ARUN AMBER SILK MILLS PRIVATE LIMITED,MUMBAI vs. DCIT-CC-3, THANE, THANE

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ITSSA 444/MUM/2025Status: DisposedITAT Mumbai29 April 2025AY 2015-1625 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the assessment proceedings under Section 153A were not validly initiated against the assessee company. The Panchnama and search warrant clearly indicated that the search was authorized in the names of individuals, not the assessee company. While the revenue argued that the search was initiated against the assessee company and executed at the directors' premises, the Tribunal found that no incriminating material was found and seized from the assessee's premises. The statements recorded from third parties were not at the assessee's premises or premises searched in relation to the assessee, and therefore, could not be treated as incriminating material found and seized from the assessee. The Tribunal also noted that reliance on documents seized from a third party's premises would necessitate proceedings under Section 153C, which was not followed. Consequently, the additions made towards unsecured loans and share application money for AY 2014-15 to 2018-19, without the aid of any incriminating material found and seized from the assessee's premises, were deleted, following the decision in Abhisar Buildwell (P.) Ltd. The disallowance of interest expenditure under Section 37(1) for AY 2019-20 and 2020-21, being consequent to the unsecured loans, was also deleted.

What were the facts?

The assessee, Arun Amber Silk Mills Private Limited, is in appeal before the Income Tax Appellate Tribunal (ITAT) against the order of the Commissioner of Income-tax (Appeals) for assessment years (AY) 2014-15 to 2020-21. The appeals arise from assessment proceedings under Section 153A of the Income-tax Act, 1961, initiated following search proceedings under Section 132. The Assessing Officer made additions for unsecured loans and share application money treated as unexplained cash credits under Section 68, and disallowed interest expenditure on these loans under Section 37(1). The Ld. CIT(A) upheld these additions. The assessee raised a legal ground challenging the validity of the reassessment proceedings under Section 153A due to the absence of incriminating material found during the search at the assessee's premises. An additional ground was admitted, arguing that the Section 153A assessment was without jurisdiction as no search was initiated against the assessee company.

What were the issues?

1. Whether the assessment proceedings under Section 153A of the Income-tax Act, 1961, are validly initiated against the assessee company in the absence of a search conducted at its premises or the premises of its directors, and in the absence of any incriminating material found and seized in relation to the assessee. Assessee's contentions: The assessee argued that the search warrant and Panchnama were issued in the names of individuals (Shri Divyesh Rameshchandra Dhanani and Smt. Kinjal Viral Dhanani) and not the assessee company. Documents seized were from the premises of Shri Divyesh Rameshchandra Dhanani, and statements recorded were from third parties (Shri Bhadresh Mansukhlal Dodhia and Shri Minesh Subhash Dodhia), none of which were at the assessee's premises or premises searched in relation to the assessee. Therefore, Section 153A proceedings were invalid and without jurisdiction. Reliance was placed on the decision in Abhisar Buildwell (P.) Ltd. Revenue's contentions: The revenue contended that the search warrant was issued in the case of the assessee company, albeit executed at the premises of its directors, as there was reason to believe that summons would not be complied with. The search was therefore validly initiated against the assessee company, making Section 153A proceedings lawful. Reliance was placed on Section 132 of the Act.

Which sections of the Income-tax Act were involved?

Section 132,Section 153A,Section 37(1),Section 68,Section 131,Section 153C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “A” MUMBAI

Before: SHRI OM PRAKASH KANT & MS. KAVITHA RAJAGOPAL

For Appellant: Ms. Simran Dhavan &, Mr. Ravi Ganatra
For Respondent: Dr. K. R. Subhash, CIT-DR &, Mr. Ram Krishn Kedia, Sr. DR
Hearing: 25/03/2025Pronounced: 29/04/2025

PER OM PRAKASH KANT, AM

These appeals by the assessee are directed against a common order dated 29.11.2024 passed by the Ld. Commissioner of Income- tax (Appeals), Pune [in short ‘the Ld. CIT(A)’] for assessment years 2014-15 to 2020-21 respectively. As common issue in dispute is involved in these appeals, therefore, same were heard together and disposed off by way of this consolidated order for the sake of convenience.

