ACIT. -CC- 2(1), MUMBAI vs. GOLDMEDAL ELECTRICALS PVT. LTD., KARNATAKA

PER OM PRAKASH KANT, AM PER OM PRAKASH KANT, AM These appeals by the Revenue are directed against a common appeals by the Revenue are directed against a common appeals by the Revenue are directed against a common order dated 30.06.2022 passed by the Ld. Commissioner of Income- order dated 30.06.2022 passed by the Ld. Commissioner of Income order dated 30.06.2022 passed by the Ld. Commissioner of Income tax (Appeals)-48, Mumbai [in short ‘the Ld. CIT(A)’] for assessment 48, Mumbai [in short ‘the Ld. CIT(A)’] for assessment 48, Mumbai [in short ‘the Ld. CIT(A)’] for assessment year 2014-15 to 2019 15 to 2019-2020. As identical grounds have been raised 2020. As identical grounds have been raised by the Revenue in these appeals e Revenue in these appeals, therefore, same therefore, same were heard together and disposed off by way of this consolidated order for together and disposed off by way of this consolidated order for together and disposed off by way of this consolidated order for convenience.

Gold Medal Electrical Pvt. Ltd. 3 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022 2. Whether on the facts and circumstances of the case and in Whether on the facts and circumstances of the case and in Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) law, the Ld. CIT(A)-48, Mumbai is right in deleting the entire 48, Mumbai is right in deleting the entire additions of additions of ₹6,36,66,340/- made in the assessment order made in the assessment order only on the ground that no incriminating material was found y on the ground that no incriminating material was found y on the ground that no incriminating material was found to sustain the addition without appreciating the facts that the to sustain the addition without appreciating the facts that the to sustain the addition without appreciating the facts that the assessment order was passed after carefully analyzing the assessment order was passed after carefully analyzing the assessment order was passed after carefully analyzing the seized material. seized material.

Gold Medal Electrical Pvt. Ltd. 4 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022 assessee,therefore, no addition could have been made in the year therefore, no addition could have been made in the year therefore, no addition could have been made in the year under consideration. under consideration.

Gold Medal Electrical Pvt. Ltd. 5 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

other High Courts including decision of the Tr other High Courts including decision of the Tribunal Special Bench ibunal Special Bench in the case of All Cargo Global Logistics Ltd. v. DIT (2012) 23 All Cargo Global Logistics Ltd. v. DIT (2012) 23 All Cargo Global Logistics Ltd. v. DIT (2012) 23 taxmann.com 103 (Mum.) (SB) taxmann.com 103 (Mum.) (SB).The Ld. CIT(A) has also considered Ld. CIT(A) has also considered the decision of the Hon’ble Delhi High Court in the case of CIT v. the decision of the Hon’ble Delhi High Court in the case of the decision of the Hon’ble Delhi High Court in the case of Harjeev Aggarwal (70 Taxmann.com 95; 10.0 Harjeev Aggarwal (70 Taxmann.com 95; 10.03.2016) 3.2016), wherein it is held that even for making assessment on the basis of statement is held that even for making assessment on the basis of statement is held that even for making assessment on the basis of statement recorded u/s 132(4) of the Act recorded u/s 132(4) of the Act, addition should have been made have been made only to the extent of statement relatable to the incriminating only to the extent of statement relatable to the incriminating only to the extent of statement relatable to the incriminating material/evidence found during the course of material/evidence found during the course of the search. A detailed the search. A detailed finding of the Ld. CIT(A) on the issue finding of the Ld. CIT(A) on the issue-in-dispute is reproduced as dispute is reproduced as under:

“7.1 I have carefully considered the facts of the case, submissions of I have carefully considered the facts of the case, submissions of I have carefully considered the facts of the case, submissions of the Appellant, the observations of the AO contained in the assessment the Appellant, the observations of the AO contained in the assessment the Appellant, the observations of the AO contained in the assessment order and the oth order and the other materials on record on this issue. In this Ground, er materials on record on this issue. In this Ground, the appellant has contended that the assessment order passed u/s the appellant has contended that the assessment order passed u/s the appellant has contended that the assessment order passed u/s 153A r.w.s 143(3) of the Act for the impugned assessment year is bad 153A r.w.s 143(3) of the Act for the impugned assessment year is bad 153A r.w.s 143(3) of the Act for the impugned assessment year is bad in law as -

(i) there were no assessment proceedings pending as on t (i) there were no assessment proceedings pending as on t (i) there were no assessment proceedings pending as on the date of search action u/s 132 of the Act which is a prerequisite for assessing search action u/s 132 of the Act which is a prerequisite for assessing search action u/s 132 of the Act which is a prerequisite for assessing the income escaped to tax. the income escaped to tax.

(ii) there is no nexus between the additions made in the assessment (ii) there is no nexus between the additions made in the assessment (ii) there is no nexus between the additions made in the assessment order to that of incriminating material found/seized pursuant to the order to that of incriminating material found/seized pursuant to the order to that of incriminating material found/seized pursuant to the search action. ion.

Gold Medal Electrical Pvt. Ltd. 6 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

7.2 In this context, a report was called for vide this office letter In this context, a report was called for vide this office letter In this context, a report was called for vide this office letter dated 08.06.2022 from the A.O. The same is reproduced hereunder: 8.06.2022 from the A.O. The same is reproduced hereunder: 8.06.2022 from the A.O. The same is reproduced hereunder:

"Sub: Copies of incriminating material found in the case of Gold Medal "Sub: Copies of incriminating material found in the case of Gold Medal "Sub: Copies of incriminating material found in the case of Gold Medal Electricals Pvt. Ltd. during search proceedin Electricals Pvt. Ltd. during search proceedings on 13.11.2019 for A.Y. gs on 13.11.2019 for A.Y. 2014-15 to 2019 15 to 2019-20- reg-

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Please refer to the above. Please refer to the above.

3.One of the grounds raised during the appellate proceedings is that 3.One of the grounds raised during the appellate proceedings is that 3.One of the grounds raised during the appellate proceedings is that no incriminating material was found during the search proceedings, no incriminating material was found during the search proceedings, no incriminating material was found during the search proceedings, hence the addition made u/s. 153(a) r.w.s. 143(3) is bad in law, as hence the addition made u/s. 153(a) r.w.s. 143(3) is bad in law, as hence the addition made u/s. 153(a) r.w.s. 143(3) is bad in law, as per various judicial decisions. s judicial decisions.

6.Please provide the above information on or before 174 June, 6.Please provide the above information on or before 174 June, 6.Please provide the above information on or before 174 June, 2022,without fail." 2022,without fail."

Gold Medal Electrical Pvt. Ltd. 7 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

7.3Since no report w 7.3Since no report was received by 171 June, 2022, a reminder was as received by 171 June, 2022, a reminder was issued to the A0 on 21.06.2022 with a request to submit the details by issued to the A0 on 21.06.2022 with a request to submit the details by issued to the A0 on 21.06.2022 with a request to submit the details by 27.06.2022.

However, till the passing of this order, no reply has been received from However, till the passing of this order, no reply has been received from However, till the passing of this order, no reply has been received from the AO.

7.4The sum and substance of this ground raised 7.4The sum and substance of this ground raised by the appellant is by the appellant is that the additions made in the assessment order are not based on or that the additions made in the assessment order are not based on or that the additions made in the assessment order are not based on or connected with any incriminating documents found or seized during connected with any incriminating documents found or seized during connected with any incriminating documents found or seized during the search proceedings. Moreover, as on the date of search action us the search proceedings. Moreover, as on the date of search action us the search proceedings. Moreover, as on the date of search action us 132 of the Act, there were no pe 132 of the Act, there were no pending assessment proceedings for the nding assessment proceedings for the impugned AY, which got abated. impugned AY, which got abated.

7.5 It is observed that the AO has remained silent on this issue by not 7.5 It is observed that the AO has remained silent on this issue by not 7.5 It is observed that the AO has remained silent on this issue by not replying to the specific query raised by this office. He has abstain replying to the specific query raised by this office. He has abstain replying to the specific query raised by this office. He has abstain himself from bringing out on record/commented o himself from bringing out on record/commented on any incriminating n any incriminating material found and/or seized during the search action, based on material found and/or seized during the search action, based on material found and/or seized during the search action, based on which the impugned additions are made. The Ld. AR, on the other which the impugned additions are made. The Ld. AR, on the other which the impugned additions are made. The Ld. AR, on the other hand, has emphatically stated that the impugned additions are not hand, has emphatically stated that the impugned additions are not hand, has emphatically stated that the impugned additions are not based on any material found/seized during based on any material found/seized during the course of search action the course of search action at the premises of the appellant. The appellant has also relied on a no. at the premises of the appellant. The appellant has also relied on a no. at the premises of the appellant. The appellant has also relied on a no. of judicial decisions on this issue. of judicial decisions on this issue.

