TaxTMI 
TaxTMI 
2023 (7) TMI 176
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....the following questions to be arising as substantial questions of law in the appeal, "(i) Whether in the facts and circumstances of the case, the ITAT has rred in deleting the addition u/s. 68 of Rs. 94,33,504/- made on account of bogus LTCG and addition u/s. 69C of Rs. 2,54,130/- made on account of expenses on bogus LTCG ? (ii) Whether in the facts and circumstances of the case, the ITAT has erred in giving relief to the assesse holding that no incriminating materials were found with regard to the issue of additions made in the assessment order ?" 3. The facts in brief are that on 27.12.2016, the Assessing Officer passed assessment order under section 143(3) read with section 153A(1) (b) of the Income Tax Act, 1961 (hereinafter referr....
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....t 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 the said proposition, other High Courts took the view that if no assessment proceedings are pending on the date of initiation of search, the Assessing Officer can consider only such incriminating material found during the search and it is not permissible for the Assessing Officer to consider any other material derived from any other source. 4.1 The supreme court in Abhisar Buildwell P. Ltd. (supra) answered the question as to whether in resp....
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.... 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 as under: Summary of the legal position 38. 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 Act, notice under Section 153A(1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previou....
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.... 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 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." 4.5 The decision of Saumya Construction (supr....