SUBHKAM VENTURES(I) PVT LTD( IN WHICH FLOWERS VALLEY PRIVATE LIMITED), MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 8(2), MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “G” MUMBAI

BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI PAWAN SINGH (JUDICIAL MEMBER)

ITA No. 3449/MUM/2025 Assessment Year: 2016-17

Subhkam Ventures (I) Private Assistant Commissioner of Limited [in which Flowers Income-tax, Central Circle – 8(2), Valley Private Limited, 14th Vs. 658, 6th Floor, Aayakar Bhavan, Floor, Maker Chamber IV, 222, Maharishi Karve Road, Mumbai – Nariman Point, Mumbai – 400020, Maharashtra. 400021, Maharashtra. PAN NO. AAACW 1624 M Appellant Respondent

Assessee by : Shri Vipul Joshi – Adv. Revenue by : Shri Basavaraj Hiremath – CIT DR. Date of Hearing : 09/07/2026 Date of pronouncement : 10/08/2026 ORDER PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against order dated 24/03/2025, passed by the learned commission of income- tax(Appeals)-50, Mumbai [in short the Ld. CIT(A)], which in turn arises out of the assessment order dated 16.03.2022 passed by the Assessing Officer [‘AO’] under section 153A read with section 143(3)

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of the Income-tax Act, 1961 [‘the Act’], for Assessment Year 2016- 17. The grounds raised by the assessee are reproduced as under:

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principally engaged in floriculture, particularly cultivation of roses, together with activities incidental and ancillary thereto. 2.1 The assessee filed its original return of income on 13.10.2016 declaring total income of Rs.51,016/-. During the relevant previous year, it sold agricultural land admeasuring approximately 50.17 acres situated at Village Savardari, Taluka Khed, District Pune, Maharashtra, to M/s. Embassy Industrial Parks Pvt. Ltd. for a consideration of Rs.77,76,45,320/-. After reducing the cost of acquisition of Rs.4,17,93,762/-, the surplus of Rs.73,58,51,558/- was disclosed as agricultural income and claimed exempt under section 10(1) of the Act. The return was processed under section 143(1) of the Act. 2.2 Thereafter, a search and seizure action under section 132 of the Act was conducted on 25.03.2021 at the premises of the assessee. In the course of the search, certain documents relating to the assessee were found and seized, and inventorised as Pages 1 to 14 of Annexure A-7. For ease of reference, and because the entirety of the controversy in this appeal turns upon the precise character of these documents, it is appropriate to give their brief details in tabular form below:

Seized Description Page(s) Pages 1-6 Letter dated 25.02.2016 addressed by the assessee to the purchaser, forwarding documents forming part of the registered sale documentation. Page 7 Certified true copy of the layout/sketch plan of the land, issued on 31.01.2011 – nearly a decade before the search and about five years before the sale – by the office of the Dy.

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Seized Description Page(s) Superintendent of Land Records, Khed; a government/public record, also annexed to the possession letter (infra) and forming part of the registered sale deed. Pages 8-9 Possession letter dated 25.02.2016 addressed by the assessee to the purchaser. Pages 10-12 Government Order dated 22.12.2015 of the Government of Maharashtra, granting permission for purchase of the land under section 63(1)(A) of the Bombay Tenancy and Agricultural Lands Act, 1948, describing the land as agricultural land and the assessee as ‘agriculturist owner’. Page 13 Forwarding letter dated 12.02.2016 of the purchaser, enclosing the aforesaid Government Order. Page 14 Certificate dated 28.01.2016 issued by the Sarpanch, Gram Panchayat, Savardari, to the effect that no municipality was situated within 8 kms of the village.

2.3 Out of those pages, Page 7 is centre point of discussion, which is a sketch/layout plan relating to the land sold by the assessee and we have reproduced scanned copy of said page on later part of the order. The assessee's case is that the above documents so seized were either already part of the registered sale documentation, Government records or documents voluntarily furnished by its directors during the course of their statements.