7.6 On perusal of the impugned assessment order, it is evident that 7.6 On perusal of the impugned assessment order, it is evident that 7.6 On perusal of the impugned assessment order, it is evident that the AO has not referred to any seized material fou the AO has not referred to any seized material found during the course nd during the course of search to make the impugned additions. The return of income, as of search to make the impugned additions. The return of income, as of search to make the impugned additions. The return of income, as mentioned previously, was filed on27.11.2014. The due date for mentioned previously, was filed on27.11.2014. The due date for mentioned previously, was filed on27.11.2014. The due date for issuing notice us 143(2) was 30.09.2015, which had issuing notice us 143(2) was 30.09.2015, which had issuing notice us 143(2) was 30.09.2015, which hadalready expired on the date of search i.e., 13.11.2019. on the date of search i.e., 13.11.2019. Since, the proceedings for AY. Since, the proceedings for AY. 2014-15 had not abated, the contention of the Ld. AR that the AO was 15 had not abated, the contention of the Ld. AR that the AO was 15 had not abated, the contention of the Ld. AR that the AO was empowered to make additions based on the incriminating material empowered to make additions based on the incriminating material empowered to make additions based on the incriminating material found and seized during the course of search operation, appears to be found and seized during the course of search operation, appears to be found and seized during the course of search operation, appears to be correct as held in a correct as held in a no. of judicial decisions including the decision of no. of judicial decisions including the decision of jurisdictional High Court. jurisdictional High Court.

Gold Medal Electrical Pvt. Ltd. 8 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

7.7 As referred to in the preceding paragraphs, there is no discussion 7.7 As referred to in the preceding paragraphs, there is no discussion 7.7 As referred to in the preceding paragraphs, there is no discussion in the assessment order about any specific incriminating material, in the assessment order about any specific incriminating material, in the assessment order about any specific incriminating material, which has been found during the course which has been found during the course of search, the matter was of search, the matter was referred back to the AO vide letter 08.06.2022 calling for a remand referred back to the AO vide letter 08.06.2022 calling for a remand referred back to the AO vide letter 08.06.2022 calling for a remand report to the effect that whether this addition was based on any report to the effect that whether this addition was based on any report to the effect that whether this addition was based on any incriminating material found during the course of search.As stated in incriminating material found during the course of search.As stated in incriminating material found during the course of search.As stated in the preceding paragraphs,in the preceding paragraphs,in the absence of any reply from the AO, it is the absence of any reply from the AO, it is apparent that the AO has preferred to remain silent to bring on record apparent that the AO has preferred to remain silent to bring on record apparent that the AO has preferred to remain silent to bring on record any incriminating material found either during the course of the any incriminating material found either during the course of the any incriminating material found either during the course of the assessment proceedings, which can be linked with the additions made assessment proceedings, which can be linked with the additions made assessment proceedings, which can be linked with the additions made in the impugned assessment order. impugned assessment order.

7.8The Hon'ble Bombay High Court in the case of CIT vs. Continental 7.8The Hon'ble Bombay High Court in the case of CIT vs. Continental 7.8The Hon'ble Bombay High Court in the case of CIT vs. Continental Warehousing Corporation [374 IT 645), has held that when the Warehousing Corporation [374 IT 645), has held that when the Warehousing Corporation [374 IT 645), has held that when the assessment has attained finality, then the AO while passing the assessment has attained finality, then the AO while passing the assessment has attained finality, then the AO while passing the independent assessment order u/s 153 independent assessment order u/s 153A of the Act can't disturb the A of the Act can't disturb the assessment / reassessment order which has attained finality, unless assessment / reassessment order which has attained finality, unless assessment / reassessment order which has attained finality, unless the materials gathered in the course of the proceedings u/S 132 of the the materials gathered in the course of the proceedings u/S 132 of the the materials gathered in the course of the proceedings u/S 132 of the Act Act Act establish establish establish that that that the the the reliefs reliefs reliefs granted granted granted under under under the the the finalized finalized finalized assessment/reassessment wer assessment/reassessment were contrary to the facts unearthed e contrary to the facts unearthed during the course of search operation. Further, upon perusal of SLP No. during the course of search operation. Further, upon perusal of SLP No. during the course of search operation. Further, upon perusal of SLP No. 18560 of 2015 dated 12/10/2015 admitted by Hon'ble Supreme Court 18560 of 2015 dated 12/10/2015 admitted by Hon'ble Supreme Court 18560 of 2015 dated 12/10/2015 admitted by Hon'ble Supreme Court against the decision of Hon'ble Bombay High Court rendered in CIT Vs. against the decision of Hon'ble Bombay High Court rendered in CIT Vs. against the decision of Hon'ble Bombay High Court rendered in CIT Vs. Continental War Continental Warehousing Corporation (supra), it is found that Hon'ble ehousing Corporation (supra), it is found that Hon'ble Apex Court has only admitted SLP against the ruling of the Hon'ble Apex Court has only admitted SLP against the ruling of the Hon'ble Apex Court has only admitted SLP against the ruling of the Hon'ble Bombay High Court's finding. However, it is seen that the Hon'ble Bombay High Court's finding. However, it is seen that the Hon'ble Bombay High Court's finding. However, it is seen that the Hon'ble Apex Court has not stayed or suspended the operation of the decision Apex Court has not stayed or suspended the operation of the decision Apex Court has not stayed or suspended the operation of the decision of the Hon'ble Bombay High Court in any manner and, therefore, at the of the Hon'ble Bombay High Court in any manner and, therefore, at the of the Hon'ble Bombay High Court in any manner and, therefore, at the moment,the decision of jurisdictional High Court is binding on the the decision of jurisdictional High Court is binding on the the decision of jurisdictional High Court is binding on the lower jurisdictional Authorities. lower jurisdictional Authorities.

7.9The aforesaid ratio was again reiterated by the Hon'ble Bombay 7.9The aforesaid ratio was again reiterated by the Hon'ble Bombay 7.9The aforesaid ratio was again reiterated by the Hon'ble Bombay High Court in the High Court in the case of Pr. CIT vs Vimal Kumar Rathi 115 case of Pr. CIT vs Vimal Kumar Rathi 115 Taxmann.com 219 (2020). In the said judgment, Hon'ble Court has Taxmann.com 219 (2020). In the said judgment, Hon'ble Court has Taxmann.com 219 (2020). In the said judgment, Hon'ble Court has

Gold Medal Electrical Pvt. Ltd. 9 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

relied upon it's own judgment in CIT v. Deepak Kumar Agarwal [2017] relied upon it's own judgment in CIT v. Deepak Kumar Agarwal [2017] relied upon it's own judgment in CIT v. Deepak Kumar Agarwal [2017] 86 taxmann.com 3 (Bom.) In the latter case, the question put before the 86 taxmann.com 3 (Bom.) In the latter case, the question put before the 86 taxmann.com 3 (Bom.) In the latter case, the question put before the Hon'ble Court was rt was-

(i) Whether on the facts and in the circumstance of the case and in Whether on the facts and in the circumstance of the case and in Whether on the facts and in the circumstance of the case and in law,the Tribunal was justified in holding that assessment under law,the Tribunal was justified in holding that assessment under law,the Tribunal was justified in holding that assessment under section 153A could be made only on the basis of incriminating material section 153A could be made only on the basis of incriminating material section 153A could be made only on the basis of incriminating material found in the search and no other issue could found in the search and no other issue could be taken following the be taken following the decision of the Special Bench of the Mumbai Tribunal rendered in the decision of the Special Bench of the Mumbai Tribunal rendered in the decision of the Special Bench of the Mumbai Tribunal rendered in the case of All Cargo Global Logistics Ltd. v. Dy. CIT2012) 23 case of All Cargo Global Logistics Ltd. v. Dy. CIT2012) 23 case of All Cargo Global Logistics Ltd. v. Dy. CIT2012) 23 taxmann.com 103/137 ITD 287, when the said decision had been taxmann.com 103/137 ITD 287, when the said decision had been taxmann.com 103/137 ITD 287, when the said decision had been disapproved by the Karnataka High Court. disapproved by the Karnataka High Court.

The Hon'ble Jurisdictional High Court took the stand in the following Hon'ble Jurisdictional High Court took the stand in the following Hon'ble Jurisdictional High Court took the stand in the following manner-

"30. The Tribunal concluded that the arguments relating to the validity "30. The Tribunal concluded that the arguments relating to the validity "30. The Tribunal concluded that the arguments relating to the validity of the notice under Section 153A and though that provision could have of the notice under Section 153A and though that provision could have of the notice under Section 153A and though that provision could have been invoked in the given facts and cir been invoked in the given facts and circumstances, but the additions cumstances, but the additions made by the Assessing Officer were in the absence of any made by the Assessing Officer were in the absence of any made by the Assessing Officer were in the absence of any incriminating material. Therefore, they are not sustainable and they incriminating material. Therefore, they are not sustainable and they incriminating material. Therefore, they are not sustainable and they came to be deleted. came to be deleted.

