Dr. Debasish Padhi, Berhampur v. ACIT, Central Circle, Bhubaneswar

ITSSA 59/CTK/2019 | 2010-2011
Pronouncement Date: 12-03-2021 | Result: Partly Allowed

Appeal Details

RSA Number 5922116 RSA 2019
Assessee PAN ADZPP4325P
Bench Cuttack
Appeal Number ITSSA 59/CTK/2019
Duration Of Justice 1 year(s) 8 month(s) 1 day(s)
Appellant Dr. Debasish Padhi, Berhampur
Respondent ACIT, Central Circle, Bhubaneswar
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 12-03-2021
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted DB
Tribunal Order Date 12-03-2021
Last Hearing Date 03-03-2020
First Hearing Date 04-03-2021
Assessment Year 2010-2011
Appeal Filed On 11-07-2019
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI C.M. GARG JM & SHRI L.P. SAHU AM ( ) / IT(SS)A NOS. 58 TO 64 /CTK/2019 ( / A SSESSMENT YEARS : 2009 - 2010 TO 20 15 - 2016 ) DR. DEBASISH PADHI THE X - RAY CLINIC STATE BANK ROAD BERHAMPUR - 760001 VS ACIT CENTRAL CIRCLE - 1 BHUBANESWAR PAN NO. : A DZPP 4325 P /ASSESSEE BY : SHRI D.PARIDA/C.PARIDA AR /REVENUE BY : SHRI M. K.GAUTAM CIT DR / DATE OF HEARING : 10 / 03 /20 2 1 / DATE OF PRONOUNCEMENT : 12 / 03 /20 2 1 / O R D E R PER BENCH : TH E ASSESSEE HAS FILED SEVEN APPEALS AGAINST THE ORDER PASSED BY THE CIT(A) - 2 BHUBANESWAR ALL DATED FO R THE ASSESSMENT YEARS 2009 - 2010 TO 2015 - 2016 . 2 . OUT OF THE SEVEN APPEALS FOUR APPEALS FILED FOR THE ASSESSMENT YEARS 2009 - 2010 TO 201 2 - 201 3 IN IT(SS)A NOS. 58 - 61 /CTK/2019 HAVING SIMILAR ISSUES INVOLVED ARE UNABATED TO BE DECIDED FIRST AND REST THREE APP EALS FILED FOR ASSESSMENT YEARS 201 3 - 201 4 2014 - 2015 IN IT(SS)A NOS. 6 2 - 63 /CTK/2019 ALSO HAVING SIMILAR ISSUES AND ABATED ASSESSMENTS TO BE DECIDED THEREAFTER ALONG WITH IT(SS)A NO.64/CTK/2019 FOR A.Y.2015 - 2016 WHICH IS FILED AGAINST THE REGULAR ASSESSMENT . IT (SS) A NO S . 58 - 64 /CTK/2019 2 IT(SS)A NO. 58 TO 6 1 /CTK/2019 (AY : 20 09 - 20 10 TO 201 2 - 201 3 ) : 3. AT THE OUTSET WE WOULD LIKE TO REPRODUCE THE DETAILS OF ASSESSMENTS AS EMANATE FROM THE ASSESSMENT ORDERS FOR THE YEARS UNDER CONSIDERATION : - IT(SS)A NOS. AYS. ORIGINAL RETURN FILED U/S .139(1) DUE DATE FOR ISSUANCE OF NOTICE U/S.143(2) WHET HER NOTICE D U/S.1 43(2) ISSUED DATE OF SEARCH 58/CTK/19 2009 - 10 30.09.09 30.09.10 NO 28.05.14 59/CTK/19 2010 - 11 02.10.10 30.09.11 NO 28.05.14 60/CTK/19 2011 - 12 29.09.11 30.09.12 NO 28.05.14 61/CTK/1 9 2012 - 13 27.09.12 30.09.13 NO 28.05.14 4 . FIRST WE SHALL TAKE UP THE APPEALS OF THE ASSESSEE FOR ASSESSMENT YEARS 2009 - 2010 TO 201 2 - 201 3 IN IT(SS)A NOS. 58 - 6 1 /CTK/2019 WHEREIN T HE ISSUE INVOLVED IN ALL THE APPEALS ARE SIMILAR. SINCE SIMILAR AND IDENTICA L GROUNDS HAVE BEEN TAKEN IN THE APPEALS FOR A.Y.2009 - 2010 TO 2012 - 2013 THEREFORE FOR THE SAKE OF CONVENIENCE AND BREVITY FIRST WE DECIDE IT(SS)A NO. 58 /CTK/2019 FILED FOR THE ASSESSMENT YEAR 2009 - 2010 AND THE DECISION OF THE SAME SHALL APPLY MUTATIS MUT ANDIS TO THE OTHER APPEALS ALSO. 5 . THE GROUNDS RAISED BY THE ASSESSEE IN ITS APPEAL FOR A.Y.2009 - 2010 READ AS UNDER : - 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) - 2 BHUBANESWAR IS ERRED IN LAW AND FACTS IN UPHOLDING THE AS SESSMENT ORDER PASSED BY THE LD. ACIT CENTRAL CIRCLE - 1 BHUBANESWAR U/S 153A IN SPITE OF THE FACTS THAT NO INCRIMINATING DOCUMENTS WHATSOEVER HAS BEEN FOUND AND SEIZED BY THE SEARCH TEAM DURING THE SEARCH U/S 132 OF THE I.T. ACT 1961 WHICH IS SINE IT (SS) A NO S . 58 - 64 /CTK/2019 3 QUA NO N FOR MAKING THE ASSESSMENT U/S 153A THUS MAKING THE ASSESSMENT ARBITRARY EXCESSIVE CONTRARY TO FACTS AND BAD IN LAW. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) - 2 BHUBANESWAR IS ERRED IN LAW AND FACTS IN UPHOLDING THE AS SESSMENT ORDER PASSED BY THE LD. ACIT CENTRAL CIRCLE - 1 BHUBANESWAR U/S 153A IN SPITE OF THE FACTS THAT THE ASSESSMENT ORDER PASSED BY THE LD. ASSESSING OFFICER IS BARRED BY LIMITATION AS THE SAME HAS BEEN PASSED AND ISSUED BEYOND THE PRESCRIBED DATE I.E. 31.12.2016 AND DISPATCHED BY THE LD. A.O. ON 7.1.2017 THROUGH SPEED POST SERVED ON THE APPELLANT ON 9.1.2017. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) - 2 BHUBANESWAR IS ERRED IN LAW AND FACTS IN UPHOLDING THE ASSESSMENT ORDER PASSED BY THE LD. ACIT CENTRAL CIRCLE - I BHUBANESWAR U/S 144 IN SPITE OF THE FACTS THAT THE PROVISIONS OF THE SAID SECTION ALONG WITH THE ENTIRE REQUIREMENTS OF THE NOTICES U/S 142(1) AND 143(2) HAVE DULY BEEN COMPLIED DURING THE ASSESSMENT PROCEED INGS CONTRARY TO THE EVIDENCES IN SUPPORT OF THE SAME . 4. THAT THE LEARNED CIT(A) - 2 HAS ERRED IN LAW AND ON FACTS OF THE CASE IN UPHOLDING THE AD - HOC DISALLOWANCE OF RS. 2 67 911/ - BEING 20% OF TOTAL EXPENDITURE OF RS.13 39 557/ - (I.E. EXPENSES OF RS . 5 37 497/ - FOR FILMS DRUGS & CHEMICALS & RS. 8 02 060/ - FOR SALARY TO STAFFS) MADE BY THE LD. ASSESSING OFFICER ALLEGING THE SAME TO BE UNVERIFIED WITHOUT CONSIDERING THE NATURE OF PROFESSION OF THE APPELLANT AND WITHOUT CONSIDERING THE SUBMISSIONS DURI NG THE PROCEEDING. 