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TMI Blog2018 (5) TMI 1322X X X X Extracts X X X X X X X X Extracts X X X X ..... y the judicial authorities. Instead the issue discussed by the AO whether the proceedings U/s. 153A are mandatory or not have been upheld, when there is no dispute with reference to initiation of proceedings. The dispute is only with reference to additions made which assessee contends that they are not based on any incriminating material found in the course of search. This aspect has not been examined by the Ld.CIT(A) at all. Once the legal issue is examined, it is incumbent on the CIT(A) to decide the merits of the addition also. If he finds that this issue was already decided in earlier round of appeals, then, he should follow the same rather than dismissing the grounds raised. For these reasons, we are not in a position to upheld the ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... U/s. 143(3) r.w.s. 153A/153C of the Act. There were certain additions made in the above cases. Assessees preferred appeals before the Ld.CIT(A), who confirmed the additions made by the AO. Aggrieved by the orders, assessees herein preferred appeals before the ITAT. In the course of proceedings before the ITAT, assessee had raised a legal ground that assessment framed in these cases is bad in law. For clarity, the common legal ground raised is re-produced here under: The CIT(A) erred in confirming the additions made by the AO inspite of the fact that they were not made with reference to any seized material found during the course of search and seizure operations . Since this legal ground goes to the root of the matter and as lowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 132 or requisition U/s. 132A is the only condition for invoking the provisions of Sec. 153A. The seizure of incriminating material is not the condition for invoking such provisions. Further, unlike provisions of Chapter XIV-B, wherein the assessment was to be made in respect of the undisclosed income on the basis of material found in the course of search (Sec. 158BA r.w.s. 158BB), section 153A in clear terms provides that in case where search is initiated after 31day of May 2003, the AO shall issue the notice in respect of specified six years and assess/reassess the total income of the assessee and not the undisclosed income. Section 153A empowers the AO to assess the total income which, undoubtedly, would include disclosed as well as und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Delhi) and Pr.CIT Vs. Lata Jain [81 taxmann.com 83] and other Co-ordinate Bench decisions [as extracted by the Ld.CIT(A) in para 5 of the order]. However, Ld.CIT(A) dismissed the contentions stating as under: 6.3. In this context, the Assessing Officer stated that In view of the above discussion, the new legal ground raised before the Tribunal that the assessment was not made with reference to seized material found during the course of search and seizure operations cannot be accepted and the assessment already made holds good since the ITAT, Hyderabad has set aside the legal ground only and the ITAT has not decided the other grounds which has bearing on Income determination . Considering the facts, issues and circumstances in the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g material, the completed assessment can be reiterated and the abated assessment or re-assessment can be made. The word assess in Section 153A is relatable to abated proceedings [i.e., those pending on the date of search] and the word re-assess to completed the proceedings. (iv) Insofar as the pending assessments are concerned, the jurisdiction to make the original assessment and assessment U/s. 153A merges into one. Only one assessment shall be made separately for each assessment year on the basis of findings of the search and any other material existing or brought on record of the AO. (v) Completed assessments can be interfered with by the AO while making assessment U/s. 153A only on the basis of some incriminating material un-e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A) inspite of written submissions made before him and contentions raised, did not consider the above principles laid down by the judicial authorities. Instead the issue discussed by the AO whether the proceedings U/s. 153A are mandatory or not have been upheld, when there is no dispute with reference to initiation of proceedings. The dispute is only with reference to additions made which assessee contends that they are not based on any incriminating material found in the course of search. This aspect has not been examined by the Ld.CIT(A) at all. Moreover, once the legal issue is examined, it is incumbent on the CIT(A) to decide the merits of the addition also. If he finds that this issue was already decided in earlier round of appeals, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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