TaxTMI 
TaxTMI 
2024 (10) TMI 416
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....he sale proceeds shown in the bank in the income tax return. 2. That the Ld. CIT(A) has erred in confirming the addition of Rs. 454706/- without appreciating that the assessee was a small business man running a restaurant business under the name of M/s Candle Light Restaurant and had filed the return of income under section 44AD on presumptive taxation basis. That the provision of section 69A could not be applied where no books of accounts were maintained. 3. That without prejudice to the aforesaid, the Ld. CIT(A) has erred in not appreciating that all the credits in bank are in respect of sales and as such, the addition has to be restricted to profit element @ 8% as per the provisions of section 44AD. 4. That the CIT(A) has erred in confirming the addition made by the AO ignoring the fact that the assessment framed u/s 153A is bad in law since the same is without mentioning DIN which is a mandatory requirement as per circular no_. 5. That the Ld. CIT(A) has erred in confirming the addition of Rs. 454706/- by not appreciating that the debits in the same bank account represent the amount expended for business purposes and as such, addition made u/....
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....- without appreciating that the provision of section 69A could not be applied where no books of accounts were maintained. That the CIT(A) has failed to appreciate that the assessee has filed the return of income for the year under consideration by applying the provisions of section 44AD. 6. That the Ld. CIT(A) has erred in confirming the addition of Rs. 648720/- merely on the basis of suspicion, surmises and conjecture and without bringing on record any material to prove that the appellant was in receipt of any income other than business income. 7. That the appellant craves leave to add or amend the grounds of appeal before the appeal is heard and disposed off." 4. The ld. counsel for the assessee has explained the reason for the delay of 443 days in filing the appeals with the support of an affidavit filed with an application dated. 20.09.2023 explaining therein the bonafide reasons that the appellant Sh. Nasir Ahmad Dar had undergone various medical tests and later advised to undergo Endovascular surgery and finally admitted to AIIMS Hospital, Ansari Nagar, New Delhi. As a result, the appellant could not approach the AR to file the appeal. Thus, the cause of ....
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....ppeals holding that these were not fit cases in which inordinate delay of 1754 days in appeals deserved to be condoned. However, it was found that respondent revenue did not express refute stand taken by assessee that they had no knowledge about passing of order, dated 29-12-2003, until June, 2008. The Supreme Court held that unless that fact was to be refuted by the Revenue, question of disbelieving stand taken by assessee on affidavit, could not arise and for which reason, High Court should have shown sympathy to assessee by condoning delay in filing concerned appeal(s)." c) Hon'ble Supreme Court in the case of Shakuntala Devi Jain vs Kuntal Kumari And Ors. AIR 1969 SC 575, 1969SCR 1006 I.T.A. No.57/Asr/2021 Assessment Year: 2010-11 "We are inclined to accept the statement that she was under the bona fide impression that the certified copy was not ready, and that is why it was not supplied to her by the copying department. It is not a case where it is possible to impute to the appellant want of bona fides or such inaction or negligence as would deprive her of the protection of Section 5 of the Limitation Act. We are therefore inclined to allow her applicatio....
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....s of bank statement submitted in reply submitted in response to questionnaire issued by the AO [Refer para no 4 of the assessment order at page no 14 of the PB]. Your Honor, it is an established law that no addition can be made u/s 153A otherwise than on the basis of incriminating document. As such, the additions made by the AO and sustained by the Hon'ble CIT(A) which are not based upon any document found during the course of search, deserves to be deleted. In this regard reliance is being placed upon the following case laws: - a) [2023] 154 taxmann.com 45 (SC) SUPREME COURT OF INDIA Principal Commissioner of Income-tax v. Jay Ace Technologies Ltd Section 68, read with section 153A, of the Income-tax Act, 1961 - Cash credits (Share application) - Assessment year 2008-09 to 2011-12 - Assessee filed return of income for relevant assessment years and said assessment was completed accordingly - Thereafter, a search was conducted at premises of assessee-company wherein certain share certificates were found which showed that certain companies had invested in shares of assessee's group of companies including assessee - Further, based on statement of one third party,....