5. THAT THE APPELLANT MAY ADD ALTER DELETE OR MODIFY ANY OF THE GROUNDS AT THE TIME OF HEARING OF THE MATTER WITH THE LEAVE OF THE HON'BLE ITAT. 6 . THE LD. AR OF THE ASSESSEE HAS ALSO FILED ADDITIONAL GROUNDS VIDE HIS LETTER DATED 20.10.2020 WHICH READ AS UNDER : - SUB ; APPLICATION FOR ADMISSION OF ADDITIONAL GROUNDS. WITH REFERENCE TO THE ABOVE I WOULD LIKE TO STATE BEFORE YOUR HONOURS THAT WHILE FILING THE AFORESAID APPEALS THE FOLLOWING GROUNDS BEING LEGAL IN NATURE WERE ESCAP ED FROM INCLUSION WHICH I CAME TO KNOW LATER THAT THESE GO TO THE ROOT OF THE ASSESSMENT HAVING A BEARING ON MY TAX LIABILITIES: 1. THAT ON THE FACT AND CIRCUMSTANCES OF THE CASE NO PRIOR APPROVAL UNDER SECTION 153D HAS BEEN GRANTED BY THE LEARNED JOINT COMMISSIONER OF INCOME TAX CENTRAL RANGE BHUBANESWAR AND THE APPROVAL OBTAINED AS MENTIONED IN THE IMPUGNED ASSESSMENT ORDER UNDER SECTION 153A/144 OF THE I.T.ACT 1961 BY THE LD. A.O IS NO APPROVAL IN THE EYE OF IT (SS) A NO S . 58 - 64 /CTK/2019 4 LAW AND HENCE THE ASSESSMENT ORDER RENDER ING IT TO BE HELD ILLEGAL AND VOID AB - INITIO. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) IS ERRED IN LAW AND FACTS IN UPHOLDING THE ASSESSMENT ORDER PASSED BY THE LD. A.O U/S 153A/144 OF THE I.T.ACT ; 1961 IN SPITE OF THE FACTS THAT NO INCRIMINATING DOCUMENTS AND ON CONCEALED INCOME WHATSOEVER HAS BEEN FOUND AND SEIZED BY THE SEARCH TEAM DURING THE SEARCH U/S 132 OF THE IT. ACT 1961 WHICH IS SINE QUA NON FOR MAKING THE ASSESSMENT U/S 153A/144 THUS MAKING THE ASSESSMENT ARBITRAR Y EXCESSIVE CONTRARY TO FACTS AND BAD IN LAW. THAT THE FIRST GROUND HAS BEEN RAISED FOR THE FIRST TIME AND THE SECOND GROUND HAS ALREADY BEEN RAISED BEFORE THE LD. CIT(APPEALS) - 2 BHUBANESWAR WHICH MAY KINDLY BE ADMITTED BY YOUR HONOURS AND IN THIS CON TEXT I RELY ON THE DECISION OF THE HONOURABLE SUPREME COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LTD VS. CIT (1998) 229 ITR 383 AND THE DECISION OF THE HONOURABLE ITAT CUTTACK BENCH CUTTACK IN THE CASE OF DILIP CONSTRUCTIONS (P) LTD VS. ACIT CIRCL E - 1 BHUBANESWAR. PRAYER GROUNDS BEING LEGAL I N NATURE THEREFORE IT IS PRAYED BEFORE THIS HON'BLE BENCH TO ADMIT THE ADDITIONAL GROUNDS AND ALLOW THE APPELLANT TO ARGUE ON THESE GROUNDS. 7 . AT THE OUTSET LD. AR OF THE ASSESSEE DID NOT PRESS THE LEGAL GROUND NO.2 AND GROUND NO.1 FROM THE ADDITIONAL GROUND THEREFORE WE DISMISS THE LEGAL GROUNDS RAISED BY THE ASSESSEE AS NOT PRESSED. 8 . BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A DOCTOR BY PROFESSION EARNS INCOME FROM MEDICAL PROFESSION. HE IS THE PROPRIETOR OF THE X - RAY AND ULTRASOUND CLINIC AT SBI ROAD BERHAMPUR AND HE IS ALSO THE MANAGING PARTNER OF M/S NIDAN RADIOLOGY AND PATHOLOGY DIAGNOSTICS CENTRE. THE ASSESSEE FILED HIS ORIGINAL RETURN OF INCOME ON 30.09.2009 SHOWING TOTAL INCOME AT RS .17 34 460/ - FOR THE ASSESSMENT YEAR 2009 - 2010. A SEARCH AND SEIZURE OPERATION U/S.132 OF THE ACT WAS CONDUCTED ON 28.05.2014IN THE BUSINESS AND RESIDENTIAL PREMISES OF THE ASSESSEE . ACCORDINGLY THE AO ISSUED NOTICE U/S.153A OF THE ACT ON IT (SS) A NO S . 58 - 64 /CTK/2019 5 05.08.2015 REQUI RING THE ASSESSEE TO FILE RETURN OF INCOME WITHIN 30 DAYS FROM THE RECEIPT OF THE NOTICE AND IN RESPONSE TO WHICH THE ASSESSEE FILED RETURN OF INCOME ON 08.07.2016 DECLARING THE SAME INCOME AS FILED IN THE ORIGINAL RETURN U/S.139(1) OF THE ACT. THEREAFTER OTHER STATUTORY NOTICES WERE ISSUED TO THE ASSESSEE. DURING THE ASSESSMENT PROCEEDINGS DETAILS WERE CALLED FOR FROM THE ASSESSEE AND THE ASSESSEE WAS ALSO ASKED TO EXPLAIN AS TO WHY 40% OF THE EXPENDITURE MENTIONED IN THE NOTICE WILL NOT BE DISALLOWED. IN THE SHOW CAUSE NOTICE THERE WAS NO COMPLIANCE ON THE PART OF THE ASSESSEE. IN VIEW OF THE REPEATED NON - COMPLIANCE BY THE ASSESSEE THE AO DISALLOWED 20% OF THE EXPENDITURE INCURRED IN RESPONSE TO FILMS DRUGS & CHEMICALS AND SALARY TO STAFF WHICH READS AS UNDER : - SI. NO. DESCRIPTION OF THE EXPENSES DEBITED IN THE P & L A/C AMOUNT DEBITED IN THE P & L A/C (IN RS.) 20% OF THEREOF (IN RS.) 1. FILMS DRUGS & CHEMICALS 5 37 497/ - 1 07 499/ - 3. SALARY TO STAFF 8 02 060/ - 1 60 412/ - TOTAL 13 39 557/ - 2 67 911/ - FURTHER THE AO AFTER GETTING INFORMATION FROM THE VARIOUS BANK U/S.133(6) OF THE ACT FOUND THAT THE ASSESSEE HAS DEPOSITS IN THE RESPECTIVE ACCOUNTS DURING THE RELEVANT FINANCIAL YEAR UNDER CONSIDERATION. THE TOTAL DEPOSITS MADE IN THE FOLLOWING A CCOUNTS HAS BEEN WORKED OUT AND MENTIONED AGAINST EACH ACCOUNT NO. WHICH IS AS FOLLOWS : - IT (SS) A NO S . 58 - 64 /CTK/2019 6 SI. NO. BANK A/C. NO. NAME OF THE BANK AMOUNT CREDITED (RS.) 1 1085937309 SBI 1 11 242/ - 2 3058181017 SBI 78 43 319/ - 3 10443024808 SBI 2 34 62 01 11 - TOTAL 3 14 16 572/ - THE AO FOUND THAT THE ASSESSEE COULD NOT FURNISHED THE DETAILS AND SOURCES FOR ABOVE DEPOSITS IN THE ABOVE ACCOUNTS THEREFORE THE AO TREATED THE SAME AS UNEXPLAINED BANK DEPOSITS AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. ACCOR DINGLY THE AO COMPLETED THE ASSESSMENT DETERMINING THE TOTAL INCOME OF RS. 3 34 18 940/ - . 9 . AGAINST THE ABOVE ORDER OF AO THE ASSESSEE FILED APPEAL BEFORE THE CIT(A) AND THE CIT(A) DELETED THE ADDITION MADE BY THE AO ON ACCOUNT OF UNEXPLAINED BANK DEPOSI TS AND UPHELD THE LUMPSUM DISALLOWANCE OF 20% MADE BY THE AO OF THE EXPENDITURE INCURRED IN RESPECT OF FILMS DRUGS & CHEMICALS AND SALARY TO STAFF. ACCORDINGLY THE CIT(A) PARTLY ALLOWED THE APPEAL OF T HE ASSESSEE 10 . LD. AR BEFORE US REITERATED THE SUBMI SSION MADE BEFORE THE AUTHORITIES BELOW . HE ALSO FILED HIS WRITTEN SUBMISSIONS CONTAINED IN THE PAPER BOOK AT PAGES 1 TO 52 ALONG WITH OTHER RELEVANT DOCUMENTS. THE LD. AR OF THE ASSESSEE HAS ALSO FILED CASE LAWS PAPER BOOK IN SUPPORT OF HIS ARGUMENTS WHI CH ARE PLACED ON RECORD. 