TaxTMI 
TaxTMI 
2025 (3) TMI 1553
X X X X Extracts X X X X
X X X X Extracts X X X X
....ightly passed order under Section 250 of the Income Tax Act and deleted the addition of Rs. 9,65,71,414/-. Similarly, in Ground No. 5, the assessee has pleaded that CIT (A) has rightly deleted addition made under Section 68 read with Section 115BBE amounting to the tune of Rs. 9,65,71,414/-. In other words, both the grounds are in support of the CIT(A)'s finding. If we peruse sub-clause (4) of Section 253 of the Income Tax Act, it provides that the AO or the assessee, as the case may be, on receipt of notice that an appeal against the order of the CIT (A) has been preferred under sub-section (1) or sub-section (2) by the other party, may notwithstanding that he may not be appealed against such order, or any part thereof, within 30 days of receipt of the notice, file a Memorandum of Cross Objection and in other words, a respondent could file a Cross Objection within 30 days on receipt of notice in an appeal. This clause further contemplates that this Cross Objection should be against any part of the order of the CIT(A). It means it is to be filed aggrieved with any part of the order. No Cross Objection is maintainable qua in support of the order. Hence, these grounds ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....age No. 72 to 91. 6.1 Similarly, he relied upon the judgement of ITAT Chandigarh in the case of Shri Tarsem Singla Vs CIT- Central, in ITA No. 263/CHD/2012, copy is placed at page No. 92 to 108. He further relied upon the order of the ITAT in the case of Ganesh Builders Vs CIT passed in ITA No. 452/CHD/2022. Copy of this order is being placed at page No. 109 to 123. On the strength of these judgements, ld. Counsel for the assessee contended that assessment order is not sustainable in the present form. 6.2 The ld. CIT DR, on the other hand contended that since notice under Section 153A was served upon the assessee as the assessee was also covered under the search action, therefore, it was open for the AO to look into all the relevant material. 7. We have duly considered the rival contentions and have perused the record carefully. Section 153C has a direct bearing on the controversy. Therefore, we deem it appropriate to take note of the relevant part of this Section which read as under : Assessment of income of any other person. "153C. (1) Notwithstanding anything contained in section 139, section 147, section 148, section 149, sect....
X X X X Extracts X X X X
X X X X Extracts X X X X
....arnataka High Court in the case of CIT Vs IBC Knowledge Park. The relevant observations contained in paragraph No. 49 to 51 are worth to be noted which read as under : "49. On a conjoint reading of the aforesaid provisions, it becomes clear that a search can take place only when a concerned officer has information and reason to believe that any person is in possession of any valuable assets, which has not been or would not be disclosed under the Act. In such a case, a search can take place. Following the search, if any books of account, other documents, any valuable assets is or are found in the possession or control of any person in the course of a search, then the books of account or other documents or valuable assets could be seized. Under Section 153A, the satisfaction regarding an inference of liability must be recorded. The Assessing Officer has to issue notice to the assessee i.e., the person searched for the purpose of assessment or reassessment of the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted. Section 153C as already noted, deals with assessment of income of a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....; as defined in Clause (b) of Section 158B(b) of the Act. This becomes even more clear on a comparison of section 132(l)(c) with Section 158B(b) of the Act. It is for the above reason that Sections 153A and 153C begin with a non-obstante clause in order to make these provisions exclusive of Sections 139, 147, 148, 149, 151 and 153 of the Act. If a search operation does not lead to detection of undisclosed income as defined in Chapter XIV-B of the Act, then no purpose would be served in reopening the assessment already completed. Also, if there is no detection of any undisclosed income, then there would be no need for pending assessment to abate. Thus, when particulars of income declared in the return is already available with the Assessing Officer, such income cannot form part of undisclosed income even if such return is filed beyond the time-limit, but before search, as long as they relate to any year covered in the block. Thus, a block assessment is justified only on the basis of evidence found during search and the materials or information relatable thereto. Section 153C is in pari materia with Section 158BD conferring jurisdiction over third parties to a search providing certai....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed by the Assessing Officer that any undisclosed income belongs to any person, other,than the person with respect to whom search was made under Section 132 of the Act; (ii) The books of account or other documents or assets seized or requisitioned had been handed over to the Assessing Officer having jurisdiction over such other person; and (iii) The Assessing Officer has proceeded under Section 158BC against such other person. The conditions precedent for invoking the provisions of Section 158BD, thus, are required to be satisfied before the provisions of the said chapter are applied in relation to any person other than the person whose premises had been searched or whose documents and other assets had been requisitioned under Section 132A of the Act." 8.1 The other orders relied upon by the assessee of ITAT Chandigarh Bench are on the same line. 9. It is further observed that Section 158BD is pari materia to Section 153C and judgement of Hon'ble Supreme Court in the case of CIT Vs Calcutta Knitwears reported in 362 ITR 673 also laid down the conditions when 158BD could be invoked. 