7.10 Furthermore, a similar view has been taken by the Hon'ble 7.10 Furthermore, a similar view has been taken by the Hon'ble 7.10 Furthermore, a similar view has been taken by the Hon'ble Bombay High Co Bombay High Court (Nagpur Bench) in case ofMurli Agro Products Ltd urt (Nagpur Bench) in case ofMurli Agro Products Ltd Vs. CIT (2014] 49 taxmann.com 172 (Bombay) Vs. CIT (2014] 49 taxmann.com 172 (Bombay) - In this case the In this case the Bombay High Court held that no addition can be made in respect of an Bombay High Court held that no addition can be made in respect of an Bombay High Court held that no addition can be made in respect of an unabated assessment which has become final if no incriminating unabated assessment which has become final if no incriminating unabated assessment which has become final if no incriminating material is found during the search. The relevant extract of the is found during the search. The relevant extract of the is found during the search. The relevant extract of the decision is reproduced hereunder: decision is reproduced hereunder:

Gold Medal Electrical Pvt. Ltd. 10 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

"Once it is held that the assessment finalized on 29.12.2000 has "Once it is held that the assessment finalized on 29.12.2000 has "Once it is held that the assessment finalized on 29.12.2000 has attained finality, then the deduction allowed w/ 80HHC would attain attained finality, then the deduction allowed w/ 80HHC would attain attained finality, then the deduction allowed w/ 80HHC would attain finality. In such a case, the AO, finality. In such a case, the AO, while passing the independent while passing the independent assessment order us 153A could not have disturbed the assessment assessment order us 153A could not have disturbed the assessment assessment order us 153A could not have disturbed the assessment order which has attained finality, unless the materials gathered in the order which has attained finality, unless the materials gathered in the order which has attained finality, unless the materials gathered in the course of the proceedings w/s 153A establish that the reliefs granted course of the proceedings w/s 153A establish that the reliefs granted course of the proceedings w/s 153A establish that the reliefs granted under the finalize under the finalized assessment were contrary to the facts unearthed d assessment were contrary to the facts unearthed during the course of s.153A proceedings. In the present case, there is during the course of s.153A proceedings. In the present case, there is during the course of s.153A proceedings. In the present case, there is nothing on record to suggest that any material was unearthed during nothing on record to suggest that any material was unearthed during nothing on record to suggest that any material was unearthed during the search or during the s. 153A proceedings which would show that the search or during the s. 153A proceedings which would show that the search or during the s. 153A proceedings which would show that the rellef us 80HHC was erroneous. In such a case, the AO, while the rellef us 80HHC was erroneous. In such a case, the AO, while the rellef us 80HHC was erroneous. In such a case, the AO, while passing the assessment order us 153A could not have disturbed the passing the assessment order us 153A could not have disturbed the passing the assessment order us 153A could not have disturbed the assessment order finalised on 29.12.2000 relating to s.. 80HHC assessment order finalised on 29.12.2000 relating to s.. 80HHC assessment order finalised on 29.12.2000 relating to s.. 80HHC deduction."

This view was upheld in another decision of the Ho This view was upheld in another decision of the Hon'ble Bombay High n'ble Bombay High Court inCIT v. Gurinder Singh Bawa [2016] 386 IT 483/|2017] 79 Court inCIT v. Gurinder Singh Bawa [2016] 386 IT 483/|2017] 79 Court inCIT v. Gurinder Singh Bawa [2016] 386 IT 483/|2017] 79 taxmann.com 398. taxmann.com 398.

7.11 Reliance in this regard, is placed on the Mumbai Special Bench 7.11 Reliance in this regard, is placed on the Mumbai Special Bench 7.11 Reliance in this regard, is placed on the Mumbai Special Bench decision in case of All Cargo Global Logistics Ltd vs. DIT (2012] 23 decision in case of All Cargo Global Logistics Ltd vs. DIT (2012] 23 decision in case of All Cargo Global Logistics Ltd vs. DIT (2012] 23 taxmann.com 103 (Mum. taxmann.com 103 (Mum.) (SB), wherein it was held by the Hon'ble ) (SB), wherein it was held by the Hon'ble Tribunal that in case of completed assessments the assessment us. Tribunal that in case of completed assessments the assessment us. Tribunal that in case of completed assessments the assessment us. 153A of the Act has to be made on incriminating material only. 153A of the Act has to be made on incriminating material only. 153A of the Act has to be made on incriminating material only.

The relevant extract of the case is as under: The relevant extract of the case is as under:

(i) In assessments that are abated, In assessments that are abated, the AO retains the original the AO retains the original Jurisdiction as well as the jurisdiction conferred on him by s. 1534 for Jurisdiction as well as the jurisdiction conferred on him by s. 1534 for Jurisdiction as well as the jurisdiction conferred on him by s. 1534 for which assessments shall be made for each of the 6 assessment years which assessments shall be made for each of the 6 assessment years which assessments shall be made for each of the 6 assessment years separately;

In other cases, in addition to the income that has already been In other cases, in addition to the income that has already been In other cases, in addition to the income that has already been assessed, the assessment u/s 1534 will be made on the basis of e assessment u/s 1534 will be made on the basis of e assessment u/s 1534 will be made on the basis of incriminating material i.e. (a) the books of accounts and other incriminating material i.e. (a) the books of accounts and other incriminating material i.e. (a) the books of accounts and other

Gold Medal Electrical Pvt. Ltd. 11 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

documents found in the course of the search but not produced in the documents found in the course of the search but not produced in the documents found in the course of the search but not produced in the course of original assessment and (b) undisclosed income or course of original assessment and (b) undisclosed income or course of original assessment and (b) undisclosed income or propertydisclosed in the course of search. osed in the course of search.

The said extract clearly brings out the essence of assessment to be The said extract clearly brings out the essence of assessment to be The said extract clearly brings out the essence of assessment to be carried out u/s.153A of the Act, and makes it clear that only carried out u/s.153A of the Act, and makes it clear that only carried out u/s.153A of the Act, and makes it clear that only incriminating material can form the basis of assessment u/s. 153A of incriminating material can form the basis of assessment u/s. 153A of incriminating material can form the basis of assessment u/s. 153A of the Act. In the present the Act. In the present case of the appellant too, no incriminating case of the appellant too, no incriminating material has been found. Thus, the argument of the appellant that the material has been found. Thus, the argument of the appellant that the material has been found. Thus, the argument of the appellant that the impugned search assessment w/s. 153A of the Act is bad impugned search assessment w/s. 153A of the Act is bad impugned search assessment w/s. 153A of the Act is bad-in-law and void, has got merit. void, has got merit.

The aforesaid decision in case of All Cargo Global Logi The aforesaid decision in case of All Cargo Global Logi The aforesaid decision in case of All Cargo Global Logistics Ltd has been upheld by the Hon'ble Bombay High Court vide its order dated been upheld by the Hon'ble Bombay High Court vide its order dated been upheld by the Hon'ble Bombay High Court vide its order dated 21.04.2015.

7.12The aforesaid findings are fortified by the decision of the Hon'ble 7.12The aforesaid findings are fortified by the decision of the Hon'ble 7.12The aforesaid findings are fortified by the decision of the Hon'ble Delhi High Court in CIT Central Delhi High Court in CIT Central-III vs. Kabul Chawla,380 IT 573(Del). III vs. Kabul Chawla,380 IT 573(Del). The Hon'ble Delhi High The Hon'ble Delhi High Court in the case of Pr. CIT vs. Meeta Gutgutia Court in the case of Pr. CIT vs. Meeta Gutgutia [2017-TIOL-1000 1000-HC-DEL-IT], has affirmed the view that no addition IT], has affirmed the view that no addition can be made for a particular assessment year without there being an can be made for a particular assessment year without there being an can be made for a particular assessment year without there being an incriminating material that relates to the said assessment year which incriminating material that relates to the said assessment year which incriminating material that relates to the said assessment year which would justify such an addition. The Hon'ble Supreme Court in the case uld justify such an addition. The Hon'ble Supreme Court in the case uld justify such an addition. The Hon'ble Supreme Court in the case of Principal Commissioner of Income of Principal Commissioner of Income-tax, Central IT, New Delhi tax, Central IT, New Delhi Vs.Meeta Gutgutia [2018] 96 taxmann.com 468 (SC)has dismissed the Vs.Meeta Gutgutia [2018] 96 taxmann.com 468 (SC)has dismissed the Vs.Meeta Gutgutia [2018] 96 taxmann.com 468 (SC)has dismissed the SLP in the case and thus upheld the decision of Hon'ble Del SLP in the case and thus upheld the decision of Hon'ble Del SLP in the case and thus upheld the decision of Hon'ble Delhi High Court that Court that invocation of section 153A to re-open concluded invocation of section 153A to re open concluded assessments of assessment years earlier to year of search was not assessments of assessment years earlier to year of search was not assessments of assessment years earlier to year of search was not justified in absence of incriminating material found during justified in absence of incriminating material found during justified in absence of incriminating material found duringsearch qua each such earlier assessment year. As noted by the Ho each such earlier assessment year. As noted by the Ho each such earlier assessment year. As noted by the Hon'ble Delhi High Court in the case of Meeta Gutgutia (supra), several other High Courts Court in the case of Meeta Gutgutia (supra), several other High Courts Court in the case of Meeta Gutgutia (supra), several other High Courts have also come to a similar conclusion either by following Kabul have also come to a similar conclusion either by following Kabul have also come to a similar conclusion either by following Kabul Chawla (supra) or otherwise. This includes the decisions of the Hon'ble Chawla (supra) or otherwise. This includes the decisions of the Hon'ble Chawla (supra) or otherwise. This includes the decisions of the Hon'ble Gujarat High Court in Pr. CITv. Gujarat High Court in Pr. CITv. Soumya Construction (P.) Ltd. [2016] Soumya Construction (P.) Ltd. [2016]

