DCIT, NEW DELHI vs. M/S. GANPATI FINCAP PVT LTD., NEW DELHI

In all the above Appeals are having identical issues except the amount of the additions made thereon and the facts of the case are also identical, for the sake of convenience, brief facts of the case as mentioned in the order of the Ld. CIT(A) for Assessment Year 2008-09 are considered and which are reproduced as under:-

The Ld. A.O. has also passed assessment ordersfor Assessment Year 2009-10 and 2010-11by making similar additions vide assessment orders dated 02/03/2015.

Aggrieved by the assessment orders dated 02/03/2015 for Assessment Years 2008-09 to 2011-12, the Assessee preferred Appeals before the Ld. CIT(A). The Ld. CIT(A) vide order dated 28/09/2015,deleted the additions made by the A.O. by allowing all the Appeals. As against the orders of the Ld. CIT(A) dated 28/09/2015, the Department of Revenue preferred the abovecaptioned Appeals.

The Assessee has also filed Cross-Objections by challenging the assumption of jurisdiction u/s 153C/143(3) of the Act for Assessment Year 2008-09 and 2009-10 and challenged assumption of jurisdiction in framing assessment u/Section 147/143(3) of the Act in A.Y 2010-11.

The Ld. Departmental Representative vehemently submitted that the order of the Ld. CIT (A) is erroneous as the Ld. CIT(A) erred in holding that proceedings u/s 153C of the Act were bad in law, further submitted that there were sufficient material available to initiate the proceedings u/s 153C of the Act, therefore, the Ld. CIT(A) committed error in deleting the addition. Thus, the Ld. Department's Representative sought for allowing the Appeal.

Per contra, the Ld. Assessee's Representative submitted that the proceedings u/s 153C has been initiated de-hors any incriminating material found and seized during the search conducted u/s 132 of the Act and also a survey u/s 133A of the Act undertaken at residential and business premises of Raj Kumar and Anju Chawla. The Ld. Counsel has also made arguments on the cross objections filed by the Assessee and sought for dismissal of the Appeals filed by the Revenue and also sought for allowing the Cross-Objection filed by the Assessee.

We have heard both the parties and perused the material available on record. In the present case a search and seizure action u/s 132 of the Act also a survey u/s 133A of the Act were undertaken at the residential and business premises of Raj Kumar Chawla and Anju Chawla. A noticeu/s 153C of the Act was issued on 09/12/2010 which was received by the Assessee on 27/12/2010. The satisfaction has been recorded in the case of the Assessee by referring the documents at Page 13-14 page 15-16 and page 17-20 of Annexure-A, which are made the basis for initiating the assessment proceedings.

The Assessee has produced the seized documents along with the paper book before us. As could be seen from the seized document, copies of the schedules to Balance sheet and profit and loss account of the Assessee Company as per books of Assessee company, which cannot be termed as incriminating documents. Page No. 21-25 and 26 are unsigned MOU between Subodh Kumar Gupta and Raj Kumar Chawla as guarantee for transferring Assessee Company. Since the those documents have no signature, which cannot be given any evidentiary value or infer against the Assessee and make addition in the absence of any other corroborative evidences.

As could be seen from the assessment order, the additions have been made on account of unexplained expenditure claimed in P &L account, unexplained deposits in bank and accounts and unexplained receipt of share application money and share premium etc., however, those additions have been made de-hors the incriminating material found during the course of search.

The Hon’ble Apex Court in the case of Abhisar Buildwell (P.)

In the present case, the A.O. has not referred any incriminating material found during the course of search, which could be the basis for the impugned additions and the addition has been made de-hors any incriminating material found during the search. Taking into consideration that as on the date of search, no assessment proceedings were pending for the years under consideration, in our opinion, the Ld. CIT (A) has committed no error in quashing the assessment proceedings.

Since we have dismissed the captioned Appeals of Revenue, the Cross-Objection filed by the Assessee in C.O 464 to 466/Del/2015, are dismissed for having become in-fructuous.