11 . ON THE OTHER HAND LD. CIT DR RELIED ON THE ORDER OF LOWER AUTHORITIES . THE LD. CIT DR ALSO SUBMITTED THAT IN A PROCEEDING U/S.153A OF THE ACT EVEN IN THE CASE OF UNABATED ASSESSMENT ADDITION IT (SS) A NO S . 58 - 64 /CTK/2019 7 CAN BE MADE DE HORS INCRIMINATING SEARCH MATERIAL. IN SUPPORT OF HIS CONTENTIONS LD. CIT DR RELIED UPON THE FOLLOWING DECISIONS : - I ) E.N. GOPAKUMAR V. COMMISSIONER OF INCOME - TAX (CENTRAL) [2016] 75 TAXMANN.COM 215 (KERALA) : II ) COMMISSIONER OF INCOME - TAX CENTRAL KANPUR V. RAJ KUMAR ARORA [2014] 52 TAXMANN.COM 172 (ALLAHABAD) : 12 . NOW WE HAVE TO DECIDE THE GROUND NO.2 OF ADDITIONAL LEGAL GROUND RAISED BY THE ASSESSEE THAT AS TO WHETHER THE ASSESSING OFFICER IS JUSTIFIED TO COMPLETE THE ASSESSMENT U/S.153A OF THE ACT BY MAKING IMPUGNED ADDI TION S FOR THE ASSESSMENT YEAR S UNDER CONSIDERATION EVEN IN THE ABSENCE OF ANY INCRIMINATING MATERIAL DEEMED TO BE FOUND DURING THE SEARCH CONDUCTED U/S.132 OF THE ACT. WE HAVE ALSO GONE THROUGH THE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL IN CASE O F DR. SUKANTA CHANDRA MALLICK AND DR. SAMBEET KUMAR MALLICK RELIED UPON BY THE LD. AR OF THE ASSESSEE AND FOUND THAT THE ISSUE INVOLVED IN THE PRESENT APPEAL HAS ALREADY BEEN DECIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE AFTER OBSERVING AS UNDER : - 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. PRIMA FACIE THE ISSUE RAISED BY BOTH THE ASSESSEES IN THEIR RESPECTIVE APPEALS FOR THE ASSESSMENT YEARS UNDER CONSIDERATION IS WITH REGARD TO THE ASSESSMENT U/S.153A OF THE ACT IS NO T MAINTAINABLE AS NO INCRIMINATING DOCUMENTS WHATSOEVER HAS BEEN FOUND OR SEIZED BY THE SEARCH TEAM DURING THE SEARCH CONDUCTED U/S.132 OF THE ACT. WE FOUND THAT THE LD. AR VEHEMENTLY EMPHASIZED THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH HENCE NO ADDITION CAN BE MADE. IT WAS ALSO THE CONTENTION OF LD. AR THAT THE CIT(A) RELYING ON THE DECISIONS OF HON'BLE KERALA AND ALLAHABAD HIGH COURTS HAS DISMISSED THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IN RESPECT OF NO INCRIMINATING MATE RIAL WAS FOUND IN THE COURSE OF SEARCH AND THE ASSESSMENT U/S.153A HAS TO BE COMPLETED AS PER THE ORIGINAL ASSESSMENT ORDER. DURING THE COURSE OF HEARING LD. AR DREW OUR ATTENTION TO THE PARA 2 OF THE ASSESSMENT ORDER AND SUBMITTED THAT THE IT (SS) A NO S . 58 - 64 /CTK/2019 8 AO IN THE LAST TWO LINES HAS MENTIONED THAT CASE OF THE ASSESSEE WAS DISCUSSED DURING THE ASSESSMENT PROCEEDINGS WITH THE AR OF THE ASSESSEE WITH REFERENCE TO THE BOOKS OF ACCOUNTS SEIZED RELATING TO THE GROUP OF THE CASES AS A WHOLE. FOR THE COMPLETENESS OF OUR ORDER WE WOULD LIKE TO REPRODUCE THE PARA 2 OF THE ASSESSMENT ORDER WHICH READS AS UNDER : - 02. NOTICE U/S.153A WAS ISSUED ON 31.01.2017. THE A.R. OF THE ASSESSEE MS. SWATI KEJIRWAL FCA APPEARED AND SUBMITTED A COPY OF THE RETURN U/S.153A FILED ON 10.03.201 7 SHOWING A TOTAL INCOME AT RS.2 05 420/ - . HERE TOTAL INCOME U/S.153A IS EQUAL TO THAT SHOWN IN THE RETURN U/S.139(1). ACCORDINGLY NOTICES US/S.143(2) & U/S.142(1) ARE ISSUED AND SERVED. THE A.R. MS. SWATI KEJIRWAL FCA APPEARED FROM TIME TO TIME AND THE CASE IS DISCUSSED WITH HER WITH REFERENCE TO THE FACTS IN THE RETURN OF INCOME AND ALSO WITH REFERENCE TO THE BOOKS OF ACCOUNTS SEIZED RELATING TO THE GROUP OF THE CASES AS A WHOLE . 9. FURTHER THE LD. AR DREW OUR ATTENTION TO THE PANCHANAMA FILED IN TH E PAPER BOOK AT PAGES 8 TO 23 AND SUBMITTED THAT NO SUCH BOOKS OF ACCOUNTS HAS BEEN SEIZED NEITHER ANY INCRIMINATING MATERIAL IS FOUND DURING THE COURSE OF SEARCH TO ENABLE THE AO TO INVOKE THE PROVISIONS OF SECTION 153A OF THE ACT. ACCEPTING THE CONTENTIO N OF LD. AR WE HAVE GONE THROUGH THE PANCHANAMA FILED BY THE ASSESSEE IN THE PAPER BOOK RUNNING FROM PAGES 8 TO 23 AND WE FOUND THAT IN THE PANCHANAMA PREPARED ON 12.03.2016 IN PARA NO.5(A)(I) IT IS MENTIONED THAT BOOKS OF ACCOUNTS AND DOCUMENTS WERE FO UND AND SEIZED AS PER ANNEXURE A (01 SHEETS) AND IN ANNEXURE - 1 FILED AT PAGE 10 OF THE PAPER BOOK CONTAIING LIST/INVENTORY OF A/C BOOKS ETC. FOUND/SEIZED IT IS MENTIONED THAT BUNCH OF LOOSE SHEET FOUND/SEIZED AND MARKED AS SCMR - 01. SIMILARLY IN THE PANCHANAMA PREPARED ON 14.03.2016 & 17.03.2016 IN PARA (I) OF SL.NO.5(A) WITH REGARD TO WHAT ARE FOUND AND SEIZED DURING THE COURSE OF SEARCH THE PANCHAS HAVE PUT A CROSS MARK ON THE SAME MEANING THEREBY THERE IS NO MENTION ABOUT THE BOOKS OF ACCOUNTS FOUND OR SEIZED DURING THE COURSE OF SEARCH. LD. DR WAS UNABLE TO ESTABLISH THAT THE LOOSE SHEETS CAN BE TREATED AS BOOKS OF ACCOUNTS WHEREAS IN THE ASSESSMENT ORDER THE AO HAS MENTIONED THAT THE BOOKS OF ACCOUNTS HAVE BEEN SEIZED BUT IN THE COPY OF PANCH ANAMA PRODUCED BEFORE US NO SUCH BOOKS OF ACCOUNTS HAS BEEN FOUND AND SEIZED. FURTHER IN THE ASSESSMENT ORDER WHILE MAKING ADDITION THE AO HAS NOT REFERRED TO ANY LOOSE SHEET OR ANY SPECIFIC INCRIMINATING DOCUMENT FOUND DURING THE COURSE OF SEARCH ENABLI NG HIM TO MAKE SUCH ADDITION. 10. WE FIND THAT THE CIT(A) RELYING UPON THE DECISIONS OF THE HONBLE HIGH COURT OF KERALA IN THE CASE OF E.N.GOPAKUMAR VS. CIT [2016] 75 TAXMANN.COM 215 (KERALA) AND THE DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. RAJ KUMAR ARORA [2014] 52 TAXMANN.COM 172 (ALLAHABAD) HAS HELD THAT EVEN IF THERE IS NO INCRIMINATING MATERIAL THE AO IS EMPOWERED TO MAKE ADDITIONS IN AN ASSESSMENT FRAMED U/S.153A OF THE ACT. W E FIND THAT NONE OF THE DECISION RELIED UPON BY EITHER OF THE PARTIES ARE OF JURISDICTIONAL HIGH COURT. IT IS A WELL SETTLED POSITION OF LAW THAT WHEN THERE ARE CONFLICTING DECISIONS OF HIGH COURTS NONE OF WHICH IS THE JURISDICTIONAL HIGH COURT THEN THE DECISION FAVOURING THE ASSESSEE SHOULD BE FOLLOWE D. FOR THIS WE DERIVE SUPPORT IT (SS) A NO S . 