TaxTMI 
TaxTMI 
2016 (4) TMI 855
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (ii) in spite of search and seizure action u/s 132 having been carried out twice, no incriminating material requiring adverse inference was found; and (iii) In the earlier assessment made u/s 153A vide order dated 26.12.2007, no adverse inference was drawn on the same set of facts available on record. The ld. CIT(A) should have held that in spite of provisions of section 50C no addition deserves to be made in the present case. 2. Because the ld. CIT(A) has erred in law and on facts in stating that charging of interest is consequential in nature whereas under the circumstances no interest u/s 234A is chargeable and charging of interest u/s 234B is excessive. 3. Because the order appeal against is contrary to the facts, law and principles of natural justice." 3. Briefly stated, facts relating to this case are that the assessee is an individual lady, who continued to be assessed to tax regularly for more than 20 years. Due to search and seizure action u/s 132 of the Income tax Act, 1961 [for short, 'the Act'] on 1.9.2005 (1st in sequence), assessment for the impugned year was made u/s 153A/143(3) of the Act vide order dated 26.12.2007 wh....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s abated under section 153A of the Act. Further, as no incriminating material was found during the course of search relating to any of the assessment year, therefore, no addition can be made in the present assessment. Said property was agreed to be sold in June 2003 for Rs. 20 lakhs and advance of Rs. 5 lakhs was received by Cheque on 14.6.2003, though sale deed was registered on 11.5.2004 (after a gap of 11 months approx), copy of sale deed has been placed at page 11-23 of PB. Addition has been made without making reference to the DVO. The ld. AR further submitted that in spite of search and seizure action under section 132 having been carried out twice, no incriminating material requiring adverse inference was found. Having perused the very same sale deed, no addition was made under section 50C of the Act in the assessment completed under section 153A/143(3) of the Act earlier vide order dated 26.12.2007, though income declared under the head capital gains was tinkered with. 5. The ld. AR has relied on the decision of the Hon'ble Jurisdictional High Court in the case of Anil Bhatia wherein it has been held as under: "In view of the above ruling, I hold that the as....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o assess total income including undisclosed income as per the decision of jurisdictional High Court in the case of Anil Bhatia. As a result, this ground of appeal is dismissed." So far as the 5th contention of the appellant is concerned, it appears in view of the fact that CIT(A) is of the opinion that addition can be made even in the absence of any seized material, he has not given any specific finding on this score. All the aforesaid issue, has been raised by the assessee by way of Grounds of Appeal No. 1.1 & 1.2 before the Hon'ble ITAT. In support of grounds taken, it is submitted as under: So far as the issue whether any incriminating material is a must so as to make addition in the assessment framed U/s 153A for the years which do not gets abated and for which there is no incriminating material, reliance is placed on the decision of Hon'ble Jurisdictional High Court of Delhi in the recent decision dated 28..8.2015 in the case of CIT vs. Kabul Chawla [ITA 707, 709 and 713 of 2014] since reported in [2015] 234 Taxman 300 (Del), wherein after analyzing the cases of - (i) CIT v. Anil Kumar Bhatia [2013] 352 ITR 493 (Del) (Para 15- 21); ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... contended that the ratio laid down by the Hon'ble Jurisdictional High Court in the case of Kabul Chawla [supra] does not apply to the facts and circumstances of the present case. 6. Placing rejoinder to the above submissions of the ld. DR, the ld. AR has drawn our attention towards para 37 of the order of the Hon'ble Jurisdictional High Court in the case of Kabul Chawla [supra] and vehemently contended that the Hon'ble High Court has summarized the legal position and the proposition in this regard and in legal position No. IV, it is amply clear that the assessment u/s 153A of the Act has to be made only on the basis of seized material. 7. On careful consideration of submission of both the rival representatives, at the very outset, undisputedly and admittedly, the earlier assessment for A.Y 2005-06 was completed u/s 153A r.w.s 143(3) of the Act on 26.12.2007 and copy of this order has been placed by the assessee at pages 1 and 2 of her paper book wherein no disallowance u/s 50C of the Act was also before the AO during original assessment proceedings which was completed on 27.12.2007 and no addition was made in this regard. In the light of the above facts and circu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e related to the evidence found, it does not mean that the assessment "can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material." v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessments can be interfered with by the AO while making the assessment under Section 153 A only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered ....