TaxTMI 
TaxTMI 
2019 (2) TMI 1637
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....A proceeding, when the assessment was not pending for these years before the AO on the date of search, there being no incriminating materials unearthed during search qua these assessment years, the AO could have only reiterated the return filed / assessment made under 143(1) / 143(3) of the Act. In the light of the aforesaid facts, we requested the Ld. CIT DR to carefully go through the assessment orders qua those respective assessment years to find out as to whether the AO has made any addition with the aid of any incriminating materials unearthed during search qua those assessment years and fixed the appeal on 31.01.2019. 3. With the aforesaid background, on 31.01.2019 we asked the Ld. CIT DR as to whether the assessment years 2009-10 to 2013-14 was pending before the AO on the date of search which he answered as not pending before the AO on the date of search. On our next query as to whether the Assessing Officer took the aid of any incriminating materials to make any additions/disallowances, the ld. CIT-DR fairly admits that there were no incriminating materials the Assessing Officer referred in his order to make the additions/disallowances. In this background, we after havi....
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....assessment order in respect of each of the six AYs "in which both the disclosed and the undisclosed income would be brought to tax". iv. Although Section 153 A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be 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 an....
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....readth of the country. The AO noticed that besides logistic operations the assessee group has forays in other commercial ventures like Tea, SEZ of gold manufacturing, power, cement etc. However, the AO took note of the fact that many of this other ventures were not part of the search operations which means the search operations was confined to transport/logistic operations wing of the assessee. The AO noticed that after the search, the assessee company for A.Y. 2015-16 had made disclosure of Rs. 7.82 crores and for other sister concern, M/s. Inland Power Ltd. 10.85 crores; and M/s. Inland Automate Pvt. Ltd. 6.33 crores; thus a total of Rs. 25 crores has been disclosed for A.Y. 2015-16. However, the AO noted that when the return of the assessee was filed post search, the profit was only to the tune of Rs. 13,03,65,534/-. The AO took note of the fact that the total income as per return filed u/s 153A or revised return was lower for all the years except that of Assessment Year 2011-12. Now, Assessment Year 2011-12 is not relevant for adjudicating these appeals. According to the AO, the disclosure made by the assessee has been negated by inserting additional heads of expenses featuring....
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....imated the income of the assessee. It was brought to our notice that the AO never put the assessee on notice as to his desire to bring the comparable company called M/s. VRL Logistics and to use it as a comparable case for estimating the income of assessee. So according to the ld. AR, the assessee did not get any opportunity to challenge the action of the Assessing Officer to take the case of M/s VRL Logistics as comparable and also the AO did not give any opportunity to the assessee to bring its own comparables. We note that the ld. DR could not controvert these facts pointed out by the ld. AR challenging the action of Assessing Officer in respect of bringing M/s VRL Logistics as comparable and not giving opportunity to assessee to bring its own comparable to justify the net profit/gross profit of the assessee company. In the light of the aforesaid facts as discussed, the aforesaid action of the AO cannot be countenanced by us. If the AO found fault with the books which assessee has regularly maintained, and which are admittedly audited, and in case if the AO was of the opinion that the assessee has not regularly followed the method of accounting as mentioned u/s 145(1) of the Act....