an assessment finalized under section 153A of the Act in the absence of any incriminating material having been found during the course of search, qua the impugned disallowance u/s. 14A of the Act. 9.3 In conclusion, I, therefore, hold that following the ratio of the judgment of the Hon'ble Bombay High Court in the case of Continental Warehousing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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