2.4 Further, during the course of the search, statements under section 132(4) of the Act were recorded from two directors of the assessee-company. Firstly, Shri Manu Punnoose, Director, in his statement dated 25.03.2021 (Question Nos. 19 to 21), stated that the sale proceeds had been duly reported in the return of income, that no tax had been paid thereon since, in his understanding, the land was not a capital asset within the meaning of section 2(14) of

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the Act, and furnished, of his own volition, the sale agreement and connected documents, including the Sarpanch’s certificate. Secondly, Shri Rakesh S. Kathotia, Managing Director, in his statement dated 27.03.2021, explained that the land had been acquired in 2005 and had continuously thereafter been used for cultivation of roses under greenhouses; He referred to the certificate dated 28.01.2016 issued by the Village Sarpanch and also furnished the Government order relating to permission for purchase of agricultural land. When asked whether any scientific procedure had been followed by the Gram Panchayat in ascertaining the aerial distance referred to in that certificate, he candidly stated his inability to speak to the internal methodology of a third-party local authority. 2.5 Pursuant to the search, notice under section 153A of the Act was issued on 14.10.2021, in response to which the assessee filed its return on 12.11.2021 declaring the very same income as originally returned, expressly under protest and without prejudice to its right to challenge the assumption of jurisdiction. Thereafter, notice under section 142(1) was issued calling for various details, including details relating to the sale of the land. The assessee furnished the relevant documents and explanations. 2.6 The Assessing Officer thereafter issued a show-cause notice proposing to treat the land as a capital asset and tax the surplus arising on its sale as capital gain. In the said notice, the Assessing

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Officer referred to page 7 of Annexure A-7 and stated that, on verification through Google Maps, the distance from PCMC was 5.7 kilometres. The certificate of the Sarpanch was rejected on the ground that it did not specify the aerial distance from PCMC. The assessee's contention throughout has been that none of seized documents disclosed the aerial distance of the land from the outer limits of PCMC. 2.7 In the assessment order dated 16.03.2022, the AO placed further reliance on: (i) a response dated 18.06.2021 received from the Tahsildar, Khed (Rajgurunagar), pursuant to summons issued under section 131/131(1A), wherein the aerial distance of the land from the outer boundary of PCMC was stated to be 5.25 kilometres. (ii) a Google Maps-based computation showing a distance of 5.34 kms between ‘Atos Syntel Inc.’, MIDC Technological Park, Talawade (treated by the AO as a reference point within PCMC), and Embassy Industrial Park, the site of the land; (iii) a further, and differing, Google Maps-based distance of 6.10 kms between MIDC Technological Park, Talawade, and Embassy Industrial Park; and (iv) the population of PCMC as per the 2011 Census, stated at 17,27,692, extracted from page 28 of the Pune District Census Handbook. 2.8 On the aforesaid basis, the Assessing Officer concluded that the land was situated within eight kilometres of the outer boundary of a municipal corporation having population exceeding ten lakh and was consequently a capital asset within the meaning of section 2(14)(iii) of the Act. He accordingly computed long-term capital gain at Rs.68,49,14,986/- and completed the assessment under section 153A read with section 143(3) of the Act on 16.03.2022.

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3.1 The learned CIT(A), on the jurisdictional issue held that the certificate of the Gram Panchayat (Page 14) had been procured by the assessee shortly before the sale, and, taken together with the sketch at Page 7 and the subsequent confirmation obtained from the Tahsildar, disclosed ‘new information related to the evasion of

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tax’ which stood ‘unearthed during the search and post-search proceedings’, and that consequently the addition was sustainable under section 153A.

