TaxTMI 
TaxTMI 
2022 (8) TMI 1363
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the order of the ld. Dy.CIT, Central Circle, Amritsar (in brevity the AO) the order passed u/s 144 r.w.s. 153A of the Act. The bunch of appeals are instituted with common issue related to section 153A, 153D and 153C of the Act. The ld. Counsel only argued on the legal issue of the two bunches of appeals. The legal issues are adjudicated in following manners for all the appeals. 2. The ld. Counsel of the assessee first took the ITA No.618/Asr/2018 as lead case for the cases heard on 18.05.2022 and the ITA No. 86/Asr/2017, 41/Asr/2022 are the lead case for the cases heard on 23.06.2022. 2.1. Before us Mr. Ashray Sarna represented all the matters on behalf of the assessees. The appeal heard on 18.05.2022 was represented on behalf of revenue by Mr. Anupam Kant Garg, CIT DR and the appeal which were heard on 23.06.2022 was represented by Mr. Rahul Dhawan, CIT DR on behalf of the revenue. 3. The assessee took the following grounds before the ITAT which are extracted as follows: "1. That the order passed u/s 153A/143(3) of the Act by the Hon'ble CIT(A) dated 10.09.2018 is against the law and facts of the case. 2. That having regard to the facts and circumstance....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d the family members. The proceeding u/s 153A was initiated. Further proceeding, ld. AO had obtained approval from the Ld. Additional Commissioner of Income tax, Central Range Jalandhar u/s 153D of the Act. For other party the satisfaction was noted u/s 153C of the Act. The ld. Counsel for the assessee challenged section 153A of the Act as there is no incriminating material during the assessment proceeding so the entire assessment proceedings is bad in law. The ld. Counsel challenged the approval u/s 153D which is in mechanical manner. So the entire approval U/s 153D of revenue is illegal and the assessments are liable to be quashed. 4.1. Related section 153C of the Act the ld. Counsel specifically mention that the order related section 153C is barred by limitation. The assessment order passed under section 153C/143(3) is time barred. 4.2. The assessee filed an appeal before the ld. CIT(A) with the following grounds which are reproduced hereunder: "1. That the order passed by the ld. Assessing Officer dated 22.03.2016, is against the law and facts of this case. 2. That the ld. Assessing Officer is erred in law in making addition amounting to Rs.15,52,000/- u....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., while granting statutory approval u/s153D of the Act, the issue stands covered in favour of the assessee by various decisions cited above. In the present case before us, we noted that the Addl. CIT did not mention anything in the approval memo towards his process of deriving satisfaction so as to exhibit his due application of mind. We noted that the Addl. CIT merely approved the letter and the relevant (sic- para) is noted in above paras. We noted that the relevant Para of the above approval letter merely says that "Necessary statutory approval u/s 153D is given to pass the above assessment order as such. Assessment record in this case is returned herewith..."which clearly proves that the Addl. CIT had routinely given approval to the AO to pass the order only on the basis of contents mentioned in the order only on the basis of contents mentioned in the draft assessment order without any application of mind and seized materials were not looked at because that was not available before him at the time of granting of approval to the draft assessment order and other enquiry and examination was never carried out". 5.3. The ld. Counsel for the assessee also relied on the order of An....