MRS. SUMANLATA BANSAL, MUMBAI v. THE ACIT CEN CIR-8, MUMBAI

ITA 525/MUM/2008 | 1999-2000
Pronouncement Date: 28-09-2016 | Result: Allowed

Appeal Details

RSA Number 52519914 RSA 2008
Assessee PAN AAHPB0141N
Bench Mumbai
Appeal Number ITA 525/MUM/2008
Duration Of Justice 8 year(s) 8 month(s) 5 day(s)
Appellant MRS. SUMANLATA BANSAL, MUMBAI
Respondent THE ACIT CEN CIR-8, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 28-09-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 28-09-2016
Date Of Final Hearing 03-12-2015
Next Hearing Date 03-12-2015
Assessment Year 1999-2000
Appeal Filed On 22-01-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E MUMBAI BEFORE SHRI G.S. PANNU ACCOUNTANT MEMBER AND SHRI SANJAY GARG JUDICIAL MEMBER ITA NOS.525 526 527 528 529 & 530/M/2008 ASSESSMENT YEARS: 1999-2000 2000-01 2001-02 2002 -03 2003-04 & 2004-05 MRS. SUMANLATA BANSAL 1502/1503 SAFALYA TARA BAUG LOVELANE BYCULLA MUMBAI 400 010 PAN: AAHPB0141N VS. ASST. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-8 MUMBAI (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI ASHOK D. MEHTA A.R. REVENUE BY : SHRI S.D. SRIVASTAVA D.R. DATE OF HEARING : 29.07.2016 DATE OF PRONOUNCEMENT : 28.09.2016 O R D E R PER SANJAY GARG JUDICIAL MEMBER: PRESENT IS A BUNCH OF APPEALS PREFERRED BY THE ASS ESSEE AGAINST THE SEPARATE ORDERS OF THE COMMISSIONER OF INCOME TAX ( APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] OF EVEN DATED 26.09.2007 IN RELATION TO THE ADDITIONS MADE BY THE AO IN THE ASSESSMENT PROCEEDINGS CARRIE D OUT U/S 153A OF THE INCOME TAX ACT ON ACCOUNT OF GIFTS RECEIVED BY THE ASSESSEE DETAILED AS UNDER: S.NO. ASST. YEAR AMOUNT OF GIFT PARA NO. OF THE ASSESSMENT ORDER 1 1999-2000 RS.2 04 000/- PARA NO.5 2 2000-01 RS.4 55 000/- PARA NO.5 3 2001-02 RS.6 52 000/- PARA NO.5 4 2002-03 RS.4 55 000/- PARA NO.5 2. THE ASSESSEE IS AN INDIVIDUAL DOING BUSINESS OF DEALING IN SHARES AND SECURITIES AND ALSO DIRECTOR IN THE COMPANY M/S. B ANSAL SHAREVEST SERVICES ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 2 PVT. LTD. A SEARCH ACTION WAS CARRIED OUT IN THE P REMISES OF THE SAID COMPANY BUT NO INCRIMINATING MATERIAL WAS FOUND. DURING THE ASSESSMENT PROCEEDINGS FOR THE BLOCK OF 6 ASSESSMENT YEARS AS PER THE PROV ISIONS OF SECTION 153A OF THE ACT THE AO NOTICED THAT AS PER CERTAIN GIFT DEEDS THE ASSESSEE HAD RECEIVED THE AMOUNTS AS STATED IN THE TABLE ABOVE. THE AO ASKED THE ASSESSEE TO PRODUCE THE CONCERNED DONORS TO PROVE THE GENUINENESS OF THE GI FT AND FINANCIAL CAPACITY OF THE DONORS. IN REPLY DATED 17.02.2006 THE ASSESSEE SUBMITTED THAT THE GIFTS WERE RECEIVED THROUGH ACCOUNT PAYEE CHEQUES. THE AS SESSEE ALSO FILED CONFIRMATIONS OF THE DONORS IN THIS RESPECT. HOWEVE R THE CONFIRMATIONS FILED BY THE ASSESSEE WERE REJECTED BY THE A.O. ON THE GR OUND THAT THE AFFIDAVITS FILED BY THE DONORS WERE DATE 28.03.2006 WHEREAS THE COVE RING LETTER TO THESE AFFIDAVITS WAS DATED 27.3.2006 I.E. ONE DAY PRIOR T O THE DATE OF AFFIDAVITS. FURTHER THAT ALL THE DONORS WERE IDENTIFIED BY ONLY ONE PERSON. THE A.O. THEREFORE TREATED THE GIFTS SHOWN TO HAVE BEEN REC EIVED BY THE ASSESSEE AS UNEXPLAINED CREDITS UNDER SECTION 68 AND ADDED THE GIFT AMOUNTS INTO THE INCOME OF THE ASSESSEE. 3. IN HER APPEALS BEFORE THE CIT(A) THE ASSESSEE TOOK A LEGAL PLEA CHALLENGING THE VALIDITY OF THE ASSESSMENT ORDERS ON THE GROUND THAT THE NOTICES U/S 143(2) OF THE ACT WERE NOT ISSUED TO THE ASSESS EE BY THE AO BEFORE PASSING THE ASSESSMENT ORDERS. HOWEVER THE ASSESSEE DID NO T SUCCEED ON THE ISSUE OF LEGALITY AND VALIDITY OF THE ASSESSMENTS AS THE LEA RNED CIT(A) WAS OF THE OPINION THAT THE REQUIREMENT OF ISSUE OF NOTICE U/S . 