9911796707
TMI Blog2024 (6) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... r Buildwell (P) Ltd. ( 2023 (4) TMI 1056 - SUPREME COURT ) AO cannot assess or reassess the income relating to completed/unabated assessment, in case no incriminating material is unearthed during the search. Thus, the above said ratio laid down by the Hon ble Supreme Court clinches the issue in favour of the assessee. Once it is established on record that the additions made by the AO are not with reference to any incriminating material found as a result of search, such additions cannot survive. That being the factual and legal position we have no hesitation in deleting the additions made by the AO. Thus the addition of commission income directed to be made by learned First Appellate Authority must also stand deleted as it is not based on an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, the assessee in addition to the grounds raised in the memo of appeal has subsequently filed revised grounds which are as under: "1. The Ld.CIT(A) has erred in law by not quashing the impugned assessment order passed under section 153A/144 of the Income-tax Act, 1961 in the absence of any incriminating material seized during search on Assessee/Respondent and the same also not being based on any seized incriminating material. 2. The Ld.CIT(A) has erred in law by making the impugned addition of alleged commission income of the Assessee/Respondent as a new source of income despite said income being outside the subject-matter of impugned assessment order. 3. Without prejudice to Ground no.2 above, the Ld.CIT(A) has erred in law an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee. Since the issue raised in this ground is a legal and jurisdictional issue, we deem it appropriate to address this issue at the very outset. 7. Relevant facts, necessary for deciding this issue are stated hereinafter briefly. 8. The assessees hitherto are individuals. A search and seizure operation u/s 132 of the Act was carried out on 23.08.2012 on M/s NKG group of cases. The assessees in appeal were also covered under the said search and seizure operation. Consequent to search and seizure operation, the Assessing Officer initiated proceedings u/s 153A of the Act calling upon the assessees to file their returns of income. In compliance with the notices issued u/s 153A of the Act, the assessees filed their respective returns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he total accommodation entries provided to M/s NKG Infrastructure Ltd., in the form of sales. 10. Before us, it is the specific case of the assessee that the additions made by the Assessing Officer were not based on any incriminating material found in course of search and seizure operation. Learned counsel for the assessee submitted that on the date of search, assessments in respect of impugned assessment years stood completed. Hence, there was no abetment of assessment on the date of search. He submitted that in a case of unabated assessment, the Assessing Officer has no power to make additoins, not based on incriminating material found as a result of search. Drawing our attention to the assessment order, he submitted that nowhere in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents or based on the special audit report. There is not even a single reference to any incriminating material found as a result of search in the assessment order. 13. Pertinently, on perusal of panchnama prepared at the time of search and seizure operation, a copy of which is placed at page 60 of the paper book, it is observed that it does not refer to any incriminating material found in course of search and seizure operation. Thus, it is established on record that the additions made by the Assessing Officer were not based on any incriminating material found as a result of search and seizure operations. In fact, learned First Appellate Authority has given a completely new dimension to the case by deleting the additions made by the Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al available with the AO including the income declared in the returns; and (iv) in case no incriminating material is unearthed during the search, the AO cannot assess or reassess taking into consideration the other material in respect of completed assessments/unabated assessments. Meaning thereby, in respect of completed/unabated assessments, no addition can be made by the AO in absence of any incriminating material found during the course of search under section 132 or requisition under section 132A of the Act, 1961. However, the completed/unabated assessments can be re-opened by the AO in exercise of powers under sections 147/148 of the Act, subject to fulfilment of the conditions as envisaged/mentioned under sections 147/148 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
