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TMI Blog2018 (4) TMI 337X X X X Extracts X X X X X X X X Extracts X X X X ..... e of ₹ 1,47,830/-. Subsequently, a search u/s 132 of the Act was carried out in the group cases of the assessee on 3.2.2009 and assessment was reopened u/s 153C of the Act by invoking the provisions of section 153C of the Act. During the search assessment proceedings, the A.O. found that the assessee had received unsecured loans of ₹ 1,61,900/- from various persons. as follows: 1. A. Narendra ` 17000 2. Ch. Hanumantha Rao ` 15000 3. G. Mani ` 17000 4. K. Ramachandra Rao ` 16000 5. S. Subba Rao ` 17000 6. P. Chandra Sekhar ` 16000 7. P. Gayatrinath ` 15000 8. M. Rama Krishna ` 17000 9. K. Dora Babu ` 16000 10. N. Venkateswara Rao ` 15000 Since the assessee could not furnish any explanation with regard to the source and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AR was asked to substantiate that the payments were reflected in the books or bank account of creditors for which he expressed his inability. The AR was also requested to substantiate the source of creditors either by bank entries or by salary certificate in order to support their claim that these loans were advanced out of their own savings from salary. The AR again expressed his inability to furnish the details. The facts and circumstances of the case have not changed from the assessment proceedings till the appellate proceedings. The fact that remains unchanged is the confirmation letters from creditors. A mere filing of confirmation letters may not absolve the legal responsibility or obligation of appellant in the absence of corroborative evidence with entries in the bank account of appellant and creditors. Such attempt was not made by the appellant even during the remand and appellate proceedings. The confirmation letters and the claim of repayment of Loan remain self serving statements. The rigors of Section 68 are stringent in the case of credits. What the appellant needs to demonstrate is identity, genuineness and creditworthiness of loan creditors. Absence of any one of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l in ITA Nos.300 to 305/Vizag/2012, in case of L. Suryakantham Vs. ACIT, where in the ITAT has considered similar issue and held that the A.O. had no jurisdiction to make additions u/s 153A of the Act, for the assessments which are not pending as on the date of search and also the time limit for issue of notice u/s 143(2) of the Act has been expired. The relevant portion of the order is extracted below: 19. We have heard both the parties, perused the materials available on record and gone through the orders of the authorities below. The factual matrix of the case is that there was a search action u/s 132 of the Act. During the course of search, incriminating documents found reveals that the assessee has inflated labour charges for the assessment years 2008-09 2009- 10. Based on the documents found during search, the assessee has accepted that he has inflated 10% labour charges and which is common in this line of business. Consequent to search action u/s 132 of the Act, the assessee case has been centralized and accordingly fresh assessment proceedings have been initiated by issuing notice u/s 153A/153C of the Act for the six assessment years immediately preceding the assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the relevant facts available on record. It was the contention of the assessee that the A.O. cannot disturb the completed assessments unless there was a seized material. The assessee further contended that where assessments are not pending as on the date of search and time limit for issue of notices u/s 143(2) of the Act has been expired, irrespective of the fact that those assessments have been completed u/s 143(1) or 143(3) of the Act, then the A.O. has no power to reassess the income of those completed assessment years. 21. We find force in the arguments of the assessee for the reason that the issue no longer res integra, as the issue has been already decided by the ITAT, special bench and held that where the assessments are not pending as on the date of search, the A.O. losses jurisdiction u/s 153A of the Act to reassess the income of those completed assessments. Though the provisions of section 153A of the Act does not specify abated and completed assessments, the natural meaning assigned to it should be given to interpret the provisions in such a way that which shall not cause undue hardship to the tax payers. The provisions of sect on 153A of the Act explained the proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has already been assessed, the assessment u/s 153A will be made on the basis of incriminating material, which in the context of relevant provisions means (i) books of account, other documents, found in the course of search but not produced in the course of original assessment, and (ii) undisclosed income or prope ty discovered in the course of search. 24. The assessee relied upon, A.P. High Court decision in the case of CIT Vs. M/s. AMR India Ltd. in TTA No.354 of 2014 dated 12.6.2014. The Hon ble High Court held that the A.O. has no jurisdiction to re-agitate the assessments which were already completed and subsiding. The relevant portion is extracted below: We have heard Sri J.V. Prasad, learned counsel for the appellant, and gone through the impugned judgement and order of the learned Tribunal. It appears that the learned Tribunal found on fact that after completion of assessment proceedings and after reaching finality thereon, the Assessing Officer tried to reagitate the assessments. According to us, the learned Tribunal has rightly held that the Assessing Officer has no jurisdiction to reagitate the assessments which were already completed and subsisting. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice u/s.143(2) of the Act within the time limit laid down in the proviso to Sec.143(2) of the Act, results in an assessment proceedings and where such assessment proceedings are completed prior to the date of search then they do not abate in terms of the Second Proviso to section 153A(1) of the Act. The decision of the ITAT Kolkata Bench rendered in the case of Shri Bishwanath Garodia (supra) on identical facts of the case as that of the Assessee in the present case, clearly supports our conclusions as above. 26. In the light of the discussion above, our conclusion is that in the present case, the issue dealt with by the AO in the assessment order u/s.153A of the Act, could not and ought not to have been examined by the AO in the assessment proceedings u/s.153A of the Act as the said issue stood concluded with the assessee's return of income being accepted prior to the date of search and no notice having been issued u/s.143(2) of the Act within the time limit laid down in that section. Such assessment did not abate on the date of search which took place on 28.3.2008. In respect of assessments completed prior to the date of search that have not abated, the scope of proc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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