Gold Medal Electrical Pvt. Ltd. 12 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

387 IT 529/[2017] 81 taxmann.com 292 (Guj.): Pr. CIT v. Devangi alias 387 IT 529/[2017] 81 taxmann.com 292 (Guj.): Pr. CIT v. Devangi alias 387 IT 529/[2017] 81 taxmann.com 292 (Guj.): Pr. CIT v. Devangi alias Rupa (Tax Appeal Nos. 54, 55 to 57 of 2017, dated 2 Rupa (Tax Appeal Nos. 54, 55 to 57 of 2017, dated 2 Rupa (Tax Appeal Nos. 54, 55 to 57 of 2017, dated 2-2-2017]; the Hon'ble Karnataka High Court in CIT v. IBC Knowledge Park (P.) Ltd. Hon'ble Karnataka High Court in CIT v. IBC Knowledge Park (P.) Ltd. Hon'ble Karnataka High Court in CIT v. IBC Knowledge Park (P.) Ltd.

[2016] 385 IT 3 [2016] 385 IT 346/69 taxmann.com 108 (kar.); the Hon'ble Kolkata 46/69 taxmann.com 108 (kar.); the Hon'ble Kolkata High Court in Pr. CIT v. Salasar Stock Broking Ltd. (GA No. 1929 of High Court in Pr. CIT v. Salasar Stock Broking Ltd. (GA No. 1929 of High Court in Pr. CIT v. Salasar Stock Broking Ltd. (GA No. 1929 of 2016, dated 24 2016, dated 24-8-2016], Principal CIT v. Ms. Lata Jain [2016] 384 IT 2016], Principal CIT v. Ms. Lata Jain [2016] 384 IT 543 (Delhi). In Meeta Gutgutia (supra) the entire gamut of the case l 543 (Delhi). In Meeta Gutgutia (supra) the entire gamut of the case l 543 (Delhi). In Meeta Gutgutia (supra) the entire gamut of the case law had been analysed and the legal position was reiterated that unless had been analysed and the legal position was reiterated that unless had been analysed and the legal position was reiterated that unless there is incriminating material qua each of the AYs in which additions there is incriminating material qua each of the AYs in which additions there is incriminating material qua each of the AYs in which additions are sought to be made, pursuant to search and seizure operation, the are sought to be made, pursuant to search and seizure operation, the are sought to be made, pursuant to search and seizure operation, the assumption of jurisdiction under Section 153A assumption of jurisdiction under Section 153A of the Act would be of the Act would be vitiated in law. vitiated in law.

7.13 The Hon'ble Gujarat High Court in the case of Saumya 7.13 The Hon'ble Gujarat High Court in the case of Saumya 7.13 The Hon'ble Gujarat High Court in the case of Saumya Construction Pvt.Ltd. (supra) in paragraph Nos. 15, 16 and 19 has Construction Pvt.Ltd. (supra) in paragraph Nos. 15, 16 and 19 has Construction Pvt.Ltd. (supra) in paragraph Nos. 15, 16 and 19 has observed and held as under: observed and held as under:

Gold Medal Electrical Pvt. Ltd. 13 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

seeks toassess the total income for the assessment year, which is oassess the total income for the assessment year, which is oassess the total income for the assessment year, which is clear from the first proviso thereto which provides that the Assessing clear from the first proviso thereto which provides that the Assessing clear from the first proviso thereto which provides that the Assessing Officer shall assess or reassess the total income in respect of each Officer shall assess or reassess the total income in respect of each Officer shall assess or reassess the total income in respect of each assessment year falling within such six assessment years. assessment year falling within such six assessment years. assessment year falling within such six assessment years. The second proviso makes the intention of the legislature clear as the same proviso makes the intention of the legislature clear as the same proviso makes the intention of the legislature clear as the same provides that assessment or reassessment, if any, relating to the six provides that assessment or reassessment, if any, relating to the six provides that assessment or reassessment, if any, relating to the six assessment years referred to in the sub assessment years referred to in the sub-section pending on the date of section pending on the date of initiation of search under section 132 initiation of search under section 132 or requisition under section or requisition under section 132A, as the case may be, shall abate. Sub 132A, as the case may be, shall abate. Sub-section (2) of section 153A section (2) of section 153A of the Act provides that if any proceeding or any order of assessment of the Act provides that if any proceeding or any order of assessment of the Act provides that if any proceeding or any order of assessment or reassessment made under sub or reassessment made under sub-section (1) is annulled in appeal or section (1) is annulled in appeal or any other legal p any other legal provision, then the assessment or reassessment rovision, then the assessment or reassessment relating to any assessment year which had abated under the second relating to any assessment year which had abated under the second relating to any assessment year which had abated under the second proviso would stand revived. The proviso thereto says that such proviso would stand revived. The proviso thereto says that such proviso would stand revived. The proviso thereto says that such revival shall cease to have effect if such order of annulment is set revival shall cease to have effect if such order of annulment is set revival shall cease to have effect if such order of annulment is set aside. Thus, any proceeding of assessment or reassessment falling , any proceeding of assessment or reassessment falling , any proceeding of assessment or reassessment falling within the six assessment years prior to the search or requisition within the six assessment years prior to the search or requisition within the six assessment years prior to the search or requisition stands abated and the total income of the assessee is required to be stands abated and the total income of the assessee is required to be stands abated and the total income of the assessee is required to be determined under section 153A of the Act. Similarly, subsection ( determined under section 153A of the Act. Similarly, subsection ( determined under section 153A of the Act. Similarly, subsection (2) provides for revival of any assessment or reassessment which stood provides for revival of any assessment or reassessment which stood provides for revival of any assessment or reassessment which stood abated, if any proceeding or any order of assessment or reassessment abated, if any proceeding or any order of assessment or reassessment abated, if any proceeding or any order of assessment or reassessment made under section 153A of the Act is annulled in appeal or any other made under section 153A of the Act is annulled in appeal or any other made under section 153A of the Act is annulled in appeal or any other proceeding.

Gold Medal Electrical Pvt. Ltd. 14 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

relation to the search or requisition. In other words, the assessment relation to the search or requisition. In other words, the assessment relation to the search or requisition. In other words, the assessment should be connected with somet should be connected with something found during the search or hing found during the search or requisition, viz., incriminating material which reveals undisclosed requisition, viz., incriminating material which reveals undisclosed requisition, viz., incriminating material which reveals undisclosed income. Thus, while in view of the mandate of sub income. Thus, while in view of the mandate of sub-section (1) of section section (1) of section 153A of the Act, in every case where there is a search or requisition, 153A of the Act, in every case where there is a search or requisition, 153A of the Act, in every case where there is a search or requisition, the Assessing Officer is obliged to issue notice to such person to g Officer is obliged to issue notice to such person to g Officer is obliged to issue notice to such person to furnish returns of income for the six years preceding the assessment furnish returns of income for the six years preceding the assessment furnish returns of income for the six years preceding the assessment year relevant to the previous year in which the search is conducted or year relevant to the previous year in which the search is conducted or year relevant to the previous year in which the search is conducted or requisition is made, any addition or disallowance can be made requisition is made, any addition or disallowance can be made requisition is made, any addition or disallowance can be made only on the basis of material collected during the search or requisition. In case the basis of material collected during the search or requisition. In case the basis of material collected during the search or requisition. In case no incriminating material is found, as held by the Rajasthan High no incriminating material is found, as held by the Rajasthan High no incriminating material is found, as held by the Rajasthan High Court in the case of Jai Steel (India), Jodhpur v. Assistant Court in the case of Jai Steel (India), Jodhpur v. Assistant Court in the case of Jai Steel (India), Jodhpur v. Assistant Commissioner of Income Tax (supra), the earlie Commissioner of Income Tax (supra), the earlier assessment would r assessment would have to be reiterated. In case where pending assessments have have to be reiterated. In case where pending assessments have have to be reiterated. In case where pending assessments have abated, the Assessing Officer can pass assessment orders for each of abated, the Assessing Officer can pass assessment orders for each of abated, the Assessing Officer can pass assessment orders for each of the six years determining the total income of the assessee which the six years determining the total income of the assessee which the six years determining the total income of the assessee which would include income declared in the retu would include income declared in the returns, if any, furnished by the rns, if any, furnished by the assessee as well as undisclosed income, if any, unearthed during the assessee as well as undisclosed income, if any, unearthed during the assessee as well as undisclosed income, if any, unearthed during the search or requisition. In case where a pending reassessment under search or requisition. In case where a pending reassessment under search or requisition. In case where a pending reassessment under section 147 of the Act has abated, needless to state that the scope and section 147 of the Act has abated, needless to state that the scope and section 147 of the Act has abated, needless to state that the scope and ambit of the assess ambit of the assessment would include any order which the Assessing ment would include any order which the Assessing Officer could have passed under section 147 of the Act as well as Officer could have passed under section 147 of the Act as well as Officer could have passed under section 147 of the Act as well as under section 153A of the Act. under section 153A of the Act.