3.2 On merits, the learned CIT(A) held that clause (b) of section 2(14)(iii) does not confine the measurement of aerial distance to the municipality within whose administrative jurisdiction the land falls, and that PCMC, being the nearest Municipal Corporation with a population exceeding ten lakh, was rightly taken as the reference point; the certificate of the Sarpanch was held unreliable for want of any indication of the methodology by which distance had been ascertained, and reliance was placed on the observations of the Hon’ble Supreme Court in M. Omer Khan vs. Addl. CIT [(1992) 196 ITR 269 (Bom.)] (as approved in 63 Taxman 533 (SC)) and the Coordinate Bench decision in Srinivas Pandit (HUF) was expressly dissented from. The addition of Rs.68,49,14,986/- was accordingly confirmed. 4. Being aggrieved, the assessee is in appeal before us, reiterating both the challenge to the assumption/exercise of jurisdiction under section 153A for want of incriminating material, and the challenge on merits to the treatment of the land as a capital asset. 5. The learned counsel for the assessee referred to ground no. 2 of the appeal and submitted that the claim of the land being agricultural, and the surplus on its sale being exempt agricultural

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income, had all along been disclosed – in the audited accounts, in the return of income filed years before the search, and, for a part of the very same land parcel, had been accepted by the Department in scrutiny assessment for A.Y. 2011-12 after full verification, including on the basis of a similar Sarpanch’s certificate. The learned counsel for the assessee submitted that the entire addition rests upon a fact which was neither found nor discovered during the search, namely, the alleged aerial distance between the land and the outer limits of PCMC. It was submitted that the only document specifically relied upon by the Assessing Officer as incriminating was page 7 of Annexure A-7, which is merely a layout plan and contains no reference whatsoever to any distance from PCMC. The other seized documents were either part of the sale deed, Government records or documents voluntarily furnished by the directors.

5.1 It was further submitted that the statements recorded under section 132(4) contained no admission adverse to the assessee. On the contrary, both directors consistently stated that the land was agricultural land and that the income from its sale had been disclosed in the return as exempt income.

5.2 The ld Counsel also submitted that the subsequent information obtained from the Tahsildar and several computations of distance made through Google Maps came into existence only

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during the post-search assessment proceedings, long after the search had concluded, and could not, be treated as material ‘found as a result of search’ so as to sustain an addition for an unabated assessment year. 5.3 The learned Departmental Representative, per contra, supported the orders of the authorities below and submitted that the sketch at Page 7, read with the statements of the directors and the certificate of the Sarpanch, taken cumulatively, constituted sufficient incriminating material to clothe the AO with jurisdiction under section 153A, and that the subsequent verification through the Tahsildar and Google Maps was only in the nature of corroboration of what had already been indicated by the seized material.

Findings and adjudication 6.

6.1 We have carefully considered the rival submissions and perused the material available on record. At the outset, it is not in dispute that Assessment Year 2016-17 was an unabated assessment year as on the date of search on 25.03.2021. The return of income had been processed under section 143(1) of the Act and the time prescribed for issuance of notice under section 143(2) had expired without any scrutiny assessment having been initiated or pending. The assessment for the year under

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consideration had, therefore, attained finality prior to the date of search. 6.2 The question that falls for our consideration, therefore, is a narrow but fundamental one: whether, in respect of the concluded assessment for Assessment Year 2016-17, any incriminating material relatable to the impugned addition was found during the course of search so as to enable the Assessing Officer to disturb the concluded assessment under section 153A of the Act. 6.3 Section 153A of the Act constitutes a special machinery for assessment consequent upon a search under section 132. The distinction drawn by the provision between pending assessments, which abate, and completed assessments, which remain unabated, assumes significance in determining the scope of the Assessing Officer’s jurisdiction. In respect of an unabated assessment, the power under section 153A is not an unrestricted power to make a fresh assessment de hors the search. The completed assessment can be disturbed only where the search has yielded incriminating material having a nexus with the addition proposed to be made. 6.4 The Hon’ble Bombay High Court, in CIT v. Continental Warehousing Corporation (Nhava Sheva) Ltd., (2015) 374 ITR 645 (Bom.), while considering the scope of section 153A in the case of completed assessments, approved the ratio of the Special Bench in All Cargo Global Logistics Ltd. v. DCIT, (2012) 137 ITD 287