143(2) TO MAKE ASSESSMENT AS IN THE CASE OF NORMAL PROCEDURE WAS NOT REQUIRE D AT ALL IN RESPECT OF THE ASSESSMENTS FRAMED U/SS. 153A OR 153C OF THE ACT. FURTHER THE LD. CIT(A) AFTER CONSIDERING THE SUBMI SSIONS OF THE ASSESSEE ISSUED A QUESTIONNAIRE AND ASKED THE ASSESSEE TO PR ODUCE DOCUMENTARY EVIDENCES OR THE DONORS /SOURCES FOR HIS EXAMINATIO N IN ORDER TO ASCERTAIN THE FINANCIAL POSITION OF THE ALLEGED DONORS TO MAKE TH E GIFTS. AFTER EXAMINING THE EVIDENCE SO FURNISHED BY THE ASSESSEE THE LEARNED CIT(A) CONCLUDED THAT THE ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 3 GIFTS COULD NOT BE ACCEPTED AS GENUINE GIFTS VIDE P ARA 2.3.10 OF HIS ORDER WHICH READ AS UNDER: - 2.3.10 THEREFORE IN VIEW OF THIS DETAILED DISCUSS ION HELD ABOVE THESE GIFTS CANNOT BE ACCEPTED AS A GENUINE GIFTS FOR THE FOLLOWING RE ASONS SUMMARIZED BELOW:- (I) ONLY AFFIDAVITS FROM THE DONORS FILED. (II) DONORS WERE NOT PRODUCED BEFORE THE ASSESSING OFFIC ER. (III) IN MANY CASES NO DETAILS OF THE ASSESSING OFFICER AND THE STATION OF ASSESSING OFFICER OF THE ALLEGED DONORS WERE THEY W ERE ASSESSED HAVE BEEN GIVEN ENABLING THIS ASSESSING OFFICER TO EXAMINE THE RECORDS OF THE ALLEGED DONORS. ONLY GIR NOS. HAVE BEEN GIVEN. (IV) NO DOCUMENTARY EVIDENCES OTHER THAN AFFIDAVITS WERE PRODUCED BEFORE THE ASSESSING OFFICER TO PROVE THE FINANCIAL COMPETENCE OF THE ALLEGED DONORS. (V) EVEN IN THE APPELLATE PROCEEDINGS WHEN I SPECIFICAL LY ASKED THE ASSESSEE TO PRODUCE THE PERSONS OR TO FURNISH THE D OCUMENTARY EVIDENCES FOR THE PURPOSE OF VERIFYING THE FINANCIA L COMPETENCE OF THE ALLEGED DONORS THE ASSESSEE EXPRESSED HIS INAB ILITY TO COMPLY WITH MY REQUEST. (VI) THUS THE ASSESSEE HAS FAILED TO ESTABLISH THE FINA NCIAL CAPABILITY OF THE DONORS TO ADVANCE THESE GIFTS. (VII) THE PECULIAR FACT OF A GROUP OF DONORS MAKING GIFTS TO A GROUP OF PERSONS OF THE ASSESSEE'S AND HIS FAMILY MEMBERS IS UNTHINKABLE AND HENCE IT FALLS OUTSIDE THE REALM OF HUMAN PROBABILI TY. THEREFORE SINCE THE ASSESSEE HAS NOT EXPLAINED PRO PERTY THE SOURCE OF THE INVESTMENT OF DEPOSITS IN THE BANK ACCOUNT WHICH SH E HAS ATTEMPTED TO EXPLAIN BY WAY OF ALLEGED RECEIPT OF GIFTS WHICH S TANDS UNPROVED THE CASH DEPOSITS MADE IN THE BANK ACCOUNT OF THE ASSESSEE A S REFLECTED IN THE BALANCE-SHEET FILED BY THE ASSESSEE IS TO BE TREATE D AS THE UNEXPLAINED INVESTMENT U/S. 69B OF THE ACT AND HENCE UNDISCLO SED INCOME OF THE ASSESSEE. THUS THE ADDITION OF RS.2 04 000/- IS CO NFIRMED AS THE UNDISCLOSED INCOME U/S. 69B AND NOT U/S. 68 AS HAS BEEN DONE BY THE ASSESSING OFFICER.' SIMILARLY HE CONFIRMED THE GIFTS IN OTHER YEARS ALS O. 4. IN A.Y. 2001-02 2002-03 AND 2003-04 ONE MORE IS SUE WAS CONSIDERED BY THE A.O. FOR ADDITION I.E. THE DEPOSITS MADE IN THE HDFC ACCOUNT IN FORT BRANCH MUMBAI OF SHRI SANTOSH PURANMAL PUROHIT WHO WAS INTRODUCED BY THE ASSESSEE. THE A.O. MADE THE FOLLOWING ADDITIONS IN THE RESPECTIVE ASSESSMENT YEARS. S.NO. ASST. YEAR AMOUNT OF UNEXPLAINED CASH DEPOSITS PARA NO. OF THE ASSESSMENT ORDER ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 4 1 2001-02 RS.8 20 000/- PARA NO.13 2 2002-03 RS.11 24 000/- PARA NO.13 3 2003-04 RS.4 95 000/- PARA NO.5 4 2004-05 RS.40 000/- PARA NO.5 THE ASSESSEE CONTENDED THAT SHE MIGHT HAVE INTRODUC ED THE ACCOUNT BUT SHE WAS NOT AT ALL CONCERNED WITH THE OPERATION OF THE BANK ACCOUNT. THE A.O ASKED THE ASSESSEE FOR PRODUCTION OF SHRI S.P. PURO HIT BEFORE HIM BUT ON FAILURE OF THE ASSESSEE TO DO SO THE AO TREATED TH E DEPOSITS IN THE BANK ACCOUNT AS ASSESSEE'S OWN UNDISCLOSED DEPOSITS UNDER SECTIO N 69B OF THE I.T. ACT. THE ASSESSEE'S CONTENTIONS BEFORE THE LD. CIT(A) WE RE ALSO NOT ACCEPTED. THE CIT(A) CONFIRMED THE ADDITION HOLDING AS UNDER: - 'THE ASSESSEE HAS OFFERED NO EXPLANATION AS TO WHY THIS SHOULD NOT BE TREATED AS HER INCOME AND THUS HAS FAILED TO REBUT THE PRESUMP TION BY PRODUCING NECESSARY EVIDENCES OR BY GETTING ANY CONFIRMATION LETTER FRO M THE OTHER THIRD PARTY NAMELY SHRI SANTOSH PURNAMAL PUROHIT WHETHER HE WAS ASSESS ED TO TAX OR WHETHER HE HAS DISCLOSED ALL THESE FACTS IN HIS RETURNS OF INCOME FILED OR WHETHER HE HAS GOT ANY SOURCE FOR THE DEPOSITS MADE IN THE BANK ACCOUNTS THE STATEMENT OF WHICH WAS FOUND IN THE ASSESSEE'S PREMISES ETC. UNLESS THE ASSESSEE PRODUCES THE CONFIRMATION LETTER FROM THE SAID PUROHIT THE PRES UMPTION WOULD STAND UNREBUTTED BY THE ASSESSEE. THEREFORE THE ASSESSEE HAS NOT EX PLAINED SATISFACTORILY AS TO WHY THIS BANK ACCOUNT OF THE DEPOSITS IN THE BANK ACCOU NT SHOULD NOT BE TREATED AS HER OWN. HENCE AS PER THE PRESUMPTION ENSHRINED IN SEC TION 292C OF THE LT. ACT THIS BANK ACCOUNT IS TO BE TREATED AS HER OWN DEPOSITS. AND SINCE THESE DEPOSITS WERE NOT ACCOUNTED FOR IN THE BOOKS OF THE APPELLANT AND SINCE THE ASSESSEE HAS FAILED TO EXPLAIN THE SOURCE OF THESE DEPOSITS THEY ARE TO BE TREATED AS UNEXPLAINED INVESTMENT U/S. 69B OF THE INCOME-TAX ACT.' HE ACCORDINGLY CONFIRMED THE ADDITIONS IN RESPECTIV E YEARS. 