TaxTMI 
TaxTMI 
2018 (11) TMI 1115
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.... advance for sale of land in the balance sheet annexed to return of income, but, he could not adduce any evidence like copy of agreement, mode of payment, identity of the purchaser etc. inspite of availing sufficient time. The AO, therefore, presumed that the assessee did not have any evidence towards his claim of advance and, hence, treated the same as unexplained receipt in the hands of assessee and added the same to the returned income of assessee. 3. When the assessee preferred an appeal before the CIT(A), the CIT(A) confirmed the action of AO. 4. Aggrieved by the order of CIT(A), the assessee is in appeal before us raising the following grounds of appeal: "1. The Ld. CIT(A) erred in both law and on facts in dismissing the appeal. 2. The Ld. CIT(A) ought to have appreciated that the material found during the search proceedings does not belong to assessee and that the proceeding u/s 153A cannot be initiated in the assessee's case. 3. The Ld. CIT(A) ought to have appreciated that the provisions of sec 153A can be invoked only when it is established by the AO having jurisdiction over the searched party, that, documents seized do not belong to the searched person. 4. ....
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.... material relating to the assessee found during the course of search, there cannot be any assessment under section 143(3) read with section 153A as far as the assessment concluded u/s 143(3) is concerned. In this connection, he relied on the decision of coordinate bench of this Tribunal in the case of M/s Engineers Syndicate India Pvt. Ltd. in ITA Nos. 1805 to 1808 & 1870/Hyd/2014, vide order dated 31/05/2018 (wherein both the Members are party), wherein the coordinate bench has held as under: "11. Having regard to the rival contentions and the material on record, we find that the assessee has filed a chart showing the status of the assessments u/s 143(3) of the Act and we find that all these assessments were completed before the date of search on 9.2.2008. The assessments u/s 143(3) for the A.Ys 2002-03 and 2003-04 were completed by the ACIT-11(II) Bangalore on 31.3.2006, whereas for the A.Y 2004-05, the ACIT 11(II) Bangalore has completed the assessment u/s 143(3) of the Act on 13.11.2006 and for the A.Y 2005-06 on 26.12.2007. For the A.Y 2006-07, the return was filed on 28.11.2006 and no proceedings were taken out by the AO thereafter. U/s 153A of the Act, in the case of a sea....
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....tion of the operative portion of the section and if there is no ambiguity in the language or if it is plain and clear, then the heading used in the section strengthens that meaning. From the heading of the section the intention of the Legislature is clear, viz., to provide for assessment in case of search and requisition. When the very purpose of the provision is to make assessment in case of search or requisition, it goes without saying that the assessment has to have relation to the search or requisition. In other words, the assessment should be connected with something found during the search or requisition, viz., incriminating material which reveals undisclosed income. Thus, while in view of the mandate of sub-section (1) of section 153A of the Act, in every case where there is a search or requisition, the Assessing Officer is obliged to issue notice to such person to furnish returns of income for the six years preceding the assessment year relevant to the previous year in which the search is conducted or requisition is made, any addition or disallowance can be made only on the basis of material collected during the search or requisition". iii) Hon'ble Delhi High Court in....
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....es can be made only on the basis of the incriminating material found during the search or requisition". vi) Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla reported in (2016) 380 ITR 573 (Del.) held as under: "The legal position that emerges on a perusal of section 153A and section 132 of the Income-tax Act, 1961, is as under: (i) Once a search takes place under section 132 of the Act, notice under section 153A(l) will have to be mandatorily issued to the person in respect of whom search was conducted requiring him to file returns for six assessment years immediately preceding the previous year relevant to the assessment year in which the search takes place. (ii) Assessments and reassessments pending on the date of the search shall abate. The total income for such assessment years will have to be computed by the Assessing Officers as a fresh exercise. (iii) The Assessing Officer will exercise normal assessment powers in respect of the six years previous to the relevant assessment year in which the search takes place. The Assessing Officer has the power to assess and reassess the "total income" of the six years in separate assessment orders for each of the six y....
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....r the completed assessment on the date of the search would stand on the same footing as the pending assessments which in terms of the second proviso to Section 153A(1) of the Act would abate. It was noticed that in Anil Kumar Bhatia (supra), this Court had left open the question whether in order to frame an assessment in terms of the first proviso to Section 153A(1) of the Act in respect of those AYs for which the assessments had already been completed, there was a requirement that some incriminating material should be unearthed during the search. Nevertheless there were some observations in Anil Kumar Bhatia (supra), which would indicate that the AO would be able to reopen the assessments for those years for which the assessment already stood completed at the time of the search, only if some incriminating material was unearthed during the search. The ITAT concluded "if no incriminating material is found in respect of such completed assessments then the total income in the proceedings under Section 153A(1) of the Act shall be computed by considering the originally determined income. If some incriminating material is found in respect of such assessment years for which assessment is ....