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TMI Blog2019 (3) TMI 1757X X X X Extracts X X X X X X X X Extracts X X X X ..... also not been controverted by the learned D.R in the course of the proceedings before us. In a case where no assessment proceedings are pending on the date of the search and seizure proceedings, the assessment under section 153A can be carried out only on the basis of seized material. In a case, where no incriminating material is unearthed during the course of search proceedings and the assessment proceedings remain unabated as on the said date, no additions can be validly made in the hands of the assessee. Our aforesaid view is fortified by the judgment of the Hon ble High Court of Delhi in the case of CIT vs. Kabul Chawla [ 2015 (9) TMI 80 - DELHI HIGH COURT] Thus as on the date of the search and seizure proceedings no assessment proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned addition. 2. (a) That having regard to the facts and circumstances of the case, Hon'ble CIT(A) has erred in law and facts in confirming the action of Ld. AO in making addition of ₹ 1,00,000/- as deemed dividend u/s 2(22)(e) of the Act without considering the submissions of the assessee and without observing the principles of natural justice (b) That having regard to the facts and circumstances of the case, Hon'ble CIT(A) has erred in law and on facts in confirming the action of Ld. A.O in making addition u/s 2(22)(e) of the Act without considering the fact that payment is made out of the running account of assessee in the books of M/s Bhagwati lacto Vegetarian Exports Pvt. Ltd. (c) That having regard to the facts and ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... did not tally with the audited 'balance sheets' of the said respective companies. Further, it was observed by the A.O that the assessee was a substantive shareholder in the aforementioned companies. It was noticed by the A.O that the assessee had raised a fresh loan of ₹ 1,00,000/- from M/s Bhagwati Lacto Vegetarian Exports Pvt. Ltd. In the backdrop of the aforesaid facts the A.O called upon the assessee to explain as to why the aforesaid loan of ₹ 1,00,000/- may not be assessed as 'deemed dividend' as per the provisions of Section 2(22)(e) of the I.T Act in her hands. The explanation tendered by the assessee in her attempt to persuade the A.O to conclude that no addition under section 2(22)(e) was called for in her hands, howev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court of Delhi in the case of CIT vs. Kabul Chawla (2016) 380 ITR 573 (Del). Apart therefrom, support was also drawn by him from the order of the ITAT, Delhi in the case of Jackson Ltd., vs. ACIT (ITA No. 6432/Del/2014), dated 27.09.2018. In the backdrop of his aforesaid deliberations, it was submitted by the ld. A.R that the addition of ₹ 1,00,000/- made by the A.O could not be sustained and was liable to be vacated. 6. Per contra, the learned Departmental Representative (for short D.R) relied upon the orders of the lower authorities. It was submitted by the learned D.R that the lower authorities after necessary deliberations had rightly made an addition of ₹ 1,00,000/- in the hands of the assessee. 7. We have heard the autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s been sought for adjudicating as to whether in the case of the assessee where the assessment proceedings had not abated at the time when the search and seizure proceedings were conducted, any addition could validly be made in the absence of any incriminating material found during the course of the search and seizure proceedings. Admittedly, in the case before us no incriminating material was found during the course of the search and seizure proceedings conducted under section 132 of the I.T. Act on 11.02.2016. Apart therefrom, the fact that the assessment proceedings in the case of the assessee were not abated at the time when the search and seizure proceedings were conducted has also not been controverted by the learned D.R in the course ..... X X X X Extracts X X X X X X X X Extracts X X X X
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