5. BEING AGGRIEVED BY THE ABOVE FINDINGS OF THE LD. CIT(A) THE ASSESSEE PREFERRED THE PRESENT APPEALS BEFORE THE TRIBUNAL. LENGTHY ARGUMENTS WERE ADVANCED BEFORE THE TRIBUNAL ON THE LEGAL ISSUE RE GARDING THE VALIDITY OF THE ASSESSMENT FRAMED UNDER SECTION 153A OF THE ACT WIT HOUT ISSUANCE OF NOTICE UNDER SECTION 143(2) OF THE ACT. A DIFFERENCE OF O PINION AROSE BETWEEN THE MEMBERS OF THE TRIBUNAL ON THIS ISSUE. THE LD. JUDI CIAL MEMBER OPINED THAT THE ISSUANCE OF NOTICE UNDER SECTION 143(2) OF THE ACT WAS NECESSARY FOR THE ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 5 ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE A O) TO ASSUME JURISDICTION TO MAKE ASSESSMENT UNDER SECTION 153A OR 153C OF THE A CT. HE THEREFORE HELD THAT SINCE NOTICE UNDER SECTION 143(2) WAS NOT ISSU ED IN THIS CASE BEFORE THE FRAMING OF THE ASSESSMENT UNDER SECTION 153A OF THE ACT HENCE THE ASSESSMENTS FRAMED BY THE AO IN ALL THESE YEARS WER E BAD IN LAW. HOWEVER THE LD. ACCOUNTANT MEMBER WAS OF THE VIEW THAT THE ISSUANCE OF NOTICE UNDER SECTION 143(2) WAS NOT MANDATORY IN RELATION TO ASS ESSMENTS FRAMED UNDER SECTION 153A OF THE ACT. THE MATTER WAS THUS REF ERRED TO THE THIRD MEMBER. THE HONBLE PRESIDENT OF THE TRIBUNAL ACTING AS THI RD MEMBER VIDE ORDER DATED 20.05.15 HAS DECIDED THE ISSUE IN FAVOUR OF THE REVENUE HOLDING THAT THE ISSUANCE OF NOTICE UNDER SECTION 143(2) OF THE ACT WAS NOT MANDATORY IN RELATION TO THE FRAMING OF ASSESSMENT UNDER SECTION 153A OF THE ACT. AFTER THE DECISION ON THIS LEGAL ISSUE THE MATTER HAS BEEN R EFERRED BACK TO THIS REGULAR BENCH TO DECIDE THE APPEAL IN THE LIGHT OF THIRD ME MBER DECISION ON THE LEGAL ISSUE. 6. THE ASSESSEE DURING THE HEARINGS BEFORE US HAS RAISED ADDITIONAL LEGAL PLEA THAT SINCE NO INCRIMINATING MATERIAL WAS FOUND DURING THE SEARCH ACTION IN RELATION TO THE GIFT DEEDS IN QUESTION HENCE IN TH E ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH ACTION THE AO WAS NOT JUSTIFIED IN MAKING ADDITIONS IN RELATION TO THE GIFTS RECEIVED BY THE ASSESSEE DURING ALL THE RELEVANT YEARS. THE ASSESSEE HAS RAISED THIS PLEA BY WAY OF AN ADDITIONAL LEGAL GROUND BEFORE US. IT IS SETTLED LAW THAT THE LEGAL ISSUE CAN BE RAISED OR AGITATED AT ANY STAGE OF THE CASE. SINCE THE PURELY LEGAL ISSUE RA ISED BY THE ASSESSEE GOES TO THE ROOT OF THE CASE AND THE FINDING ARRIVED ON THAT IS SUE WILL BE DETERMINATIVE OF THE VALIDITY OF THE ASSESSMENTS WHICH ALREADY STOOD COMPLETED AND NOT ABATED ON THE DATE OF SEARCH HENCE WE DEEM IT FIT TO ADMI T THE LEGAL ISSUE. 7. THE LD. D.R. IN REBUTTAL TO THIS LEGAL PLEA RAI SED BY THE ASSESSEE HAS STRONGLY CONTENDED THAT EVEN IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH ACTION THE AO IS EMPOWERED TO LOOK INTO CONSIDER ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 6 AND MAKE ADDITIONS IN RELATION TO THE ISSUES REGARD ING WHICH NO INCRIMINATING MATERIAL WAS FOUND DURING THE SEARCH ACTION AS IT W AS OPEN TO THE AO TO PASS FRESH ASSESSMENT ORDERS UNDER SECTION 153A OF THE A CT LOOKING INTO ALL THE ASPECTS OF THE MATTER IRRESPECTIVE OF THE FACT WHET HER OR NOT THE ORIGINAL ASSESSMENTS HAVE BEEN COMPLETED AND NOT PENDING OR ABATED ON THE DATE OF SEARCH ACTION. HE HAS FURTHER CONTENDED THAT EVEN OTHERWISE THE ORIGINAL ASSESSMENT PROCEEDINGS WERE NOT COMPLETED UNDER SEC TION 143(3) OF THE ACT RATHER THE RETURNS FILED BY THE ASSESSEE WERE PROCE SSED UNDER SECTION 143(1) OF THE ACT AND UNDER THE CIRCUMSTANCES THE AO WAS EMPO WERED TO EXAMINE AND LOOK INTO THE ISSUES AS THE SAME WERE NOT LOOKED IN TO WHILE PROCESSING THE RETURN UNDER SECTION 143(1) OF THE ACT. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALS O GONE THROUGH THE RECORDS. ADMITTEDLY FOR A.Y. 1999-2000 A.Y. 2000 -01 & A.Y. 2001-02 THE ASSESSMENT STOOD COMPLETED ON THE DATE OF SEARCH. THE SAME WERE NOT PENDING AND EVEN THE LIMITATION PERIOD FOR ISSUANCE OF NOTI CE U/S 143(2) FOR INITIATION OF SCRUTINY ASSESSMENT PROCEEDINGS HAD EXPIRED. THE C ONTENTION OF THE LD. A.R. HAS BEEN THAT IN CASE OF COMPLETED ASSESSMENTS NO ADDITION CAN BE MADE UNDER SECTION 153A IN THE ABSENCE OF ANY INCRIMINATING MA TERIAL BEING FOUND DURING THE SEARCH ACTION. THE LD. A.R. HAS FURTHER CONTEN DED THAT AS DIRECTED BY THIS BENCH THIS FACT HAS BEEN VERIFIED FROM THE RECORD A ND AS PER THE AOS LETTER DATED 20.08.15 THE AO HAS ACCEPTED THAT THE GIFT D EEDS WERE NOT RECOVERED IN THE COURSE OF SEARCH. HE FURTHER IN THIS RESPECT HAS RELIED UPON THE DECISION OF THE HONBLE JURISDICTIONAL BOMBAY HIGH COURT IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. 