Gold Medal Electrical Pvt. Ltd. 15 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

assessment year, no incriminating material is found, no addition or assessment year, no incriminating material is found, no addition or assessment year, no incriminating material is found, no addition or disallowance can be made in relation to that assessment year in disallowance can be made in relation to that assessment year in disallowance can be made in relation to that assessment year in exercise of powers under section 153A of the Act an exercise of powers under section 153A of the Act an exercise of powers under section 153A of the Act and the earlier assessment shall have to be reiterated. In this regard, this court is in assessment shall have to be reiterated. In this regard, this court is in assessment shall have to be reiterated. In this regard, this court is in complete agreement with the view adopted by the Rajasthan High complete agreement with the view adopted by the Rajasthan High complete agreement with the view adopted by the Rajasthan High Court in the case of Jai Steel (India), Jodhpur v. Assistant Court in the case of Jai Steel (India), Jodhpur v. Assistant Court in the case of Jai Steel (India), Jodhpur v. Assistant Commissioner of Income Tax (supra). Besides, Commissioner of Income Tax (supra). Besides, as rightly pointed out by as rightly pointed out by the learned counsel for the respondent, the controversy involved in the the learned counsel for the respondent, the controversy involved in the the learned counsel for the respondent, the controversy involved in the present case stands concluded by the decision of this court in the case present case stands concluded by the decision of this court in the case present case stands concluded by the decision of this court in the case of Commissioner of Income of Commissioner of Income-tax-1 v. Jayaben Ratilal Sorathia (supra) 1 v. Jayaben Ratilal Sorathia (supra) wherein it has bee wherein it has been held that while it cannot be disputed that n held that while it cannot be disputed that considering section 153A of the Act, the Assessing Officer can reopen considering section 153A of the Act, the Assessing Officer can reopen considering section 153A of the Act, the Assessing Officer can reopen and/or assess the return with respect to six preceding years; however, and/or assess the return with respect to six preceding years; however, and/or assess the return with respect to six preceding years; however, there must be some incriminating material available with the there must be some incriminating material available with the there must be some incriminating material available with the Assessing Officer with respect to the sale transactions in the particular Officer with respect to the sale transactions in the particular Officer with respect to the sale transactions in the particular assessment year. assessment year.

7.14 The Hon’ble Delhi High Court in the case of the PCIT, Central 7.14 The Hon’ble Delhi High Court in the case of the PCIT, Central 7.14 The Hon’ble Delhi High Court in the case of the PCIT, Central-3 v. Allied Perfumers (P.) Ltd. [2021] 124 taxmann.com 358 (Delhi) has Allied Perfumers (P.) Ltd. [2021] 124 taxmann.com 358 (Delhi) has Allied Perfumers (P.) Ltd. [2021] 124 taxmann.com 358 (Delhi) has reiterated the aforesaid position of reiterated the aforesaid position of law with following findings: law with following findings:

10."...We find that the additions made by the AO are beyond the scope 10."...We find that the additions made by the AO are beyond the scope 10."...We find that the additions made by the AO are beyond the scope of section 153C section 153C of of the the Income Tax Act, Income Tax Act, 1961, 1961, because because no no incriminating material or evidence had been found during the course of incriminating material or evidence had been found during the course of incriminating material or evidence had been found during the course of search so as to doubt the transactions. It was noted that in the entire arch so as to doubt the transactions. It was noted that in the entire arch so as to doubt the transactions. It was noted that in the entire assessment order, the AO has not referred to any seized material or assessment order, the AO has not referred to any seized material or assessment order, the AO has not referred to any seized material or other material for the year under consideration having being found other material for the year under consideration having being found other material for the year under consideration having being found during the course of search in the case of assessee during the course of search in the case of assessee, leave alone the , leave alone the question of any incriminating material for the year under appeal. We question of any incriminating material for the year under appeal. We question of any incriminating material for the year under appeal. We

Gold Medal Electrical Pvt. Ltd. 16 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

also find that the case laws cited by the Ld. CIT(DR) are not relevant to also find that the case laws cited by the Ld. CIT(DR) are not relevant to also find that the case laws cited by the Ld. CIT(DR) are not relevant to the present case. Therefore, in our considered opinion, the action of the the present case. Therefore, in our considered opinion, the action of the the present case. Therefore, in our considered opinion, the action of the AO is based upon conj AO is based upon conjectures and surmises and hence, the additions ectures and surmises and hence, the additions made is not sustainable in the eyes of law, because this issue in made is not sustainable in the eyes of law, because this issue in made is not sustainable in the eyes of law, because this issue in dispute is now no more res dispute is now no more res-integra, in view of the decision dated integra, in view of the decision dated 29.08.2017 of the Hon'ble Supreme Court of India in the case 29.08.2017 of the Hon'ble Supreme Court of India in the case 29.08.2017 of the Hon'ble Supreme Court of India in the case of Commissioner of Income Tax Commissioner of Income Tax- III, Pune vs. Sinhgad Technical III, Pune vs. Sinhgad Technical Educational Society Educational Society reported in (2017) 84 taxmann.com 290 (SC) as reported in (2017) 84 taxmann.com 290 (SC) as well as the decisions of the Hon'ble Delhi High Court passed in the well as the decisions of the Hon'ble Delhi High Court passed in the well as the decisions of the Hon'ble Delhi High Court passed in the case Commissioner of Income Tax vs. Kabul Chawla Commissioner of Income Tax vs. Kabul Chawla reported (2016) 380 ITR 573 (Del.) and in the case of 380 ITR 573 (Del.) and in the case of Principal Commissioner of Principal Commissioner of Income Tax (Central) Income Tax (Central) -2 vs. Index Securities (P) Ltd.

Gold Medal Electrical Pvt. Ltd. 17 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

153C cannot be sustained in view of the decision of this Court in the cannot be sustained in view of the decision of this Court in the cannot be sustained in view of the decision of this Court in the case of Kabul Chawla (Supra). case of Kabul Chawla (Supra).

7.15 Recently, Hon’ble Mumbai Tribunal in the detailed order dated 7.15 Recently, Hon’ble Mumbai Tribunal in the detailed order dated 7.15 Recently, Hon’ble Mumbai Tribunal in the detailed order dated 02.11.2021 in the case 02.11.2021 in the case of Jasmin K. Ajmera v. DCIT (ITA No. of Jasmin K. Ajmera v. DCIT (ITA No. 983/Mum/2020) has extensively discussed every aspect of the issue 983/Mum/2020) has extensively discussed every aspect of the issue 983/Mum/2020) has extensively discussed every aspect of the issue concerned and held as under: concerned and held as under:

Our findings and Adjudication Our findings and Adjudication

Gold Medal Electrical Pvt. Ltd. 18 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

Warehousing Corporation [2015 374 374 ITR 645]. Therefore this ITR 645]. Therefore this argument would not hold much water which is also fortified by argument would not hold much water which is also fortified by argument would not hold much water which is also fortified by subsequent decision of Hon'ble Bombay High Court in CIT V/s Deepak subsequent decision of Hon'ble Bombay High Court in CIT V/s Deepak subsequent decision of Hon'ble Bombay High Court in CIT V/s Deepak Kumar Agarwal (398 ITR 586 11/09/2017) which held as under: Kumar Agarwal (398 ITR 586 11/09/2017) which held as under: Kumar Agarwal (398 ITR 586 11/09/2017) which held as under: -

Gold Medal Electrical Pvt. Ltd. 19 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

Gold Medal Electrical Pvt. Ltd. 20 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

Similar view has been expressed by Hon'ble Delhi High Court in CIT Similar view has been expressed by Hon'ble Delhi High Court in CIT Similar view has been expressed by Hon'ble Delhi High Court in CIT Vs. Kabul Chawla (380 ITR 573). Vs. Kabul Chawla (380 ITR 573).

