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TMI Blog2018 (3) TMI 1178X X X X Extracts X X X X X X X X Extracts X X X X ..... n trading of shares - Decided partly in favour of assessee - ITA Nos.1363 to 1367/PUN/2014 - - - Dated:- 16-3-2018 - MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM For The Assessee : Shri M.K. Kulkarni For The Revenue : Shri Ajay Modi, JCIT ORDER PER SUSHMA CHOWLA, JM: This bunch of five appeals filed by same assessee are against consolidated order of CIT(A), Kolhapur, dated 10.02.2014 relating to assessment years 2004-05 to 2008-09 against respective orders passed under section 153A r.w.s. 143(3) of Income Tax Act 1961 (in short the Act ). 2. This bunch of appeals relating to the same assessee for different assessment years were heard together and are being disposed of by this consolidated order for the sake of convenience. 3. The assessee in ITA No.1363/PUN/2014, relating to assessment year 2004-05 has raised the following grounds of appeal:- 1) On the facts and circumstances of the case and in law and on the careful perusal of the assessment order framed under S.153A r.w.s. 143(2) and the Panchanama prepared at the time of search action under S.132(1) of the Act on 23-9-2009, it transpires that the additions were not made on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specified ? If this condition is not satisfied the search will not be valid and the consequent assessments framed would be bad in law and without jurisdiction? 4.4 Whether on the facts and circumstances of the case and in law and for having recourse to block assessment as provided in Ss. 153A to 153C of the Act the authority, before ordering extreme step of search action u/s 132 was required to be satisfied in consequence of information in his possession about eventuality catalogued in Cl. (b) of sub-section (1) of S. 132, which mandates to record that any person to whom a summons or notice has been issued or might be issued will not, or would not, produce or cause to be produced any books of account or other documents which will be useful for, or relevant to any proceedings under this Act? It is mandatory to specify such position in the reasons recorded and in the event of non-satisfaction of this condition the search action will be invalid and consequent assessments also will become illegal and without jurisdiction? 4.5 Whether on the facts and circumstances of the case and in law and for having recourse to block assessment as provided in Ss. 153A to 153C the authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w the Ld. CIT(A) was not justified in confirming the addition made by the A.O. of ₹ 18,01,889/- invoking the provisions of S. 2(22)(e) of the Act. The addition being illegal and without jurisdiction be deleted. 7) On the facts and circumstances of the case and in law the Ld.CIT(A) was not justified in confirming the addition of ₹ 2,25,000/- made by the A.O. rejecting the claim of depreciation @ 20% on Motor car holding that it was a new claim. The assessee is entitled to claim such depreciation considering the anatomy of the provisions of S.153A to 153C of the Act. The claim be allowed. 8) On the facts and circumstances of the case and in law the Ld.CIT(A) was not justified in confirming the addition of ₹ 13,92,618/- made by the A.O on account of interest payment to Ravi Co. Op. Bank probably invoking S. 43B of the Act. The claim being properly made and allowable the addition be deleted. 9) On the facts and circumstances of the case and in law the appeal is delayed by 4 days due to unavoidable circumstances. The detailed affidavit for condonation of delay will be filed subsequently. It is therefore. Prayed that the delay be condoned and the appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r disallowed the same. 6. The CIT(A) upheld the additions made by Assessing Officer in the respective years on different issues, against which the assessee is in appeal. 7. The learned Authorized Representative for the assessee before us pointed out that the years under appeal are assessment years 2004-05 to 2008-09, for which original return of income was filed in time and thereafter, search proceedings had taken place on 23.09.2009. The years under appeal i.e. assessment years 2004-05 to 2008-09 were the assessment years where the proceedings had not abated and the Assessing Officer thus, pointed out that against non-abated assessment years, no addition could be made in the hands of assessee in the absence of any incriminating material found during the course of search. 8. The learned Departmental Representative for the Revenue on the other hand, pointed out that in case these were non-abated proceedings, then the assessee was also precluded from making any fresh claim in the return of income filed under section 153A of the Act. 9. We have heard the rival contentions and perused the record. The years under appeal are assessment years 2004-05 to 2008-09. The assessee i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn of income filed by the assessee, fresh claim of interest expenditure and depreciation on certain assets was made. The said claim was not allowed by the authorities below. The assessments for assessment years 2005-06 to 2008-09 i.e. appeals listed before us have not abated. In such cases, where the assessment has not abated, then the Hon ble Bombay High Court (supra) has laid down that only undisclosed income and undisclosed assets detected during the course of search could be brought to tax. Applying the said ratio to the facts of the present case, we hold that the assessee is not entitled to claim any deduction on account of fresh claim i.e. on account of interest and depreciation in the respective years. Applying the ratio laid down by the Hon ble Bombay High Court in CIT Vs. (1) Continental Warehousing Corporation (Nhava Sheva) Ltd. (2) All Cargo Global Logistics Ltd. (supra), we hold that in the years under appeal, where the assessment has not abated, then no deduction is to be allowed in respect of fresh claim made in the return of income filed in response to notice under section 153A of the Act. Consequently, the first issue raised by way of ground of appeal No.1 in asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Hon ble Bombay High Court in CIT Vs. Shri Deepak Kumar Agarwal (supra) has upheld the order of Tribunal and has held that the additions made in the absence of any incriminating material in the case of non-abated proceedings are not sustainable and are to be deleted in cases of assessments under section 143(1) or 143(3) of the Act. In view of the ratio laid down by the jurisdictional High Court, we hold that in the case of non-abated assessments for the relevant assessment years, where no incriminating document was found during the course of search, whether the assessment was completed under section 143(1) or 143(3) of the Act, there is no basis for making the routine disallowance as made by the Assessing Officer i.e. the disallowance of interest expenditure on account of interest free advances made by the assessee. Accordingly, we hold so. The issue raised by the assessee in the bunch of appeals is thus, allowed. 14. In the facts of the present case also, admittedly, no incriminating document was found, on the basis of which additions were made. In view thereof and following the ratio laid down by the Hon ble Bombay High Court in CIT Vs. (1) Continental Warehousing Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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