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TMI Blog2018 (4) TMI 628X X X X Extracts X X X X X X X X Extracts X X X X ..... in the order of the ld. CIT(A). In our considered opinion AO did not have any “good and sufficient” reasons for extending the period of audit “suo motu” to the maximum permissible extent, and was not correct in casually attaching the tag of non-cooperative attitude to the appellant. AO has exercised beyond his power. We can also see from the order of the lower authorities that no incriminating documents were found during the search and whatever document were found in earlier year for completed the assessment u/s.143(3) and 143(1). In our considered opinion, additions made were having no foundation or reference of any seized document al all. So whatever additions have been made by the AO were on the basis of commenced of special auditor - Decided against revenue - I.T. (SS) A. Nos. 143 & 144/AHD/2016, Cross Objection Nos.103 & 104/AHD/2016 - - - Dated:- 4-4-2018 - Shri Mahavir Prasad, Judicial Member And Shri, Manish Borad, Accountant Member Revenue by : Shri Surendera Kumar, CIT-DR Assessee by : Shri K.C. Thakar, A.R. ORDER Per Mahavir Prasad, Judicial Member These are two appeals by the revenue alongwith two cross objections by the assessee against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent fund u/s.36(1)(va) amounting to ₹ 9,394/-. 5. On the facts and in the circumstances of the case and in law, the CIT(A) ought to have upheld the order of the A.O. 3. The relevant facts as culled out from the materials on record are as under:- In the case of Friends Group, search operation u/s.132 of the Act was carried out on 15/06/2011. The assessee's case was also covered in the search action. Thus the assessee is governed by the provisions of Section 153A of the Act. Notice u/s.153A issued on 02/01/2013 and served upon the assessee. The assessee field the return of income in response to notice u/s.153A for A.Y. 2008-09 on 29/06/2013, declaring total income at ₹ 62,23,940/- 4. Notice u/s.143(2) was issued on 19/09/2013 and served upon the assessee, Due to change in incumbent, another notice u/s.143(2) was issued on 03/12/2013. Notice u/s.142(1) alongwith questionnaire was issued on 04/12/2013. In response the notices issued, Shri Manish Vora, A.R. of the assessee attended from time to time and filed details called for. 5. The assessee is a Partnership Firm and engaged in the business of Manufacturing of Salt and Trading of Goods Commodit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der u/s.142(2A) of the Act was passed only to unlawfully extend the limitation brushing aside our factual and legal objections filed in response to the notice proposing the said action. We therefore request you to kindly give due consideration to the factual and legal objections raised against the proposal for passing the order for special audit u/s.142(2A) of the Act, and to kindly drop the assessment proceedings as these having been unlawfully kept inconclusive beyond the period of limitation, are time-barred. We also bring to your kind notice that our appearance and compliance in these proceedings is under protest and we place on record our objection to completion of the assessment proceedings as provided under the provision to S.292BBof the Act. 7. The objection raised by the assessee is devoid of any merit and is not acceptable. This was also raised by the assessee before the Assessing Officer vide its reply 26/03/2014 which was duly considered by him and also by the CIT, Central-II, Ahmedabad while according approval for Special Audit u/s.142(2A) vide his letter NO.CIT(C)-II/Friends Gr./Special Audit/KSAIPL/2013-14/3684/ dated 26.03.2014. While according approval the CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Special Audit . In view of the facts mentioned above the objection of the assessee is not tenable, as the reference was made after complying with the due procedure laid down under the Act for obtaining necessary sanction of the Competent Authority. The contention that only to buy time, the action was taken, cannot be accepted since notice was issued on 26/02/2014, where admittedly, the proceedings were getting time barred on 31/03/2014. There was thus sufficient time to complete the assessment even without the extended time limit. 8. Before the lower authorities, assessee made detailed submissions both on the legality of the additions challenged. Assessee made detailed return submission and drew attention of ld. CIT(A) that AO and special auditor available in the detailed paper book filed by the appellant. The contention of the assessee was that it is evident from these communication that there is neither any complexity in the books of account encountered by the AO, nor was there existing any other prerequisite condition for direction u/s.142 as AO had already issued a show-cause notice dated 03/03/2014 for completing the assessment after the reply by the appellant 26/02/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s. Date of order 1. 2006-07 143(3) 22/12/2008 2. 2007-08 143(1) 30/03/2009 3. 2008-09 143(3) 19/11/2010 10. It was further submitted that during the course of assessment proceedings u/s.153A, for making various additions as tabulated in assessment order, the ld. AO simply relied on the report and comments of the Special Auditor which, in turn, is based on audited books of accounts which were the foundation of returns filed u/s.139 at appropriate time as above, and were already considered by the AO during the assessment proceedings completed as per the table above. It was also argued that patently, the additions made were having no foundation or reference in any seized document at all. On these facts, the ld. AR relied on Cargo Global, 137 ITD 287 (Mum)(SB), Kabul Chawla 61 taxmann.com 412 (Del), Saumya Construction ITA (ss) No.3/Ahd/2014 (Ahd Trib), Desai Construction ITA (ss) A No.12 13/Ahd/2012 (Ahd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r of the lower authorities that no incriminating documents were found during the search and whatever document were found in earlier year for completed the assessment u/s.143(3) and 143(1). In our considered opinion, additions made were having no foundation or reference of any seized document al all. So whatever additions have been made by the AO were on the basis of commenced of special auditor. 14. In our considered opinion, ld. CIT(A) has passed detailed and reasoned order and ld. DR could not point out any ambiguity in the order passed by the ld. CIT(A) and he did not cited any case of law before us on the basis of which we could have taken adverse view against the assessee. 15. In the result, both the appeals filed by the department in ITA Nos. 143 144/Ahd/2016 for Assessment Years 2007-08 2008-09 are dismissed. 16. So far as Cross Objection Nos.103 104/Ahd/2016 for Asst. Years 2007-08 2008-09 are concerned. Both are dismissed as not pressed. 17. In the result, both the department s appeals are dismissed and both the assessee s cross objections are also dismissed as not pressed. This Order pronounced in Open Court on 04/04/2018. - - TaxTMI - TMITax - ..... 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