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vant part is extracted as below:- "In the case of CIT -vs- T. O. Abraham & Co. reported in (2011) 333 ITR 182 (Ker.) the Kerala High Court held that the whole purpose of Section 292B is not to defeat on technicalities the object of the statute that is to assess and collect the tax legitimately due under the Act. The mere fact that the Additional Commissioner did not record his satisfaction in so many words would not render invalid the sanction granted under Section 151(2) when the reasons on the basis of which sanction was sought for could not be assailed. Even an appellate authority is not required to give reasons when it agrees with the finding unless statute or rules so requires. We are supported in our view by the Judgment of the Apex Court in R.P. Bhatt v. Union of India, reported in AIR 1986 SC 1040. In R.P. Bhatt (supra) the Apex Court relied on judgment rendered by a Constitutional Bench in the case of Som Datt Datta v. Union of India reported in AIR 1969 SC 414 wherein their lordships held as follows." iii. Mazinda Singh Kanu vs. CIT (P & H) ITA No. 421/2010 date of order 13.09.2010. iv. Baldevbhai Bhikhabhai Patel vs. DCIT (Guj) Spl Civil Applic....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t Id A.O, as well as, ld CIT(A) has not given telescopic benefit of the opening balance of Reserves & Surplus in the hands of the company for the year under consideration, if at all the addition is to be confirmed u/s 2(22)(e), amounting to Rs. 15,21,421 - 5500=Rs.l5,15,921 3. That neither Id A.O nor ld CIT(A) has provided sufficient opportunity to substantiate the credit of Rs. Seven lacs in the account of appellant on 02.08.2010 which is against the Principal of natural justice. 4. That order of Ld A.O is bad in law, as well as, on facts. 5. That appellant craves to add or amend any ground of appeal before the appeal is finally heard or disposed-off. 6. That the order may kindly be modified or another consequential relief be allowed." 6.1. The ld. Counsel for the assessee further filed an additional ground on dated 21.04.2022 which is reproduced as below: "1. That having regard to the facts and circumstances of the case, Hon'ble CIT(A) has erred in law and on facts in confirming the action of Ld. AO in assuming jurisdiction and framing the impugned assessment order u/s 153A/143(3) of the Act is bad in law and against the facts and c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....so placed intimation as proof of the return was processed u/s 143(1) of the Act. 6.5. Ld. CIT DR Mr. Dhawan further argued that the search took place on 05.12.2012 for assessment year 2011-12 and return was filed on 17.03.2012. As per Mr. Dhawan, CIT-DR this case is not abated, and the nature incriminating documents actually has not been defined in any of the Act. As per Mr. Dhawan all the documents of the of assessee are incriminating documents. The documents are unverified, un-assessed by the revenue authority during the processing of return u/s 143(1) of the Act. 6.6. Ld CIT-DR further argued & referred the order of Hon'ble Delhi High Court in case of CIT, Circle-3 vs. Kabul Chawla (2015) 61 taxman.com 412(Del):- "37. 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 seize....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n v. Leathem. [1901] AC 495, relied on Griffiths v. J.P. Harrison (Watford) Ltd., [1963] AC 1; Finsbury Securities Ltd. v. Inland Revenue Commissioners, [1966] 1 WLR 1402, referred to.116" Also respectfully relied on in case of Siddharam Satlingappa Mhetre vs. State of Maharashtra and Ors, (SC), Criminal Appeal No-2271 of 2010, Date of Order-02/12/2010: "139. Now we deem it imperative to examine the issue of per incuriam raised by the learned counsel for the parties. In Young v. Bristol Aeroplane Company Limited (1994) All ER 293 the House of Lords observed that `Incuria' literally means `carelessness'. In practice per incuriam appears to mean per ignoratium. English courts have developed this principle in relaxation of the rule of stare decisis. The `quotable in law' is avoided and ignored if it is rendered, `in ignoratium of a statute or other binding authority. The same has been accepted, approved and adopted by this court while interpreting Article 141 of the Constitution which embodies the doctrine of precedents as a matter of law. "......... In Halsbury's Laws of England (4th Edn.) Vol. 26: Judgment and Orders: Judicial Decisions as Author....