120 DTR 89. 9. ON THE OTHER HAND THE LD. D.R. HAS CONTENDED TH AT THE ASSESSMENT FOR THE ABOVE STATED YEARS WERE COMPLETED UNDER SECTION 143(1) OF THE ACT WHICH MEANS THAT THE ONLY RETURNS WERE PROCESSED AND THER E WAS NO APPLICATION OF THE MIND BY THE AO TO THE RETURNS FILED BY THE ASSESSEE . HE WHILE CITING THE PROVISIONS OF SECTION 147 OF THE ACT HAS STATED TH AT WHERE THE INITIAL RETURN IS ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 7 PROCESSED UNDER SECTION 143(1) OF THE ACT THE AO C AN FORM REASONS TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT BY EXAMINING THE VERY RETURN OR THE DOCUMENTS ACCOMPANYING THE RETURN AND THAT IT WAS N OT NECESSARY IN SUCH A CASE BY THE AO TO COME ACROSS SOME FRESH TANGIBLE M ATERIAL TO FORM REASONS TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT. HE IN THIS RESPECT HAS RELIED UPON THE FOLLOWING DECISIONS: 1. HONBLE SUPREME COURT IN ZUARI ESTATE [2015] 37 3 ITR 661 (SC) 2. HONBLE DELHI HIGH COURT IN INDU LATA RANGWALA V S. DY. CIT [2016] 384 ITR 337. THE LD. DR HAS FURTHER SUBMITTED THAT SIMILAR PROPO SITION CAN BE APPLIED IN THE CASE OF ASSESSMENT MADE UNDER SECTION 153A OF THE A CT AND THAT IT IS NOT NECESSARY FOR THE AO TO COME ACROSS SOME FRESH TANG IBLE MATERIAL DURING THE SEARCH ACTION. 10. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. THE ISSUE RELATING TO THE VALIDITY OF ASSESSMENT MADE UNDER SECTION 153A WITH OUT HAVING ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH ACTI ON U/S 132 OF THE ACT IN CASE WHERE THE ORIGINAL RETURN WAS PROCESSED UNDER SECTI ON 143(1) OF THE ACT HAS COME INTO CONSIDERATION BEFORE THE CO-ORDINATE BENC H OF THE TRIBUNAL IN THE CASE OF THE ACIT CENT. CIR. 33 MUMBAI VS. SHRI JA YENDRA P. JHAVERI ITA NOS.2141 2142 2143 & 2144/M/2012 & CO NOS.248 24 9 250 & 251/M/2013 DECIDED ON 20.02.2014 (ONE OF US BEING P ARTY TO THAT ORDER). THE TRIBUNAL HAS DISCUSSED THE ISSUE IN DETAIL AND HAS MADE THE FOLLOWING OBSERVATIONS: 8. THE LEARNED DR HAS ALSO FILED WRITTEN SUBMISSION S. TO STRESS HIS POINT THAT THE RETURN PROCESSED U/S. 143(1) CANNOT BE SAID TO B E AN ASSESSMENT BUT A MERE INTIMATION HE HAS RELIED UPON THE JUDGMENT OF H ONBLE SUPREME COURT IN THE CASE OF RAJESH JHAVERI STOCK BROKERS P. LTD. (2007) 291 ITR 500 (SC). HIS CONTENTION HAS BEEN THAT IN THE CASE IN HAND THE ASS ESSMENT WAS NOT DONE ORIGINALLY U/S. 143(3) HENCE THE ESTIMATION IN QUESTION HAS BEEN RIGHTLY MADE U/S. 153A OF THE ACT BY THE AO. HE HAS FURTHER CO NTENDED THAT THE PRINCIPAL LAID DOWN BY THE SPECIAL BENCH OF THE TRIBU NAL IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. 137 ITD 287 CAN BE APPL IED TO THE CASE WHERE THE ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 8 ORIGINAL ASSESSMENT WAS COMPLETED U/S. 143(3) OF THE A CT AND NOT TO THE CASE WHERE THE RETURN WAS PROCESSED U/S. 143(1) OF THE ACT. 9. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNE D DR. SO FAR SO THE RELIANCE PLACED BY HIM IN THE CASE OF RAJESH JHAVER I STOCK BROKERS P. LTD. (SUPRA) IS CONCERNED WE MAY OBSERVE THAT THE ISSUE B EFORE THE HONBLE SUPREME COURT IN THAT CASE WAS REGARDING THE REOPENING OF THE ASSESSMENT U/S. 147 OF THE ACT. THE HONBLE SUPREME COURT HELD TH AT THE PROPOSITION OF LAW LAID DOWN BY THE HONBLE GUJARAT HIGH COURT IN THE CASE OF ADANI EXPORTS V. DEPUTY CIT (1999) 240 ITR 224 (GUJ) WAS NOT APPLICABLE IN THAT CASE. IN THE CASE OF ADANI EXPORTS (SUPRA) WHERE TH E ASSESSMENT WAS MADE U/S. 143(3) OF THE ACT AND THE AO DID NOT HOLD ANY BELIEF THAT INCOME HAD ESCAPED ASSESSMENT ON ACCOUNT OF ERRONEOUS COMPUTATION THE RE-OPENING U/S. 147 MADE MERELY ON THE BASIS OF AUDIT OBJECTIONS WAS HELD TO BE BAD IN LAW BY THE HONBLE HIGH COURT. IN THE CASE OF RAJESH JHAVERI STOCK BROKERS P. LTD. (SUPRA) THE HONBLE SUPREME COURT WHILE INTERPRE TING THE PROVISIONS OF SECTION 143(1) AND SECTION 143(3) (AS WERE IN FORCE D URING THE RELEVANT TIME PERIOD) HAS HELD THAT IN CASE OF ASSESSMENT MADE U/S. 143(3) THE ASSESSMENT IS MADE BY THE AO BY APPLYING HIS MIND WHEREAS IN CA SE OF PROCESSING OF RETURN U/S. 143(1) OF THE ACT THERE IS NO APPLICATION O