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(Mum.) (SB), and held that, in the absence of incriminating material found during the course of search, a completed assessment could not be disturbed under section 153A. The said decision, being that of the jurisdictional High Court, is binding upon us. The principle underlying the decision is that the search assessment machinery is intended to bring to tax income detected as a consequence of the search and not to provide a fresh opportunity for making a roving examination of concluded assessments. 6.5 The same principle has been explained by the Hon'ble Delhi High Court in Commissioner of Income Tax v. Kabul Chawla, (2016) 380 ITR 573 (Delhi), wherein it is held, inter alia, that completed assessments could be interfered with under section 153A only on the basis of incriminating material found during the search. The existence of such material is thus the jurisdictional foundation for making an addition in an unabated assessment. The principle in Kabul Chawla (supra) has been subsequently approved by the Hon'ble Supreme Court.

6.6 The legal position now stands conclusively settled by the judgment of the Hon'ble Supreme Court in Principal Commissioner of Income Tax v. Abhisar Buildwell (P.) Ltd., (2023) 454 ITR 212 (SC). The Hon'ble Supreme Court, after considering Kabul Chawla, (supra) Continental Warehousing ltd (supra) and the corresponding decisions of other High Courts, held that in respect of completed/unabated assessments, no addition

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can be made under section 153A in the absence of incriminating material found during the course of search. The Hon’ble Supreme Court further clarified that where no incriminating material is found, the Revenue is not without remedy and may resort to the reassessment provisions, subject to satisfaction of the statutory conditions governing such proceedings. 6.6 The principle which emerges, therefore, is that in an unabated assessment, the addition made under section 153A must have its foundation in incriminating material found as a result of the search and such material must have a live nexus with the addition sought to be made. Material which merely enables the Assessing Officer to undertake an inquiry, or information subsequently gathered in the course of assessment proceedings, even if relevant to the merits of the proposed addition, cannot retrospectively acquire the character of incriminating material found during search. 6.7 The Revenue has also placed reliance upon the statements of the two directors recorded under section 132(4) of the Act. The evidentiary value of such statements has to be considered in the context of the aforesaid legal position. In CIT v. Harjeev Aggarwal, (2016) 290 CTR 263 (Delhi), the Hon’ble Delhi High Court examined the nature and evidentiary scope of a statement recorded under section 132(4) and held, in substance, that a statement cannot, divorced from the material or evidence to which it relates, be treated as conclusive proof of undisclosed income

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merely by reason of the fact that it was recorded during search. Where the statement contains no admission of undisclosed income and is not supported by any adverse material found during search, its mere existence cannot supply the incriminating material otherwise absent from the search record. 6.8 Tested on this touchstone, the statements of Shri Manu Punnoose and Shri Rakesh S. Kathotia do not assist the Revenue. Neither statement contains any admission of undisclosed income, undisclosed consideration or any fact contrary to the assessee’s disclosed position. On the contrary, the directors reiterated the very claim made in the return of income, namely, that the land was agricultural land and the surplus on its sale exempt income. Shri Kathotia voluntary produced sale agreement, the Government Order, and the Sarpanch’s certificate. The Sarpanch's certificate, referred to and produced by Shri Kathotia in the course of his statement, does not alter this position. Corroboration within the meaning of Harjeev Aggarwal (supra) contemplates corroboration by material that is adverse to the assessee — material which, taken together with the statement, supplies the missing element of undisclosed income. A document that merely reinforces a claim already made in the return, and which was in the assessee's possession prior to the search rather than unearthed by it, does not answer to this description. It cannot be said that the assessee has, by voluntarily furnishing a document in support of its own

