SHRI KABUL CHAWLA Vs. ASSTT. COMMISSIONER OF INCOME TAX, NEW DELHI
INCOME TAX APPELLATE TRIBUNAL
Shri Kabul Chawla
Asstt. Commissioner Of Income Tax, New Delhi
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R.S.Syal, Member (A) -
(1.) THESE five appeals by the assessee relate to the assessment years 2002 -03 and 2005 -06 to 2008 -09. Since some common issues raised in this batch of appeals, we, are, therefore, proceeding to dispose them of by this consolidated order for the sake of convenience.
A.Ys. 2002 -03, 2005 -06 & 2006 -07
(2.) A legal issue has been raised in these three appeals for the assessment years 2002 -03, 2005 -06 and 2006 -07 to the effect that the additions made in these three years u/s. 2(22)(e) of the Income -tax Act, 1961 (hereinafter also called 'the Act') are not sustainable because no incriminating material concerning such additions was found during the course of search and further the assessments for such years were not pending on the date of search. Briefly stated the facts of the case are that the assessee was subjected to search and seizure action on 15.11.2007. Notices u/s. 153A were issued requiring the assessee to file returns of total income for the relevant six assessment years. In so far as the assessment year 2002 -03 is concerned, the assessee filed his return on 19.1.2009 declaring total income of Rs. 12,42,740/ -. The assessment was finally completed on total income of Rs. 68,31,740/ -, which inter alia included an addition of Rs. 3.89 lakh on account of deemed dividend u/s. 2(22)(e) of the Act. Thereafter, the assessee filed rectification application u/s. 154 against such assessment alleging that the accumulated profits of the payer companies were less than the amount of loan or advance given to the recipient companies. The AO got convinced with such application and reduced the addition under this section to Rs. 37,162. The facts of the other two assessment years are mutatis mutandis similar qua the additions made u/s. 2(22)(e) of the Act. The assessee took similar legal ground before the ld. CIT(A) as well, who chose to dismiss the same by observing that sec. 153A of the Act authorizes the Assessing Officer to assess 'total income' and accordingly, such assessment u/s. 153A is not restricted only to the determination of the undisclosed income, which was the position under Chapter XIV -B of the Act.
(3.) THE case of the assessee before us through such legal ground taken for these three assessment years is that the additions u/s. 2(22)(e) of the Act are not sustainable because no incriminating material concerning these additions was found during the course of search. The ld. DR countered this contention by reiterating the opinion expressed by the ld. first appellate authority and also putting forth that the scope of sec. 153A of the Act is not limited to the additions on the basis of incriminating material found during the course of search, but to additions of any kind made with or without any incriminating material found during the course of search. She tried to justify her view by accentuating on the requirement of determining the 'total income' of the assessee u/s. 153A of the Act.;
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