TaxTMI 
TaxTMI 
2020 (12) TMI 1336
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.... dated 19/09/2017 on following effective grounds: - 1.1 In the facts and circumstances of the case and in law, the Ld. CIT(A)-2, Udaipur erred in confirming the additions made by AO in his order passed u/s 153A r.w.s. 143(3) of the Income Tax Act, 1961 ("the Act") dt. 27.03.2016 for the relevant assessment years as same is bad in law and deserve to be deleted since the same are not based on any incriminating material unearthed during the course of search. 1.2 Without prejudice to the above, it is respectfully submitted that CIT(A) - 2 Udaipur erred in confirming the order passed by AO as same bad in law and deserves to be quashed for want of jurisdiction since no incriminating material whatsoever was unearthed for the relevant assessment year during the course of search and as such without any incriminating material no order could have been passed by the Ld. AO. 2. In the facts and circumstances of the case and in taw, the Ld.CIT (A) -2 erred in confirming the addition and failed to appreciate that the impugned order passed by the Ld. AO is bad in law and void for want of jurisdiction since the assessment order is passed by AO u/s 153A is without issuing the jurisdictional....
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.... disallowance of certain expenses for Rs.8.44 Lacs. The assessment proceedings stem from search operations u/s 132 carried out by the department on Vinod Purohit group of cases on 16/04/2013 wherein several incriminating documents along with cash, jewelery and other valuables were stated to be found / seized from various premises searched by the department. 2.2 The original return of income was filed by the assessee on 04/09/2008 and the same was processed u/s 143(1). Apparently, no existing assessment proceedings were pending at the time of search action on 16/04/2013. 2.3 In response to notice u/s 153A dated 10/01/2014, the assessee filed return of income on 17/03/2014. Notices u/s 143(2) & 142(1) along with questionnaire was issued on 07/08/2015 wherein the assessee was directed to file requisite details. 2.4 Upon perusal of details so filed, it transpired that the assessee had not started any business during the year and therefore, the business expenditure was of Rs.13.31 Lacs claimed against interest income was not to be allowed. The interest income was to be assessed under 'Income from Other Sources'. Although, the assessee justified the deduction of expenditure, how....
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....rom the facts, it emerges that the original return was filed by the assessee on 04/09/2008 and the search took place on 16/04/2013. Admittedly, no assessment proceedings were pending against assessee on the date of search and it was not a case of abated assessment. Upon perusal of the assessment order, it is quite evident that Ld. AO has not referred to any incriminating material against the assessee and the additions made therein are also not based on any incriminating material. The business expenditure claimed that is sought to be disallowed was already claimed in the original return of income. The facts of the case, in our considered opinion are squarely covered in assessee's favor by the decision of Hon'ble Bombay High Court in CIT V/s Continental Warehousing Corporation (Nhava Sheva) Ltd. (2015 374 ITR 645) as well in Gurinder Singh Bawa (2016 386 ITR 418) which has held that in the absence of any incriminating material, the unabated assessments could not be disturbed. Similar is the view of Hon'ble Delhi High Court in CIT V/s Kabul Chawla 61 Taxmann.com 412 which has summed up legal position as follows: - "Summary of the legal position: 37. On a conspectus o....
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....53A only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the Course of search which were not produced or not already disclosed or made known in the course of original assessment. The view of Hon'ble Delhi High Court in CIT V/s Kabul Chawla (supra) has been followed by Hon'ble High Court of Rajasthan in Pr.CIT V/s Smt. Daksha Jain (ITA No.125/2017 dated 04/07/2019) which has declined to admit revenue's appeal. Further, upon perusal of SLP No. 18560 of 2015 dated 12/10/2015 admitted by Hon'ble Supreme Court against the decision of Hon'ble Bombay High Court rendered in CIT Vs. Continental Warehousing Corporation (supra), we find that Hon'ble Apex Court has only admitted Special Leave Petition (SLP) against the ruling of the Hon'ble Bombay High Court's finding that no addition can be made in respect of assessments which have become final if no incriminating material is found during search or during 153A proceedings. However, it is seen that the Hon'ble Apex Court has not stayed or suspended the operation of the decision of the Hon'ble Bombay High Court in ....