F MIND BY THE AO AND AS SUCH IF A NEW MATERIAL COMES INTO THE KNOWLEDGE OF THE AO AND THE REQUIREMENTS OF SECTION 147 OF THE ACT ARE FULFILLED THE AO IS FREE TO INITIATE PROCEEDINGS U/S. 147 AND THE FAILURE TO TAKE STEPS U/S. 143(3) WILL NOT RENDER THE AO POWERLESS TO INITIATE RE-ASSESSMENT PROCEEDINGS EVEN WHEN INTIMATION U/S. 143(1) HAD BEEN ISSUED. SO THE PROPO SITION OF LAW LAID DOWN IN THE CASE OF RAJESH JHAVERI STOCK BROKERS P. LTD. (SUPRA) RELATES TO THE POWERS OF THE AO FOR RE-OPENING OF ASSESSMENT U/S. 14 7IN RELATION TO THE ASSESSMENT PROCEEDINGS CONDUCTED UNDER SECTION 143(1) VIZ-A-VIZ U/S 143(3) OF THE ACT. (AS WERE IN FORCE DURING THE RELEVANT PERIO D SINCE SECTION 143 HAS BEEN FURTHER AMENDED VIDE FINANCE ACT 2008 W.E.F 01. 04.2008.) IT IS TO BE NOTED THAT POWERS OF THE AO TO RE-OPEN AN ASSESSMENT U/S. 147 IS SUBJECT TO LIMITATION OF TIME PERIOD AS PRESCRIBED U/S. 149 OF TH E ACT. SO THE REASONABLE CONCLUSION WILL BE THAT WHETHER THE RETURN WAS PROCESSE D U/S. 143(1) OR U/S. 143(3) IF THE AO HAS A REASON TO BELIEVE THAT ANY INCO ME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT HE CAN RE-OPEN THE ASSESSMENT U/S. 147 BY ISSUING NOTICE U/S. 148 BUT WITHIN THE TIME LIMIT AS PRESCRIBE D U/S. 149 OF THE ACT. 10. SO FAR SO THE QUESTION AS TO THE PROCESSING OF RET URN U/S. 143(1) VIZ-A-VIZ ASSESSMENT MADE U/S. 143(3) IS CONCERNED IT MAY FURTH ER BE OBSERVED THAT ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 9 AFTER PROCESSING OF RETURN U/S. 143(1) THE SAME CAN B E ASSESSED U/S. 143(3) BY ISSUE OF NOTICE U/S. 143(2) SUBJECT TO ITS ISSUANC E WITHIN THE LIMITATION PERIOD OF 12 MONTHS FROM THE END OF THE MONTH IN WHICH RETURN IS FURNISHED AS PER THE PROVISO TO CLAUSE (II) OF SECTION 143(2) [ AS WAS EXISTING AT THE TIME OF RELEVANT ASSESSMENT YEAR]. ONCE THE LIMITATION PERI OD AS PRESCRIBED VIDE PROVISO TO CLAUSE (II) OF SUB SECTION (2) OF SECTION 143 IS EXPIRED IT IS NOT OPEN TO THE AO TO ASSESS THE INCOME U/S. 143(3) OF THE ACT AN D THE RETURN FILED BY THE ASSESSEE U/S. 139 IS DEEMED TO BE ACCEPTED WHICH HOWEVER CAN BE RE- OPENED U/S. 147 OF THE ACT SUBJECT TO THE FULFILLMENT OF INGREDIENTS OF SECTION 147 AND WITHIN THE TIME PERIOD AS PRESCRIBED U/S. 149 OF THE ACT AS DISCUSSED IN THE PRECEDING PARA. SO UNDER SUCH CIRCUMSTANCES IF THE RETURN IS PROCESSED U/S. 143(1) AND NOT U/S. 143(3) AND AFTER THE PRESCRI BED PERIOD OF LIMITATION THE SAME CANNOT BE ASSESSED U/S. 143(3) THOUGH IT MAY BE INTERPRETED AS MERE INTIMATION ASSESSMENT OR OTHERWISE BUT THE SAME SHALL BE DEEMED TO BE ACCEPTED BY THE AO AND IT WILL NOT HAVE ANY DIFFEREN T COLOUR OTHER THAN THE RETURN WHICH IS PROCESSED U/S. 143(3) OF THE ACT. THE ONLY DISTINGUISHING FEATURE AS HELD BY THE HONBLE SUPREME COURT IN THE C ASE OF RAJESH JHAVERI STOCK BROKERS P. LTD. (SUPRA) WOULD BE THAT IF TO A SE T OF FACTS AND CIRCUMSTANCES THE AO HAS APPLIED HIS MIND AND HE WAS OF THE BELIEF THAT THERE WAS NO ESCAPEMENT OF INCOME THEN FOR INVOKING TH E PROVISIONS OF SECTION 147 OF THE ACT HE IS PRECLUDED ON THE BASIS OF SAME FACTS AND CIRCUMSTANCES TO SAY THAT HE HAS REASON TO BELIEVE THAT INCOME OF THE ASSESSEE HAS ESCAPED ASSESSMENT. WHEREAS IN CASE OF RETURNS PROCESSED U/S. 143(1) SINCE THE AO DOES NOT APPLY HIS MIND SUCH A DEFENSE IS NOT AVAILABLE TO THE ASSESSEE. HOWEVER THAT PROPOSITION OF LAW DOE S NOT HELP THE REVENUE IN THE PRESENT CASE WHICH IS A CASE OF ASSESSMENT/RE -ASSESSMENT U/S. 153A OF THE ACT. 11. ADMITTEDLY IN THE CASE IN HAND THE RETURN WAS PRO CESSED U/S. 143(1) OF THE ACT BUT THE SAME HAS ATTAINED FINALITY DUE TO THE EX PIRY OF LIMITATION PERIOD OF TWELVE MONTHS FROM THE END OF THE MONTH IN WHI CH THE RETURN WAS FILED. HENCE THE ASSESSMENT IS DEEMED TO BE COMPLETE D AND NOT PENDING ON THE DATE OF SEARCH ON 14.08.2008. ADMITTEDLY NO INCRI MINATING MATERIAL WAS FOUND FROM THE PREMISES OF THE ASSESSEE DURING THE SE ARCH U/S. 132 OF THE ACT. THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD.