TaxTMI 
TaxTMI 
2022 (9) TMI 1140
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....herefore, prayed that the order of Ld CIT(A) may be set aside and that of the Assessing Officer be restored." 3. The assessee has raised the following grounds of cross objection: "1. The Ld. A.O. erred in law and in fact of the case in assessing the income of Rs. 2,00,00,000/- as unexplained income without mentioning under which provision of the act. The said income can be considered as unexplained either u/s. 68 or u/s. 69 of the act which, in the present case neither section is applicable. 2. The Ld. AO erred in law and in facts of the case in assessing the income of Rs. 2,00,00,000/- as unexplained income without any evidence in this regard and only on assumptions which is not sustainable in law. 3. Any other ground which may be raised before or during the time of hearing the appeal/cross objection. Total tax effect (see note below) Rs. 2,00,00,000/-" 4. The brief facts of the case are that the return of income was filed by the assessee on 31-03-2013 declaring total income of Rs. 30,20,855/-. Thereafter, order under section 143(3) of the Act was passed on 18-02-2016, determining total income at Rs. 30,20,860/-. Meanwhile, search was cond....
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....initiated u/s. 271(l)(c) for furnishing inaccurate particulars of income. (Addition of Rs.2,00,00,000/-)" 4. Before Ld. CIT(Appeals), the assessee made three contentions: first, the assessment of the assessee for assessment year 2013-14 was already framed under section 143(3) and no incriminating material was found during search at third-party place, and therefore addition could not have been made while making assessment under section 153C. Second, the so-called documents seized during the search of Venus infrastructure and developers Private Limited did not "belong to" the assessee. Thirdly, in view of the judgments of the Jurisdictional Gujarat High Court in the case of Anilkumar Gopikkrishna Agrawal vs ACIT (2019) 418 ITR 25 (Guj) as also, Delhi High Court in the case of Pr CIT vs Dreamcity Buildwell (2019) 417 ITR 617 (Del) the amendment brought about in section 153C of the Income tax Act substituting the words "belong to " by the words "pertains or-pertain to, or any information contained therein relates to " is applicable only in respect of Searches initiated after 1st June 2015 and therefore if the documents etc did not belong to the assessee, assessment could be....
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....r containing information relating to him have been seized during the course of search, within the fold of that section, this question assumes significance, inasmuch as in the facts of the present case, as on the date of search, it was only if such material belonged to a person other than the searched person, that the Assessing Officer of the searched person could record such satisfaction and forward the material to the Assessing Officer of such other person. However, subsequent to the date of search, the amendment has been brought into force and based on the amendment, the petitioners who were not included within the ambit of section 153C of the Act as on the date of the search, are now sought to be brought within its fold on the ground that the satisfaction note and notice under section 153C of the Act have been issued after the amendment came into force. Therefore, this case does not relate to the interpretation of the provisions of any of the sections, but relates to the stage at which the amended section 153C of the Act can be made applicable, as to whether it relates to the date of search; or the date of recording of satisfaction by the Assessing Officer of the searched person....
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....ssessing Officer of the searched person after recording the earlier satisfaction would have already forwarded the material to the Assessing Officer having jurisdiction over the other person, therefore, there would be no question of his again forming a satisfaction as required under the amended provisions of section 153C of the Act." 4.4 The above judgment is later on followed by Gujarat High Court in the case of Mukesh Mankechand Sheth vs ACIT (2020) 166taxman.com618 (Guj). In view of the above binding judgments of the jurisdictional High Court, I am of the opinion that addition made by the AO on the basis of seized documents and loose papers recovered during the course of search on 10.03.2015 not belonging to the appellant cannot be sustained. As the AO has no jurisdiction to make such addition on the ground that such loose papers pertained or information therein related to the appellant assesse , I direct to delete the addition of Rs. 2,00,00,000/-. 4.5 As regards the loose papers reproduced by AO at para 3.1 of the assessment order, the appellant had submitted in his reply dated 18.06.2018 that loose papers were not found from his premises, nor are written unde....
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....en in the year under appeal , the said loan was returned by appellant, he would have been paid back the cash and such cash transaction was unexplained. The appellant's contention that there is no such clinching evidence of any .cash being exchanged for receipt of loan and repayment thereof. Had it been so then such vouchers could have been found is during search. No such documents are identified by the AO. The appellant had taken loan by banking channel and paid interest thereon and TDS too was deducted as per law and no fault is found as regards payment of interest by the AO. It is further contended that once the loan is treated as genuine in the earlier year, there is no question of not accepting repayment by cheque made in later year (year under consideration) I am inclined to agree with the appellants contention that if the case of the AO is to be accepted (though it cannot be being based on no clinching evidence or cogent material) that the appellant might have paid cash in earlier year ie A.Y. 2012-13 against receipt of loan by cheque, and that (again presuming ) such cash would have been received back by the appellant during the year under consideration, while repaying t....
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....sment order framed under section 143 (3) r.w.s. 153C of the Act is void ab initio. Further, on merits, the counsel for the assessee relied upon the order passed by the Ahmedabad Tribunal in the case of DCIT v. Zodiac Mediquip Ltd in ITA number 1646/Ahd/2019, wherein on similar set of facts, addition was deleted by the Ahmedabad ITAT by holding that the provisions of section 68 of the Act did not apply to the instant set of facts. 10. We have heard the rival contentions and perused the material on record. In our considered view, we find no infirmity in the order of the Ld. CIT(Appeals), who specifically observed that in view of the specific satisfaction made in the assessment order to the effect that the documents "pertain/relate" to the assessee, it is evident that documents did not "belong to" the assessee, as was the mandate in view of various judicial precedents passed by the High Court/Tribunals in order to invoke provisions of 143(3) r.w.s. 153C of the Act prior to the amendment on 1st June 2015. Therefore, we are of the view that the Ld. CIT(Appeals), after taking into consideration the facts of the case and applicable judicial precedents (including those of the jurisdicti....