2.

Briefly stated, facts of the case are that in view of search proceedings u/s 132 of the Income-tax Act, 1961 (in short ‘the Act’) at the premises of the ‘Dhodhia’ group, assessment proceedings u/s 153A of the Act have been carried out in the case of the assessee company for assessment years 2014-15 to 2020-21, wherein various additions ,interalia, (i) addition for unsecured loans received and share application money received by the assessee company treating the same as unexplained cash credit u/s 68 of the Act, and (ii) disallowance of interest expenditure towards such unsecured loan invoking section 37(1) of the Act, were made. The Ld. CIT(A) upheld those additions on merit . The legal ground raised by the assessee challenging the validity of the reassessment proceedings

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u/s 153A of the Act without the aid of any incriminating material found from the premises of the assessee was also dismissed by the ld CIT(A).

3.

Before us, the Ld. counsel for the assessee, referred to the ground challenging validity of the addition made in assessment u/s 153A of the Act in absence of any incriminating material qua the addition in completed assessments. He also raised an additional ground by way of oral plea and later on filed written application for admitting additional ground. In the additional ground, the assessee raised the issue that in the case of the assessee no search was initiated and therefore, completion of the assessment u/s 153A of the Act is without jurisdiction and hence, liable to be quashed ab- initio. In view of no objection by the ld DR , admissibility of additional ground raised by way of oral plea was heard. The additional ground raised being purely of legal nature and not requiring investigation of fresh facts, same was admitted for adjudication.

3.1 Accordingly, firstly, we take up the additional ground challenging the validity on the ground that no search was conducted in the case of the assessee.

3.2 We have heard the rival submissions of the parties on issue and dispute and perused the relevant material on record. The issue in dispute raised before us is whether the search action was

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initiated against assessee company. During the course of hearing before us, while responding the arguments on the additional ground, the Ld. Departmental Representative (DR) produced a copy of the ‘Panchnama’ and a copy of the ‘search warrant’ alleged to be issued in the case of assessee company along with copy of statements of shri Bhadresh Mansukhlal Dodhia and Minesh Subhas Dhodia, which were recorded u/s 132(4) of the Act. It is the contention of the ld DR that while carrying out search on the assessee company, a residential premise of the director of assessee namely, ‘Shri Divyesh Rameshchndra Dhanani’ was covered. Therefore, search was validly initiated against the assessee company. For ready reference, scanned copy of such ‘Panchnama’ and ‘warrant’ are reproduced as under:

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3.3 The learned counsel for the assessee, referring to the ‘Panchnama’ and the ‘warrant of authorization of search’, submitted that the ‘Panchnama’ expressly records that the search warrant was issued in the names of "Shri Divyesh Rameshchandra Dhanani" and "Smt. Kinjal Viral Dhanani" alone, and not in the name of the assessee company. Further, in the search warrant itself, it is clearly stated that the authorization dated 25.11.2019 was issued in respect of Shri Divyesh Rameshchandra Dhanani, to search the premises located at Room Nos. 203 and 204, A-Wing, Akshay Park, Kamatghar, Bhiwandi. It was further submitted that even in the statement recorded under section 132(4) of the Act, the Authorized Officer had directed his inquiries specifically towards Shri Divyesh R. Dhanani, referencing the search conducted at his premises. For ease of reference, one of the questions posed to Shri Divyesh R. Dhanani during the statement recorded under section 132(4) on 27.11.2019 is reproduced here in below:

