2022 (10) TMI 496

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....-11. 2. Learned counsel for the Appellant states that the ITAT has erred in holding that the addition which was not based on incriminating material found during the search, could not be made the basis for an assessment under Section 153A of the Income Tax Act,1961 ('the Act') and accordingly, deleted the said addition without going into merits of the same. He further states that the ITAT has erred in relying upon the judgement of this Court in the case of CIT vs Kabul Chawla 380 ITR 573 (Del) ignoring the fact that Revenue's SLP on similar issue is pending before the Supreme Court in the case of M/s Apar Industries Ltd. 3. Upon a perusal of the paper book, this Court finds that the ITAT has observed that the case of the respondent....

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....hence dismissed. 26. In the result, the Cross Objection of the assessee for boththe years are allowed partly and appeals of the Assessing Officer are dismissed for both the years." (Emphasis supplied) 4. This Court finds that the conclusion reached in Kabul Chawla (supra) was summarized in PCIT vs. Meeta Gutgutia, (2017) 82 taxmann.com 287 Del. The relevant portion of the Judgment passed in PCIT vs. Meeta Gutgutia (supra) is reproduced hereinbelow:- "37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the ....

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....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 requisiti....