Revenue appeal partly allowed, cash adjustment directed from assessment completion date. Interest levy under Section 234A to be decided.

The Tribunal partly allowed the Revenue's appeal, directing the AO to adjust the seized cash from the date of assessment completion. The second ground was deemed allowed for statistical purposes, with directions to decide the levy of interest under Section 234A in line with the Tribunal's findings. The assessee's cross-objections were also deemed allowed for statistical purposes.

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Issues Involved:
1. Adjustment of seized cash towards advance tax liability.
2. Admission of additional evidence and grounds by CIT(A).
3. Levy of interest under sections 234A and 234B of the IT Act.
4. Applicability and interpretation of Section 132B and related provisions.

Detailed Analysis:

Issue 1: Adjustment of Seized Cash Towards Advance Tax Liability
The Revenue contested the CIT(A)'s decision to adjust the seized amount towards the assessee's advance tax liability, arguing that Section 132B does not allow such adjustments. The Revenue emphasized that "existing liability" under Section 132B does not include advance tax, as clarified by Explanation 2, which was inserted by the Finance Act, 2013, with retrospective effect from 01.06.2002. The assessee countered that the seized cash should be adjusted from the date of seizure (29.04.2008) against the tax liability for A.Y. 2008-09. The Tribunal held that the seized cash could not be adjusted as advance tax for A.Y. 2008-09, as per Section 208, which mandates advance tax liability during the financial year. The Tribunal concluded that the adjustment should be given from the date of assessment completion (24.12.2010), not from the date of seizure or any other date.

Issue 2: Admission of Additional Evidence and Grounds by CIT(A)
The Revenue argued that the CIT(A) admitted additional evidence (letters dated 30.06.2008 and 18.08.2008) without following Rule 46A of the IT Rules, which requires comments from the Assessing Officer (AO). The assessee contended that these letters were already submitted during the assessment proceedings. The Tribunal found that the letters were indeed submitted to the AO, and the CIT(A) did not contravene Rule 46A. Therefore, the additional grounds based on this legal contention were dismissed.

Issue 3: Levy of Interest Under Sections 234A and 234B of the IT Act
The Revenue argued that CIT(A) admitted an additional ground regarding non-credit of seized cash before the levy of interest under Section 234A without seeking comments from the AO. The Tribunal noted that CIT(A) did not grant specific relief regarding the levy of interest under Sections 234A and 234B but left it open for the AO to consider in light of the decisions of the Punjab and Haryana High Court. The Tribunal directed the AO to decide the issue of levy of interest under Section 234A in accordance with the Tribunal's findings on the main issue and the calculation of adjustment of seized cash under Section 132B.

Issue 4: Applicability and Interpretation of Section 132B and Related Provisions
The Tribunal examined Section 132B and its Explanation 2, which clarifies that "existing liability" does not include advance tax. The Tribunal held that Explanation 2 is a clarificatory provision with retrospective effect from 01.06.2002. The Tribunal also reviewed various case laws cited by both parties and concluded that the benefit of the decisions of the Punjab and Haryana High Court in the cases of Arun Kapoor and Ashok Kumar was not applicable to the assessee's case, as they pertained to assessment years before the insertion of Section 132B.

Conclusion:
The Tribunal partly allowed the Revenue's appeal on the first ground, directing the AO to adjust the seized cash from the date of assessment completion (24.12.2010). The second ground was deemed allowed for statistical purposes, with directions to the AO to decide the issue of levy of interest under Section 234A in accordance with the Tribunal's findings. The assessee's cross-objections were also deemed allowed for statistical purposes with directions to the AO. The Tribunal's order was pronounced on 17/10/2014.

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