“Q No. 29. During the course of Search action u/s 132 of the IT act conducted at your residential premise located at Room/Flat no. 203 & 204, A- Wing, Akshay Park, Kamatghar, Bhiwandi-421302. On 27.11.2019, the search party found arid Seized various documents in the master bedroom located at your residential premise in the three polythene bag, the same are found and Seized as item no 2 to 9 in the presence of the panchas, please go through the same and please explain to whom these document's belongs? Please offer your comment. Ans: These documents and certain papers, diaries and notebook found and seized during the search action u/s 132 of the IT act in the three polythene bags. These items are iriventorised as item no

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02 to 09 as per the annexure A. These documents belongs to Shri Pradip Dodhia. He handed over to me arid asked to keep at my residential premise. Me and my family members had not written these documents these belongs to Mr Pradip Dodhia and only he can explain the same.” 3.4 On the strength of the aforesaid, the learned counsel for the assessee contended that no search was initiated against the assessee company, and, consequently, the proceedings initiated under section 153A of the Act were invalid and without jurisdiction.

3.5 In rebuttal, the learned Departmental Representative (DR) referred to the copy of the warrant of authorization and submitted that Warrant No. 1623 records that the Principal Director of Income-tax (Investigation) had reason to believe that, had summons been issued to the assessee, they would not have been complied with and the books of account would not have been produced. Based on such satisfaction, the residential premises of Shri Divyesh Rameshchandra Dhanani and Smt. Kinjal Viral Dhanani were searched. It was contended that the warrant was, therefore, issued in the case of the assessee company itself, under whose name the search was initiated, albeit executed at the premises of its directors. Accordingly, it was urged that the search had been validly initiated against the assessee company, rendering the proceedings under section 153A of the Act valid and lawful. The learned DR further referred to section 132 of the Act, which empowers the Principal Director, among other authorities, to authorize a search and seizure where there is reason to believe that a summons issued under

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section 131 would not be complied with, or that books of account and other documents would not be produced. The relevant provisions of section 132 are reproduced for ready reference:

“ 132. (1) Where the Principal Director General or Director General or Principal Director or Director or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner or Additional Director or Additional Commissioner or Joint Director or Joint Commissioner in consequence of information in his possession, has reason to believe that—

(a) any person to whom a summons under sub-section (1) of section 37 of the Indian Income-tax Act, 1922 (11 of 1922), or under sub-section (1) of section 131 of this Act, or a notice under sub-section (4) of section 22 of the Indian Income-tax Act, 1922, or under sub-section (1) of section 142 of this Act was issued to produce, or cause to be produced, any books of account or other documents has omitted or failed to produce, or cause to be produced, such books of account or other documents as required by such summons or notice, or (b) any person to whom a summons or notice as aforesaid has been or might be issued will not, or would not, produce or cause to be produced, any books of account or other documents which will be useful for, or relevant to, any proceeding under the Indian Income-tax Act, 1922 (11 of 1922), or under this Act, or (c) any person is in possession of any money, bullion, jewellery or other valuable article or thing and such money, bullion, jewellery or other valuable article or thing represents either wholly or partly income or property which has not been, or would not be, disclosed for the purposes of the Indian Income-tax Act, 1922 (11 of 1922), or this Act (hereinafter in this section referred to as the undisclosed income or property), then,— (A) the Principal Director General or Director General or Principal Director or Director or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be, may authorise any Additional Director or Additional Commissioner or Joint Director, Joint Commissioner, Assistant Director or Deputy Director, Assistant Commissioner or Deputy Commissioner or Income-tax Officer, or