58 - 64 /CTK/2019 9 FROM THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. VEGETABLE PRODUCTS LTD . 88 ITR 192 (SC). THEREFORE WE ARE OF THE CONSIDERED VIEW THAT IN AN ASSESSMENT MA DE U/S.153 A OF THE ACT FOR AN ASSESSMENT YEAR FOR WHICH ASSESSMENT HAS NOT BEEN ABATED THEN THE JURISDICTION OF THE ASSESSING OFFICER TO MAKE ADDITION IN SUCH AN ASSESSMENT IS CONFINED TO SUCH INCRIMI NATING SEARCH MATERIAL AND NO ADDITION DEHORS THE SEARCH MATERIAL CAN BE MADE. 11. UNDISPUTEDLY IN THE INSTANT CASE THE ASSESSMENT FOR THE ASSESSMENT YEARS IN QUESTION HAVE ALREADY BEEN COMPLETED ON THE DATE OF SEARCH IN THE CASES OF BOTH THE ASSESSEES AND SINCE NO INCRIMINATING MATERIAL WAS UNEARTHED DURING THE SEARCH AS IS EVIDENT FROM THE PANCHANAMA PREPARED DURING THE COURSE OF SEARCH NO ADDITIONS CAN BE MADE TO THE INCOME ALREADY ASSESSED. TO SUPPORT OUR VIEW WE SHALL RELY ON THE DECISION OF HON BLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA [2015] 61 TAXMANN.COM 412 (DELHI) WHEREIN THE HONBLE HIGH COURT HAS HELD AS UNDER : - ON A CONSPECTUS OF SECTION 153A(1) READ WITH THE PROVISOS THERETO AND IN THE LIGHT OF THE LAW EXPLAINED IN VARIOUS DECISIONS THE LEGAL POSITION THAT EMERGES IS AS UNDER: (I) ONCE A SEARCH TAKES PLACE UNDER SECTION 132 NOTICE UNDER SECTION 153A(1) WILL HAVE TO BE MANDATORILY ISSUED TO THE PERSON SEARCHED REQUIRING HIM TO FILE RETURNS FOR SIX ASSESSMENT YEARS IMMEDIA TELY PRECEDING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR IN WHICH THE SEARCH TAKES PLACE. (II) ASSESSMENTS AND REASSESSMENTS PENDING ON THE DATE OF THE SEARCH SHALL ABATE. THE TOTAL INCOME FOR SUCH ASSESSMENT YEARS WILL HAVE TO BE COMPUTED BY THE ASSESSING OFFICERS AS A FRESH EXERCISE. ( III ) THE ASSESSING OFFICER WILL EXERCISE NORMAL ASSESSMENT POWERS IN RESPECT OF THE SIX YEARS PREVIOUS TO THE RELEVANT ASSESSMENT YEAR IN WHICH THE SEARCH TAKES PLACE. THE ASSESSING OFFICER HAS THE POWER TO ASSES S AND REASSESS THE 'TOTAL INCOME' OF THE AFOREMENTIONED SIX YEARS IN SEPARATE ASSESSMENT ORDERS FOR EACH OF THE SIX YEARS. IN OTHER WORDS THERE WILL BE ONLY ONE ASSESSMENT ORDER IN RESPECT OF EACH OF THE SIX ASSESSMENT YEARS 'IN WHICH BOTH THE DISCLOSED AN D THE UNDISCLOSED INCOME WOULD BE BROUGHT TO TAX'. (IV) ALTHOUGH SECTION 153 A DOES NOT SAY THAT ADDITIONS SHOULD BE .STRICTLY MADE ON THE BASIS OF EVIDENCE FOUND IN THE COURSE OF THE SEARCH OR OTHER POST - SEARCH MATERIAL OR INFORMATION AVAILABLE WITH TH E ASSESSING OFFICER WHICH CAN BE RELATED TO THE EVIDENCE FOUND IT DOES NOT MEAN THAT THE ASSESSMENT 'CAN BE ARBITRARY OR MADE WITHOUT ANY RELEVANCE OR NEXUS WITH THE SEIZED MATERIAL. OBVIOUSLY AN ASSESSMENT HAS TO BE MADE UNDER THIS SECTION ONLY ON THE BA SIS OF SEIZED MATERIAL.' (V) IN ABSENCE OF ANY INCRIMINATING MATERIAL THE COMPLETED ASSESSMENT CAN BE REITERATED AND THE ABATED ASSESSMENT OR IT (SS) A NO S . 58 - 64 /CTK/2019 10 REASSESSMENT CAN BE MADE. THE WORD 'ASSESS' IN SECTION 153A IS RELATABLE TO ABATED PROCEEDINGS (I.E. THOSE PEND ING ON THE DATE OF SEARCH) AND THE WORD 'REASSESS' TO COMPLETE ASSESSMENT PROCEEDINGS. (VI) INSOFAR AS PENDING ASSESSMENTS ARE CONCERNED THE JURISDICTION TO MAKE THE ORIGINAL ASSESSMENT AND THE ASSESSMENT UNDER SECTION 153A MERGES INTO ONE. ONLY ONE AS SESSMENT SHALL BE MADE SEPARATELY FOR EACH ASSESSMENT YEAR ON THE BASIS OF THE FINDINGS OF THE SEARCH AND ANY OTHER MATERIAL EXISTING OR BROUGHT ON THE RECORD OF THE ASSESSING OFFICER. (VII) COMPLETED ASSESSMENTS CAN BE INTERFERED WITH BY THE ASSESSING OF FICER WHILE MAKING THE ASSESSMENT UNDER SECTION 153A ONLY ON THE BASIS OF SOME INCRIMINATING MATERIAL UNEARTHED DURING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS OR UNDISCLOSED INCOME OR PROPERTY DISCOVERED IN THE COURSE OF SEARCH WHICH WERE NOT PROD UCED OR NOT ALREADY DISCLOSED OR MADE KNOWN IN THE COURSE OF ORIGINAL ASSESSMENT. [PARA 37] THE PRESENT APPEALS CONCERN ASSESSMENT YEARS 2002 - 03 2005 - 06 AND 2006 - 07. ON THE DATE OF THE SEARCH THE SAID ASSESSMENTS ALREADY STOOD COMPLETED. SINCE NO INCRIMIN ATING MATERIAL WAS UNEARTHED DURING THE SEARCH NO ADDITIONS COULD HAVE BEEN MADE TO THE INCOME ALREADY ASSESSED. [PARA 38] THE REVENUE'S APPEALS ARE ACCORDINGLY DISMISSED.[PARA 40] 12. IN THE PRESENT CASE WE FIND THAT THERE IS NOTHING ON RECORD TO SUG GEST THAT ANY MATERIAL WAS FOUND IN THE COURSE OF SEARCH WHICH WOULD SHOW ANY CONNECTION ON ADDITION MADE BY AO WITH THE SEIZED MATERIAL WHICH IS THE SUBJECT MATTER OF DISPUTE IN ASSESSMENT ORDER. NOTHING IS FOUND CONTRARY TO THE STATED POSITION OF THE ASS ESSEE. WE ALSO FIND THAT THERE IS NO MATERIAL REFERRED TO BY THE AO TO SAY THAT ANY INCRIMINATING MATERIAL WAS UNEARTHED DURING THE SEARCH. THEREFORE IN THE FACTUAL BACKGROUND WE DO NOT FIND ANY JUSTIFICATION FOR THE AO TO MAKE THE IMPUGNED ADDITIONS/DIS ALLOWANCE IN AN ASSESSMENT FINALIZED U/S 153A OF THE ACT IN THE ABSENCE OF ANY INCRIMINATING MATERIAL HAVING BEEN FOUND DURING THE COURSE OF SEARCH QUA THE IMPUGNED ADDITIONS MADE IN ASSESSMENT ORDER. RESPECTFULLY FOLLOWING THE RATIO OF DECISION