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TMI Blog2018 (10) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... bul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] that no addition to be made in assessment framed u/s 153A of the Act in absence of any incriminating material, where assessments were not abated. - Decided against revenue. - ITA No.994/Chd/2017 - - - Dated:- 24-9-2018 - Ms. DIVA SINGH, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER For The Appellant : Shri Gulshan Raj, CIT DR For The Respondent : Shri Ashwani Kumar, CA ORDER PER ANNAPURNA GUPTA, A.M.: The present appeal has been filed by the Revenue against the order of Commissioner of Income Tax(Appeals) 3, Gurgaon [hereinafter referred to as CIT(Appeals)], dated 31.03.2017, relating to assessment year 2010-11. 2. The Department is aggrieved by the action of the Ld. CIT(Appeals) in deleting the addition made by the Assessing Officer on account of unsecured loans of ₹ 1 crore, as unexplained credit under section 68 of the Income Tax Act, 1961 (in short the Act ). 3. Briefly stated, search seizure operation, under section 132 of the Act, was carried out at the premises of the assessee on 04.10.2012. In the assessment framed thereafter ,pursuant to the search carried out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly received from the Assessing Officer dated 29.3.2018 as under: Kindly refer to your office letter No. CIT(DR)/ITAT02/2017-18/1609 dated 15.03.2018 on the above cited subject. 2. Brief facts of the case are that pursuant to search 8s seizure operation u/s 132 of the I.T. Act, 1961 carried out on the assessee on 04.10.2012, the assessment was completed u/s 153A(l)(b) r.w.s. 143(3) of the I.T.Act,1961vide assessment order dated 23.03.2015 at an income of ₹ 1,00,00,000/- against nil returned income. 3. Addition of ₹ 1,00,00,000/- was made u/s 68 of the I.T. Act,1961 as it was found that the Steel Strips Group was resorting to systematic re-introduction of unaccounted black money into the regular books of accounts in the form of share capital, share premium and unsecured loan. The group created companies controlled by its employees as directors, the assessee is one of such companies. The assessee received huge share capital, share premium and loans from a third layer of entry Provider Company which did not have the wherewithal and the economic reasons prudence to invest heavy amounts in paper companies. The assessee had received credits in its bank account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eel Strips Group through their trusted aides. 9. Needless to add that as has been mentioned in the assessment order, incriminating documents were found during the course of search on an entry provider Shri S.K. Jain, which indicated that companies managed by him including M/s Apoorva Leasing and Finance was a paper company. 10. In view of the facts stated above, the addition has been made on the basis of incriminating documents found during search. 11. As desired, the revised grounds of appeal are also enclosed herewith. 6. Referring to the same the Ld. DR stated that the only incriminating material found was Balance Sheet of the assessee relating to assessment year 2012-13,i.e the succeeding A.Y, showing loan received from M/s RSM Metals. The case was thereafter heard on 10/04/18.Thereafter the case was fixed for seeking further clarification from the Ld.DR as to how the document stated by the AO in his letter dt.20-03-18, constituted incriminating material in the present case. Further opportunity was given to the Ld. DR to make submissions in this regard when finally on 09-08-18, the Ld. DR categorically stated at Bar that he had gone through the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6] 380 ITR 571 (Delhi) (para 4), (iv) CIT v. Lancy Constructions [2016] 383 ITR 168/237 Taxman taxmann.com 264 (Kar.) (para 4), (v) CIT v. ST. Francies Clay Decor Tiles [2016] 240 Taxman 168/70 taxmann.com 234 (Ker.) (para 5) and (vi) CIT v. Promy Kuriakose [2016] 386 ITR 597 (Ker.) (para 5). 2. CIT Vs Rai Kumar Arora F20141 52 taxmann.com 172 Allahabad)/r20141 367 ITR 517 (Allahabad) (PAGE NO.5 TO 17 OF ANNEXURE) where Hon'ble Allahabad High Court held that Assessing Officer has power to reassess returns of assessee not only for undisclosed income found during search operation but also with regard to material available at time of original assessment 3. CIT Vs Kesarwani Zarda Bhandar Sahson Alld. [ITA No. 270 of 20141 (Allahabad) (PAGE NO.18 TO 23 OF ANNEXURE) where Hon'ble Allahabad High Court held that Assessing Officer has power to reassess returns of assessee not only for undisclosed income found during search operation but also with regard to material available at time of original assessment 4. CIT Vs St. Francis Clay Decor Tiles (385 ITR 624) (Copy Enclosed) (PAGE NO.24 TO 31 OF ANNEXURE) where Hon'ble De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd assessment for the impugned year had not abated. The fact that no incriminating material was found has been admitted at Bar by the Ld. DR before us. The only document pointed out by the Revenue, we find, is a Balance Sheet that too pertaining to the succeeding year and which throws no light absolutely on the facts leading to additions made in the impugned year on account of share application money of ₹ 50 lakhs received from M/s RSM Metals and M/s. Octomac Software Pvt. Ltd. The said document, we find, reflects only some unsecured loans taken by the assessee from the two companies that too in the succeeding year only and not in the impugned year. Therefore it is an admitted fact that no incriminating material was found during search conducted on the assessee. The fact that the assessment for the impugned year has not abated is also an undisputed fact. In view of the same we hold that the Ld. CIT(Appeals) has rightly deleted the additions made following the proposition laid down by Hon ble Delhi high court in case of Kabul Chawla (supra), that no addition to be made in assessment framed u/s 153A of the Act in absence of any incriminating material, where assessments were not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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