DIPALIBEN M. SHAH,VADODARA vs. THE DY.CIT, CENTRAL CIRCLE-2, VADODARA

ITSSA 104/AHD/2023Status: DisposedITAT Ahmedabad08 January 2026AY 2010-119 pages
AI SummaryPartly Allowed

What were the facts?

The Income Tax Appellate Tribunal (ITAT) heard a batch of four appeals filed by the assessee, Dipaliben M. Shah, against orders of the Commissioner of Income-tax (Appeals)-12, Ahmedabad, for Assessment Years (AYs) 2009-10, 2010-11, 2012-13, and 2015-16. The appeals for AYs 2012-13 and 2015-16 were dismissed as not pressed. For AY 2009-10, a search under Section 132 of the Income-tax Act, 1961, was conducted on November 13, 2014, in the Sigma Group of cases, including the assessee, who is the daughter of the main person of the group. The assessment under Section 153A read with Section 143(3) resulted in additions. For AY 2010-11, similar grounds were raised concerning additions made under Section 153A.

What did the Tribunal hold?

For AYs 2012-13 and 2015-16, the appeals were dismissed as not pressed. For AY 2009-10, Ground 1 was dismissed, respectfully following the Co-ordinate Bench decision in ACIT vs. Benefit Tradelink Pvt. Ltd. (175 taxmann.com 818), regarding additions made under Section 153A without incriminating material found on the assessee's premises. For Ground 2 (AY 2009-10), the Tribunal held that since the amounts received as student fees were already offered to tax by the entities managing the Sigma Group before the Settlement Commission, the provisions of Section 56(2)(vi) were not attracted, and no additions were called for on merits. For Ground 3 (AY 2009-10), the addition was restricted to Rs. 1,42,000/- after recomputing the assessee's proportionate contribution to the property investment. Thus, the appeal for AY 2009-10 was partly allowed. For AY 2010-11, Grounds 1 & 2 were dismissed, following the same precedent as for AY 2009-10. For Ground 3, the Tribunal held that since the purchase of property at Village Hanumanpura for Rs. 51,00,000/- was offered to tax before the Settlement Commission, no further addition was required. However, the Revenue was permitted to take action to tax the Rs. 12,71,890/- paid towards stamp duty and other expenses for registration, as this amount was not offered to tax and was paid by family members. For Ground 4, the addition of Rs. 6,00,000/- for investment in Krishna Leela Society was deleted as it was offered to tax before the Settlement Commission. For Grounds 5 & 6, the assessee's offer to tax the amounts of Rs. 85,000/- (unsecured loan) and Rs. 2,61,761/- (investment) was accepted. For Ground 7, the addition of Rs. 1,51,119/- was confirmed as it was a computation mistake by the Revenue. Thus, the appeal for AY 2010-11 was partly allowed. The operative direction was that appeals IT(SS)A No. 106 & ITA No. 537/Ahd/2023 were dismissed, and appeals IT(SS)Nos. 103 & 104/Ahd/2023 were partly allowed.

What were the issues?

The Tribunal had to decide the following issues: 1. Whether the addition of Rs. 5,33,322/- for AY 2009-10, confirmed by the CIT(A) under Section 153A, was valid when the incriminating material was allegedly recovered from a third party, not the assessee's premises (Section 153A). 2. Whether the addition of Rs. 1,24,000/- and Rs. 1,25,000/- for AY 2009-10, treated as unaccounted student fees, was correctly confirmed by the CIT(A), and if Section 56(2)(vi) was attracted (Section 56(2)(vi)). 3. Whether the addition of Rs. 2,84,322/- for AY 2009-10, relating to unexplained investment in property at Survey No. 143, village Bakrol, was justified (Section 69). 4. Whether the addition of Rs. 10,67,972/- for AY 2010-11, confirmed under Section 153A, was valid when no incriminating material was recovered from the assessee's premises (Section 153A). 5. Whether the addition of Rs. 10,97,880/- for AY 2010-11, confirmed under Section 153A, was valid due to the absence of incriminating material (Section 153A). 6. Whether the addition of Rs. 10,67,972/- for AY 2010-11, concerning unexplained investment in land at village Hanumanpura, was justified (Section 69). 7. Whether the addition of Rs. 6,00,000/- for AY 2010-11, relating to alleged investment in a residential unit at Krishna Leela Society, was correct (Section 69). 8. Whether the addition of Rs. 85,000/- for AY 2010-11, for alleged unexplained unsecured loan from Mr. Manish B. Shah, was justified (Section 68). 9. Whether the addition of Rs. 2,61,761/- for AY 2010-11, for alleged unexplained investment in the firm Deesa Overseas, was correct (Section 69). 10. Whether the addition of Rs. 1,51,119/- for AY 2010-11, for alleged unaccounted business profit, was justified (Section 28). Assessee's Contentions: For Ground 1 (AY 2009-10) and Grounds 1 & 2 (AY 2010-11), the assessee argued that no incriminating material was recovered from their premises, and the relied-upon documents were found elsewhere. For Ground 2 (AY 2009-10), the assessee contended that the amounts received as student fees were already offered to tax by the managing entities before the Settlement Commission, thus Section 56(2)(vi) was not attracted. For Ground 3 (AY 2009-10), the assessee argued for a recomputation of their proportionate contribution to the property investment. For Grounds 3, 4, 6, and 7 (AY 2010-11), the assessee stated that the amounts were offered to tax before the Settlement Commission. For Grounds 5 & 6 (AY 2010-11), the assessee offered the amounts to tax due to old documents and small tax effect. For Ground 7 (AY 2010-11), the assessee claimed it was a computation mistake. Revenue's Contentions: The Revenue, through the CIT-DR and Sr. DR, did not explicitly record arguments for all grounds but pointed out that stamp duty and registration expenses of Rs. 12,71,890/- for land at village Hanumanpura (AY 2010-11) were not offered to tax, and these were paid by the assessee's father, mother, and brother, with no contribution from the assessee.

Which sections of the Income-tax Act were involved?

Section 153A,Section 143(3),Section 56(2)(vi),Section 69,Section 68,Section 28

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, AHMEDABAD

Before: DR. B.R.R. KUMAR, VICE-SHRI T.R. SENTHIL KUMAR

For Appellant: Shri Manish J. Shah, AR
For Respondent: Shri Alpesh Parmar, CIT-DR, Shri Rajenkumar M. Vasavada, Sr DR
Hearing: 08.01.2026Pronounced: 08.01.2026

PER DR. B.R.R. KUMAR, VICE-PRESIDENT :

This bunch of four appeals has been filed by the assessee against the separate orders of the Ld. Commissioner of Income-tax (Appeals)-12, Ahmedabad (hereinafter referred to as "CIT(A)" for short), all dated 12.05.2023,

IT(SS)A No. 103/Ahd/2023 Dipaliben M. Shah Vs. DCIT

The order continues below.

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