RAJESH PODDAR,MUMBAI vs. DCIT CENT. CIR. 7(4), MUMBAI

Order u/s.254(1)of the Income-tax Act,1961(Act) लेखा सद�य लेखा सद�य,राजे�� के अनुसार लेखा सद�य लेखा सद�य राजे�� के अनुसार राजे�� के अनुसार -Per Rajendra,AM: राजे�� के अनुसार Challenging the order dated 29.01.2016 of CIT(A)-48, Mumbai the assessee has filed the present appeal.

2.A search and seizure action u/s.132(1) of the Act was carried out in Loha Ispaat Group of cases on 22/2/12.The notice u/s. 153A was issued to the assessee on 16.10.2012.The assessee filed its return of income on 27.11.2012,declaring income of Rs.25.48 lakhs.The AO completed the assessment u/s.143(3) r.w.s.153A of the Act on 27.03.2014,determining his income at Rs.30.48lakhs.

3.During the assessment proceedings the AO observed that the assessee had a family of six members, that he was staying in a self owned two 2BHK flats of total area of 2200 sq.ft in Santacruz(W) Mumbai,that both his children were going to college,that the father of the assessee was a senior citizen.He tabulated the drawings made by assessee and members of the family from AY 2006-07 to 2011-12 as under :- AY. Self Wife Parents drawings (Rs.) Children drawings Total drawing drawings drawings (Rs.) (Rs.) (Rs.) 2006-07 1,83,143/- 1,38,751/- 53,601/- NIL 3,77,495/- 2007-08 3,44,174/- 1,24,010/- 55,401 22,612/- 5,46,197/- 2008-09 7,12,816/- 2,20,781/- 20,000/- 843/- 9,54,440/- 2009-10 19,85,487/- 8,26,448/- 52,084/- 3,371/- 28,67,390/- (includes foreign travel expense of Rs.11,89,000/-) 2010-11 4,90,768/- 1,39,323/- 1,12,702/- NIL 7,42,793/-

2114/M/16(11-12)- Rajesh Poddar

2011-12 1,32,939/- 2,64,623/- 41,949/- NIL 4,39,511/- 2012-13 1,57,350/- 77,903/- 21,323/- NIL 2,56,578/- He further observed that the assessee had gone abroad and had spent Rs.12.00 lakhs approx for foreign visit, that the drawing shown by him would not be sufficient to suffice the expenses actually borne by any family staying in such a locality of Mumbai, that the assessee had shown drawing of Rs.3000-4000 per month,per person.Considering the increase in inflation,family size he held that the drawing shown by the assessee were not adequate. Invoking the provisions of section 69C of the Act,he held that an addition of Rs.5.00 lakhs to the income of the assessee for the year under consideration on estimated basis.

4.Aggrieved by the order of the AO,the assessee preferred an appeal before the First Appellate Authority (FAA).During the appellate proceedings before the FAA the assessee made elaborate submissions, who in turn confirmed the addition made by AO observing that assessee had spent a good deal of money on the education of children,maintenance of residence etc.

5.Before us,the Authorised Representative(AR)stated that the year under consideration was unabated year, that no incriminating material was found during the search with regard to low house hold withdrawal.The Departmental Representative (DR) left the issue to the discretion of the Bench.

6.We have heard the rival submissions we find that an action u/.s132(1) was taken in case of group entities, that AO had made certain additions invoking provisions of section 69C of the Act, that the year under consideration is unabated year, that no action could be taken u/s153A for assessments of unabated years.We would like to refer to the case of All Cargo Global Logistics Ltd.(374ITR645). The relevant portion of the judgment reads as under. “Under section 153A of the Income-tax Act, 1961, which enables carrying out of search or exercise of power of requisition, assessment in furtherance thereof is contemplated. There is a mandate to issue notices under section 153(1)(a) and assess or reassess the total income of six assessment years immediately preceding the assessment year relevant to the previous year in which such search is conducted or requisition is made. Thus, the crucial words “search” and “requisition” appear in the substantive provision and the provisos. That would throw light on the issue of applicability of the provision. True it is that the assessment which has to be made in pursuance of the notice is in relation to the six years. An order will have to be made in that regard. While making the order, the income or the return of income filed for all these assessment years is to be taken into account. A reference will have to be made to the income disclosed therein. However, the scope of enquiry though not confined essentially revolves around the search or the requisition under section 132A , as the case may be. The provision deals with those cases where assessment or reassessment, if any, relating to the assessment

2114/M/16(11-12)- Rajesh Poddar