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(B) such Additional Director or Additional Commissioner or Joint Director, or Joint Commissioner, as the case may be, may authorise any Assistant Director or Deputy Director, Assistant Commissioner or Deputy Commissioner or Income-tax Officer, (the officer so authorised in all cases being hereinafter referred to as the authorised officer) to—) (i) enter and search any building, place, vessel, vehicle or aircraft where he has reason to suspect that such books of account, other documents, money, bullion, jewellery or other valuable article or thing are kept; (ii) break open the lock of any door, box, locker, safe, almirah or other receptacle for exercising the powers conferred by clause (i) where the keys thereof are not available; (iia) search any person who has got out of, or is about to get into, or is in, the building, place, vessel, vehicle or aircraft, if the authorised officer has reason to suspect that such person has secreted about his person any such books of account, other documents, money, bullion, jewellery or other valuable article or thing;] (iib) require any person who is found to be in possession or control of any books of account or other documents maintained in the form of electronic record as defined in clause (t) of sub-section (1) of section 2 of the Information Technology Act, 2000 (21 of 2000)9, to afford the authorised officer the necessary facility to inspect such books of account or other documents;] (iii) Seize any such books of account, other documents, money, bullion, jewellery or other valuable article or thing found as a result of such search: Provided that bullion, jewellery or other valuable article or thing, being stock-in-trade of the business, found as a result of such search shall not be seized but the authorised officer shall make a note or inventory of such stock-in-trade of the business;] (iv) place marks of identification on any books of account or other documents or make or cause to be made extracts or copies therefrom; (v) make a note or an inventory of any such money, bullion, jewellery or other valuable article or thing : xxxxxxxxxxxxxxxxxxxxx

(Emphasis supplied externally)

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3.6 We have carefully considered the rival submissions and perused the material on record. The issue before us pertains to the validity of proceedings initiated under section 153A of the Act in the case of the assessee company, consequent to the search conducted at the residential premises of its directors. The learned DR asserts that a warrant authorizing a search was indeed issued in the name of the assessee company, even though the search was conducted at the residential premises of its directors, Shri Divyesh Rameshchandra Dhanani and Smt. Kinjal Viral Dhanani. It is the Department's contention that the search at their premises formed an integral part of the search proceedings against the assessee company. Conversely, the learned counsel for the assessee has drawn attention to the panchnama, to support that the search was confined to the aforementioned individuals, without any reference to the assessee company. It was urged that the assessee, not having access to the search warrant but only to the panchnama, was unable to verify whether its name was actually included therein.

3.7 Upon a careful perusal of the warrant of authorization and the panchnama on record, and considering the rival arguments, the position emerges that the competent authority recorded reasons to suspect in two respects — first, that the assessee company would not comply with summons issued under section 131 requiring production of books of account; and, second, that unaccounted cash, jewellery, or other valuable articles might be found at the

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premises of Shri Divyesh Rameshchandra Dhanani. Accordingly, the residential premises located at Room Nos. 203 and 204, A-Wing, Akshay Park, Kamatghar, Bhiwandi, was searched in relation to:

 the books of account and documents pertaining to the assessee company; and  the undisclosed assets pertaining to Shri Divyesh Rameshchandra Dhanani in his individual capacity.

3.8 Thus, the search warrant was executed on two distinct persons — against the assessee company as well as against the individual persons named.

3.9 Having regard to the express requirement of section 153A of the Act that a search must be "initiated" against the assessee, we find that such initiation has indeed taken place in the present case. Consequently, the assessment framed under section 153A of the Act in the case of the assessee is valid in law. The additional ground raised by the assessee is, accordingly, dismissed.

Ground Relating to Validity of Addition Made:

4.

The next ground raised for our consideration pertains to the validity of the addition made by the Assessing Officer. In this regard, the learned counsel for the assessee has invited our attention to Ground No. 6 of the appeal, wherein the assessee has challenged the addition on the basis that no incriminating material

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was found during the course of the search action in relation to the said additions. The learned counsel for the assessee submitted that Assessment Years 2014-15 and 2015-16 are unabated assessment years. It was argued that, in view of the judgment of the Hon’ble Supreme Court in the case of Abhisar Buildwell (P.) Ltd. [2023] 149 taxmann.com 399 (SC), no addition could be made in such unabated assessment years except on the basis of incriminating material found and seized during the course of search proceedings. It was further submitted that in other assessment years, disallowance of presumed interest on unsecured loans is merely consequential to the addition made in Assessment Years 2014-15 and 2015-16, and therefore, in the absence of incriminating material, the disallowance also cannot be sustained.