(SUPRA) HAS HELD THAT ASSESSMENT U/S. 1 53A CAN BE MADE ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING THE S EARCH. THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF JAI STEEL (INDIA) V. ACIT (2013) 259 CTR 281 HAS HELD THAT IN CASE NOTHING INCRIMINATING IS FOU ND ON ACCOUNT OF SEARCH ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 10 OR REQUISITION THE QUESTION OF REASSESSMENT OF THE CON CLUDED ASSESSMENT DOES NOT ARISE. UNDER SUCH CIRCUMSTANCES IT IS NOT OP EN TO THE ASSESSEE TO SEEK DEDUCTION OR CLAIM EXPENDITURE WHICH HAS NOT BEE N CLAIMED IN THE ORIGINAL AND ALREADY CONCLUDED ASSESSMENT IN THE CAS E OF ASSESSMENT U/S. 153A IN PURSUANCE OF SEARCH ACTION. HONBLE HIGH COU RT REJECTED THE ARGUMENT OF THE LEARNED COUNSEL FOR ASSESSEE TO THE EF FECT THAT ONCE THE NOTICE U/S. 153A IS ISSUED THE ASSESSMENTS FOR SIX Y EARS ARE AT LARGE BOTH FOR THE AO AND THE ASSESSEE. IT HAS BEEN FURTHER HELD BY THE HONBLE HIGH COURT THAT THE PROVISIONS OF SECTION 153A TO 153C CANNOT BE IN TERPRETED TO BE FURTHER INNINGS TO THE AO AND/OR ASSESSEE BEYOND THE PR OVISIONS OF SECTION 139(RETURN OF INCOME) 139(5) (REVISED RETURN OF INCO ME) 147 (INCOME ESCAPING ASSESSMENT) AND 263(REVISION OF ORDERS) OF THE ACT. THE HONBLE HIGH COURT HAS FURTHER OBSERVED THAT THE WORDS ASSESS OR RE-ASSESS HAVE BEEN USED AT MORE THAN ONE PLACE IN THE SECTION AND A HARMONIOUS CONSTRUCTION OF THE ENTIRE PROVISION WOULD LEAD TO AN IR RESISTIBLE CONCLUSION THAT THE WORD ASSESS HAS BEEN USED IN THE CONTEXT OF A BATED PROCEEDINGS AND REASSESS HAS BEEN USED FOR COMPLETED ASSESSMEN T PROCEEDINGS WHICH WOULD NOT ABATE AS THEY ARE NOT PENDING ON THE DATE OF I NITIATION OF THE SEARCH OR MAKING OF REQUISITION AND WHICH WOULD ALS O NECESSARILY SUPPORT THE INTERPRETATION THAT FOR THE COMPLETED ASSESSMENTS THE SAME CAN BE TINKERED ONLY ON THE BASIS OF THE INCRIMINATING MATERIAL FOUN D DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS. THE HONBLE HIGH COURT WHILE REPRODUCING THE PROPOSITION OF LAW LAID DOWN BY THE H ONBLE SUPREME COURT IN THE CASE OF K P VARGHESE V. ITO (1981) 24 CTR 3 58 THAT IT IS RECOGNIZED RULE OF CONSTRUCTION THAT A STATUTORY PROVISO MUST BE SO C ONSTRUED IF POSSIBLE THAT ABSURDITY AND MISCHIEF MAY BE AVOIDED HAS OBSERVED THAT IF THE ARGUMENT OF THE COUNSEL FOR THE ASSESSEE WAS TO BE ACCEPTED IT WOULD MEAN THAT EVEN IN CASE WHERE THE APPEAL ARISES OUT OF TH E COMPLETED ASSESSMENT HAS BEEN DECIDED BY THE CIT(A) OR TRIBUNAL AND THE HIGH COURT ON A NOTICE ISSUES U/S. 153A OF THE ACT THE AO WOULD H AVE POWER TO UNDO WHAT HAS BEEN CONCLUDED BY THE HIGH COURT. ANY INTERPRE TATION WHICH LEADS TO SUCH CONCLUSION HAS TO BE REPELLED AND/OR AVOIDED AS HELD BY THE HONBLE SUPREME COURT IN THE CASE OF K P VARGHESE (SUPRA). ALMOST SIMILAR PROPOSITION OF LAW HAS BEEN LAID DOWN BY THE CO- ORDINATE BENCH OF THE TRIBUNAL BENCH OF THE TRIBUNAL I N THE CASE OF M/S DEEPA RESTAURANT & BAR P. LTD. IN ITA NO.1336/M/2012 DECIDED ON 05.02.2014 (ONE OF US BEING THE PARTY OF THE SAID ORDE R) WHEREIN IT HAS BEEN OBSERVED THAT WHERE THE SCRUTINY ASSESSMENT ORDER U/S. 143(3) OF THE ACT ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 11 WAS SET ASIDE BY THE HIGHER AUTHORITIES THAT ITSELF CANN OT BE A GROUND FOR RE- OPENING THE ASSESSMENT U/S. 147 OF THE ACT ON THE PLEA TH AT SINCE SCRUTINY ASSESSMENT HAS BEEN ANNULLED ON THE LEGALITY OF NOTICE U/S. 143(2) OF THE ACT AND THE CASE HAS NOT BEEN HEARD AT ANY OF THE STAGE HENC E THERE WAS A REASON TO BELIEVE THAT THE INCOME ASSESSED IN THIS CASE HAS ESCAPED ASSESSMENT. THE CO-ORDINATE BENCH IN THE ABOVE SAID C ASE HAS FURTHER HELD THAT SUCH AN ACTION CANNOT BE ALLOWED UNDER THE LAW A S IT MAY AMOUNT TO DEFEATING ONE OF THE STATUTORY PROVISIONS IN THE GRAB OF ACTING UNDER OTHER PROVISIONS OF THE STATUTE. ONCE ASSESSMENT U/S. 143(3) H AD BEEN ANNULLED BY HIGHER AUTHORITIES ON THE GROUND OF LEGALITY OF NOTICE U/S. 143(2) OF THE ACT RE-OPENING U/S. 147 ON THAT VERY GROUND WOULD MEAN NO THING ELSE BUT THE ABUSE OF PROCESS OF LAW. HENCE THE CONTENTION OF THE L EARNED DR THAT AS THE RETURN WAS PROCESSED U/S. 143(1) AND IT WAS A MERE IN TIMATION HENCE THE AO HAD REASON TO BELIEVE THAT INCOME HAD ESCAPED ASSESSME NT AND IT WAS OPEN TO THE AO TO REASSESS THE INCOME U/S. 153A EVEN WITH OUT ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH ACTION IS NOT TENAB LE. 12. THE LEARNED DR HAS FURTHER RELIED ON THE JUDGMENT OF THE HONBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF GOPAL LAL BADRUKA VS. DCIT 346 ITR 106 (AP) TO STRESS THE POINT THAT THE AO CAN USE EVIDENCE OTH ER THAN THAT FOUND DURING THE COURSE OF SEARCH WHILE FRAMING THE ASSESSM ENT U/S. 153A OF