TaxTMI 
TaxTMI 
2022 (7) TMI 1482
X X X X Extracts X X X X
X X X X Extracts X X X X
....écor Group on 06.03.2018. Consequent to the search action, the case of the assessee being Director and Key person on D Décor Group, was centralized vide order u/s. 127(2) of the Act on 29.05.2018. Consequently, notice u/s. 153A dated 11.01.2019 was issued and served on the assessee. In response assessee filed his return of income on 09.02.2019 declaring total income of Rs..38,45,10,750/- after claiming deduction of Rs..1,60,000/- under Chapter VI-A of the Act. Accordingly, notices u/s. 143(2) and 142(1) of the Act were issued and served on the assessee. In response AR of the assessee attended and submitted the relevant information as called for. 4. During assessment proceedings, Assessing Officer observed that assessee is holding 84.5% of the shares and assessee has received loans and advances during the year. He observed that D Décor Home Fabrics Private Limited (DDHF) has given loans either directly to the assessee or in the form of payments made to third parties on behalf of the assessee. When the assessee was asked to substantiate, assessee submitted that the transaction with D Décor Home Fabrics Private Limited are running account and which is mutu....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... for admission of the above said additional grounds of appeal and further, he submitted that Ld. CIT(A) has already deliberated on this issue. 9. Considered the rival submissions and material placed on record, we observe that the issue raised by the assessee in additional grounds of appeal goes to the root of the matter and accordingly, admitted and proceeded to adjudicate the same. Since it is a jurisdictional issue we proceed to decide this issue without going into merits of the case. 10. At the time of hearing, Ld. AR brought to our notice, notice issued u/s. 153A of the Act dated 11.01.2019 to the assessee which is placed on record vide letter dated 14.06.2022. As per the notice issued by the Assessing Officer which is general in nature and nowhere Assessing Officer has discussed the material found during the search in the notice issued u/s. 153A of the Act. In this regard he brought to our notice decision of the Hon'ble Bombay High Court in the case of Underwater Services Co. Ltd. v. ACIT & Others (2002) 326 CTR (Bom) 208. He submitted that in the above said decision the Hon'ble High Court has reproduced the notice issued u/s. 153A of the Act to the assessee which is....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vation on the merits of the case. Respondent may issue fresh notice under Section 153A and word it suitably, as advised so that petitioner may have some information reading that notice the basis on which such notice has been issued. All rights and contentions of the parties are kept open." 11. Further, he brought to our notice the case of D Décor Exports Pvt. Ltd., v. DCIT in ITA.No. 1050,1055,1056,1057, & 1709/Mum/2021 dated 22.04.2022 wherein the Coordinate Bench has considered the above decision and decided the same issue in favour of the assessee. 12. With regard to no incriminating material found, Ld. AR submitted that assessee is an individual and major shareholder in D Décor Group in which search was conducted on 06.03.2018. He submitted that return was filed on 16.11.2016 and notice u/s. 143(2) of the Act was issued on 30.09.2017. He brought to our notice Page No. 24 of the order of the Ld. CIT(A) and his conclusion. Further, he brought to our notice Page No. 7 of the Paper Book which is statement recorded from the assessee on 07.03.2018. Ld. AR took us through the statement recorded and submitted that Assessing Officer has not raised any query regarding iss....
X X X X Extracts X X X X
X X X X Extracts X X X X
....BN Dairies & Allied Ltd. v. ACIT (2018) 96 taxmann.com 353 (Del-Trib.) (TM). (x). Lord Krishna Dwellers (P) Ltd. v. DCIT, (2019) 197 TTJ (Del) 502. (xi). ACIT v. RPD Earth Movers (P.) Ltd., (2019) 101 taxmann.com 89 (Chennai-Trib). In the said decision it was observed in para 5 that accounts in the form of Tally cannot be said to be incriminating material found during search. (xii). Moon Beverages Ltd. & Anr. v. ACIT, (2018) 195 TTJ 0076 (Del). In the said decision the Tribunal in para 41 held that statement recorded u/s. 132(4) cannot constitute incriminating material. (xiii). Vishal Dembla v. DCIT, (2013) 157 TT) (Jd) 189. In the said decision the Hon'ble Tribunal held that the gifts disclosed by the assessee for the first time u/s. 153A cannot be added in the absence of any incriminating material found in the course of the search and seizure proceedings. The findings are at para 2.8 of the said decision. (xiv). Metalind (P) Ltd. v. DCIT, (2019) 72 ITR Trib (Trib) 204) (Kol). In the said decision it is held that profit and loss account and balance sheet cannot be considered as incriminating material and the details filed of a flat constitutes official record of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on of the Hon'ble Bombay High Court in the case of Underwater Services Co. Ltd. v. ACIT & others (supra) in the case of D Décor Exports Pvt. Ltd., v. DCIT., (supra), for the sake of clarity it is reproduced below: - "16. Considered the rival submissions and material placed on record. First let us deal with the jurisdictional issue raised by the assessee in their appeal that the Assessing Officer has issued improper notice u/s 153A of the Act to initiate the unabated assessment year under consideration. We noticed from the submissions of the Ld AR that the notice issued u/s 153A by the Assessing Officer does not contain any details of incriminating material found during the search. In absence of such crucial details, whether the assessment made under section 143(3) r.w.s 153A is bad in law. As indicated earlier the notice issued u/s 153A does not contain any details of incriminating material or any reasons for which the assessment is reassessed u/s 153A of the Act, we observe that in the similar situation, the Hon'ble Bombay High Court in the case of Underwater Services Company Limited (supra) held that issuance of notice is the preliminary step which enables the assess....