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TMI Blog2018 (2) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... ve alone the question of any incriminating material for the year under appeal. Therefore, the action of the AO is based upon conjectures and surmises and hence, the additions made is not sustainable in the eyes of law, because this issue in dispute is now no more res-integra, in view of the decision in the case Commissioner of Income Tax vs. Kabul Chawla reported (2015 (9) TMI 80 - DELHI HIGH COURT) - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... 10) read as under:- "1. That ground no. 2 & 3 taken by the revenue are contrary to the facts and circumstances: a) Because the disallowance does not arise from any incriminating material unearthed during the search either by way of undisclosed assets or documentary evidence against the assessee. b) Because the Hon'ble Delhi High Court has clearly laid down the law that additions made in assessment u/s. 153A of the Act should be based on incriminating material found during the course of search. 2. That Ground No. 4 taken by the revenue in connection with the genuineness of execution of contract and the expenses is also contrary to the facts on record: a) Because AO had given irrelevant reasons and grounds despite finding the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s Becon Construction Pvt. Ltd. Relying on the statement of Sh. Pankaj Jain, G.M. (Marketing and Administration) of the K-world group, wherein he admitted that M/s Becon Construction P. Ltd has facilitated PACL India Ltd. by subcontracting work to M/s Quest Infrastructure Pvt. Ltd., the A.O. held that the assessee too (on similar lines) has also acted as a facilitator to M/s PACL India Ltd. Relying on the decision of Hon'ble Punjab & Haryana High Court in CIT vs. Prabhat Kumar, he held that net profit of the assessee is to be adopted at 12% of the receipts instead of3.3% reflected by the assessee and accordingly added a sum of ₹ 70,07,160/- to the income of the assessee by assessing the total income of the assessee at ₹ 85,1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated that with regard to genuineness of execution of contract and the expenses is also contrary to the facts on record because AO had given irrelevant reasons and grounds despite finding the fact that the assessee has not carried out any work in its own therefore, no question of unverifiable expense arise and the addition was made merely on the basis of statement of Sh. Pankaj Jain, GM (Marketing and Administration), whereas the transactions mentioned in the statement are not relevant for the proceedings of the current assessment year; AO has ignored the fact that the assessee had discharged the onus placed on it in respect of identity of contractee, genuineness of the transaction by way of deduction of TDS and payment made through banking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ises and hence, the additions made is not sustainable in the eyes of law, because this issue in dispute is now no more res-integra, in view of the decision of the Hon'ble Delhi High Court passed in the case Commissioner of Income Tax vs. Kabul Chawla reported (2016) 380 ITR 573 (Del.) wherein, the Hon'ble High Court has held 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 ITA Nos. 707, 709 and 713 of 2014 of decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153 A (1) will have to be mandatorily issued to the person searched requiring him to file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 findings 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 income or property discovered in the course of search which were not produced or not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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