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TMI Blog2018 (3) TMI 1923X X X X Extracts X X X X X X X X Extracts X X X X ..... A No.430 to 433/LKW/2016, C.O. No. 9 to 12/LKW/2017 - - - Dated:- 15-3-2018 - SHRI. T.S. KAPOOR AND SHRI PARTHA SARATHI CHAUDHURY, JJ. Department by: Shri V. K. Bora, D.R. Assessee by: Shri Ashish Jaiswal, Advocate ORDER These appeals preferred by the Revenue and corresponding cross objections by the assessee emanate from separate orders passed by the ld. CIT(A)-II, Kanpur. 2. The crux of the grievance of the Revenue in all the appeals is against deletion of addition made by the Assessing Officer on account of unexplained credit entries. 3. These appeals and cross objections were heard together and since the facts are similar and the grounds are common, they are being disposed of in this consolidated order. As a matter of convenience, we take up the facts as appearing in ITA No.430/LKW/2016. 4. In this case, on perusal of the saving bank account statement of the assessee, it was revealed that there are major cash credit entries in the bank account of the assessee. Vide order sheet entry No.1, dated 29-03-2014, the assessee was specifically required to furnish the details of these entries. But the assessee offered no explanation about the nature and so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uiry made whether cash was for distribution among the voters, the assessee was stopped by the Punjab Police on border of U.P Punjab as cash of ₹ 4 lacs was found and this amount was seized and his statement was recorded by the JCIT(OSD)(Inv) on 13-01-2013. Before the JCIT(OSD)(Inv) assessee made a categorically statement that this money belongs to M/s. Bajaj Steels Industries Ltd. Vide reply to query No. 3 4 he categorically stated that the purpose of being cash in hand and simultaneously he furnished the ITR of M/s. Bajaj Steels Industries Ltd., Copy of Pan Card, Copy of abstract of cash in hand in the hands of company as on 27-12-2011. The cash-inhand on this day was at ₹ 865583.63. The abstract of cash book clearly stated that the payment was made to the director against payment voucher No. 406. The assessee has also furnished copy of voucher as well as copy of ledger account in the books of Bajaj Steels Industries Ltd. All the supporting documents were produced before the above authority. That the assessee has filed his return of income for the A.Y 2011- 12 for relevant year disclosing income of ₹ 2780500/-. It is submitted that requisition u/s 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11 03-10-2007 90,160.00 Salary RIL 12 16-10-2007 21,700.00 13 03-11-2007 1,72,672.00 Salary RIL JAL 14 20-11-2007 90.00 15 11-12-2007 82,512.00 Salary JAL 16 11-12-2007 90,160.00 Salary RIL 17 11-01-2008 82,512.00 Salary JAL 18 11-01-2008 90,160.00 Salary RIL 19 01-02-2008 90,160.00 Salary RIL 20 02-02-2008 82,512.00 Salary JAL 21 27-03-2008 1,72,672.00 Salary RIL JAL 22 31-03-2008 1,72,672.00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving the assessee a reasonable opportunity of being heard. Moreover the entries now stand explained in light of the information received from the bank and also submitted by the appellant. Legal position has been summarized in a recent judgement of Hon'ble Delhi High Court in the case of CIT (CENTRAL)-III v. KABUL CHAWLA in ITA 707/2014 (Del) decided on decided on August 28, 2015 held: Summary of the legal position 37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153 A (1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previous year relevant to the AY in which the search takes place. ii. Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as a fresh exercise. iii. The AO will exercise normal assessment powers in respect of the six years previous to the relev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ul consideration of submissions and records produced before me, I am of the view that A.O. was not justified to treat the credit entries appearing in the bank account as unexplained cash credits on any ground. Since there were no pending assessments at the time of issuance of notice u/s 153A of the act, completed assessments could not be interfered with by the AO while making the assessment under Section 153A without any incriminating material unearthed during the course of search. Assessment cannot be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under these circumstances only on the basis of seized material. Cash found during the search was properly explained in the hands of the company to which the cash belonged and there was no other incriminating documents found during search related to the bank entries, the addition made by the AO are to be deleted, in view of the judgments of Premier Car Sales Ltd. v. Director General of Income-tax, Investigation (North) [2013] 40 taxmann.com 19 (All); and CIT (CENTRAL)-III v. KABUL CHAWLA in ITA 707/2014 (Del). Appellant gets relief on these grounds. 8. We have p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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