TaxTMI 
TaxTMI 
2023 (5) TMI 917
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....f order dated 23.11.2022 of the Income Tax Appellate Tribunal, Rajkot in Income Tax (SS)A No. 155 of 2016 in respect of the Assessment Year 2008-2009. 2.1 The Revenue has proposed the following questions to be arising as substantial questions of law in the appeal, "(i) Whether on the facts and circumstances of the case, the Hon'ble Tribunal has erred in finding that addition during the assessment u/s 153A has to be confined to the incriminating material found during the course of search u/s 132(1) of the Act ? (ii) Whether the Hon'ble Tribunal has erred in law and on facts in upholding the order of the CIT(A) on the issue of deletion of the addition made on account of dis-allowance of ROC & stamping expenses of Rs. 7,71....
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....ces out of interest bearing funds during the assessment u/s 153A of the Act by holding that additions have to be confined to the incriminating material found during the course of search u/s 132(1) of the Act, even though, there is no such stipulation ? (vi) Whether the Hon'ble Tribunal has erred in law and on facts in upholding the order of the CIT(A) on the issue of deletion of the addition made on account of dis-allowance of depreciation on land cost of wind mill of Rs. 3,38,000/- during the assessment u/s 153A of the Act by holding that additions have to be confined to the incriminating material found during the course of search u/s 132(1) of the Act, even though, there is no such stipulation in Sec. 153A of the Act ? 3. The ....
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....irly conceded that the issue represented in the substantial questions of law is answered by the supreme court in Principal Commissioner of Income Tax, Central-3 vs. Abhisar Buildwell P. Ltd. being Civil Appeal No. 6580 of 2021 and other group of appeals decided on 24th April, 2023. They were the group of appeals filed by the Revenue as well as the assessee respectively. The issue involved in the said appeals before the supreme court was about the scope of assessment under section 153A of the Act. According to the case of the Revenue, the Assessing Officer is competent to consider all the material available on record including the material found during the search and make assessment of 'total income'. While some High Courts had agreed with t....
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....bsequently followed and approved by the other High Courts, referred to hereinabove. One another lead judgment on the issue is the decision of the Gujarat High Court in the case of Saumya Construction (supra), which has been followed by the Gujarat High Court in the subsequent decisions, referred to hereinabove. Only the Allahabad High Court in the case of Pr. Commissioner of Income Tax v. Mehndipur Balaji, 2022 SCC Online All 444 : (2022) 447 ITR 517 has taken a contrary view." (para 7) 4.4 The Kabul Chawla (supra) was quoted for its ratio as under, "In the case of Kabul Chawla (supra), the Delhi High Court, while considering the very issue and on interpretation of Section 153A of the Act, 1961, has summarised the legal position....
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.... 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 o....