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TMI Blog2024 (10) TMI 923X X X X Extracts X X X X X X X X Extracts X X X X ..... Act proceedings in the case of the assessee. The same statement was the basis for assessment under section 153C of the Act previously carried out in the case of the assessee. The issue already stood resolved in favour of the assessee by the ITAT in the earlier proceedings u/s 153C of the Act. In view of the judgment delivered in the case of Pr. CIT vs. Abhisar Builwell Pvt. Ltd [ 2023 (4) TMI 1056 - SUPREME COURT ] it is trite that in the absence of incriminating material found in the course of search, the legal foundation for making additions under section 153A in unabated assessment do not exist. Coupled with this, mere statement of a person under section 132(4) of the Act in the course of search, by itself, cannot be regarded as incriminating material found in the course of search as held in the case of Pavitra Realcon Pvt. Ltd. and Anand Kumar Jain (HUF) [ 2021 (3) TMI 8 - DELHI HIGH COURT ]. The additions made on the basis of confessional statement without other material is thus unsustainable in law. Thus, seen from any angle, additions made under section 153A of the Act for the captioned appeals are not permissible in law. Assessee appeal allowed. - Shri Pradip Kumar Kedia, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income under section 153A of the Act declaring total income at Rs. 35,16,760/- which is the same as ROI dated 30.09.2012 filed under section 139(1) of the Act prior to search. The Assessing Officer framed assessment order under section 153A of the Act wherein the AO alleged that assessee company is involved in providing accommodation entries in consideration of commission income. The Assessing Officer estimated commission income @ 3% on alleged entries provided towards purchase and sales. The commission income was estimated at Rs. 1,71,10,259/- towards such alleged entries. The AO thus made an addition of Rs. 1,35,93,504/- on account of unaccounted commission income over and above the income returned. Resultantly, the income was assessed at Rs. 1,71,10,260/- as against the returned income of Rs. 35,16,760/-. Similar additions have been made in respect of other assessment years with variations in the quantification of assessed income linked to alleged entries on account of purchases and sales in the respective assessment years. 4. Aggrieved by the aforesaid additions, the assessee preferred appeal before the CIT(A). 5. The CIT(A) however, confirmed the action of the AO and denied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or thereabout. The estimated profits was thus calculated for each assessment year on protective basis in the hands of the assessee company for Assessment Years 2008-09 to 2014-15 while the said income made in the hands of the assessee company was simultaneously assessed on substantive basis in the case of Shri Praveen Kumar Jain. The matter was carried to ITAT. The Tribunal passed a common order in the hands of the Shri Praveen Kumar Jain in ITA No.7191/Mum/2018 and ors. concerning Assessment Years 2008-09 up to 2014- 15 order dated 19.01.2023 in which the substantive additions made in the hands of Shri Praveen Kumar Jain by the Revenue was confirmed and consequently the appeal of Shri Praveen Kumar Jain was dismissed. The substantive additions in the hands of Shri Praveen Kumar Jain was thus confirmed by the ITAT. Simultaneously, the Tribunal in ITA No.1402/Mum/2023 and others order dated 27.07.2023 concerning Assessment Years 2008-09 up to 2013-14 applied the decision rendered by the Tribunal in the case of Shri Praveen Kumar Jain (wherein the additions made on substantive basis were affirmed) and thus deleted the additions made by the AO on protective basis in the hands of asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commission has been earned by the assessee herein. For making estimated additions towards purported commission income, the Assessing Officer also observed that Shri Praveen Kumar Jain has also admitted the carrying on the accommodation entries business in his statement in the course of search on 01.10.2013. 7.5 The learned Counsel thus submitted that in sum and substance, the additions made earlier in Section 153C proceedings have been reiterated and repeated in section 153A proceedings in the present case solely based on the statement of Shri Manish Jain and Shri Praveen Kumar Jain. There is no reference to any tangible material of any sort to implicate the assessee per se. No other enquiry with the alleged beneficiary of accommodation entries have been carried out at any stage. No material was found to vindicate the allegation of bogus entries of accommodation nature. The learned Counsel referred to the judgment rendered by the Hon ble Supreme Court in the case of PCIT vs. Abhisar Builwell P. Ltd. (2023) 149 taxmann.com 399 (SC) to contend that the legal principles laid down in the judgment squarely applies to the facts of the present case. The assessments for A.Ys. 2012-13, 201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... books and estimation of income. The learned Counsel thus submitted that impugned additions in all the captioned appeals are wholly and justified and unsustainable in law. 8. The learned DR for the Revenue, on the other hand, relied upon the assessment order and first appellate order. 9. We have carefully considered the rival submissions and perused the material referred to and relied upon in the course of hearing. 9.1 It is the case of the assessee that additions made in Section 153A proceedings in question are beyond the remit of the Assessing Officer to make such additions solely based on a sketchy statement of accountant under Section 132(4) of the Act which statement is, in turn, based on confessional statement of the director Shri Praveen Kumar Jain in the previous search carried out on 01.10.2013 in the case of Shri Praveen Kumar Jain. It is further case of the assessee that the statement of Shri Praveen Kumar Jain given on 01.10.2013 are irrelevant for the assessment years subsequent to the date of search and the averments made therein cannot be applied to the subsequent years. The statement can possibly be useful only for the period prior to search. It is also the case of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of confessional statement without other material is thus unsustainable in law. 9.5 Thus, seen from any angle, additions made under section 153A of the Act for the captioned appeals are not permissible in law. 10. In the result, captioned appeals of the assessee for A.Ys. 2012-13 up to 2015-16 are allowed and the additions made in such appeals are stuck down. ITA No.3333/Del/2023 for A.Y. 2016-17 Olive Overseas Pvt. Ltd. vs. DCIT ITA No.3334/Del/2023 for A.Y. 2017-18 ITA No.3335/Del/2023 for A.Y. 2018-19 11. All the facts in these appeals are identical to the facts involved in A.Ys. 2012-13 up to 2015-16. The only difference is that the assessment pertaining to A.Ys. 2016-17; 2017-18 and 2018-19 were pending at the time of search in the case of the assessee and therefore, stood abated pursuant to search. 12. The assessee contends that apart from the contentions raised for A.Ys. 2012-13 up to 2015-16 (unabated assessment), the additions in the A.Ys. 2016-17 to 2018-19 are made on the basis of uncorroborated and non-descript statement of Shri Manish Jain and Shri Praveen Kumar Jain. The statement of Shri Praveen Kumar Jain which is the basis of statement obtained from Shri Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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