4.1 Per contra, the learned Departmental Representative (DR) submitted that, firstly, during the course of search action, in statements recorded under section 132(4) of the Act, key persons of the Dhodia Group categorically admitted that accommodation entries in the form of loans and share application money had been received against cash payments. Secondly, it was contended that incriminating documents were seized from the premises of the assessee during the search, which demonstrated the repayment of amounts received by cheque through cash. Therefore, it was argued that the additions made towards unsecured loans and share

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application money are duly based on incriminating material and have been validly made.

4.2 We note that the Hon’ble jurisdictional High Court in its decision dated 21/04/2015 in the case of Continental Warehousing Corporation (Nhava sheva) Ltd in ITA 523 of 2013 has laid down that consequent to a search action, while passing assessment orders for six assessment years under the provisions of section 153A of the Income Tax Act, an addition in respect of an unabated assessment year can be made only if incriminating material, pertaining specifically to the addition, is found and seized from the premises of the assessee. The assessments pending as on the date of search shall abate, while where no assessment is pending, such years are categorized as unabated. The aforesaid ratio in the case of Continental Warehousing Corporation (Nhava sheva) Ltd(supra) has subsequently been upheld by the Hon'ble Supreme Court in the case of Abhisar Buildwell (P.) Ltd. (supra)

4.3 Therefore, the first issue for consideration in the case is to determine which assessment years fall into the category of unabated assessment years. In the present case, the search was conducted on the assessee on 27.11.2019, i.e. previous year 2019- 20 corresponding to AY 2020-21. Consequently, the six assessment years prior to the year in which search was conducted, for the purposes of section 153A are Assessment Years 2014-15 to 2019-

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20.

Now, any assessment year would fall in the category of abated assessment year if any assessment is pending as on the date of search or limitation for selection of case under scrutiny was not expired as on the date of search. It is not disputed that no assessment was pending in respect of six assessment years under reference. So, we need to examine as to whether for which AY, the limitation for selection of case under scrutiny was expired as on the date of search. We find that during relevant period the due date for filing the return of income for the assessee-company was 30th November for each of relevant assessment year, and the limitation for issuance of scrutiny notice expires on 30th September of the subsequent assessment year. Such limitation period for AY 2018-19 and earlier AY expired on 30th September, 2019, hence, for Assessment Years 2014-15 to 2018-19, no scrutiny notice could have been issued as on the date of search, and thus, no assessment proceedings were pending. Those assessment years, therefore, fall within the category of unabated assessment years. Only Assessment Years 2019-20 and AY 20-21 , where limitation for issue of notice under section was available as on the date of search ,could be said to be pending and hence would fall under the category of abated assessment years. 4.4 We now proceed to examine whether there exists any incriminating material found qua the additions made towards unsecured loans and share application money.

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4.5 The Assessing Officer, in the assessment order, firstly, referred to inquiries allegedly conducted by the Department in relation to unsecured loans (at last paragraph on page 3 of the assessment order), and similarly, in relation to share application money (at last paragraph on page 4 of the assessment order),albeit without specifying the particulars of such inquiries. Secondly, the Assessing Officer referred to statements recorded under section 132(4) of key persons of Dhodia Group and to documents, specifically pages 36-38 of Bundle No. 3, found and seized from the residence of one Shri Divyesh Rameshchandra Dhanani. In these documents, it was alleged that the interest paid by cheque was returned in cash after deducting a commission of 3%. Based on these documents, the Assessing Officer concluded that the unsecured loans were accommodation entries and proceeded to make additions. 4.6 The learned CIT(A) similarly relied upon statements recorded under section 132(4) of Shri Bhadresh Mansukhlal Dodhia and Shri Minesh Subhash Dodhia, along with the aforementioned documents (pages 36-38 of Bundle No. 3), as incriminating material to sustain the additions. 4.7 Before us, the learned Departmental Representative (DR) has also placed reliance upon the statements recorded under section 132(4) to support the contention that the unsecured loans were accommodation entries received from Kolkata-based companies through M/s Vinam Finance Pvt. Ltd. The DR referred to question