10. At the time of hearing, ld. CIT DR has expressed his apprehension as to how ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rch was carried out at the premises of the assessee, therefore, no notice ought to have been issued under Section 153A. Hon'ble High Court took cognizance of Section 153C of the Income Tax Act and recorded that the procedure contemplated in 153C is a mandatory procedure. The Hon'ble Court has also made reference to the decision of Hon'ble Supreme Court in the case of Abhisar Buildwell Pvt. Ltd. 454 ITR 212 and others. We find that on the principle of law, whether without following the mandatory procedure of Section 153C, the document 'BTD 2011' found at the premises of Shri Kapil Romana could be used in an assessment proceeding of the assessee undertaken under Section 153A or not. We have held that this document cannot be used and for relying upon this document, the Revenue has to follow the mandatory procedure contemplated under Section 153C. 11. The kind of revenue involved in this appeal of the Department indicates that dispute will be carried on before the higher appellant authorities. Therefore, we deem it appropriate to adjudicate the issue on merits also. The Revenue has taken six grounds of appeal but its grievance revolves around the single issue namely, ld.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted for or is not related to him and does not represent his income in any form and the other part (opening balance)is unexplained cash credit. In fact, in case if the part transactions are wrong, there is no reason to make unexplained cash credit. In fact, in case if the part transactions are wrong, there is no reason to make impugned addition of other part (i.e. the opening balance) which is unsubstantiated in absence of any corroborative evidence. Since part of the transaction has been accepted as not related to the assessee then the same logic should have been applied to other part (i.e. opening balance). (ii) The relied upon document is not a genuine document. Not only no addition has been made in case of assessee for AY 2020-21, ASC builders Pvt Ltd for all the relevant years but also no addition has been made in case of Jagjeet Chawla whose ledger the AO has strongly relied on to allege that the amount represents unexplained credit. Following the principles of consistency, addition cannot to be made in the case of the appellant for current year, Moreover, the AO has failed identify the entity BTD 2011. (iii) The AO has also failed to refer to any corroborati....
X X X X Extracts X X X X
X X X X Extracts X X X X
....neja, IT Appeal No. 57 of 2017. He further relied upon decision of Hon'ble Bombay High Court in the case of PCIT Vs Hassan Ali Khan 426 ITR 556. He also placed on record the copies of these decisions as well as some other orders of the ITAT on this point. He further contended that author of the ledger account is unknown. He was never put to cross-examination by the assessee. The assessee has made specific request for this purpose. He pointed out that in paragraph No. 4.11, the AO has observed that Shri Kapil Romana has accepted this ledger account in his statement 'on oath' but it is pertinent to note that he can accept 'on oath' qua himself and cannot bind the assessee. The ld. Counsel for the assessee has relied upon judgement of Hon'ble Supreme Court in the case of Shri Vasantlal & Co. Vs CIT 45 ITR 206. He also relied upon two decisions of Hon'ble Delhi High Court, namely; CIT Vs Ashwani Gupta 322 ITR 326 and CIT Vs Pradeep Kumar Gupta 303 ITR 95. 15. The ld. Counsel for the assessee further contended that document is to be read as a whole. He took us through the document which is being reproduced by the CIT (A) at page 20 of the impugned order. He poin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or requisition. Therefore, only in a case where the undisclosed income is found on the basis of incriminating material, the AO would assume the jurisdiction to assess or reassess the total income for the entire six years block assessment period even in case of completed/unabated assessment. As per the second proviso to Section 153A, only pending assessment/reassessment shall stand abated and the AO would assume the jurisdiction with respect to such abated assessments. It does not provide that all completed' unabated assessments shall abate. " 17. The authenticity of the document has not been proved by the AO because assumption of truth contemplated under Section 132(4) is confined qua the person who has confessed a document. In other words, this document was from the books of Shri Kapil Romana and if he admits these entries pertaining to him can be construed as true qua him and he can be bound for the liabilities, but not a third person. We rely upon the judgement of Hon'ble Supreme Court in the case of CBI Vs V.C. Shukla (supra). 17.1 The AO has not put Shri Kapil Romana for cross examination of the assessee and in the absence of opportunity of cross examination, any....