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disclosed position, supplied the very incriminating material required to sustain an addition against itself. Nothing has been placed on record by the Revenue, whether by way of an independent verification report, survey, or other material found during the search, to suggest that the certificate was procured through misrepresentation or that the aerial distance recorded therein is otherwise incorrect. In the absence of any such adverse material, the certificate remains what it purports to be: a document corroborative of the assessee's own claim, and not of any suppression. Neither statement discloses, admits, or even hints at any fact adverse to the assessee or at variance with its disclosed position. Their statements, therefore, do not supply the missing incriminating fact concerning the alleged distance from PCMC. Applying the ratio of Harjeev Aggarwal (supra), we are of the view that neither statement constitutes, singly or cumulatively with the seized documents, ‘incriminating material’ within the meaning of section 153A. 6.9 We shall now examine the material relied upon by the Revenue, not merely by reference to the fact that it was physically found or seized during search, but by asking the more pertinent question: what fact adverse to the assessee was actually revealed by such material which was not already disclosed and which formed the foundation of the impugned addition?

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6.10 The first and principal document relied upon is page 7 of Annexure A-7, described by the Assessing Officer as the map/layout of the land. For ready reference scan of said document reproduced by the ld AO in impugned assessment order is extracted as under:

6.11 The document at Page 7 is a layout plan relating to the land at Savardari. It does not record the aerial distance between the land and the outer limits of PCMC; it does not state that the land is situated within eight kilometres of PCMC; it does not identify PCMC as the relevant municipality for purposes of section 2(14)(iii); nor does it disclose any undisclosed consideration or undisclosed income. Thus, the document, considered by ld AO as incriminating

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is wholly neutral. It identifies the property; it does not establish the crucial fact on which the addition rests. Indeed, the figure of 5.7 kilometres was arrived at by the Assessing Officer only after he applied information obtained through Google Maps to the location shown in the plan. In our opinion, the distance did not emerge from the seized document itself, but from an exercise the Assessing Officer undertook independently of it. It may be noted that the Assessing Officer, both in the assessment order and in the remand report before the learned CIT(A), has characterised only Page 7, and no other seized document, as "incriminating material." The document, however, is a government-issued survey/layout sketch, forming part of the registered sale documentation and voluntarily produced by the director during the course of his statement. Being wholly silent as to the distance from PCMC, it cannot, without something more, constitute the incriminating material necessary to sustain the impugned addition.

6.12 We next consider the certificate of the Sarpanch placed at page 14 of Annexure A-7. The certificate stated, in substance, that no municipality was situated within eight kilometres of the village. It did not certify the aerial distance of the land from PCMC. Significantly, the Assessing Officer himself did not treat this certificate as establishing distance from PCMC, or as incriminating material at all. he rejected it precisely because it did not furnish such distance. It is, therefore, the approach of the learned CIT(A) in

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subsequently treating the very same certificate as material revealing that the assessee had deliberately concealed the true position , can’t be accepted , being a characterisation the Assessing Officer himself never placed on the document.

6.13 The remaining documents comprised in Annexure A-7, namely pages 1 to 6, 8 to 13 of Annexure A-7 consist essentially of correspondence, possession documentation, the Government order dated 22.12.2015 and other documents forming part of the transaction. The record shows that these documents were either part of the registered sale documentation/Government records or were voluntarily furnished by the directors during the search. These documents do not disclose any undisclosed consideration, undisclosed income or any fact establishing that the land was situated within eight kilometres of PCMC. The Government order dated 22.12.2015 also does not establish that the land was within eight kilometres of PCMC. It concerns permission relating to the agricultural land and was already part of the transaction documents. No material has been brought on record to demonstrate that this document disclosed any undisclosed income or any fact which contradicted the assessee's return. 6.14 We thus find that none of the documents actually found during the search establishes the factual premise on which the impugned addition rests. The seized material identifies the land and

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records aspects of its acquisition, possession and sale; it does not reveal its alleged aerial distance from PCMC. 6.15 We next consider the statements of Shri Manu Punnoose and Shri Rakesh Kathotia. Their statements do not contain any admission that the land was within eight kilometres of PCMC. On the contrary, the answers given by them were that the land was agricultural land and that the income from its sale had been treated accordingly. Their reference to the Sarpanch's certificate cannot convert that certificate into incriminating material when the certificate itself contains no finding regarding the distance from PCMC. The learned CIT(A) placed considerable emphasis on the fact that the directors were aware of section 2(14) and the possible taxability of capital gains. In our considered view, such awareness is entirely beside the point. Knowledge/ absence of knowledge of the law cannot constitute incriminating material. More importantly, neither director admitted that the land was within the prescribed distance from PCMC or that the claim of exemption was false. The statements consequently do not establish the factual foundation of the addition.

