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TMI Blog2024 (12) TMI 1162X X X X Extracts X X X X X X X X Extracts X X X X ..... d with the search and requisition made u/s 132 and 132A of the Act, and the objects of Section 153A is to bring under tax the undisclosed income, which is found during the course of search or pursuant to search or requisition. Hon ble Supreme Court in Abhisar Buildwell [ 2023 (4) TMI 1056 - SUPREME COURT] held that only in a case where the undisclosed income was found on the basis of incriminating material, the AO would frame the jurisdiction to assess or reassess the total income for the entire six block assessment year period in the case of unabated assessment. As there is no incriminating materials in these four appeals, we quash the assessment framed u/s 153A of the Act for all these four years and also set aside the orders of CIT(A). Hence, these four appeals of the assessee are allowed for this jurisdictional issue. - Shri Mahavir Singh, Vice President And Shri S Rifaur Rahman, Accountant Member For the Assessee : Shri Sandeep Jain, CA For the Revenue : Mr. Javed Akhtar, CIT(DR) ORDER PER BENCH: These four appeals by the Assessee are arising out of different orders of Commissioner of Income Tax (Appeals)-IV, Kanpur, in appeal numbers CIT(A)-IV/10792/DCIT-CC/Noida/2017-18/61 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated that these are jurisdictional issues that goes to root of the matter, and in view of the decision of Hon ble Supreme Court in the case of National Thermal Power Company Limited Vs. CIT- 229 ITR 383 (SC) , these grounds are to be admitted and to be adjudicated upon. 4. When these facts were confronted to Ld. CIT(DR), he contested the admissibility of the additional grounds. He argued that these grounds could have been raised by the assessee at the time of framing the assessment because the assessment orders are dated 30.12.2017, and at that point of time, these issues have already been adjudicated by many High Courts. Hence, he opposed the admissibility of the additional grounds. 5. We have heard rival contentions and gone through facts and circumstances of this case. We noted that the issue of framing the assessment i.e., search assessment U/s 153A of the Act, based on incriminating material or no incriminating material in the case of an unabated assessment, is a purely legal issue, and, hence this ground goes to the root of the matter. Hence, we admit this ground for adjudication. This view is supported by the decision of the Hon ble Supreme Court in the case of National Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority is vested with all the plenary powers which the subordinate authority may have in the matter. There is no good reason to justify curtailment of the power of the Appellate Assistant Commissioner in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the Income-tax Officer. This Court further observed that there may be several factors justifying the raising of a new plea in an appeal and each case has to be considered on its own facts. The Appellate Assistant Commissioner must be satisfied that the ground raised was bona fide and that the same could not have been raised earlier for good reasons. The Appellate Assistant Commissioner should exercise his discretion in permitting or not permitting the assessee to raise an additional ground in accordance with law and reason. The same observations would apply to appeals before the Tribunal also. 7. The view that the Tribunal is confined only to issues arising out of the appeal before the Commissioner of Income-tax (Appeals) takes too narrow a view of the powers of the Appellate Tribunal [vide, e.g., C.I.T, v. Anand Prasad (Delhi), C.I.T. v. Karamchand Premchand P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11-12, Rs. 9,77,95,000/- for AY 2012- 13 and Rs. 2,34,85,000/- for AY 2013-14. Similarly, other additions were also made by the Assessing Officer as the particulars were declared in financials of the relevant assessment years. For AY 2010-11, being unexplained cash credit of Rs. 4 lakhs, for AY 2011- 12 being unexplained cash deposits of Rs. 2 lakhs, for AY 2012-13 being disallowance of expenses and cash credits of Rs. 5,00,000/- and 8,00,000/- and for AY 2013-14 being unexplained unsecured loans of Rs. 29 lakhs were added. As the facts and circumstances narrated are exactly identical in all the four assessment years, hence, we take the facts from the Assessment Year 2010-11. The Assessing Officer noted that during the course of the search and post-search enquiry, it was observed that the company of this group is involved in taking bogus unsecured loans, accommodation entries, and some expenditure was incurring which is unexplained. He also noted that the assessee is taking the entries from paper companies, which are providing accommodation entries while actually the unaccounted cash of the group companies is being ploughed back in the books of such companies through these bogus un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turns for these four years as under: AY Filling Date ACK No. 2010-11 15/10/2010 172729291151010 2011-12 29/03/2012 371614941290312 2012-13 25/09/2012 494398621250912 2013-14 28/09/2013 796576441280913 13. We noticed that the details regarding the filing of the return of income on due dates, are noted as above, and the same were confronted to the Ld. Sr. DR. 14. When these facts were confronted to the Ld. CIT(DR) and inquired whether any incriminating materials reflecting these unsecured loans or cash credits for these four assessment years were available in the seized material or not, he answered that, actually if incriminating material is interpreted in a particular manner, then what is incriminating material ?, it is not in strict term the incriminating material is not available. However, he submitted that the facts emerging from the findings of the Assessing Officer that he has collected the details of incriminating material found during the search and as well as post-search proceedings. But, he could not point out any incriminating material either from the assessment order or the order of CIT(A), or from the seized materials. When he was confronted with the assessment order, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eted 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 fulfillment of the conditions as envisaged/mentioned under sections 147/148 of the Act and those powers are saved. 16. The above clause (iv) of para 14 clears that in case, no incriminating material is found or seized during the course of search proceedings, the AO cannot assess or reassess taking into consideration other materials in respect of completed assessment or unabated assessment meaning thereby no addition can be made by the AO in absence of any incriminating material found during the course of search u/s. 132 of the Act. Further, we notice that the Hon'ble Supreme Court has rejected the Revenue's contention that in case of search even where no incriminating material is found during the course of search, whether the AO can assess or reassess the income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nating material is found, in case of completed/unabated assessment, the only remedy available to the Revenue would be to initiate the reassessment proceedings under sections 147/48 of the Act, subject to fulfillment of the conditions mentioned in sections 147/148, as in such a situation, the Revenue cannot be left with no remedy. Therefore, even in case of block assessment under section 153A and in case of unabated/completed assessment and in case no incriminating material is found during the search, the power of the Revenue to have the reassessment under sections 147/148 of the Act has to be saved, otherwise the Revenue would be left without remedy. 12. If the submission on behalf of the Revenue that in case of search even where no incriminating material is found during the course of search, even in case of unabated/completed assessment, the AO can assess or reassess the income/total income taking into consideration the other material is accepted, in that case, there will be two assessment orders, which shall not be permissible under the law. At the cost of repetition, it is observed that the assessment under Section 153A of the Act is linked with the search and requisition under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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