SUDHIR DAMJI BHARANI,MUMBAI vs. ITO, WARD 27 (3)(1), MUMBAI, MUMBAI

On the facts and circumstances of the case and in law, the Assessing Officer erred in issuing the notice under Section 148 based on the information pertaining to the appellant which was found from the books of accounts/documents seized during the course of search of the other person which was contrary to the provisions of Section 153C.

On the facts and circumstances of the case and in law, the assessment framed u/s 147 of the Act is bad in law in so far as the same should have been framed u/s 153C of the Act since it is based on the information contained in the books of accounts/documents seized or requisitioned during the course of search of the other person

On the facts and circumstances of the case and in law, the Ld. CIT (A) has erred in confirming the addition of unexplained money amounting to 20,00,000 under Section 69A.

On the facts and circumstances of the case and in law, the Ld. CIT (A) has erred in confirming the findings of the Assessing Officer that the appellant had advanced a loan of 20,00,000 in cash to M/s. Evergreen Enterprises.

On the facts and circumstances of the case and in law, the Ld. CIT (A) ought to have appreciated the fact that M/s. Evergreen Enterprises itself was not in existence during the year under consideration and, therefore, there could not have been any transactions between it and the appellant.

First, I take up the grounds raised by the assessee on the merits of the additions, i.e., Ground Nos. 3 and 4, which are interrelated and interconnected and relates to challenging the order of the Ld. CIT(A) in confirming the additions made by the AO under Section 69A of the Act. Therefore, I have decided to adjudicate these grounds through the present consolidated order.

As per the facts of the present case, a search and seizure action took place under Section 132 of the Income Tax Act in the case of M/s. Evergreen Enterprises. During the course of the search action, certain documentary evidence was found and impounded, and the statement of Mr. Nilesh Bharani, one of the partners of Evergreen Enterprises, was recorded on oath. The statements of other persons were also recorded. On the basis of the documents found and seized during the course of the search, it was revealed that the assessee had lent a cash loan of Rs. 20 lakhs. Therefore, after providing an opportunity to the assessee, additions were made by the AO and were also confirmed by the Ld. CIT(A).

Whereas, the Ld. AR specifically submitted that the assessee had never lent any cash loan to the said M/s. Evergreen Enterprises and further submitted that no addition could have been made on the basis of the statement of Mr. Nilesh Bharani, as the said statement already stands retracted. Moreover, it was further submitted that the additions in other assessees' cases had already been challenged before the Coordinate Benches of the ITAT regarding the same charge, wherein the respective additions were deleted. The decisions of the Coordinate Benches of the ITAT are as follows:

Thus, keeping in view the facts and circumstances of the present case, the decisions of the Coordinate Benches of the ITAT, and also the doctrine of binding precedents and the need to maintain judicial consistency, we direct the AO to delete the impugned additions.

Since we have already deleted the impugned additions, the other grounds have become academic in nature and, therefore, do not require any adjudication.

In the result, appeal filed by the Assessee stands allowed.