OF THE H ONBLE DELHI HIGH COURT IN THE CASE OF KABUL CHAWLA (SUPRA) WHEREIN THE HON'BLE HIGH COURT AFTER DETAIL ANALYSIS CONCLUDED THAT WHERE THERE IS NO INCRIMINATING MATERIAL QUA EACH OF THE ASSESSMENT YEAR ROPED IN UNDER SECTION 153A OF THE ACT THEN NO ADDITION CAN BE MADE WHILE FRAMING THE ASSESSMENT UNDER SECTION 153A OF THE ACT. THE AFORESAID PRINCIPLE AND RATIO ARE CLEARLY APPLICABLE ON THE FACTS OF THE PRESENT CASE ALSO AS ADMITTEDLY NO INCRIMINATING MATERIAL RELATING TO THESE ASSESSMENT YEARS OR AS A MATTER OF FACT FOR ANY OF THE ASSESSMENT YEARS WERE FOUND DURING THE COURSE OF SEARCH AND ACCORDINGLY WE SET ASIDE THE ORDERS OF BOTH THE AUTHORIT IES BELOW AND HELD THAT WHEN NO INCRIMINATING MATERIAL HAS BEEN FOUND DURING THE COURSE OF SEARCH THEN NO ADDITION CAN BE MADE WHILE FRAMING THE ASSESSMENT UNDER SECTION 153A OF THE ACT. THUS THE GROU NDS RAISED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2010 - 2011 ARE ALLOWED. IT (SS) A NO S . 58 - 64 /CTK/2019 11 13 . IN THE ABOVE CASE THE TRIBUNAL SET ASIDE THE ORDERS OF BOTH THE AUTHORITIES BELOW HOLDING THEREIN THAT WHEN NO INCRIMINATING MATERIAL HAS BEEN FOUND DURING THE COURSE OF SEARCH THEN NO ADDITION CAN BE MADE WHILE FRAMING THE ASSESSMENT UNDER SECTION 153A OF THE ACT. THE AFORESAID PRINCIPLE AND RATIO ARE CLEARLY APPLICABLE ON THE FACTS OF THE PRESENT CASE ALSO AS ADMITTEDLY I N THE ASSESSMENT YEAR S UNDER CONSIDERATION WHILE FRAMING THE ASSESSMENT THE AO HAS NOT REFERRED TO ANY INCRIMINATING MATERIAL . THEREFORE IT IS CLEAR THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH WHICH COULD HAVE BEEN UTILIZED FOR MAKING ASSESSMENT U/S.153A/14 4 OF THE ACT. 14 . RELIANCE CAN ALSO BE PLACED ON THE DECISION OF COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF MIDAS CAPITAL PVT. LTD. VS. ACIT IT(SS)A NO.04&05/CTK/2018 ORDER DATED 23.03.2018 FOR THE ASSESSMENT YEARS 20 11 - 2012 & 2012 - 2013 WHERE THE DECISION RELIED ON BY THE CIT(A) OF HONBLE KERALA AND ALLAHABAD HIGH COURT WAS CONSIDERED BY THE COORDINATE BENCH AND OBSERVED AS UNDER : - 23. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE THE ASSESSEE ORIGINALLY FILED ITS RETURN OF INCOME ON 29.9.2011 FOR THE ASSESSMENT YEAR 2011 - 12 AND ON 27.9.2012 FOR THE ASSESSMENT YEAR 2012 - 13 DISCLOSING TOTAL INCOME AT RS. 9 56 200/ - AND RS.2 95 840/ - AND MATY OF RS.21 90 642/ - . 24. IN PURSUANCE TO SEARCH CONDUCTED ON 6.8.2014 PROCEEDINGS U/S.153A WAS INITIATED IN THE CASE OF THE ASSESSEE FOR THE ASSESSMENT YEARS UNDER CONSIDERATION. IN PURSUANCE TO THESE PROCEEDINGS THE IMPUGNED ORDERS OF ASSESSMENT WAS PASSED ON 28.12.2016 WHERE ADDITIONS OF RS.9 94 50 000/ - AND RS.15 00 000/ - WERE MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT BY INVOKING THE PROVISIONS OF SECTION 68 OF THE ACT. IT IS NOT IN IT (SS) A NO S . 58 - 64 /CTK/2019 12 DISPU TE THAT THE TIME LIMIT OF ISSUANCE OF NOTICE U/S.143(2) OF THE ACT WITH REFERENCE TO THE ORIGINAL RETURN FILED BY THE ASSESSEE ON 29.9.2011 FOR THE ASSESSMENT YEAR 2011 - 12 AND ON 27.9.2012 FOR THE ASSESSMENT YEAR 2012 - 13 RESPECTIVELY EXPIRED ON 30.9.2012 FOR THE ASSESSMENT YEAR 2011 - 12 AND ON 30.9.2013 FOR ASSESSMENT YEAR 2012 - 13 AND NO SUCH NOTICE WAS ISSUED TO THE ASSESSEE BY THE SAID DATES. THUS THE ORIGINAL RETURN OF INCOME BECAME FINAL ON 30.9.2011 AND 30.9.2012 FOR THE ASSESSMENT YEARS 2011 - 12 AND 2 012 - 13 RESPECTIVELY I.E. BEFORE THE DATE OF RELEVANT SEARCH. IN OTHER WORDS THE ASSESSMENT YEARS UNDER CONSIDERATION WERE NOT ABATED. 25. FURTHER THE OTHER RELATED FACTS WHICH HAVE BEEN NOTICED ARE THAT THE ASSESSEE RECEIVED RS.9 94 50 000/ - BY CHEQUES FOR THE ASSESSMENT YEAR 2011 - 12 AND RS.15 00 000/ - FOR THE ASSESSMENT YEAR 2012 - 13 ON ACCOUNT OF SALE PROCEEDS OF INVESTMENT AND CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE IN THE RELEVANT ASSESSMENT YEARS. THE ABOVE FACTS WERE DISCLOSED IN THE RETURN OF INCOME FILED ON 29.9.2011 AND 27.9.2012. 26. ON THE OTHER HAND LD CIT DR IS OF THE VIEW THAT IN A PROCEEDING U/S.153 A OF THE ACT EVEN IN THE CASE OF UNABATED ASSESSMENT ADDITION CAN BE MADE DEHORS INCRIMINATING SEARCH MATERIAL. LD D.R. IN SUPPORT OF HIS ABOVE VIEW RELIED UPON THE FOLLOWING DECISIONS. (A) E.N. GOPAKUMAR V. COMMISSIONER OF INCOME - TAX (CENTRAL) [2016] 75 TAXMANN.COM 215 (KERALA): ' SECTION 153A READ WITH SECTION 132 OF THE INCOME - TAX ACT 1961 - SEARCH & SEIZURE - ASSESSMENT IN CASE OF (SCOPE OF) - WHETHER FOR ISSUANCE OF A N OTICE UNDER SECTION 153A(1)(A) IT IS NOT NECESSARY THAT SEARCH ON WHICH IT WAS FOUNDED SHOULD HAVE NECESSARILY YIELDED ANY INCRIMINATING MATERIAL AGAINST ASSESSEE OR PERSON TO WHOM SUCH NOTICE IS ISSUE D - HELD YES - WHETHER THEREFORE ASSESSMENT PROCEEDINGS GENERATED BY ISSUANCE OF A NOTICE UNDER SECTION 153A(1)(A) CAN BE CONCLUDED AGAINST INTEREST OF ASSESSEE INCLUDING MAKING ADDITIONS EVEN WITHOU T ANY INCRIMINATING MATERIAL BEING AVAILABLE AGAINST ASSESSEE IN SEARCH UNDER SECTION 132 ON BASIS OF WHICH NOTICE WAS ISSUED UNDER SECTION 153A(1)(A) HELD YES [PARAS 7 AND 8] [IN FAVOUR OF REVENUE). ' (B) COMMISSIONER OF INCOME - TAX CENTRAL KANPUR V. RAJ KUMAR ARORA [2014] 52 TAXMANN.COM 172 (ALLAHABAD) : ' SECTION 153A READ WITH SECTION 143 OF THE INCOME - TAX ACT 1961 - SEARCH AND SEIZURE - ASSESSMENT IN CASE OF (SCOPE OF ASSESSMENT) - ASSESSMENT YEAR 2000 - 01 - WHETHER ASSESSING OFFICER HAS POWER TO REASSESS RETURNS OF ASSESSEE NOT ONLY FOR UN DISCLOSED INCOME WHICH WAS FOUND DURING SEARCH OPERATION BUT ALSO WITH REGARD TO MATERIAL THAT WAS AVAILABLE AT TIME OF ORIGINAL ASSESSMENT - HELD YES [PARA 11] [IN FAVOUR OF REVENUE/MATTER REMANDED]' IT (SS) A NO S . 