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Income Tax Appellate Tribunal, “D” Bench, Mumbai
Before: Shri B.R. Baskaran (AM)& Pawan Singh (JM)
O R D E R Per B.R. Baskaran (AM) :-
The appeal filed by the assessee is directed against the order dated 1.4.2014 passed by learned CIT(A)-37, Mumbai and it relates to A.Y. 2008-09.
The assessee is aggrieved by the decision of the Assessing Officer in rejecting the claim of long term capital gain in respect of office premises sold by the assessee.
At the time of hearing learned counsel appearing for the assessee submitted that the Assessing Officer has passed the impugned assessment order u/s. 143(3) read with section 153A of the Act consequent to the search conducted in the hands of the assessee on 29.10.2010. Learned Counsel submitted that the assessee had filed original return of income u/s. 139(1) of the Act on 31.7.2008. The said return was not taken up for scrutiny and the time limit for issuing notice u/s. 143(2) of the Act has expired prior to initiation of search. Accordingly, learned AR submitted that the impugned
2 Rahil Agencies assessment year falls in the category of “completed assessment” and hence the same would not abate as per provisions of section 153A of the Act. Learned AR placed reliance on the decision rendered by Hon'ble Bombay High Court in the case of All Cargo Global Logistics (374 ITR 645) and submitted that the Assessing Officer is not entitled to disturb completed assessment, if no incriminating material relating to the same was found during the course of search. Learned AR submitted that the revenue did not unearth any incriminating material relating to the assessment year under consideration and accordingly contended that the addition made by the Assessing Officer, which was confirmed by learned CIT(A), is beyond the scope of provisions of section 153A of the Act.
On the contrary, learned Departmental Representative strongly supported the order passed by learned CIT(A).
We have heard the rival contentions on this legal issue and perused the record. We notice that the return of income filed by the assessee for the year under consideration was not taken up for scrutiny and the period for issuing notice u/s 143(2) of the Act has also expired prior to the initiation of search in the hands of the assessee. Hence the assessment has become completed by operation of law and hence the impugned assessment year would fall under the category of “Completed assessment” and hence the same shall not abate as per the provisions of sec. 153A of the Act.
In the assessment order passed u/s. 143(3) of the Act read with section 153A of the Act, the Assessing Officer has not referred to any incriminating material in connection with the issues urged before us. At the same time, it is also not clear as to how the Assessing Officer came to be seized of these issues, viz., the additions relating to sale of office premises. It is also not clear as to how the Assessing Officer has came to know of the fact that the assessee has declared long term capital gain on the sale of office premises, on which depreciation had been claimed by the assessee. In the absence of any 3 Rahil Agencies discussion about the same and also in the absence of the details of material seized by the Department as well as copy of the sworn statement, if any, taken from the assessee, we are of the view that it would be difficult to straight away examine the legal contentions urged by the assessee.
7. There is no dispute with regard to the claim of the assessee that issues completed in the original assessment cannot be disturbed in 153A assessment, unless any incriminating material is found during the course of search. Hence we are of the view that availability of incriminating material either in the form of papers, documents or in the form of sworn statement in support of the additions made by the AO, needs to be verified. Then only one can examine the legal contention urged by the assessee. Accordingly, we set aside the order passed by learned CIT(A) and restore all the matters, both relating to legal and merits, to the file of the Assessing Officer with the direction to examine first, the legal issue urged by the assessee with reference to the search materials/sworn statement and decide the same in accordance with the decision rendered by Hon'ble Jurisdictional High Court in the case of All Cargo Global Logistics (supra), after affording adequate opportunity of being heard to the assessee. If the Assessing Officer is of the view that the decision rendered by the Hon’ble Bombay High Court in the above said case is not applicable, he may proceed to decide all the issues on merits afresh, after affording opportunity to the assessee.
In the result, appeal filed by the assessee is treated as allowed for statistical purposes. Order has been pronounced in the Court on 29.7.2016