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TMI Blog2022 (8) TMI 1226X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of some incriminating material unearthed during the course of search documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made in the course of original assessment, we are of the considered view that in the instant facts, the Ld. CIT(A) has erred in facts and in law in upholding the additions for assessment years 2005-06 and 2006-07. Since we have set aside the assessment order on the issue of jurisdiction itself, we are not separately discussing the merits of the case. Appeal of assessee allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... 11, Ahmedabad erred in confirming the action of the assessing officer in disallowing the claim of deduction u/s 80IA(4) in respect of following infrastructure projects undertaken by the appellant: Sr. No. of project referred by CIT (Appeals) Name of the project 1 GUDC Water Transmission (Limdi - Dhangadhra) 2 GUDC WS & SS Mandvi Site 3 Bhavnagar-Trapaj Road 4 Limdi 46 to 58 Canal Project 5 SH - 17 STM Road 6 SH - 21 Budheal - Faridabad Road Project 3. The learned Commissioner of Income Tax (Appeals) - 11, Ahmedabad erred in holding that appellant was not a developer of infrastructure facility in respect of projects specified by him and listed in ground No. 2 above. The appellant craves leave to add, amend, alter and withdraw any ground of appeal anytime up to the hearing of this appeal." 3.1 The Department has raised the following grounds of appeal "1) The Ld. CIT(A) has erred in law and/or on facts in treating the assessee as a "Developer" of Infrastructure Project instead of "Work Contractor" and thereby allowing deduction u/s. 80IA(4) in respect of those projects. 2) On facts and circumstances of the case and in law, the Ld. CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... larifies which is always intended to be the meaning of the provisions of section 80IA(4) of the Act. Since, the original assessment was completed prior to insertion of this explanation the then Assessing Officer did not had the benefit or occasion to examine the claim of the assessee in the light of intention and meaning of the provision as clarified by the said Explanation. Subsequently a Search was conducted in the case of the assessee on 24.06.2010 and after examining the documents found at the premises of the assessee during the course of search, it was observed that the assessee was not eligible for deduction under section 80IA(4) as clarified by the said Explanation, It would therefore, be incorrect to say that this was not a finding of the Search. Further, the claim of the assessee was examined during the course of present assessment proceedings and it was found that the findings of the Search that the assessee is not eligible for such deduction, is correct in view of the said -provisions-..of section 80IA(4) of-the Act, It would also be most -relevant to mention that the issue of eligibility of the assessee for deduction under section 80IA(4) in the case of the assessee cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The second proviso does not contain any word or words to the effect that no reassessment shall be made in respect of completed assessments. The courts have unanimous view that the language is clear in this behalf and therefore, literal interpretation should be followed. The Bombay Tribunal (special bench) held that such interpretation does not produce any manifestly absurd or unjust results as Section 153A (I) (b) and the first proviso clearly provide for assessment or reassessment of all six years. 6.1 The ratio of the decisions of the courts makes it abundantly clear that once action u/s 132 was carried or requisition u/s 132A initiated, it becomes mandatory to the AO. to initiate assessment proceedings in 6 A. Ys., preceding to year in which search was carried out or requisition was made. It is not relevant whether any incriminating material was found, in any particular year or in all of the relevant financial years. Therefore, the ground of appeal that the assessments already made cannot be re-opened u/s 153A is not in accordance with the provisions of the Act. After having regard to the rulings of the courts, the provisions of the Act and the facts of the case, this ground o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Before us, the Ld. Counsel for the assessee challenged the validity of the assessment framed under section 153A of the Act in the absence of any incriminating material found during search action undertaken on the assessee, particularly when the assessment years 2005-06 and 2006-07 had attained finality and thus not abated. Before us, the Department has not been able to produce any material/evidence to prove that the assessment under section 153A r.w.s. 143(3) of the Act was framed on the basis of any incriminating material found during the course of search. 8. We have heard the rival contentions and perused the material on record. In the case of PCIT v. Meeta Gutgutia [2018] 96 taxmann.com 468 (SC), Supreme Court held that invocation of section 153A to re-open concluded assessments of assessment years earlier to year of search was not justified in absence of incriminating material found during search qua each such earlier assessment year. In the case of Pr. CIT v. Saumya Constructions 81 Taxman.com 292 (Gujarat), the Gujarat High Court held that under section 153A, an assessment has to be made in relation to search or acquisition, namely, in relation to material disclosed during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st assessee-share trader found certain evidences showing client code modification done by assessee which were not for genuine reasons and, accordingly, made addition on account of such client code modification, since impugned addition was not made by AO based on any incriminating material found during search against assessee and assessment was not pending on date of search, impugned addition was unjustified and same was to be deleted. The Department has not been able to produce any material to suggest / substantiate that the assessment order was passed on the basis of any incriminating material found during the course of search. 8.1 In the instant case, we observe that for assessment year 2005-06, return of income was filed on 31-03-2006 declaring total income of Rs. "Nil" wherein deduction u/s 80-IA of Rs. 8,09,00,367/- has been claimed. The regular assessment for the captioned year was also completed on 28-12- 2007. Subsequently, a search action under section 132 of the Act was carried out at the premises of the assessee company and on 24-06-2010, an assessment order was passed under section 153A r.w.s. 143(3) of the Act, disallowing the deduction claimed under section 80IA(4) o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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