58 - 64 /CTK/2019 13 27. ON THE OTHER HAND THE AR OF THE ASSESSEE RELIED UPON THE FOLLOWING DECISIONS: (I) (1) CIT VS. CONTINENTAL WAREHOUSING CORPORATION (NHAVA SHEVA) LTD. (2)ALL CARGO GLOBAL LOGISTICS LTD. (2015) 374 1TR 645 (BOM) WHERE IT WAS HELD THAT THE NOTICE U/S.153 A OF THE ACT WAS FOUNDED ON SEARCH. IF THERE WAS NO INCRIMINATING MATERIAL FOUND DURING THE SEARCH THEN THE TRIBUNAL WAS RIGHT IN HOLDING THAT THE POWER U/S.153 A OF THE ACT BEING NOT EXPECTED TO BE E XERCISED ROUTINELY SHOULD BE EXERCISED IF THE SEARCH REVEALED ANY INCRIMINATING MATERIAL. IF THAT WAS NOT FOUND THEN IN RELATION TO THE. SECOND PHASE OF THREE YEARS THERE WAS NO WARRANT FOR MAKING AN ORDER WITHIN THE MEANING OF THIS PROVISION (II) JAI S TEEL (INDIA) LTD. VS. ACIT [2013] 36 AXMANN.COM 523 (RAJ.HC) WHEREIN THE HON'BLE RAJASTHAN HIGH COURT HAS HELD THAT THE PLEA RAISED ON BEHALF 0 THE ASSESSEE THAT AS THE FIRST PROVISO PROVIDES FOR ASSESSMENT OR REASSESSMENT OF THE TOTAL INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN THE SIX ASSESSMENT YEARS IS MERELY READING THE SAID PROVISION IN ISOLATION AND NOT IN THE CONTEXT OF THE ENTIRE SECTION. THE WORDS 'ASSESS' OR 'REASSESS' HAVE BEEN USED AT MORE THAN ONE PLACE IN THE SECTION AND A HAR MONIOUS CONSTRUCTION OF THE ENTIRE PROVISION WOULD LEAD TO AN IRRESISTIBLE CONCLUSION THAT THE WORD 'ASSESS' HAS BEEN USED IN THE CONTEXT OF AN ABATED PROCEEDINGS AND 'REASSESS' HAS BEEN USED FOR COMPLETED ASSESSMENT PROCEEDINGS WHICH WOULD NOT ABATE AS T HEY ARE NOT PENDING ON THE DATE OF INITIATION OF THE SEARCH OR MAKING OF REQUISITION AND WHICH WOULD - ALSO NECESSARILY SUPPORT THE INTERPRETATION THAT FOR THE COMPLETED ASSESSMENTS THE SAME CAN BE TINKERED ONLY BASED ON THE INCRIMINATING MATERIAL FOUND DUR ING THE COURSE OF SEARCH OR REQUISITION OF DOCUMENTS. (III) PR.CIT VS. MEETA GUTGUTIA PROP. M/S.FEMS 'N' PETALS [2017) 395 ITR 526 (DEL) WHEREIN IT WAS HELD THAT IT IS ONLY IF DURING THE COURSE OF SEARCH U/S.132 OF THE ACT INCRIMINATING MATERIAL JUSTIFYI NG THE RE - OPENING OF THE ASSESSMENTS FOR SIX PREVIOUS YEARS IS FOUND THAT THE INVOCATION OF SECTION 153A QUA SEARCH OF THE ASSESSMENT YEARS WOULD BE JUSTIFIED. IV) IN CASE OF PR. CIT - 2 KOLKATA VS. M/S SALASAR STOCK BROKING LTD. G.A.NO.1929 OF 2016 (ITAT NO.264/KOL/2016) ORDER DATED 24.08.2016 THE HON'BLE KOLKATA HIGH COURT HAS HELD AS UNDER : - 'WE ARE IN AGREEMENT WITH THE VIEWS EXPRESSED BY THE KAMATAKA HIGH COURT THAT INCRIMINATING MATERIAL IS A PRE - REQUISITE BEFORE POWER COULD HAVE BEEN EXERCISED UNDER SECTION 153C READ WITH SECTION 153A . IN THE CASE BEFORE US THE ASSESSING OFFICER HAS M ADE DISALLOWANCES OF THE EXPENDITURE WHICH WERE ALREADY DISCLOSED FOR ONE REASON OR THE OTHER. BUT SUCH DISALLOWANCES WERE NOT CONTAINED UNDER SECTION 153C READ WITH SECTION 153A . THE IT (SS) A NO S . 58 - 64 /CTK/2019 14 DISALLOWANCES MADE BY THE ASSESSING OFFICER WERE UPHELD BY THE CIT(A) BUT THE LEARNED TRIBUNAL DELETED THOSE DISALLOWANCES. IN THAT VIEW OF THE MATTER WE ARE UNABLE TO ADMIT THE APPEAL. THE APPEAL IS THEREFORE DISMI SSED.' 28. WE FIND THAT NONE OF THE DECISION RELIED UPON BY EITHER OF THE PARTIES ARE OF JURISDICTIONAL HIGH COURT. IT IS A WELL SETTLED POSITION OF LAW THAT WHEN THERE ARE CONFLICTING DECISIONS OF HIGH COURTS NONE OF WHICH IS THE JURISDICTIONAL HIGH COURT THEN THE DECISION IN FAVOUR OF THE ASSESSEE SHOULD BE FOLLOWED. FOR THIS WE DERIVE SUPPORT FROM THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. VEGETABLE PRODUCTS LTD . 88 ITR 192 (SC). T HEREFORE WE ARE OF THE CONSIDERED VIEW THAT IN AN ASSESSMENT MADE U/S.153 A OF THE ACT FOR AN ASSESSMENT YEAR FOR WHICH ASSESSMENT HAS NOT BEEN ABATED THEN THE JURISDICTION OF THE ASSESSING OFFICER TO MAKE ADDITION IN SUCH AN ASSESSMENT IS CONFINED TO SUCH INCRIMINATING SEARCH MATERIAL AND NO ADDITION DEHORS THE SEARCH MATERIAL CAN BE MADE. 29. IN THE INSTANT CASE WE FIND THAT DURING THE COURSE OF THE RELEVANT SEARCH ONLY TALLY DATA OF THE ASSESSEE CO MPANY WAS FOUND WHICH SHOWS THAT THE ASSESSEE HAS RECEIVED CASH CREDIT FROM (I) RUNICHA MERCHANTS PVT LTD. (II) SANKALP (III) SCOPE VYAPAR EVENT DEVELOPERS PVT LTD. (V) SCOPE VYAPAR HARMAN HIRE PURCHASE PVT LTD.(VI) SCOPE VYAPAR SARWATI VINCOM LTD. (VI ) SCOPE ALFHA PROPERTIES PVT LTD. (VII) SIGNET VINIMAY PVT LTD. (VIII) SIGNET COUNTRY WIDE TRADECOM PVT LTD. (IX) SRIJAN VYPAR PVT LTD. (X) SRIJAN VYAPAR CAPLIN MARKETING PVT LTD. (XI) SRIJAN TANTIA AGROCHEMICALS PVT LTD. (XII) WEST LINE ECONOMY ADVI SORY SERVICES PVT LTD. (XIII)WINALL VINIMAY PVT LTD. (XIV) WINALL ELECTRO COCK FUELS PVT LTD AND (XV) YOGIRAJ AGGREGATING TO RS.9 94 50 000/ - FOR THE ASSESSMENT YEAR 2011 - 12 AND RS.15 00 000/ - FOR THE ASSESSMENT YEAR 2012 - 13. 30. IN THE INSTANT CASE WE FIND THAT THE ADDITION WAS MADE BY THE ASSESSING OFFICER ON THE SOLE GROUND THAT AMOUNT RECEIVED ON SALE OF INVESTMENT OF RS.9 94 50 000/ - FOR THE ASSESSMENT YEAR 2011 - 12 AND RS.15 00 000/ - FOR THE ASSESSMENT YEAR 2012 - 13 WERE UNEXPLAINED CASH CREDIT OF TH E ASSESSEE. THUS THERE IS NOT REFERENCE TO ANY SEARCH MATERIAL BY THE ASSESSING OFFICER BASED ON WHICH SUCH ADDITIONS WERE MADE IN THE HANDS OF THE ASSESSEE. THEREFORE WE SET ASIDE THE ORDERS OF LOWER AUTHORITIES AND DELETE THE ADDITION OF RS.9 94 50 000 / - FOR THE ASSESSMENT YEAR 2011 - 12 AND RS.15 00 000/ - FOR THE ASSESSMENT YEAR 2012 - 13 RESPECTIVELY AND ALLOW THE GROUNDS OF APPEAL OF THE ASSESSEE. 