2023 (10) TMI 569

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....ated 10.01.2022 for the said Assessment Years, ordering some additions to the return of income by the Assessees. The learned Counsel agree that a common judgment can dispose of both these appeals. 3. In these appeals, the appellant has proposed the following substantial questions of law: A. Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT was correct in deleting the additions made in the assessment order which was rightly upheld by the CIT (Appeals)? B. Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT erred in deleting the addition the ground that the same is not based on incriminating documents, although the Assessment was made for the first time and all the issues....

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....n any incriminating material found during the course of search based on which the addition was made. Even the Id. First Appellate Authority has not made any whisper in his order regarding any incriminating material found during the course of search. Under these circumstance that addition made by the Id. AO has not legs to stand on. The Ld. Departmental Representative could not dispute the proposition that additions in the present case cases have not been made on the basis of any incriminating material found during search." 7. Based upon the above, the I TAT, by following the decisions of the Mumbai Bench of the Tribunal in the case of DCIT V/s. Vipul Suresh Kumar Modi in ITAT No.540/Mum/2021 and of this Court in Commissioner of Income-tax....

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.... the jurisdiction to assess or reassess the 'total income' taking into consideration the incriminating material collected during the search and other material which would include income declared in the returns, if any, furnished by the assessee as well as the undisclosed income. However, in case during the search no incriminating material is found, in case of completed/unabated assessment, the only remedy available to the Revenue would be to initiate the reassessment proceedings under sections 147/48 of the Act, subject to fulfilment of the conditions mentioned in sections 147/148, as in such a situation, the Revenue cannot be left with no remedy. Therefore, even in case of block assessment under section 153A and in case of unabated....

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....such a view in the case of Commissioner of Income Tax V/s. M/S. Kesarwani Zarda Bhandar Sahson (Civil Appeal Nos. 7738- 7732-7735/2021 and 7740- 7739/2021, 7736-7737/2021, 7743/2021) which was not interfered with by the Hon'ble Supreme Court. 12. As regards the liberty to proceed under Section 147/148 is concerned, Mr Joshi also does not dispute that such a liberty would be available to the Revenue subject to fulfilment of the conditions mentioned in Section 147/148. In U.K. Paints (Overseas) (supra), the Hon'ble Supreme Court, upon referring to Abhisar Buildwell (P.) Ltd. (supra), particularly, the observations in paragraphs 11 and 13 clarified that the Revenue would have the liberty to initiate reassessment proceedings under Sect....