The Principal Commissioner of Income-tax v. Rameshbhai Jivraj Desai
[Citation -2020-LL-0918-38]

Citation 2020-LL-0918-38
Appellant Name The Principal Commissioner of Income-tax
Respondent Name Rameshbhai Jivraj Desai
Court HIGH COURT OF GUJARAT AT AHMEDABAD
Relevant Act Income-tax
Date of Order 18/09/2020
Assessment Year 2008-09
Judgment View Judgment
Keyword Tags incriminating material • concluded assessment • unabated assessment • search proceedings
Bot Summary: The Revenue has proposed the following substantial question of law for the consideration of this Court:- Page 1 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER Whether the Appellate Tribunal is right in law and on facts in holding that in absence of any incriminating material related to the given assessment year found during search, assessment u/s. 153A of the Act cannot be made for that assessment year for which assessment has been concluded on the date of search and not abated 3. As such we note that the addition made by the AO based on the search proceedings represents the items of the regular Page 3 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER assessments being income from the sale of the land bearing survey Nos. If any incriminating material is not found during the course of search related to the concluded assessment year, the Act does not confer any power to the AO to disturb the finding given thereon and income determined thereon as finality has already been reached and no proceeding was pending on the date of search. Once the proceeding u/s 153A of the Act is initiated which are special proceedings, the legislature provides diferent treatments for abated and unabated assessments. In respect of unabated assessments the legislature has conferred powers on the Ld. AO to just follow the assessments already concluded unless incriminating materials are found in the course of search. The Tribunal noticed that there was no record to indicate that any material was unearthed during the Page 5 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER course of Section 153A proceedings and in such circumstances, the Assessing Officer, while passing the order under Section 153A read with Section 143(3) of the Act, 1961 could not have disturbed the assessment order.


C/TAXAP/216/2020 ORDER IN HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 216 of 2020 PRINCIPAL COMMISSIONER OF INCOME TAX Versus RAMESHBHAI JIVRAJ DESAI Appearance: MRS MAUNA M BHATT, SENIOR STANDING COUNSEL(174) for Appellant(s) No. 1 for Opponent(s) No. 1 CORAM:HONOURABLE CHIEF JUSTICE MR. VIKRAM NATH and HONOURABLE MR. JUSTICE J.B.PARDIWALA Date : 18/09/2020 ORAL ORDER (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1. This Tax Appeal under Section 260A of Income Tax Act, 1961 (for short Act, 1961 ) is at instance of Revenue and is directed against order passed by Income Tax Appellate Tribunal, Ahmedabad C Bench, Ahmedabad dated 17.01.2020 in IT (SS)A No. 107/Ahd/2017 for A.Y. 2008-09. 2. Revenue has proposed following substantial question of law for consideration of this Court:- Page 1 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER Whether Appellate Tribunal is right in law and on facts in holding that in absence of any incriminating material related to given assessment year found during search, assessment u/s. 153A of Act cannot be made for that assessment year for which assessment has been concluded on date of search and not abated? 3. We have heard Ms. Mauna Bhatt, learned Senior Standing Counsel appearing for Revenue. 4. Tribunal, while passing impugned order observed as under:- At outset we note that technical issue raised by assessee in ground 1 & 2 challenging validity of assessment framed under section 153A of Act is identical to issue raised in case of Shri Rajnibhai Jivraj Desai in ITA No. 104/AHD/2017 whic has been decided by us in favour of assessee vide paragraph No. 14 & 15 of this order. For detail discussion please refer relevant paragraph as discused above. Therefore respectfully following same and to Page 2 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER maintain parity wit findings, we allow technical ground raised by assessee in his favour without going into merit of case. 5. We shall now look into findings recorded by Tribunal in ITA No. 104/AHD/2017 in case of Shri Rajnibhai Jivraj Desai. findings recorded are as under:- 9. We have perused case record, analyzed facts and circumstances of case and heard rival contentions. We find that it would be necessary to address preliminary issue, whether assessment could be framed u/s 153A of Act in respect of concluded proceedings without existence of any incriminating materials found during course of search. scheme of Act provides for abatement of pending proceedings as on date of search. It is not in dispute that assessment year under consideration falls under ambit of unabated assessment as on date of search. There is no differentiation as found in intent of legislature to diferentiate whether assessments were originally framed u/s 143(1) OR 143(3) OR 147 of Act. As such we note that addition made by AO based on search proceedings represents items of regular Page 3 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER assessments being income from sale of land bearing survey Nos. 522/3, 520,523, 525 and 526 along wit Shri Rajeshbhai Jivraj Desai and Rameshbhai Jivraj Desai located at Sarkhej Village, Ahmedabad which was disclosed in income tax return. Therefore, if any incriminating material is not found during course of search related to concluded assessment year, Act does not confer any power to AO to disturb finding given thereon and income determined thereon as finality has already been reached and no proceeding was pending on date of search. xxx xxx xxx 13. Once proceeding u/s 153A of Act is initiated which are special proceedings, legislature provides diferent treatments for abated and unabated assessments. However, in respect of unabated assessments legislature has conferred powers on Ld. AO to just follow assessments already concluded unless incriminating materials are found in course of search. 14. That for reasons stated above and on basis of various judicial pronouncements, we hold that impugned addition for Assessment year under consideration which was unabated/concluded assessment as on date of search cannot be made in search assessments in absence of any Page 4 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER incriminating material found in course of search and acordingly impugned addition is directed to be deleted. Since legal issues are addressed, we refrain to give our findings on merits of additions under provisions of Act. Accordingly, ground raised by assessee is allowed. 6. Thus, having regard to materials on record, Tribunal is right in holding that once it is held that assessment has attained finality, then, Assessing Officer, while passing independent assessment order under Section 153A read with Section 143(3) of Act cannot disturb assessment/reassessment, which has attained finality unless materials gathered in course of proceedings under Section 153A of Act establish that reliefs grnated in final assessment/reassessment were contraty to facts coming during course of Section 153A proceedings. 7. Tribunal noticed that there was no record to indicate that any material was unearthed during Page 5 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 C/TAXAP/216/2020 ORDER course of Section 153A proceedings and in such circumstances, Assessing Officer, while passing order under Section 153A read with Section 143(3) of Act, 1961 could not have disturbed assessment order. 8. We are in complete agreement with line of reasoning assigned by Tribunal. In our opinion, question as proposed by Revenue cannot be termed as substantial question of law. 9. In result, this appeal fails and is hereby dismissed. (VIKRAM NATH, CJ) (J. B. PARDIWALA, J) NAIR SMITA V./A.M.PIRZADA Page 6 of 6 Downloaded on : Wed Sep 30 07:59:01 IST 2020 Principal Commissioner of Income-tax v. Rameshbhai Jivraj Desai
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