THE ACT. THE SAID JUDGMENT OF HONBLE ANDHRA PRADESH HIGH COURT HAS BEEN DULY DISCUSSED BY THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. (SUPRA) HOLDING THAT THE SAME WAS DIS TINGUISHABLE ON THE FACTS. IN THE CASE OF GOPAL LAL BADRUKA VS. DCIT (S UPRA) INCRIMINATING EVIDENCE WAS FOUND IN RELATION TO EIGHT PLOTS OF LAND BUT NO EVIDENCE WAS FOUND IN RESPECT OF 24 PLOTS. SINCE INCRIMINATING MATER IAL WAS FOUND IN RESPECT OF EIGHT PLOTS HONBLE COURT HELD THAT THE AO CA N ESTIMATE THE INCOME IN RESPECT OF ALL 32 PLOTS. THE FACT WAS THAT I NCRIMINATING MATERIAL WAS FOUND IN THAT CASE. THE OTHER JUDGMENT OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. CHETAN DASS LACHMAN DASS [2012] 211 TAXMANN 61 STRONGLY RELIED UPON BY THE LEARNED DR IS ALSO OF NO HELP TO THE REVENUE BUT TO THE ASSESSEE ONLY. IN THE SAID CASE THE HONBLE DELHI HIGH COURT IN PARA 11 OF THE ORDER THOUGH HAS HELD THAT THERE IS NO CONDITION IN SECTION153A THAT ADDITIONS SHOULD BE STRICTLY MADE ON THE BASIS OF EVIDENCE FOUND DURING TH E COURSE OF SEARCH OR OTHER POST SEARCH MATERIAL OR INFORMATION AVAILABLE W ITH THE AO WHICH CAN BE RELATED TO THE EVIDENCE FOUND AND THAT THE SEIZED MATER IAL CAN BE RELIED ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 12 UPON TO ALSO DRAW INFERENCE THAT THERE CAN BE SIMILAR TR ANSACTIONS THROUGHOUT THE RELEVANT PERIOD YET AT THE SAME TIME IT H AS BEEN FURTHER OBSERVED THAT THIS HOWEVER DOES NOT MEAN THAT ASSESSMEN T U/S 153 A CAN BE ARBITRARILY MADE WITHOUT ANY RELEVANCE OR NEXUS WI TH THE SEIZED MATERIAL. THE PROPOSITION OF LAW WHICH EMERGES OUT IN THE LIGHT OF THE LAW LAID DOWN BY THE RAJASTHAN HIGH COURT IN THE CASE OF JAI STEEL (INDIA) (SUPRA) HONBLE GUJARAT HIGH COURT IN THE CASE OF GOPAL LAL B ADRUKA (SUPRA) AND ALSO BY THE HONBLE DELHI HIGH COURT IN THE CASE OF CHETAN DASS LACHMAN DASS IS THAT WHERE INCRIMINATING MATERIAL IS FOUND DU RING THE SEARCH ACTION THE AO WHILE MAKING ASSESSMENT U/S. 153A CAN TAKE NOTE OF OTHER MATERIALS ON RECORD WHICH ARE RELEVANT AND CONNECTED TO THE MATER IAL FOUND DURING THE SEARCH AND INFERENCE CAN BE DRAWN RELATING TO OTH ER TRANSACTIONS OF SIMILAR NATURE. HOWEVER WHEN NO INCRIMINATING EVIDEN CE IS FOUND DURING SEARCH IT IS NOT OPEN TO THE AO TO MAKE RE-ASSESSMENT O F CONCLUDED ASSESSMENT IN THE GARB OF INVOKING THE PROVISIONS OF SECTION 153A. AS OBSERVED ABOVE SUCH AN ACTION WILL DEFEAT THE OTHER R ELEVANT PROVISIONS OF THE ACT AND ALSO THE RIGHTS OF THE ASSESSEE ACCRUED THER EIN. 11. THE ABOVE DECISION HAS ALSO BEEN FOLLOWED BY A NOTHER CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF ATUL BAROT (HUF) VS . DCIT IN ITA NO.2889/M/2011 & ORS. DECIDED ON 26.02.2014. WE AGR EE WITH THE VIEW TAKEN BY THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CAS E OF SHRI JAYENDRA P JHAVERI (SUPRA). WITH UTMOST RESPECT WE ARE OF TH E VIEW THAT THE CASE LAWS CITED BY THE LD. DR ARE NOT APPLICABLE TO THE FACTS OF THE CASE IN HAND. FURTHER THE SPECIAL BENCH DECISION IN THE CASE OF ALL CARGO GLOBAL LOGISTICS LTD. (SUPRA) AND HAS NOW BEEN APPROVED BY THE HON BLE BOMBAY HIGH COURT IN THE CASES OF ALL CARGO LOGISTICS ITA NO.1969 OF 2013 AND CONTINENTAL WAREHOUSING CORPORATION ITA NO. 523 OF 2013 REPORT ED IN (2015) 279 CTR 0389 (BOMBAY) DECIDED BY COMMON ORDER WHEREIN IT HA S BEEN HELD THAT IN RELATION TO THE ASSESSMENTS WHICH HAVE ALREADY BEEN CONCLUDED THE AO WAS PRECLUDED FROM MAKING ADDITIONS ON ANY OTHER ISSUE EXCEPT RELATING OR CONCERNING TO THE INCRIMINATING MATERIAL FOUND DURI NG THE SEARCH ACTION. THE AO CANNOT DISTURB THE ASSESSMENT ORDER OR REASSESSM ENT ORDER WHICH HAS ATTAINED FINALITY UNLESS THE MATERIAL GATHERED IN THE COURSE OF PROCEEDINGS U/S ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 13 153A OF THE ACT ESTABLISHES THAT RELIEF GRANTED UND ER THE FINAL ASSESSMENT/REASSESSMENT WAS CONTRARY TO THE FACT UN EARTHED DURING THE COURSE OF 153A PROCEEDINGS. IDENTICAL VIEW HAS BEEN TAKEN BY THE JURISDICTIONAL HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. MU RLI AGRO PRODUCTS LTD. ITA NO.36 OF 2009 DECIDED VIDE ORDER DATED 29-10-20 10. IN VIEW OF THE ABOVE DISCUSSION THIS LEGAL ISSUE IS DECIDED IN FAVOUR O F THE ASSESSEE. ADMITTEDLY THE SEARCH ACTION WAS CARRIED OUT ON 27. 