Gold Medal Electrical Pvt. Ltd. 21 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

law. The additions made merely on the basis of retracted statement law. The additions made merely on the basis of retracted statement law. The additions made merely on the basis of retracted statement without there being any corroborative evidence / material, in our without there being any corroborative evidence / material, in our without there being any corroborative evidence / material, in our considered opinion, is not sustainab considered opinion, is not sustainable in law since the same run le in law since the same run contrary contrary contrary to to to CBDT CBDT CBDT Circular Circular Circular F. F. F. No.286/2/2003-IT(Inv.), No.286/2/2003 No.286/2/2003 dated 10/03/2003 which has clearly stated that no attempt should be made 10/03/2003 which has clearly stated that no attempt should be made 10/03/2003 which has clearly stated that no attempt should be made to obtain confession / surrender as to the undisclosed income during to obtain confession / surrender as to the undisclosed income during to obtain confession / surrender as to the undisclosed income during search. Such confession, if not search. Such confession, if not based on credible evidence, when based on credible evidence, when retracted, would not serve useful purpose and an therefore, the retracted, would not serve useful purpose and an therefore, the retracted, would not serve useful purpose and an therefore, the authorities should focus on collection of evidence of income which authorities should focus on collection of evidence of income which authorities should focus on collection of evidence of income which leads to information on what has not been disclosed or is not likely to leads to information on what has not been disclosed or is not likely to leads to information on what has not been disclosed or is not likely to be disclosed before be disclosed before the Income-tax department. Further, while tax department. Further, while recording statement during the course of search and seizure operation, recording statement during the course of search and seizure operation, recording statement during the course of search and seizure operation, no attempt should be made to obtain confession as to the undisclosed no attempt should be made to obtain confession as to the undisclosed no attempt should be made to obtain confession as to the undisclosed income and the addition should be made only on the basis of material income and the addition should be made only on the basis of material income and the addition should be made only on the basis of material gathered during search operations. Any action on the contrary has to red during search operations. Any action on the contrary has to red during search operations. Any action on the contrary has to be viewed adversely. The subsequent Circular F.NO.286/98/2013 be viewed adversely. The subsequent Circular F.NO.286/98/2013 be viewed adversely. The subsequent Circular F.NO.286/98/2013-IT (INV.II)] dated 18/12/2014 emphasizes upon need to focus on (INV.II)] dated 18/12/2014 emphasizes upon need to focus on (INV.II)] dated 18/12/2014 emphasizes upon need to focus on gathering evidences during search / survey and to strictly avoid gathering evidences during search / survey and to strictly avoid gathering evidences during search / survey and to strictly avoid obtaining admission of undisclosed income under coercion / taining admission of undisclosed income under coercion / taining admission of undisclosed income under coercion / undue influence. Therefore, the action of Ld. AO could not be said to be in line influence. Therefore, the action of Ld. AO could not be said to be in line influence. Therefore, the action of Ld. AO could not be said to be in line with these circulars issued by CBDT. with these circulars issued by CBDT.

Gold Medal Electrical Pvt. Ltd. 22 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

unearthed or found during search. In other words, there must be a r found during search. In other words, there must be a r found during search. In other words, there must be a nexus between the statement recorded and the evidence/material nexus between the statement recorded and the evidence/material nexus between the statement recorded and the evidence/material found during search in order to sustain additions on the basis of found during search in order to sustain additions on the basis of found during search in order to sustain additions on the basis of recorded statement. Similar is the view of Hon'ble High Court in an recorded statement. Similar is the view of Hon'ble High Court in an recorded statement. Similar is the view of Hon'ble High Court in an earlier judgment of CIT V/s Sunil Aggarwal ( 379 ITR 367; 2016) and ier judgment of CIT V/s Sunil Aggarwal ( 379 ITR 367; 2016) and ier judgment of CIT V/s Sunil Aggarwal ( 379 ITR 367; 2016) and also the decision of Hon'ble Andhra Pradesh High Court in also the decision of Hon'ble Andhra Pradesh High Court in also the decision of Hon'ble Andhra Pradesh High Court in CIT v. Shri Ramdas Motor Transport Ramdas Motor Transport (238 ITR 177) wherein Hon'ble Court refused (238 ITR 177) wherein Hon'ble Court refused to give any evidentiary value to the statement made by the assessee ive any evidentiary value to the statement made by the assessee ive any evidentiary value to the statement made by the assessee u/s 132(4) as the department could not find any unaccounted money, u/s 132(4) as the department could not find any unaccounted money, u/s 132(4) as the department could not find any unaccounted money, article or thing or incriminating document either at the premises of the article or thing or incriminating document either at the premises of the article or thing or incriminating document either at the premises of the company or at the residence of managing director or company or at the residence of managing director or other directors. In other directors. In such circumstances, the finding of the Tribunal that the statement of such circumstances, the finding of the Tribunal that the statement of such circumstances, the finding of the Tribunal that the statement of managing director recorded patently u/s 132(4) did not have any managing director recorded patently u/s 132(4) did not have any managing director recorded patently u/s 132(4) did not have any evidentiary value, was evidentiary value, was upheld. The ratio of all these decisions makes upheld. The ratio of all these decisions makes it clear that the surrendered in it clear that the surrendered income must be correlated with some come must be correlated with some incriminating material found during the course of search action so as incriminating material found during the course of search action so as incriminating material found during the course of search action so as to justify the addition. We find that there is no such incriminating to justify the addition. We find that there is no such incriminating to justify the addition. We find that there is no such incriminating material in the case of the assessee which would show that the material in the case of the assessee which would show that the material in the case of the assessee which would show that the transactions under c transactions under consideration were sham transactions and there onsideration were sham transactions and there was any connection / nexus between the assessee and the group was any connection / nexus between the assessee and the group was any connection / nexus between the assessee and the group entities of Shri Shirish C. Shah. entities of Shri Shirish C. Shah.

Gold Medal Electrical Pvt. Ltd. 23 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

Accordingly, the time limit to issue notice u/s. 143(2) expired on Accordingly, the time limit to issue notice u/s. 143(2) expired on Accordingly, the time limit to issue notice u/s. 143(2) expired on 30.09.2012 upon expiry of six months from the end of the Financial 30.09.2012 upon expiry of six months from the end of the Financial 30.09.2012 upon expiry of six months from the end of the Financial Year in which return was furnished for the relevant assessment Year in which return was furnished for the relevant assessment Year in which return was furnished for the relevant assessment year.

(i). Pr.CIT v. Meeta Gutgutia Pr.CIT v. Meeta Gutgutia [ 82 taxmann.com 287 (Del)] SLP [ 82 taxmann.com 287 (Del)] SLP dismissed by Hon'ble Supreme Court which i dismissed by Hon'ble Supreme Court which is reported in 96 s reported in 96 taxmann.com 468 (SC). taxmann.com 468 (SC).

(ii). CIT v. Gurinder Singh Bawa CIT v. Gurinder Singh Bawa [386 ITR 483 (BOM)]

Gold Medal Electrical Pvt. Ltd. 24 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

(iii). CIT v. Kabul Chawla CIT v. Kabul Chawla [380 ITR 573 (Del)]

(iv). CIT v. Continental Warehousing Corporation CIT v. Continental Warehousing Corporation [374 ITR 645 (BOM)] [374 ITR 645 (BOM)]

(v). CIT v. Anil Kumar Bhatia CIT v. Anil Kumar Bhatia [352 ITR 493 (Del)]

(vi). Brij Bhushan Singal & Ors v. ACIT Brij Bhushan Singal & Ors v. ACIT in ITA.Nos. 1412 to in ITA.Nos. 1412 to 141/Del/18 order dated 31.10.2018 141/Del/18 order dated 31.10.2018

(vii). Shri Sanjay and Smt. Aarti Singal v. DCIT Shri Sanjay and Smt. Aarti Singal v. DCIT in ITA.Nos. 706, in ITA.Nos. 706, 707, 709/Chd/18, order dated 07.02.2020. 709/Chd/18, order dated 07.02.2020.

"In a case where pursuant to issue of notice under "In a case where pursuant to issue of notice under "In a case where pursuant to issue of notice under section 153A assessments are abated. Assessing Officer retains original assessments are abated. Assessing Officer retains original assessments are abated. Assessing Officer retains original jurisdiction as well as jurisdiction conferred on him under jurisdiction as well as jurisdiction conferred on him under jurisdiction as well as jurisdiction conferred on him under section 153A for which assessments shall be made for each of six for which assessments shall be made for each of six for which assessments shall be made for each of six assessment years separately. No addition can be made in respect of assessment years separately. No addition can be made in respect of assessment years separately. No addition can be made in respect of unabated assessments which have become final if no incriminating unabated assessments which have become final if no incriminating unabated assessments which have become final if no incriminating material is found during search". found during search".

Gold Medal Electrical Pvt. Ltd. 25 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

"In the present case, the assessment had been completed under "In the present case, the assessment had been completed under "In the present case, the assessment had been completed under summary scheme under summary scheme under section 143(1) and time limit for issue of and time limit for issue of notice under notice under section 143(2) had expired on the date of search. had expired on the date of search. Therefore, there was no assessment pending in this ca Therefore, there was no assessment pending in this ca Therefore, there was no assessment pending in this case and in such a case there was no question of abatement. Therefore, addition could a case there was no question of abatement. Therefore, addition could a case there was no question of abatement. Therefore, addition could be made only on the basis of incriminating material found during be made only on the basis of incriminating material found during be made only on the basis of incriminating material found during search."

