TaxTMI 
TaxTMI 
2024 (10) TMI 1373
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....rly known as M/s Krishna Flexi Solution), C-13, Sushant Lok, Phase-1, Gurugram on 28.03.2018. In the return of income, the assessee has declared its income of Rs. 3,53,03,79,100/-. After giving opportunity to the assessee, the assessment order was passed under Section 153A (1) (b) of the Act on the total income of Rs. 5,77,68,34,292/-. Aggrieved against the same, the assessee preferred appeal before the Commissioner of Income Tax (Appeals)-3, Gurugram, who vide his order dated 31.03.2022 dismissed the appeal. Thereafter, the assessee filed the appeal before the ITAT, which was allowed vide order dated 23.09.2022. Now the Revenue is in appeal before this Court. 3. Learned counsel for the Revenue submitted that the ITAT was incorrect in holding that no search was conducted in the premises of the assessee, whereas warrants of authorization were executed in the name of the assessee. It was incorrect in holding that no additions can be made under Section 153A of the Act as there was no incriminating material found during search. The interpretation made under Section 153A of the Act by the ITAT that proceedings can be initiated only with regard to incriminating material found during sea....
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....he assessee found mentioned does not belong to the assessee, the search could not be held to be valid. She submitted that no incriminating material was found from the premises of the assessee to justify the additions of Rs. 62.89 crores in the hands of the assessee. 9. Learned counsel for the Revenue submitted that the ITAT has wrongfully noted that no incriminating material was found at the premises where the search was conducted. He also submitted that warrants, which were issued to search 106A, Tower-1, DLF Aralias, Golf Link, Gurugram, mentioned the name of the respondent, therefore, there was sufficient incriminating material available for initiating proceedings. There is perversity in the order passed by the ITAT. 10. We have carefully considered the submissions of the counsel for the parties and perused the referred law. 11. Although, prima facie, this Court is of the firm view that the factual aspects would not be examined in appeal but with the purpose to satisfy ourselves, we asked the Department to place before us the warrants of authorization issued under Section 132 of the Act. 12. The original file containing satisfaction note for issue of consequential warrant of....
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.... the course of search operation conducted against the respondent-firm or its partners that incriminating material was recovered. If there was any indication of violation of provisions of the Act or suppression of income or any other incriminating material, which may have been recovered from the premises, the proceedings under Section 153-A of the Act can be said to be justified and legal. However, since no such material was collected or found from the premises of the respondent-assessee, we are unable to sustain the proceedings initiated under Section 153-A of the Act. 15. Delhi High Court in Kabul Chawla's case (supra) has held as under:- "Summary of the legal position On a conspectus of section 153A (1) of the Act, read with the provisos 37 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 assessment years immediately preceding the previous year relevant to the assessment year in which the search takes place. (ii) ....
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....imited (2023) 454 ITR 212, the Supreme Court upheld the law laid down in Kabul Chawla's case (supra) and held as under:- "For the reasons stated hereinbelow, we are in complete agreement with the view taken by the Delhi High Court in the case of Kabul Chawla (supra) and the Gujarat High Court in the case of Saumya Construction (supra), taking the view that no addition can be made in respect of completed assessment in absence of any incriminating material." We further find that the proceedings, if at all which could have been initiated on the basis of material collected while conducting search of some other assessee and found to be relevant for the purpose, then the course which could have been adopted was only under Section 153-C of the Act. In Misty Meadows Private Limited vs Union of India and others 2024 (465) ITR 630, after considering the provisions of Section 153-A and 153-C of the Act, we have held that both operate in different fields. Relevant paras of Misty Meadows Private Limited (supra) are extracted below:- "Thus, we find that a particular procedure has been prescribed, as above. Following the salutary principles of law as laid down in Nazir Ahmad and followed in ....