6.16 We then come to the information obtained from the Tahsildar, Khed, which, in our view, is the most significant piece of evidence in the entire assessment order. Pursuant to summons issued after the search, the Tahsildar furnished a communication

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dated 18.06.2021 stating that the aerial distance of the land from the outer boundary of PCMC was 5.25 kilometres. This was the first material which, according to the Revenue itself, furnished the factual basis for treating the land as falling within the eight- kilometre limit. But, this information was not found during the search. It was obtained pursuant to an inquiry conducted after the search. The search concluded on 25.03.2021; the Tahsildar's communication is dated 18.06.2021. It could, therefore, at best constitute material gathered during the post-search assessment proceedings. It cannot, by retrospective description, become material “found as a result of search” within the contemplation of section 153A 6.17 The same reasoning applies to the subsequent reference by the Assessing Officer to Google Maps. The Assessing Officer referred to distances of 5.7 kilometres, 5.34 kilometres and 6.10 kilometres, depending upon the reference point adopted, and also relied upon Census data concerning the population of PCMC. These were not documents seized during the search. They were information/data subsequently accessed or gathered by the Assessing Officer in the course of assessment. Even assuming, without expressing any opinion, that the distances so ascertained are factually correct, the fact remains that they emerged only from an exercise undertaken after the search. Such subsequent inquiry cannot be transmuted into incriminating material found during

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search merely because it relates to an asset or document identified during the search. They may, depending upon the circumstances, constitute material relevant to an assessment on merits; but they cannot satisfy the statutory requirement of incriminating material found during search in an unabated assessment.

6.18 The distinction between material gathered during the search and material gathered post the search is substantive. If information gathered by the Assessing Officer after the search could itself be treated as incriminating material found during search, the limitation placed by the law upon disturbing an unabated assessment would become meaningless. The Assessing Officer could first invoke section 153A in respect of a concluded assessment and thereafter gather, during the assessment proceedings, the very material necessary to justify the addition. Such an approach would defeat the jurisdictional safeguard recognised in Continental Warehousing (supra), Kabul Chawla (supra) and authoritatively affirmed in Abhisar Buildwell (supra).

6.18.1 For completeness, and to test the Revenue’s case item- wise, the evidentiary position emerging from the record may be summarised as under:

Material relied When available What it establishes Whether upon incriminating Pages 1–6, Search Sale-related No Annexure A-7 documentation/correspondence Page 7, Annexure Search Layout/sketch of land Does not

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A-7 establish distance from PCMC Pages 8–9 Search Possession documentation No Pages 10–12 Search Government order Does not establish distance or undisclosed income Page 13 Search Forwarding letter No Page 14 Search Sarpanch’s certificate Does not establish aerial distance from PCMC Statement of Shri Search Land treated as agricultural; No adverse Manu Punnoose income disclosed admission Statement of Shri Search Agricultural activity and reliance No admission of Rakesh S. Kathotia on certificate 8-km proximity Tahsildar’s Post-search Distance stated at 5.25 km from Not material communication PCMC found in search dated 18.06.2021 Google Maps Post- Distances of 5.7/5.34/6.10 km Not material search/assessment found in search Census data Post- Population of PCMC Not material search/assessment found in search