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o documents of the assessee. Respectfully observed the order of Hon'ble Supreme Court in the case of Rajesh Jhaveri Stock Brokers Pvt. Ltd, supra "12. What were permissible under the first proviso to section 143(1)(a) to be adjusted were, (i) only apparent arithmetical errors in the return, accounts or documents accompanying the return, (ii) loss carried forward, deduction allowance or relief, which was prima facie admissible on the basis of information available in the return but not claimed in the return and similarly (iii) those claims which were on the basis of the information available in the return, prima facie inadmissible, were to be rectified/allowed/disallowed. What was permissible was correction of errors apparent on the basis of the documents accompanying the return. The Assessing Officer had no authority to make adjustments or adjudicate upon any debatable issues. In other words, the Assessing Officer had no power to go behind the return, accounts or documents, either in allowing or in disallowing deductions, allowance or relief." 6.12. Respectful observation of this order which is stated that during processing of return u/s 143(1) there is no application o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s wrongly made an addition of Rs. 1,42,892/- disallowed the expenses of loss on sale of car . 5. That the appellant craves the leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other." 8.1 Also the assessee filed an additional ground during the hearing on the date 03.12.2021 before the bench. The Additional ground reproduced as under: "Sub: Prayer for admission of additional grounds in the case of Ms Guru Nanak Milk Products, Ferozpur Cantt. in ITA No. 583 ASR/2019, 584/ASR/2019; 585/ASR/2019 The appellant begs to move the following ground as additional ground:- 1. That having regard to the facts and circumstances of the case, Hon'ble CIT(A) has erred in law and on facts in confirming the action of Ld. AO in passing the impugned assessment order u/s 143(3) r.w.s. 153C of the Act and that too without complying with the mandatory requirements and conditions u/s 153D as envisaged under the Income Tax Act, 1961. Since the above ground does not require fresh facts to be investigated and goes to the root of the matter, it is prayed that ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in the case of the assessee M/s. Guru Nanak Milk Products where reference of documents found from various premises and their relevance in relation to action under section 153C in the case of the assessee has been duly recorded by the Assessing Officer of the assessee. In view of the above facts, the arguments of the AR on this ground are not found acceptable and assumption of jurisdiction by the AO is found valid as per law. Accordingly, this ground of appeal is dismissed." The counsel of the assessee took the plea that the proceedings u/s 153C were initiated on 12.10.2017 by issuing notices to the assessee. The point is that the order was passed barred by the limitation. As per section 153C r.w.s. 153D of the Act. 10.1. The ld. Counsel also referred the judgment of Hon'ble Supreme Court in case of Super Malls P. Ltd. Vs. PCIT-8, New Delhi 115 taxman.com105 (SC). 10.2. The ld. CIT DR Mr. Rahul Dhawan further argued that limitation will start with the AO received seized material section 153C is initiated on 12.10.2017. He also referred the order of the ld. CIT(A) in page no. 8, as mentioned above. After the satisfaction of the AO the 153C will be issued. He respec....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... S. No. Name of the assessee A.Y. 1. 2. M/s. Narula Foods Pvt. Ltd., Guru Harcahai, Ferozpur M/s. Sat Kartar Solvex Pvt. Ltd., Vill. Sandhe Hasham, Ferozpur 2008-09 to 2014-15 2008-09 to 2014-15 3. M/s. G.H. Agro Products Pvt. Ltd., Vill. Wadala 2008-09 to 2014-15 Bhittewad, Amritsar 4. M/s. Guru Sahal Foods Pvt. Ltd., Guru Harsahal. 2008-09 to 2014-15 Ferozpur 5. M/s. Narula Solvex Pvt. Ltd., Moga 2008-09 to 2014-15 6. M/s. Narula Oil & Fats Pvt. Ltd., at Ladoriyal Valva 2008-09 to 2014-15 Sanand Rd., Gujrat 7. Sh. Ravi Narula, Guru Harsahai, Ferozpur. 2008-09 to 2014-15 Sh. Ashok Kumar Narula, Guru Harsahai, Ferozpur 2008-09 to 2014-15 9. 10. Sh. Arun Narula, Ranjit Avenue, Amritsar Sh. Gaurav Narula, Bhopal Tehsil Daskroi. Ahmedabad. 2008-09 to 2014-15 2008-09 to 2014-15 Document 2 3 on कारà¥à¤¯à¤¾à¤²à¤¯ संयà¥à¤•à¥à¤¤ आयकर आयà¥à¤•à¥à¤¤ केनà¥à¤¦à¥à¤°à¥€à¤¯ मंडल जालंध....