15 . LD. AR FURTHER EXPLAINED THAT THE ASSESSMENT IS UNABATED AS THE RETURN OF INCOME U/S.139 (1) OF THE ACT FILED ON 30 .09.2009 FOR A.Y.2009 - 2010 FOR THE ASSESSMENT YEAR 2010 - 2011 RETURN WAS FILED ON IT (SS) A NO S . 58 - 64 /CTK/2019 15 02.10.2010 FOR THE ASSESSMENT YEAR 2011 - 2012 THE RETURN WAS FILED ON 29 .09.2011 AND FOR THE ASSESSMENT YEAR 201 2 - 201 3 THE RETURN WAS FILED ON 27 .09.2011 WHER EAS THE DATE OF SEARCH U/S.132 OF THE ACT DATED 28 .0 5 .2014 AND AT THE TIME OF SEARCH THE RE WAS NO ANY PENDING ASSESSMENT AND NO INCRIMINATING MATERIAL WAS FOUND AS PER RECORD. 16 . FROM THE ENTIRE ASSESSMENT ORDER THE AO HAS NO T REFERRED ANY SEIZED MATERI ALS IF ANY FOUND DURING THE COURSE OF SEARCH AND SEIZURE OPERATION AND WE ALSO OBSERVE THAT THE ASSESSEE HAS NOT COOPERATED DURING THE ENTIRE PROCEEDINGS OF ASSESSMENT. IF THE ASSESSEE DOES NOT APPEAR BEFORE THE AO AFTER GIVING SEVERAL NOTICES/OPPORTUNITI ES THEN THE AO CAN UTILIZE THE REMEDY PROVIDED IN THE ACT. THE AO HAS HUGE POWER TO REQUIRE THE PRESENCE OF THE ASSESSEE BEFORE HIM AS DEFINED IN THE INCOME TAX ACT. HE CAN ALSO IMPOSE THE PENALTY BUT NOT DONE SO. THE BOOKS OF ACCOUNTS AND OTHER SEIZED DOC UMENTS WERE AVAILABLE BEFORE HIM WHILE COMPLETING THE ASSESSMENT. FROM THE ASSESSMENT ORDER IT IS CLEAR THAT THAT IN THE OPINION OF THE AO THAT THERE WAS NO ANY INCRIMINATING MATERIAL. HAD IT BEEN FOUND SOME INCRIMINATING MATERIAL DURING THE COURSE OF SEA RCH THEN THE AO MUST HAVE TAKEN INTO COGNIZANCE WHILE FRAMING THE ASSESSMENT ORDER BUT HE DID NOT REFER TO ANY INCRIMINATING MATERIALS/ DOCUMENT S . EVEN THE LD. CIT(A) IN HIS ORDER HAS NOT REFERRED ANY INCRIMINATING MATERIAL. HE HAS SIMPLY MADE ADDITION ON ADHOC BASIS AS STATED SUPRA IN PARA NO. 8 . FURTHER WE NOTICE IT (SS) A NO S . 58 - 64 /CTK/2019 16 THAT THE AO HAS ADDED THE 20% OF THE AFORESAID EXPENDITURE WITHOUT REFERRING TO ANY SEIZED/INCRIMINATING MATERIAL. THE IMPUGNED ASSESSMENT YEAR IS ABATED ASSESSMENT YEAR AND IN CASE OF ABATED ASSESSMENT YEAR FOR MAKING ADDITION THERE MUST BE INCRIMINATING MATERIAL AS DECIDED BY VARIOUS COURTS . THE LD. CITDR HAS SUBMITTED THAT THE BOGUS EXPENSES HAVE BEEN ENTERED IN THE BOOKS OF ACCOUNTS. SINCE THESE FOUR YEARS ARE UNABATED ASSESSMENT YEARS AND NO ANY INCRIMINATING MATERIAL REFERRED BY THE AO THEREFORE THE ARGUMENT ADVANCED BY THE LD. CITD R IS NOT ACCEPTED. 17 . THEREFORE CONSIDERING THE ABOVE FACTS OF THE CASE AND ALSO THE OBSERVATIONS OF BOTH THE LOWER AUTHORITIES AND THE DECISION OF THE COORDI NATE BENCH OF THE TRIBUNAL REFERRED ABOVE WE ARE OF THE SUBSTANTIVE OPINION THAT THE ASSESSMENT IS UNABATED AND THE TRIBUNAL IS BOUND BY THE JUDICIAL PRECEDENCE AND HENCE APPLYING THE RATIO OF ABOVE DECISION S TO THE PRESENT CASE WE ALLOW LEGAL GROUND R AISED BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2009 - 2010 TO 201 2 - 201 3 CHALLENGING THE ASSESSMENT FRAMED U/S.153A OF THE ACT IN THE ABSENCE OF ANY INCRIMINATING MATERIALS NOR OBSERVED BY THE AO WHILE FRAMING THE ASSESSMENT ORDER . ACCORDINGLY WE SET ASIDE T HE ORDERS OF BOTH THE AUTHORITIES BELOW AND HELD THAT ASSESSMENT FRAMED U/S.153A OF THE ACT FOR ALL THE FOUR YEARS UNDER CONSIDERATION ARE NOT SUSTAINABLE BEING UNABATED ASSESSMENT AND THEREFORE ALSO NO ADDITION CAN BE MADE IT (SS) A NO S . 58 - 64 /CTK/2019 17 WHILE FRAMING THE ASSESSMENT U NDER SECTION 153A OF THE ACT HAVING NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH WHICH IS CLEAR FROM THE ASSESSMENT ORDER . HENCE IT(SS)A NOS. 58 - 6 1/CTK/2019 ARE ALLOWED ON LEGAL GROUNDS ON THE BASIS OF NO INCRIMINATING MATERIAL. 18 . SINCE WE HAVE ALREADY QUASHED THE ASSESSMENT FRAMED BY THE AO U/S.153A OF THE ACT ALLOWING THE APPEALS OF THE ASSESSEE ON LEGAL ISSUE THE OTHER GROUNDS ON MERIT NEED NOT TO BE ADJUDICATED UPON. THUS APPEAL S OF THE ASSESSEE IN IT(SS)A NOS.58 - 61/CTK/2019 ARE PARTLY ALLOWED. IT(SS)A NO. 62 TO 64 /CTK/2019 (AY : 201 3 - 201 4 TO 2015 - 2016 ) : 19 . SINCE COMMON ISSUES HAVE BEEN RAISED BY THE ASSESSEE IN ALL THE THREE YEARS UNDER CONSIDERATION THEREFORE FOR THE SAKE O F CONVENIENCE WE SHALL TAKE INTO CONSIDERATION THE GROUNDS RAISED IN THE APPEAL OF THE ASSESSEE FOR A.Y.2013 - 2014 IN IT(SS)A NO.62/CTK/2019 FOR DECIDING ALL THE APPEALS. 20 . THE ASSESSEE IN ITS APPEAL FOR A.Y.2013 - 2014 IN IT(SS)A NO./62/CTK/2019 RAISED T HE FOLLOWING GROUNDS : - 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) - 2 BHUBANESWAR IS ERRED IN LAW AND FACTS IN UPHOLDING THE ASSESSMENT ORDER PASSED BY THE LD. ACIT CENTRAL CIRCLE - 1 BHUBANESWAR U/S 153A IN SPITE OF THE FAC TS THAT NO INCRIMINATING DOCUMENTS WHATSOEVER HAS BEEN FOUND AND SEIZED BY THE SEARCH TEAM DURING THE SEARCH U/S 132 OF THE I.T. ACT 1961 WHICH IS SINE QUA NON FOR MAKING THE ASSESSMENT U/S 153A THUS MAKING THE ASSESSMENT ARBITRARY EXCESSIVE CONTRARY TO FACTS AND BAD IN LAW. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) - 2 BHUBANESWAR IS ERRED IN LAW AND FACTS IN UPHOLDING THE ASSESSMENT ORDER PASSED BY THE LD. ACIT CENTRAL CIRCLE - 1 IT (SS) A NO S . 