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TMI Blog2021 (10) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... ut the AO should have invoked the provision of Section 153C of the Act which is mandatory - Decided in favour of assessee. - ITA No 2311/Del/2013 1769/Del/2013 , 4789/Del/2018 , 5112/Del/2018 , 1676/Del/2013 - - - Dated:- 27-9-2021 - SH. ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SH. SANJAY GARG, JUDICIAL MEMBER Assessee by : Shri Piyush Kaushik, Adv. Shri Ajay Bhagwani, FCA Revenue by : Ms. Nidhi Srivastava, CIT-D.R. Dr. Maninder Kaur, Sr.D.R. ORDER PER BENCH : These five appeals of which four appeals filed by the assessee and one appeal filed by the Revenue are directed against the order dated 15.01.2013, 17.12.2012, 07.05.2018, 31.05.2018 17.12.2012 of the Commissioner of Income Tax (Appeals)- XXXIII 30 New Delhi relating to Assessment Years 2006-07 2007-08. 2. Before us, Learned AR submitted that the issues raised in Appeal Nos.2311/Del/2013 1769/Del/2013 of the assessee are identical and the Appeal No.1676/Del/2013 raised by the Revenue for A.Y. 2007-08 are interconnected. He further submitted that the Appeal Nos.4789/Del/2018 5112/Del/2018 are with respect to penalty on the quantum additions. He submitted that all the appeals can be cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... grounds of appeals in ITA No.2311/Del/2013: 1. That on the facts and circumstances of the case and in law the CIT(A) erred in rejecting appellant's contention that assessment order made by Assessing Officer was bad in law and void abinitio on the ground that it ought to have been made u/s 153C of the Income Tax Act, and not, as was done u/s 143(3)/147 of the Income Tax Act. 2. That without prejudice, on the facts and circumstances of the case and in law, the CIT(A) erred in upholding the assumption of jurisdiction u/s 147 by the Assessing Officer and in making the assessment in pursuance thereof, without dealing with appellant's objections on merits. 2.1 That the CIT(A) having given a finding that no seized material obtained from the search of BPTP Group of cases (no search having been made on the appellant) belonged to the appellant, clearly erred in yet upholding the action u/s 147 taken in the hands of the appellant based on such seized material. 3. That on the facts and circumstances of the case and in law the CIT(A) erred in holding to quote, 'that seized documents definitely proves that interest is paid on PDC' despite- i. that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch u/s 132 of the Act was carried out on 15.11.2007 on BPTP Ltd. and other Group Companies but no search was carried out on the assessee. He submitted that the assessment in the case of the assessee has been made u/s 143(3) read with section 147 of the Act. He submitted that a basic objection was taken before the CIT(A) against the assessment framed u/s 143(3) of the Act by utilizing the material seized in the course of search conducted on 15.11.2007 on the BPTP and the Group Companies and some of which belonged to the assessee. It was submitted before the CIT(A) that in such a situation when the material belonging to assessee was found during the course of search of third party, it was mandatory on the part of the AO to make assessment u/s 153C of the Act, as against the assessment made u/s 143(3) r.w.s 147 of the Act. In support of his contention that the addition has been made on the basis of material found during search at third party, Learned AR pointed to Para 2.2.2 of the order wherein the AO makes reference to the various seized documents based of which additions has been made in the hands of the assessee. Learned AR submitted that the utilization of the documents which b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that if the assessment itself is quashed then the appeal of Revenue would also will have to be dismissed. He further submitted that if assessment itself is set aside, the other grounds raised by the assessee would rendered academic and will not require any adjudication. 9. Learned DR on the other hand did not controvert the submissions made by Learned AR but however pointing to the findings of CIT(A) supported the order of CIT(A). 10. We have heard the rival submissions and perused the materials available on record. Assessee before us is challenging the assessment framed by the AO u/s 143(3) r.w.s 147 of the Act. Before us, it is assessee s submissions that a search and seizure action took place in BPTP Group and its Group Companies on 15.11.2007. On the basis of the documents seized during the course of search and post-search enquiries, the addition has been made in the case of the assessee. It is an undisputed fact that the assessee was not covered under the search action u/s 132 of the Act. It is thus the case of the assessee that no addition could be made u/s 143(3) r.w.s 147 of the Act on the basis of the materials seized during the course of search and the proper cours ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lly the documents belonging to the assessee were found from the premises of the third party during the course Of Search. Based on these documents the additions are made in the hands of the assessee. Therefore, the only option available with the assessing officer is to proceed u/s 153C of the act. We find that in para No. 6.3 of the order of the ld. CIT (Appeals) he has dealt with seized materials starting from page No. 8 to page No. 15. Further, the ld. AO after recording all the seized material in the body of the assessment order stated that there are number of other seized documents, which proves that assessee has made payment of interest to the beneficiaries. In para 2.4 of the assessment order also the ld. AO noted that though assessee has denied that there are no incriminating documents seized for payment of interest on post dated cheques, the ld. AO has materially tabulated that there are incriminating documents in the form of post dated cheques based on which the addition is made. Some of these cheques are found during the course of search in case of a third party. Therefore, apparently the assessment is required to be made under the provisions of Section 153C of the act. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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