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no. 69 and 70 of the statement of Shri Bhadresh Mansukhlal Dodhia recorded under section 132(4), wherein it was admitted that M/s Vinam Finance Pvt. Ltd. was a paper company used for the purposes of accommodation entries, and that funds were brought into the books of the Dodhia Group in exchange for cash payments. relevant question and answer is reproduced as under:

Q. 69. I am showing you statement of Shri Minesh Dodhla who is current director of M/s Vinam Finance Pvt Ltd. In his statement he has confirmed that he works for M/s DSL. He had signed certain documents and become director of M/s Vinam Finance Pvt Ltd just because he was asked to do so by his employer i.e. Dodhia group. He also stated that he signs the blank cheques of M/s Vinam Finance Pvt Ltd and hands it over whenever asked to do so. Please comment on this. And: Shri Minesh Dodhia works for us and we had asked him to become director of M/s Vinam Finance Pvt Ltd.

Q.70. From the above facts. It is clear that M/s Vinam Finance Pvt Ltd. is a paper company, which is engaged in providing accommodation entries. Please comment on the same and also state as to how you had acquired the company having around 44 crores in its books for Rs. 95,40,000/-?

Ans: I wish to state that, Dodhia Group was in need of Funds in the Books of accounts for the business

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purposes over the time. And we had cash available from various sources. In order to bring this cash in our books of accounts, we had taken the entry through M/s Vinam Finance Pvt Ltd. We have acquired the shares of shareholding companies of M/s Vinam Finance Pvt Ltd at nominal amount and the funds available with M/s Vinam Finance Pvt Ltd were taken in our books of accounts by giving equivalent amount of cash (after deducting the amount of Rs. 95,40,000 paid in cheque for acquisition of shareholding companies). 4.8 Per contra, the learned counsel for the assessee has contended that, firstly, the statements u/s 132(4) referred to were not recorded at the premises of the assessee but were recorded at third-party premises, and therefore, cannot be treated as incriminating material found and seized from the premises of the assessee. Secondly, it was submitted that mere statements recorded under section 132(4) do not constitute incriminating material unless corroborated by other documentary evidence, as held by the Hon'ble Delhi High Court in deicion dated 10/03/2016 the case of Harjeevlal Agrawal in ITA 8/2004. Thirdly, it was pointed out that pages 36-38 of Bundle No. 3 were found and seized from the premises in relation to search of Shri Divyesh Rameshchandra Dhanani, and not in relation to search of the assessee. Reliance was placed on the copy of the ‘Panchnama’ furnished by the Revenue, which shows that no seizure was made in

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relation to the assessee. It was accordingly argued that if reliance was to be placed on documents found and seized in seizure relation to Shri Divyesh Rameshchandra Dhanani, proceedings ought to have been initiated under section 153C, and not under section 153A. 4.9 We have carefully considered the rival submissions and the material on record. As noted above, the Department has relied on two statements: (i) Statement of Shri Bhadresh Mansukhlal Dodhia recorded under section 132(4) at his office at 1001, Filiz Towers, Bhandup (W), Mumbai;

(ii) Statement of Shri Minesh Subhash Dodhia recorded under section 132(4) at A-402, Padmavati Residency, Oswal Park, Bhiwandi.

4.10 It is clear that both statements were neither recorded at the premises of the assessee, nor were they recorded at any premise, which was searched in relation to the assessee i.e. the residence of Shri Divyesh Rameshchandra Dhanani, therefore, in our considered opinion, the said statements cannot be treated as incriminating material found and seized from the assessee.