58 - 64 /CTK/2019 18 BHUBANESWAR U/S 153A IN SPITE OF THE FACT S THAT THE ASSESSMENT ORDER PASSED BY THE LD. ASSESSING OFFICER IS BARRED BY LIMITATION AS THE SAME HAS BEEN PASSED AND ISSUED BEYOND THE PRESCRIBED DATE I.E. 31.12.2016 AND DISPATCHED BY THE LD. A.O. ON 7.1.2017 THROUGH SPEED POST SERVED ON THE APPELLANT ON 9.1.2017. 3. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) - 2 BHUBANESWAR IS ERRED IN LAW AND FACTS IN UPHOLDING THE ASSESSMENT ORDER PASSED BY THE LD. ACIT CENTRAL CIRCLE - I BHUBANESWAR U/S 144 IN SPITE OF THE FACTS THAT THE PROVISIONS OF THE SAID SECTION ALONG WITH THE ENTIRE REQUIREMENTS OF THE NOTICES U/S 142(1) AND 143(2) HAVE DULY BEEN COMPLIED DURING THE ASSESSMENT PROCEEDINGS CONTRARY TO THE EVIDENCES IN SUPPORT OF THE SAME . 4. THAT THE LEARNED CIT(A) - 2 HAS ERRED IN LAW AND ON FACTS OF THE CASE IN UPHOLDING THE AD - HOC DISALLOWANCE OF RS. 3 61 079/ - BEING 20% OF TOTAL EXPENDITURE OF RS.18 05 394/ - (I.E. EXPENSES OF RS. 11 32 050/ - FOR FILMS DRUGS & CHEMICALS & RS. 6 73 344/ - FOR SALARY TO STAFFS) MADE BY THE LD. ASSE SSING OFFICER ALLEGING THE SAME TO BE UNVERIFIED WITHOUT CONSIDERING THE NATURE OF PROFESSION OF THE APPELLANT AND WITHOUT CONSIDERING THE SUBMISSIONS DURING THE PROCEEDING. 5. THAT THE APPELLANT MAY ADD ALTER DELETE OR MODIFY ANY OF THE GROUNDS AT THE TIME OF HEARING OF THE MATTER WITH THE LEAVE OF THE HON'BLE ITAT. 21. THE ASSESSEE HAS ALSO FILED ADDITION AL GROUNDS IN ALL THE ABOVE THREE APPEALS WHICH READ AS UNDER : - 1. THAT ON THE FACT AND CIRCUMSTANCES OF THE CASE NO PRIOR APPROVAL UNDER SECTIO N 153D HAS BEEN GRANTED BY THE LEARNED JOINT COMMISSIONER OF INCOME TAX CENTRAL RANGE BHUBANESWAR AND THE APPROVAL OBTAINED AS MENTIONED IN THE IMPUGNED ASSESSMENT ORDER UNDER SECTION 153A/144 OF THE I.T.ACT 1961 BY THE LD. A.O IS NO APPROVAL IN THE EYE OF LAW AND HENCE THE ASSESSMENT ORDER RENDERING IT TO BE HELD ILLEGAL AND VOID AB - INITIO. 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) IS ERRED IN LAW AND FACTS IN UPHOLDING THE ASSESSMENT ORDER PASSED BY THE LD. A.O U/S 153A /144 OF THE I.T.ACT ; 1961 IN SPITE OF THE FACTS THAT NO INCRIMINATING DOCUMENTS AND ON CONCEALED INCOME WHATSOEVER HAS BEEN FOUND AND SEIZED BY THE SEARCH TEAM DURING THE SEARCH U/S 132 OF THE IT. ACT 1961 WHICH IS SINE QUA NON FOR MAKING THE ASSESSMENT U/ S 153A/144 THUS MAKING THE ASSESSMENT ARBITRARY EXCESSIVE CONTRARY TO FACTS AND BAD IN LAW. PRAYER GROUNDS BEING LEGAL I N NATURE THEREFORE IT IS PRAYED BEFORE THIS HON'BLE BENCH TO ADMIT THE ADDITIONAL GROUNDS AND ALLOW THE APPELLANT TO ARGUE ON THESE GROUNDS. IT (SS) A NO S . 58 - 64 /CTK/2019 19 22 . AT THE OUTSET OF HEARING LD. AR OF THE ASSESSEE DID NOT PRESS THE ALL LEGAL GROUNDS RAISED IN THE GROUNDS OF APPEAL HOWEVER HE ARGUED ONLY ON THE MERITS OF THE CASE. HE ALSO CONCEDED THAT IF THIS BENCH RESTRICT THE ADDITION MADE BY THE AO AND CONFIRMED BY THE CIT(A) TO 10% OF THE TOTAL EXPENDITURE FOR FILMS DRUGS & CHEMICALS AND SALARY TO STAFFS IN THE ABATED ASSESSMENTS I.E. FOR THE A.YS.2013 - 2014 & 2014 - 2015 RESPECTIVELY THEN HE HAS NO OBJECTION. FURTHER FOR THE REGULAR ASSESSMENT MAD E BY THE AO FOR ASSESSMENT YEAR 2015 - 2016 LD. AR ALSO AGREED THAT THE 20% DISALLOWANCE MADE BY THE AO MAY BE RESTRICTED TO 10%. HE FURTHER SUBMITTED THAT ALL THE BILLS AND VOUCHERS WERE AVAILABLE AT THE TIME OF ASSESSMENT. 23 . ON THE OTHER HAND LD. CIT - D R RELIED ON THE ORDERS OF LOWER AUTHORITIES AND SUBMITTED THAT THE ASSESSEE DID NOT FURNISH ANY DETAILS NOR FURNISH BILLS/VOUCHERS IN RESPECT OF THE EXPENSES CLAIMED THEREFORE THE CIT(A) HAS RIGHTLY UPHELD THE 20% DISALLOWANCE MADE BY THE AO ON THE EXPEN DITURE CLAIMED BY THE ASSESSEE. 2 4 . AFTER HEARING BOTH THE SIDES AND PERUSING THE ENTIRE MATERIAL AVAILABLE ON RECORD ALONG WITH THE ORDERS OF AUTHORITIES BELOW AS WELL AS THE CASE LAWS CITED BY BOTH THE PARTIES WE FOUND THAT THE ASSESSEE COULD NOT FURNIS H THE DETAILS FOR THE EXPENDITURE CLAIMED ON ACCOUNT OF FILMS DRUGS & CHEMICALS AND SALARY TO STAFFS THEREFORE THE AO RESTRICTED THE DISALLOWANCE TO 20% OF THE TOTAL EXPENDITURE CLAIMED IT (SS) A NO S . 58 - 64 /CTK/2019 20 WHICH HAS BEEN UPHELD BY THE CIT(A) IN THE APPELLATE ORDER. BEFOR E US THE LD. AR OF THE ASSESSEE REQUESTED TO RESTRICT THE DISALLOWANCE TO 10% AS AGAINST 20% MADE BY THE AO WHICH HAS ALSO NOT BEEN OBJECTED BY THE LD.CIT - DR. ACCORDINGLY WITH THE CONSENT OF BOTH THE PARTIES AND CONSIDERING THE OBSERVATIONS MADE BY BOTH THE AUTHORITIES BELOW WE RESTRICT THE DISALLOWANCE TO 10% AS AGAINST 20% MADE BY THE AO AND CONFIRMED BY THE CIT(A). THUS THIS GROUND OF APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. CONSEQUENTLY APPEALS OF THE ASSESSEE IN IT(SS) A NOS. 62 - 6 4 /CTK/2019 ARE PAR TLY ALLOWED. 25 . IN THE RESULT THE APPEAL S OF THE ASSESSEE I.E. IT(SS)A NOS. 58 - 6 1/CTK/2019 AND IT(SS)A NO S . 62 - 64 /CTK/2019 ARE PARTLY ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 12 / 03 / 20 2 1 . SD/ - ( C.M.GARG ) SD/ - (L.P.SAHU) / JUDICIAL MEMBER / ACCOUNTANT MEMBER CUTTACK; DATED 12 /03 /20 2 1 PRAKASH KUMAR MISHRA SR.P.S. / COPY OF THE ORDER FORWARDED TO : / BY ORDER ( SENIOR PRIVATE SECRETARY ) /ITAT CUTTACK 1. / THE APPELLANT - DR. DEBASISH P ADHI THE X - RAY CLINIC STATE BANK ROAD BERHAMPUR - 760001 2. / THE RESPONDENT - ACIT CENTRAL CIRCLE - 1 BHUBANESWAR 3. ( ) / THE CIT(A) 4. / CIT 5. / DR ITAT CUTTACK 6. / GUARD FILE. //TRUE COPY//