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Facts
The assessee's appeal for AY 2013-14 was against an order passed under Section 143(3) r.w.s. 147 of the Income Tax Act, 1961. The lower authorities reopened the assessment based on reasons to believe that unsecured loans of Rs. 30,00,000/- were unexplained cash credits that had escaped assessment.
Held
The Tribunal noted that the assessment was unabated and any addition could only be made based on seized material, as per the landmark decision in PCIT vs. Abhisar Buildwell Pvt. Ltd. Since no such incriminating material was available with the Assessing Officer regarding the unsecured loans, the addition was directed to be deleted.
Key Issues
Whether additions for alleged unexplained cash credits in unsecured loans can be made without incriminating material in an unabated assessment, especially when reopening was done under Section 147.
Sections Cited
143(3), 147, 148
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year : 2013-14 Lokpriya Nursing Home Ltd., Vs ACIT, Samrat Place, Garh Road, Central Circle, Meerut-250001 Meerut-250001 (APPELLANT) (RESPONDENT) PAN No. AAACL3281F Assessee by: None Revenue by : Sh. Akhilesh Kumar Yadav, Sr. DR Date of Hearing: 02.06.2025 Date of Pronouncement: 02.06.2025 ORDER
This assessee’s appeal for Assessment Year 2013-14, arises against the CIT(A)-3, Noida’s DIN & order No. ITBA/APL/M/250/2024-25/1064669631(1) dated 06.05.2024, in proceedings u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (in short “the Act”).
Case called twice. None appears at the assessee’s behest. It is accordingly proceeded ex-parte.
It emerges during the course of hearing with the able assistance coming from the Revenue side that both the learned lower authorities had taken recourse to section 148/147 reopening mechanism after recording reasons to believe that the assessee’s unsecured loans of Rs.30,00,000/- representing unexplained cash credits, had escaped assessment. The Lokpriya Bursing Home Ltd. Revenue could hardly dispute the clinching fact that the assessment herein is an “unabated” one wherein any addition could be made specifically qua the seized material only in light of PCIT vs. Abhisar Buildwell Pvt. Ltd. (2023) 454 ITR 212 (SC). A perusal of para 2 in assessment discussion dated 21.03.2022 suggests that no such details were available with the learned Assessing Officer so far as the impugned unsecured loans are concerned.
Faced with this situation, I find no merit in the Revenue’s vehement arguments seeking to add the impugned unsecured loans in the assessee’s hands since not represent the incriminating material as per their lordships above landmark decision. The same is directed to be deleted.
This assessee’s appeal is allowed. Order Pronounced in the Open Court on 02/06/2025.