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.... in absence of any incriminating material found during course of search under section 132 or requisition under section 132A - Held, yes - Whether, however, completed/unabated assessments can be reopened by Assessing Officer in exercise of powers under section 147/148 subject to fulfilment of conditions as envisaged/mentioned under section 147/148 and those powers are saved - Held, yes [Paras 8, 12 to 14] [In favour of assessee] c) [2023] 153 taxmann.com 155 (Calcutta) HIGH COURT OF CALCUTTA Principal Commissioner of Income-tax v. Phalguni Enclave (P.) Ltd. Section 153A, read with section 143(3) of the Income-tax Act, 1961 - Search and seizure - Assessment in case of (Illustration) - Assessment year 2011-12 - Assessment of assessee was completed for relevant assessment year - Thereafter, a search was conducted at premises of assessee - Assessing Officer thereafter, made addition under section 153A/143 - Whether addition made by Assessing Officer were not based on any incriminating materials/paper seized during search operation and therefore, it deserved to be deleted - Held, yes [Para 5] [In favour of assessee] 10. Per contra, the Ld. DR relied on the impugned o....
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....y which were subject to search u/s 132 and as such the assessment proceedings had to be initiated vide notice u/s 153Cof the Income Tax Act. He pleaded that the assessment order may be quashed as void ab initio. In support, the Ld. AR filed written note, relevant part of the same reads as under: 9.1 That a search and seizure operation u/s 132 was carried out at the premises of Sh. Mohammad Nayeem Khan and the related parties Sh. Nasir Ahmad Dar, Sh. Muzaffar Ahmad Dar [The appellant] and Sh. Ishtiaq Ahmad Dar on 27.02.2019. 9.2 It is a matter of record that nothing incriminating, cash or undisclosed assets was found during the course of search from the residential premises of the appellant 301, Baba Building, residency road, Poloview, Srinagar which lead to conclusion that the appellant has earned total income of Rs 936250/- against the returned income of Rs 253530/-. The whole case has been framed on the basis of the CA certificate seized from the premises of company M/s Golden Tulip Hospitality Pvt. Ltd marked as page no 38 of annexure A-l. In these circumstances the proceedings were required to be initiated u/s 153C particularly considering the fact that the co....
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....s seized or requisitioned have a bearing on the determination of the total income of such other person -[for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and] for the relevant assessment year or years referred to in sub-section (1) of section153At :] 9.5 That the Ld. A.O. has completed the assessment under section 153A for the A.Y. 2018- 19 which is bad in law, since the addition has been made on the basis of material seized during search conducted on a person other than the assessee (i.e., M/s Golden Tulip Hospitality Pvt. ltd for which an independent search warrant was issued). That the assessment proceedings can only be initiated in case of assessee u/s 153C and not 153A, only after satisfaction was arrived in the assessment proceedings of M/s Golden Tulip Hospitality Pvt, that the material found and seized during search, pertain to appellant. That the CIT(A) has failed to appreciate that the searched premises from where the income certificate was found does not belong to the assessee, thus, the assessment order u/s 153A is completely without jurisdiction, void- ab-initio....
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....an proceed against such other person. However, in the case under appeal before us, admittedly. Section 153C is not invoked in the case of the assessee and the assessment is framed under Section 153A. We hold that during the course of assessment under Section 153A, the incriminating material, if any, found during the course of search of the assessee only can be utilized and not the material found in the search of any other person. c) 2017 (7) TMI 1091 - DELHI HIGH COURT - PR. COMMISSIONER OF INCOME TAX CENTRAL-2, NEW DELHI VERSUS SUBHASH KHATTAR Additions made u/s 153A - proof of incriminating material found in search - Held that:- The entire case against the Assessee was based on what was found during the search of the premises of the AEZ Group. It is thus apparent on the face of it, that the notice to the Assessee under Section 153A of the Act was misconceived since the so-called incriminating material was not found during the search of the Assessee's premises. The Revenue could have proceeded against the Assessee on the basis of the documents discovered under any other provision of law, but certainly, not under Section 153A.This goes to the root of the matte....