6.2 6.2 6.2 In In In this this this case, case, case, the the the AO AO AO had had had made made made assessment assessment assessment on on on the the the information/material available in the return o information/material available in the return of income. The information f income. The information regarding the gift was available in the return of income as capital regarding the gift was available in the return of income as capital regarding the gift was available in the return of income as capital account had been credited by the assessee by the amount of gift. account had been credited by the assessee by the amount of gift. account had been credited by the assessee by the amount of gift. Similar was the position in relation to addition under Similar was the position in relation to addition under section 2(22)(e). The AO had not referred to any incriminating material found during the The AO had not referred to any incriminating material found during the The AO had not referred to any incriminating material found during the search based on which addition had been made. Therefore, following search based on which addition had been made. Therefore, following search based on which addition had been made. Therefore, following the decision of the Special Bench (supra), we hold that the AO had no the decision of the Special Bench (supra), we hold that the AO had no the decision of the Special Bench (supra), we hold that the AO had no jurisdiction to make a jurisdiction to make addition under section 153A. The addition made . The addition made is therefore deleted on this legal ground". is therefore deleted on this legal ground".

"during the search of the assessee's premises, no document or "during the search of the assessee's premises, no document or "during the search of the assessee's premises, no document or incriminating material, except the one unsigned undertaking for the incriminating material, except the one unsigned undertaking for the incriminating material, except the one unsigned undertaking for the loan was found. There was no corroborative material seized in the loan was found. There was no corroborative material seized in the loan was found. There was no corroborative material seized in the course of search. The income tax course of search. The income tax returns for the assessment years returns for the assessment years 2000-01 to 2005 01 to 2005-06 (six years) were filed prior to the search and in the 06 (six years) were filed prior to the search and in the normal course, suo moto disclosing the normal course, suo moto disclosing the particulars of the subject particulars of the subject additions and these returns stood accepted under additions and these returns stood accepted under Section 143(1) Section 143(1) of the Act. Since on the date of the initiation of the search, no assessment the Act. Since on the date of the initiation of the search, no assessment the Act. Since on the date of the initiation of the search, no assessment was pending as they had all abated, the Assessing Officer has was pending as they had all abated, the Assessing Officer has was pending as they had all abated, the Assessing Officer has wrongly wrongly invoked Section invoked 153A of the Act. Act. The The assessment assessment contemplated by contemplated by Section 153A is not a denovo assessment and the is not a denovo assessment and the additions made therein have to be necessarily restricted to the additions made therein have to be necessarily restricted to the additions made therein have to be necessarily restricted to the

Gold Medal Electrical Pvt. Ltd. 26 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

undisclosed income unearthed during the search. The Sect undisclosed income unearthed during the search. The Sect undisclosed income unearthed during the search. The Section has to be strictly interpreted. It is not an assessment such as a normal or be strictly interpreted. It is not an assessment such as a normal or be strictly interpreted. It is not an assessment such as a normal or regular scrutiny assessment". regular scrutiny assessment".

"completed assessments can be interfered with by Assessing Officer "completed assessments can be interfered with by Assessing Officer "completed assessments can be interfered with by Assessing Officer while making assessment under while making assessment under section 153A only on basis of some only on basis of some incriminating material unearthed during course of search which was incriminating material unearthed during course of search which was incriminating material unearthed during course of search which was not produced or not already disclosed or made known in course of oduced or not already disclosed or made known in course of oduced or not already disclosed or made known in course of original assessment. Pursuant to search carried out in case of the original assessment. Pursuant to search carried out in case of the original assessment. Pursuant to search carried out in case of the assessee, a notice under assessee, a notice under section 153A(1) was issued. In course of was issued. In course of assessment, A assessment, Assessing Officer made addition to assessee's income in ssessing Officer made addition to assessee's income in respect of deemed dividend. It was undisputed that assessment for respect of deemed dividend. It was undisputed that assessment for respect of deemed dividend. It was undisputed that assessment for assessment years in question had already been completed on date of assessment years in question had already been completed on date of assessment years in question had already been completed on date of search. Since no incriminating material was unearthed during the search. Since no incriminating material was unearthed during the search. Since no incriminating material was unearthed during the search, no additions could have been made to income already rch, no additions could have been made to income already rch, no additions could have been made to income already assessed. Consequently, the impugned addition was to be deleted". assessed. Consequently, the impugned addition was to be deleted". assessed. Consequently, the impugned addition was to be deleted".

Gold Medal Electrical Pvt. Ltd. 27 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

The Assessing Officer in the Assessment Order refers to the seized The Assessing Officer in the Assessment Order refers to the seized The Assessing Officer in the Assessment Order refers to the seized incriminating material in the case of one Shri Shirish C. shah and the incriminating material in the case of one Shri Shirish C. shah and the incriminating material in the case of one Shri Shirish C. shah and the post search enquiries made in his case to make an addition in the post search enquiries made in his case to make an addition in the post search enquiries made in his case to make an addition in the hands of the assessee denying the long term capital gain claimed by f the assessee denying the long term capital gain claimed by f the assessee denying the long term capital gain claimed by the assessee. I also noticed from the remand report dated 09.01.2017 the assessee. I also noticed from the remand report dated 09.01.2017 the assessee. I also noticed from the remand report dated 09.01.2017 furnished by the Dy. CIT, CC furnished by the Dy. CIT, CC-2(2), Mumbai to the Ld.CIT(A) 2(2), Mumbai to the Ld.CIT(A) -48 in the course of appeal proceedings wherein the Assessing Offic course of appeal proceedings wherein the Assessing Offic course of appeal proceedings wherein the Assessing Officer stated as under: -

"Sir, in the present case under consideration, though no incriminating "Sir, in the present case under consideration, though no incriminating "Sir, in the present case under consideration, though no incriminating material was found, the assessee admitted undisclosed Income in his material was found, the assessee admitted undisclosed Income in his material was found, the assessee admitted undisclosed Income in his statement u/s.132(4) of the statement u/s.132(4) of the Income Tax Act 1961. It is totally 961. It is totally immaterial that the assessee later on retracted the statements immaterial that the assessee later on retracted the statements immaterial that the assessee later on retracted the statements recorded u/s 132(4) of the recorded u/s 132(4) of the Income Tax Act 1961. Therefore 1961. Therefore assessment of AY 2011 assessment of AY 2011-12 and AY 2012-13 which was made on the 13 which was made on the basis of undisclosed income admitted during the course of search is is of undisclosed income admitted during the course of search is is of undisclosed income admitted during the course of search is totally valid assessment and does not get affected by the decision of totally valid assessment and does not get affected by the decision of totally valid assessment and does not get affected by the decision of Hon'ble Bombay High Court in the case of Continental Warehousing Hon'ble Bombay High Court in the case of Continental Warehousing Hon'ble Bombay High Court in the case of Continental Warehousing (Supra)".

"117. From the aforesaid Circulars, it is clear that the assessments "117. From the aforesaid Circulars, it is clear that the assessments "117. From the aforesaid Circulars, it is clear that the assessments made pursuant to search operation are required to be based on made pursuant to search operation are required to be based on made pursuant to search operation are required to be based on incriminating materials discovered as a result of search operation in incriminating materials discovered as a result of search operation in incriminating materials discovered as a result of search operation in the case of the assessee and not on the recorded statement. In the he assessee and not on the recorded statement. In the he assessee and not on the recorded statement. In the

Gold Medal Electrical Pvt. Ltd. 28 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

instant case, the persons who gave the statements, retracted the same instant case, the persons who gave the statements, retracted the same instant case, the persons who gave the statements, retracted the same and even the opportunity to cross and even the opportunity to cross-examine was not afforded to the examine was not afforded to the assessee. In our opinion, it cannot be said that those statements assessee. In our opinion, it cannot be said that those statements assessee. In our opinion, it cannot be said that those statements on the basis of which impugned additions were made by the AO, were the basis of which impugned additions were made by the AO, were the basis of which impugned additions were made by the AO, were incriminating material found during the course of search. As we have incriminating material found during the course of search. As we have incriminating material found during the course of search. As we have already noted that no incriminating material was found during the already noted that no incriminating material was found during the already noted that no incriminating material was found during the course of search and the additions were made by the AO course of search and the additions were made by the AO course of search and the additions were made by the AO while framing the assessments u/s 153 framing the assessments u/s 153A of the Act, the said additions need , the said additions need to be restricted or limited only to incriminating material found during to be restricted or limited only to incriminating material found during to be restricted or limited only to incriminating material found during the course of search. However, in the present case, no s the course of search. However, in the present case, no s the course of search. However, in the present case, no such incriminating material was found during the course of search from the incriminating material was found during the course of search from the incriminating material was found during the course of search from the possession of the assessee. .... possession of the assessee. ....