6.19 The aforesaid chronology brings the controversy into sharp focus. The search yielded the identity and documentation of the property; it did not yield the fact upon which the addition was ultimately founded, namely, that the property was situated within eight kilometres of PCMC. What was found in the search was the land and its transaction-related documentation; what was required for the impugned addition was evidence establishing its aerial distance from PCMC. The latter fact did not emerge from any material found during the search. That fact emerged, for the first time, from the Tahsildar’s communication dated 18.06.2021 and from the Assessing Officer’s subsequent exercise using Google Maps

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and Census data. The material which supplied the missing factual link was thus generated only after the search. 6.20 We are, therefore, unable to accept the reasoning of the learned CIT(A) that the alleged undisclosed income was “discovered during the search and post-search proceedings”. The statutory test under section 153A, as settled by the Hon'ble Supreme Court, is not whether the Revenue ultimately discovered some information during the assessment proceedings after a search. The relevant inquiry is whether incriminating material was found as a result of the search so as to authorise disturbance of an unabated assessment. 6.21 The fact that the assessee's return had already disclosed the sale of the land, the consideration received thereon and the treatment of the resultant income as exempt agricultural income is also material. There was no discovery of an undisclosed sale, undisclosed consideration or undisclosed asset. The dispute that ultimately arose was whether, on the disclosed facts, the land satisfied the statutory exclusion under section 2(14)(iii). Such a dispute, in the absence of incriminating material found during search, could not be converted into a search-based addition under section 153A. The inquiry may have been relevant for determining the merits of the controversy; but relevance to the merits is not the same thing as satisfaction of the jurisdictional condition under section 153A.

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6.22 Having regard to the foregoing discussion, we hold that no incriminating material relatable to the impugned addition was found during the course of search. The seized documents and the statements recorded under section 132(4) do not establish that the land was situated within eight kilometres of PCMC. The crucial material relied upon by the Assessing Officer for establishing such distance was obtained only after the search, principally from the Tahsildar and through the subsequent exercise undertaken with the aid of Google Maps and Census data. Once it is held that no incriminating material relatable to the assessment year under consideration was found during the search, the legal consequence prescribed Abhisar Buildwell (supra) follows inexorably. The subsequent material gathered during the assessment proceedings cannot cure the foundational jurisdictional defect. Since Assessment Year 2016-17 was an unabated assessment year as on the date of search, the impugned addition made under section 153A, in the absence of the requisite incriminating material, is unsustainable in law. The addition of Rs.68,49,14,986/- is accordingly deleted.

6.23 Having so held on the jurisdictional issue, we consider it neither necessary nor appropriate to record any finding on the merits of the controversy touching the interpretation of section 2(14)(iii)(b) of the Act – namely, whether the aerial distance for that clause is to be measured from the municipality/municipal council

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within whose administrative jurisdiction the land is situated (Khed/Rajgurunagar), or from the nearest Municipal Corporation of the requisite population (PCMC). That question is expressly left open, to be adjudicated in an appropriate stage in which it properly arises for determination; the observations of the lower authorities on that aspect shall not be treated as having attained finality.

6.24 The ground(s) of appeal challenging the validity of the assessment framed under section 153A, for want of incriminating material, are accordingly allowed.

Order pronounced in the open Court on 10/08/2026.

Sd/- Sd/- (PAWAN SINGH) (OM PRAKASH KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 10/08/2026 M. Ranganath Vittal , Sr. P.S. Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, //True Copy// (Assistant Registrar) ITAT, Mumbai

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Date Initials Original dictation pad is enclosed at Yes the end of file 1. Draft dictated on: 06.08.2026 Sr. PS/PS 2. Draft placed before author: .08.2026 Sr. PS/PS 3. Draft proposed & placed before the JM/AM second member: 4. Draft discussed/approved by Second JM/AM Member: 5. Approved Draft comes to the Sr. Sr. PS/PS PS/PS: 6. Order pronounced on: Sr. PS/PS 7. File sent to the Bench Clerk: 8. Date on which file goes to the Head Sr. PS/PS Clerk: 9. Date on which file goes to AR 10. Date of Dispatch of order