7.2003. THE LD. AR OF THE ASSESSEE HAS GIVEN A CHART TO SHOW THAT THE LIMITAT ION PERIOD FOR ISSUING THE NOTICE U/S 143(2) IN RELATION TO AY 1999-2000 AND A Y 2000-01 HAD EXPIRED ON 30.9.2001 AND IN RELATION TO AY 2001-02 ON 30.09.20 02. THE ASSESSMENT IN RELATION TO ABOVE MENTIONED ASSESSMENT YEARS STOOD COMPLETED/NOT ABATED ON THE DATE OF SEARCH. IN VIEW OF OUR FINDINGS GIVEN A BOVE ON THE LEGAL PLEA RAISED BY THE ASSESSEE ADDITIONS MADE BY THE AO U/S 153A IN RELATION TO THE ALREADY COMPLETED ASSESSMENTS WAS ILLEGAL AND THE SAME ARE QUASHED FOR AY 1999- 2000 AY 2000-01 AND AY 2001-02. HOWEVER FOR THE RE MAINING THREE AYS THE ASSESSMENT PROCEEDINGS STOOD ABATED ON THE DATE OF SEARCH AND THE AO THEREFORE WAS JUSTIFIED IN EXAMINING ALL THE MATERI AL FACTS COMING INTO HIS KNOWLEDGE DURING THE FRAMING OF THE ASSESSMENT PROC EEDINGS U/S 153A OF THE ACT. 12. NOW COMING TO THE QUESTION AS TO THE VALIDITY O F THE ADDITIONS ON MERITS IN RELATION TO THREE ASSESSMENT YEARS I.E. AY 2002- 03 AY 2003-04 & AY 2004-05 IN RELATION TO WHICH THE ASSESSMENT PROCEED INGS STOOD ABATED ON THE DATE OF SEARCH. THE ISSUE OF GIFT IS INVOLVED IN AY 2002-03 IN RESPECT OF WHICH THE LD. A.R. HAS SUBMITTED THAT THE ASSESSEE WAS SU PPOSED TO PROVE THE IDENTITY OF THE DONOR THE GENUINENESS OF THE TRANSACTION AN D THE FINANCIAL CAPACITY OF THE DONOR. THE ASSESSEE HAD ALREADY FILED THE GIFT DECLARATION IN THE SHAPE OF AFFIDAVITS FROM THE DONORS STATING THAT THE GIFTS W ERE GIVEN FROM THEIR OWN FUNDS. HOWEVER BOTH THE LOWER AUTHORITIES IGNORED THESE FACTS. THOUGH THE ASSESSEE HAD STATED THAT SHE WAS UNABLE TO BRING TH E DONORS TO THE INCOME TAX DEPARTMENT BUT THE AO WAS NOT SUPPOSED TO MAKE ADDI TIONS ONLY ON THIS ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 14 GROUND. THE AO AND THE LD. CIT(A) HAD GOT VAST POW ERS UNDER THE ACT TO SUMMON THE DONORS AND VERIFY THE GENUINENESS OF THE TRANSACTIONS. REGARDING THE ANOTHER ISSUE OF DEPOSITS FOUND IN THE ACCOUNT OF SHRI S.P. PUROHIT THE LD. A.R. HAS ALSO VEHEMENTLY SUBMITTED THAT NO PRESUMPT ION CAN BE DRAWN THAT THE SAID ACCOUNT BELONGED TO THE ASSESSEE. IF THE ASSES SEE WAS UNABLE TO PRODUCE SAID MR. PUROHIT THE AO WAS NOT SUPPOSED TO MAKE A DDITIONS ONLY ON THIS GROUND. THE AO COULD HAVE SUMMONED THE SAID PERSON . HE HAS FURTHER SUBMITTED THAT EVEN OTHERWISE THE ASSESSEE HAS NOT BEEN GIVEN PROPER OPPORTUNITY BY THE AO TO PROVE HER CASE AND THAT TH E ASSESSEE WAS ASKED TO SUBSTANTIATE HER CONTENTIONS AFTER A SUBSTANTIAL LA PSE OF TIME. 13. ON THE OTHER HAND THE LD. D.R. HAS RELIED UPON THE FINDING OF THE LOWER AUTHORITIES. 14. AFTER CONSIDERING THE RIVAL SUBMISSIONS WE ARE OF THE VIEW THAT THE LOWER AUTHORITIES HAVE NOT PROPERTY APPRECIATED THE CONTENTIONS OF THE ASSESSEE. THE CLAIM OF THE ASSESSEE HAS MERELY BEEN REJECTED BECAUSE THE COVERING LETTER WAS BEARING THE DATE PRIOR TO THAT OF EXECUTION OF AFFIDAVITS AND THAT IT SELF CANNOT BE A GROUND TO HOLD THAT THE AFFIDAVITS WERE FORGED OR FICTITIOUS. THE LOWER AUTHORITIES HAVE NOT EXAMINED THE VERACITY OF THE AFFIDAVITS AND WHETHER THE GIFT TRANSACTIONS OTHERWISE WERE GENUINE OR NOT . EVEN THE ISSUE RELATING TO FINDING OF DEPOSITS WHEREIN THE ASSESSEE WAS AN INT RODUCER HAS NOT BEEN EXAMINED PROPERLY BY THE LOWER AUTHORITIES. WE T HEREFORE DEEM IT FIT TO RESTORE THE MATTER ON MERITS TO THE FILE OF THE AO FOR DECISION AFRESH ON THE ABOVE ISSUES IN RELATION TO THE ASSESSMENTS WHICH S TOOD ABATED ON THE DATE OF SEARCH I.E. ITA NOS. 528 529 & 530/M/2008 FOR AY 2002-03 AY 2003-04 & AY 2004-05 RESPECTIVELY. NEEDLESS TO SAY THAT THE AO WILL GIVE PROPER OPPORTUNITY TO THE ASSESSEE TO PRESENT HER CASE AND SUBMIT THE NECESSARY DOCUMENTS AND THEN TO DECIDE THE ISSUES AS PER LAW AND FACTS AVAILABLE BEFORE HIM. ITA NOS.525M/2008 & ORS. MRS. SUMANLATA BANSAL 15 15. IN THE RESULT APPEALS BEARING NO. ITA NOS.525 526 527/M/2008 FOR AYS 1999-2000 2000-01 2001-02 RESPECTIVELY ARE HE RE BY ALLOWED; WHEREAS ITA NOS. 528 529 & 530/M/2008 FOR AYS 2002-03 20 03-04 & 2004-05 RESPECTIVELY ARE RESTORED TO THE FILE OF THE AO AND HENCE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 28.09.2016. SD/- SD/- (G.S. PANNU) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED: 28.09.2016. * KISHORE SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT CONCERNED MUMBAI THE CIT (A) CONCERNED MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR ITAT MUMBAI.