Assessments under Section 153A require incriminating material found during a search; relying solely on AIR data for making additions is invalid.

ORDER

PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

These appeals are filed by the Department and Assessee against the order of Commissioner of Income Tax (Appeals)-12 (in short “CIT(A)”), Ahmedabad vide separate orders dated 26.07.2019, 05.12.2019, 27.08.2019 and 25.03.2021 passed for A.Ys. 2011-12, 2012-13, 2014-15 and 2017-18.

We shall first start the Department’s appeal for A.Y. 2011-12 in IT(SS)A No. 449/Ahd/2019:

2. The Department has raised the following grounds of appeal:

“1. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in holding that any addition during the assessment u/s.l53A has to be confined to the incriminating material found during the course of search u/s. 132(1) of the Act, even though, there is no such stipulation in sec. 153 A of the Act.

2. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in not appreciating that sec. 153A requires a notice to be issued requiring the assessee to furnish his return of income in respect of each assessment year falling within six assessment years and to assess or re-assess the total income of those six assessment years, and that the scheme of assessment or re-assessment of the total income of a person, searched will be brought to naught if no addition is allowed to be made for those six assessment years in the absence of any seized incriminating material.

3. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in not appreciating that while computation of undisclosed income of the block period U/S.158BB was to be made on the basis of evidence found as a result of search or requisition of books of accounts, there is no such stipulation in sec.153A and scc.153BI specifically states that the provisions of Chapter-XIV-B, under which sec.158BB falls, would not be applied where a search was initiated u/s. 132 after 31/5/2003.

4. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in not appreciating that assessment in relation to certain issues not related to the search and seizure may arise in. any of the said six assessment years after the search u/s. 132 is conducted in the case of the assessee, and that if the interpretation of the ld. CIT(A) were to hold it will not be possible to assess such income in the 153A proceedings, while no other parallel proceedings to assess such other income can be initiated, leading to no possibility of assessing such other income, which could not have been the intention of the legislature.

5. On the facts and in the circumstances of the case and in law the ld. CIT(A) has erred in deleting the addition of Rs. 4,91,59,500/- made on account of unexplained investment in purchase of land without appreciating the fact involved in this case that assesses failed to submit an explanation dining the assessment proceeding..

6. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in deleting the addition of Rs.2,18,56,110 on account of sale of immovable properties without appreciating the fact involved in this case that assesses failed to submit an explanation during the assessment proceeding.

7. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in deleting the addition of Rs.3,17,81,453/- on account of unsecured loan without, appreciating the fact involved in this case that assessee failed to prove the identity, creditworthiness and genuiness of the depositors