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TMI Blog2019 (12) TMI 199X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the AO is based upon conjectures and surmises and hence, the addition made is not sustainable in the eyes of law. The issue in dispute is now no longer res integra in view of the decision case of Commissioner of Income Tax vs. Kabul Chawla [ 2015 (9) TMI 80 - DELHI HIGH COURT] In the present appeal before us, it is not in dispute that the no incriminating material was found in respect of the assessee during the course of search as is evident from the Assessment Order itself. During the course of hearing before us also, the Department could not negate this factual finding of the Ld. CIT (A) - CIT (A) in deleting the addition in dispute and dismiss the Revenue s appeal - ITA No. 5112/Del/2016 - - - Dated:- 30-9-2019 - Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equired documents evidencing creditworthiness, genuineness and identity of the investors were not furnished and, therefore, the addition to the tune of ₹ 1,11,00,000/- was called for. The assessment was completed at an income of ₹ 1,11,84,740/- after making addition of ₹ 1,11,00,000/- u/s 68 of the Act on account of alleged bogus share capital. 2.2 Aggrieved, the assessee approached the Ld. CIT (A) and challenged the addition on the legal ground that since no incriminating material was unearthed during the course of search, the addition could not have been justifiably made. The Ld. CIT (A), following the judgment of the Hon ble Delhi High Court in the case of CIT vs. Kabul Chawla reported in 280 ITR 573 (D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons. It was noted that in the entire assessment order, the AO has not referred to any seized material or other material for the year under consideration having being found during the course of search in the case of the assessee, leave alone the question of any incriminating material for the year under appeal. Therefore, in our considered opinion, the action of the AO is based upon conjectures and surmises and hence, the addition made is not sustainable in the eyes of law. The issue in dispute is now no longer res integra in view of the decision of the Hon ble Delhi High Court in the case of Commissioner of Income Tax vs. Kabul Chawla reported (2016) 380 ITR 573 (Del.) wherein the Hon ble High Court has held as under :- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material. v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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