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TMI Blog2022 (2) TMI 874X X X X Extracts X X X X X X X X Extracts X X X X ..... of search relatable to such assessment year. The said decision also covers all the decisions relied upon by the ld. DR before us. Special Leave Petition (SLP) preferred by the Revenue before the Hon ble Supreme Court against the decision of the Hon ble Delhi High Court in the case of Kabul Chawlahad been dismissed by the Hon ble Apex Court - Though SLP has been granted by the Hon ble Apex Court in some of the cases referred to supra on the impugned issue of existence of incriminating material found during search for framing addition in respect of unabated assessment we find that as on date, the issue is squarely covered in favour of the assessee in Continental warehousing corporation. - Decided in favour of assessee. - ITA No.541/Mum/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s.143(1) of the Act. Subsequently, a search and seizure action was carried out in the case of Indo Count Industries Ltd and other group concerns on 01/02/2018. Consequent to the search, the case of the assessee was also centralized vide order of PCIT-31, Mumbai dated 11/05/2018. Consequently, notice u/s.153A of the Act was issued on 19/02/2019 to the assessee. In response to the said notice, the assessee filed return of income on 12/03/2019 declaring total income of ₹ 9,91,700/-. 4. During the course of search assessment proceedings, the ld. AO observed that assessee had sold 2,00,000 shares of Global Capital Markets Ltd for ₹ 47,32,500/- in May 2011. These shares were purchased by the assessee in November and December 2009 f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade on originally assessed / returned income and no addition of disallowance can be made de hors the incriminating evidences recovered during the course of search. 6.3.34. In this case, since the additions of ₹ 47,32,500/- and ₹ 2,36,625/- were made on the basis of suo moto observations and analysis of facts by the Id. AO, which are not based on any incriminating material found during the course of Search conducted u/s 132 of the Act, the additions are directed to be deleted. The Ground No. 1 is accordingly allowed. 6.3.35. The contentions and submissions of the assessee in the subsequent grounds No. 2 and 3 as to the merit of the additions become only academic in view of the above and the same is, therefore, not adjud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . DR, in view of the fact that the ld. CIT(A) is admittedly having co-terminus powers with that of the ld. AO and also has power to enhancement which is statutorily provided to him. In any case, we find that this issue raised by the assessee for the first time before the ld. CIT(A) was purely a legal issue, which can be raised at any time during the pendency of proceedings, as it goes to the root of the matter. 8. With regard to yet another argument advanced by the ld. DR that the original assessment was framed only u/s.143(1) of the Act and hence, the same would not tantamount to framing of assessment at all. Reliance in this regard was placed by the ld. DR on the decision of the Hon ble Supreme Court in the case of Rajesh Jhaveri Stock ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'ble Apex Court has granted SLP and issued notice against the decision of Hon'ble Delhi HC 9. We find that in some of the years that went up to the Hon ble Bombay High Court in the case of Continental Warehousing Corporation Ltd., assessments were indeed completed only u/s.143(1) of the Act. Moreover, the aspect of the return not getting selected for scrutiny is certainly not in the control of the assessee and it is purely the prerogative of the income tax department whether to select the case for scrutiny or not. Hence, once the requisite time limit for issuance of scrutiny notice u/s.143(2) of the Act had expired, the assessee would be justified in entertaining a honest belief that assessment for the concerned assessment year ..... X X X X Extracts X X X X X X X X Extracts X X X X
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