4.11 Further, as held by the Hon'ble Delhi High Court in Harjeevlal Agrawal (supra), a statement recorded under section 132(4)

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alone cannot constitute incriminating material unless corroborated by other material found during the search. Relevant finding of Hon’ble High Court is reproduced as under:

“ 23. It is also necessary to mention that the aforesaid interpretation of Section 132(4) of the Act must be read with the explanation to Section 132(4) of the Act which expressly provides that the scope of examination under Section 132(4) of the Act is not limited only to the books of accounts or other assets or material found during the search. However, in the context of Section 158BB(1) of the Act which expressly restricts the computation of undisclosed income to the evidence found during search, the statement recorded under Section 132(4) of the Act can form a basis for a block assessment only if such statement relates to any incriminating evidence of undisclosed income unearthed during search and cannot be the sole basis for making a block assessment. 24. If the Revenue's contention that the block assessment can be framed only on the basis of a statement recorded under Section 132(4) is accepted, it would result in ignoring an important check on the power of the AO and would expose assessees to arbitrary assessments based only on the statements, which we are conscious are sometimes extracted by exerting undue influence or by coercion. Sometimes statements are recorded by officers in circumstances which can most charitably be described as oppressive and in most such cases, are subsequently retracted. Therefore, it is necessary to ensure that such statements, which are retracted subsequently, do not form the sole basis for computing undisclosed income of an assessee.” 4.12 Regarding the reliance placed on pages 36-38 of Bundle No. 3 by the AO, we find that the said documents were seized through ‘Panchnama’ prepared in the name of Shri Divyesh Rameshchandra Dhanani, and not any ‘Panchnama’ prepared on the assessee company. Though search was initiated in the name of the assessee by way of warrant of authorization but no seizure has been made qua the assessee. There is no

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‘Panchnama’ evidencing seizure from the assessee. Therefore, the said documents cannot be treated as incriminating material seized in the case of the assessee for the purposes of section 153A proceedings. In such a situation, if reliance was sought to be placed on such third-party material, the Revenue was required to follow the procedure prescribed under section 153C, which has not been done in the present case. 4.13 In view of the above discussion, we are of the considered view that no incriminating material has been found and seized from the assessee's premises qua the additions made towards unsecured loans and share application money for the unabated assessment years under consideration. Consequently, the additions so made are liable to be deleted. Accordingly, for Assessment Years 2014-15 to 2018-19, following the decision of the Hon’ble Supreme Court in the case of Abhisar Buildwell (p.) Ltd (supra), no addition could have been made in the assessment completed u/s 153(A) of the Act in relation to unsecured loan and share application money without the aid of any incriminating material found and seized during the course of the search from the premises of the assessee. The ground No. 6 of the appeal of the assessee for AY 2014-15 and corresponding grounds in AY 2015-16 to AY 2018-19 are accordingly allowed.

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5.

Since we have already held that no addition could have been made qua the issue of unsecured loan/share application money in the assessment years from AY 2014-15 to AY 2018-19 , the other grounds raised on the merits of the addition are rendered academic and therefore we are not adjudicating upon the same. 6. In Grounds raised in A.Y. 2019-20 to 2020-21 the addition has been made in the respect of the interest paid in respect of the unsecured loans. Since we have already held that no addition could have been made in the A.Y. 2014-15 to 2018-19 in relation to unsecured loan, the consequent interest disallowance u/s 37(1) of the Act also cannot be made in the A.Y. 2019-20 to A.Y. 2020-21. The said grounds are dismissed accordingly. 7. In the result all the appeals of the assessee are allowed partly. Order pronounced in the open Court on 29/04/2025.

Sd/- Sd/- (KAVITHA RAJAGOPAL) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 29/04/2025 Disha Raut,Stenographer Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file.

Arun Amber Silk Mills Private Ltd. 25 IT(SS)A Nos. 443,444,445,446 & 447/MUM/2025

BY ORDER,

//True Copy// (Assistant Registrar) ITAT, Mumbai

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