Gold Medal Electrical Pvt. Ltd. 29 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

Therefore, merely on the basis of the statement of Sh. Ankur Agarwal, Therefore, merely on the basis of the statement of Sh. Ankur Agarwal, Therefore, merely on the basis of the statement of Sh. Ankur Agarwal, the addition made u/s 153 the addition made u/s 153A of the Act was also not justified, was also not justified, particularly when Sh. Ankur Agarwal retracted his statement later on. when Sh. Ankur Agarwal retracted his statement later on. when Sh. Ankur Agarwal retracted his statement later on. In the instant case, the AO also failed to establish any link/nexus of In the instant case, the AO also failed to establish any link/nexus of In the instant case, the AO also failed to establish any link/nexus of the alleged cash trail. We, therefore, by considering the totality of the the alleged cash trail. We, therefore, by considering the totality of the the alleged cash trail. We, therefore, by considering the totality of the facts and the various judicial pronouncement discussed facts and the various judicial pronouncement discussed facts and the various judicial pronouncement discussed in the former part of this order are of the view that the additions made by the AO part of this order are of the view that the additions made by the AO part of this order are of the view that the additions made by the AO and sustained by the Ld. CIT(A) u/s 153 and sustained by the Ld. CIT(A) u/s 153A of the Act in the absence of in the absence of any incriminating material found during the course any incriminating material found during the course any incriminating material found during the course of search u/s 132(1) of the Act in respect of unabated assessment years i.e. the 132(1) of the Act in respect of unabated assessment years i.e. the 132(1) of the Act in respect of unabated assessment years i.e. the assessment years 2010 assessment years 2010-11 to 2012-13 were not justified." 13 were not justified."

As could be seen from the above the Delhi Bench of the Tribunal As could be seen from the above the Delhi Bench of the Tribunal As could be seen from the above the Delhi Bench of the Tribunal considering various circulars of CBDT held that the a considering various circulars of CBDT held that the assessments made ssessments made pursuant to search operation are required to be based on incriminating pursuant to search operation are required to be based on incriminating pursuant to search operation are required to be based on incriminating material discovered as a result of search operation in assessee's case material discovered as a result of search operation in assessee's case material discovered as a result of search operation in assessee's case but not on the recorded statements. but not on the recorded statements.

The facts in the above case are quite identical to the case before us The facts in the above case are quite identical to the case before us The facts in the above case are quite identical to the case before us since the additions permeates from same search action and similar since the additions permeates from same search action and similar since the additions permeates from same search action and similar additions were made in th additions were made in the case of this assessee. Therefore, the ratio e case of this assessee. Therefore, the ratio of above decision is quite applicable here and we see no reason to of above decision is quite applicable here and we see no reason to of above decision is quite applicable here and we see no reason to deviate from the same. deviate from the same.

Gold Medal Electrical Pvt. Ltd. 30 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

6.1 The Ld. CIT(A) finally concluded in para 7.16 of the impugned The Ld. CIT(A) finally concluded in para 7.16 of the impugned The Ld. CIT(A) finally concluded in para 7.16 of the impugned

order and deleted the impugned addition order and deleted the impugned addition observing as under: observing as under:

“7.16 Conclusion 7.16 Conclusion- The aforesaid detailed discussion with respect to The aforesaid detailed discussion with respect to various judicial decisions clearly laid down the following principles various judicial decisions clearly laid down the following principles various judicial decisions clearly laid down the following principles -

(i) the assessments which have been concluded us 143(3) of the Act (i) the assessments which have been concluded us 143(3) of the Act (i) the assessments which have been concluded us 143(3) of the Act and not pending at the time o and not pending at the time of search proceedings, do not abate. f search proceedings, do not abate.

(ii) for this purpose, intimation u/s 143(1) would constitute an (ii) for this purpose, intimation u/s 143(1) would constitute an (ii) for this purpose, intimation u/s 143(1) would constitute an assessment, relying on the decision of Hon'ble Bombay High Court in assessment, relying on the decision of Hon'ble Bombay High Court in assessment, relying on the decision of Hon'ble Bombay High Court in CIT V/s Gurinder Singh Bawa (79 taxmann.com 398) CIT V/s Gurinder Singh Bawa (79 taxmann.com 398)

(iii) the proceedings us 153A of the A ) the proceedings us 153A of the Act do not empower the Assessing ct do not empower the Assessing officer to re officer to re-adjudicate the settled issues again, unless fresh adjudicate the settled issues again, unless fresh incriminating material is found during the course of search. incriminating material is found during the course of search. incriminating material is found during the course of search.

(iv)theAssessing (iv)theAssessing (iv)theAssessing officer officer officer does does does not not not have have have jurisdiction jurisdiction jurisdiction tomakeadditions/disallowances tomakeadditions/disallowances tomakeadditions/disallowances which which which are are are not not not based bas bas on any incriminating material found incriminating material found during the course of search. during the course of search.

(v) in the case of completed/un (v) in the case of completed/un-abetted assessments, where no abetted assessments, where no incriminating material is found during the course of search, the incriminating material is found during the course of search, the incriminating material is found during the course of search, the assessment us 153A of the Act is to be made on originally assessment us 153A of the Act is to be made on originally assessment us 153A of the Act is to be made on originally assessed / returned income and no addition or disallowance can be made de hors returned income and no addition or disallowance can be made de hors returned income and no addition or disallowance can be made de hors the incriminating evidences recovered during the course of search. the incriminating evidences recovered during the course of search. the incriminating evidences recovered during the course of search.

Gold Medal Electrical Pvt. Ltd. 31 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022 (vi)Any admission or confession needs corroboration with evidences. In (vi)Any admission or confession needs corroboration with evidences. In (vi)Any admission or confession needs corroboration with evidences. In order to make a genuine and legally sus order to make a genuine and legally sustainable addition on the basis tainable addition on the basis of admission or confession during search action, it is necessary that of admission or confession during search action, it is necessary that of admission or confession during search action, it is necessary that some incriminating material must have been found to correlate the some incriminating material must have been found to correlate the some incriminating material must have been found to correlate the undisclosed income with such statement. undisclosed income with such statement.” 6.2 The Ld. DR though relied on the order of the The Ld. DR though relied on the order of the Assessing Officer Assessing Officer however could not brought any decision of the jurisdictional High brought any decision of the jurisdictional High brought any decision of the jurisdictional High Court in favour of the Revenue to substantiate that addition u/s Court in favour of the Revenue to substantiate that addition u/s Court in favour of the Revenue to substantiate that addition u/s 153A of the Act should should have been made in case of unabated in case of unabated assessments even without referring to the incrim even without referring to the incriminating material inating material found during the course of the search. found during the course of the search.

6.3 In the impugned assessment order, the Assessing Officer has In the impugned assessment order, the Assessing Officer has In the impugned assessment order, the Assessing Officer has made addition invoking section 68 of the Act on the ground that made addition invoking section 68 of the Act on the ground that made addition invoking section 68 of the Act on the ground that assessee assessee assessee failed failed failed to to to establish establish establish identity, identity, identity, genuineness genuineness genuineness and and and creditworthiness of the lender parties. Though there is reference of of the lender parties. Though there is reference of of the lender parties. Though there is reference of investigation carried out by the Directorate of Investigation Kolkata, investigation carried out by the Directorate of Investigation Kolkata investigation carried out by the Directorate of Investigation Kolkata but no reference of any but no reference of any incriminating material found during the incriminating material found during the course of the search at the premises of the assessee. In the course of the search at the premises of the assessee. In the course of the search at the premises of the assessee. In the circumstances, we do not find any error in the order of the Ld. tances, we do not find any error in the order of the Ld. tances, we do not find any error in the order of the Ld. CIT(A) on the issue- -in-dispute in deleting the addition following dispute in deleting the addition following binding precedent of the Hon’ble High Court binding precedent of the Hon’ble High Courts (supra) s (supra) including

Gold Medal Electrical Pvt. Ltd. 32 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022 decision of the Hon’ble jurisdictional High Court in the case of decision of the Hon’ble jurisdictional High Court in the case of decision of the Hon’ble jurisdictional High Court in the case of Continental Warehousing Corporation (supra). Accordingly, the nental Warehousing Corporation (supra). Accordingly, the nental Warehousing Corporation (supra). Accordingly, the grounds raised by the Revenue grounds raised by the Revenue for AY 2014-15 are dismissed. are dismissed.

6.4 In the appeals for other In the appeals for other assessment years from AY 2015 assessment years from AY 2015-16 to 2019-2020, identical grounds have been raised therefore, same are identical grounds have been raised therefore, same are identical grounds have been raised therefore, same are decided mutatis mutandis mutatis mutandis. The grounds raised in grounds raised in appeals of the Revenue for AY 2015 for AY 2015-16 to 2019-2020 are therefore, accordingly are therefore, accordingly dismissed.

Order pronounced Order pronounced under Rule 34(4) of the ITAT Rules, the ITAT Rules, 1963 on 28/11/2022 /2022. Sd/- Sd/ Sd/- (RAHUL CHAUDHARY RAHUL CHAUDHARY) (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 28/11/2022 Rahul Sharma, Sr. P.S.

Gold Medal Electrical Pvt. Ltd. 33 ITA Nos. 2160 to 2165/M/2022 ITA Nos. 2160 to 2165/M/2022

Copy of the Order forwarded to Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A)- 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. BY ORDER, BY ORDER, //True Copy// (Sr. Private Secretary) (Sr. Private Secretary) ITAT, Mumbai ITAT, Mumbai