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TMI Blog2022 (9) TMI 302X X X X Extracts X X X X X X X X Extracts X X X X ..... mpleted should not be disturbed in the search assessments without existence of any incriminating material relatable to such assessment year. We direct the AO to re-compute the total income of the assessee by accepting the income declared in the return filed in response to notice u/s.153C of the Act without making any additions or disallowance thereon, both under ormal provisions of the Act as well as in the computation of book profits u/s 115JB - We categorically hold that no additions / disallowance could be made in the search assessment u/s.153C - Appeal of assessee allowed. - ITA No.1017/Mum/2018 And ITA No.1552/Mum/2018 - - - Dated:- 5-9-2022 - Shri M.Balaganesh, Accountant Member And Shri Rahul Chaudhary, Judicial Member For the Assessee : Shri Yogesh Thar For the Revenue : Shri Amol Kirtane ORDER PER M. BALAGANESH (A.M): These cross appeals in ITA Nos.1017/Mum/2018 1552/Mum/2018 for A.Y.2008-09 arises out of the order by the ld. Commissioner of Income Tax (Appeals)-47, Mumbai in appeal No.CIT(A)-47/10109/16-17 dated 26/12/2017 (ld. CIT(A) in short) against the order of assessment passed u/s.153C r.w.s. 143(3) of the Income Tax Act, 1961 (he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly verified in course of assessment proceeding u/s 143(3) of the Act. 5. That on the facts and in the circumstances of the case and in law, and without prejudice to Ground No. 4, the CIT(A) erred in not considering the appellant's Ground No. 6 (before the CIT(A)) which was against the action of the AO in valuing the closing stock of sub-grade Iron Ore after including Royalty. 5.1 That the CIT(A) failed to appreciate that Royalty cannot be included in the valuation of closing stock of sub-grade Iron Ore which was lying in the premises of the appellant. Royalty is applicable only on actual despatches from the mines. 6. That on the facts and in the circumstances of the case and in law, and without prejudice to Ground No. 4, the CIT(A) erred in not considering the appellant's Ground No. 7 (before the CIT(A)) in which appellant had claimed that in case of addition on account of non-reporting of sub-grade production in particular assessment year, than impact of the same should be given in successive assessment years till the assessment in which such production was reported as saleable production due to available market. 7. That the appellant craves leave to add, al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 133A of the Act was conducted in the said premises in the case of ABMCPL on 15/10/2013 which was converted into search and seizure operation by issuance of search warrant u/s.132 of the Act in the name of ABMCPL and in the case of its group Executive President Shri Shubhendu Amitabh at his residential premises on 16/10/2013. The search and seizure action resulted into seizure of unaccounted cash of Rs.25,13,41,000/-; jewellery and billion worth of Rs.44,82,394/- besides incriminating documents from the office of the ABMCPL and from the residence of Shri Shubhendu Amitabh. Several books of accounts, documents etc., were found seized and inventorised as Annexure-1 to Annexure-23. Also various computer hard discs and laptops were seized which were inventorised as Annexure-24 to Annexure-40. 4.3. The Annexure A-8 seized from the premises of ABMCPL which was subjected to search u/s.132 of the Act was a petty cash book of M/s. Essel Mining Industries Ltd., i.e. the assessee before us. This petty cash book belonging to Essel Mining and Industries Ltd., was found and seized from the said premises of ABMCPL and since the said entries suggest that the ownership of unaccounted cash lies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne the same in respect of each disallowance / addition made in the assessment as under:- A. Disallowance u/s.14A of the Act - Rs.17,15,98,000/- We find that this disallowance was made already in the regular assessment framed u/s. 143(3) of the Act for the A.Y.2008-09 on 22/12/2010. Hence, there cannot be any reliance that could be placed on any search material. B. Disallowance of Prior Period Expenses Rs.3,86,365/- We find that this disallowance was made already in the regular assessment framed u/s. 143(3) of the Act for the A.Y.2008-09 on 22/12/2010. Hence, there cannot be any reliance that could be placed on any search material. C. Disallowance of Expenditure on Provision Rs.5,84,29,722/- We find that this disallowance was made already in the first re-assessment order u/s.143(3) r.w.s. 147 of the Act on 31/01/2014 for the A.Y.2008-09. Hence, there cannot be any reliance that could be placed on any search material. D. Addition made on account of illegal unaccounted provision Rs.4,65,56,163/- We find that the ld. AO in page 27 para 15.1 had addressed this issue wherein he had made this addition by placing reliance on Justice M.B.Shah Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 31/01/2014. Hence, there cannot be any reliance that could be placed on any search material. 4.5. We find that the ld. DR vehemently argued that there was yet another notice u/s.148 of the Act which was issued by the Kolkata Assessing Officer dated 13/10/2014. The date of issuance of notice u/s.153C of the Act was 26/11/2014. Hence, as on the date of the assumption of jurisdiction by the ld. AO u/s.153C of the Act, proceedings u/s.148 of the Act dated 13/10/2014 was pending which gets abated pursuant to search assessment to be framed in the hands of the assessee u/s.153C of the Act. Hence, he argued that there is no need for the existence of any search material for making any disallowance or additions in the assessment framed u/s.153C of the Act in the hands of the assessee. We have already stated supra that the jurisdiction of the assessee has been changed from Kolkata to Mumbai vide order u/s.127(2) of the Act dated 30/09/2014 by the Administrative Commissioner of Income Tax. When the jurisdiction of the case has already been shifted from Kolkata to Mumbai on 30/09/2014, we are unable to understand as to how the Kolkata Assessing Officer could have issued notice u/s. 148 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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