ACIT CC 2(3) AHMEDBAD, AHMEDABAD vs. MANAV ADHIKAR PARTY, MANINAGAR

ITSSA 25/AHD/2024Status: DisposedITAT Ahmedabad25 February 2025AY 2021-226 pages
AI SummaryDismissed

What were the facts?

The Revenue is in appeal against an order of the CIT(A) for Assessment Year 2021-22. The assessee, a political party, was subject to a search under Section 132 on February 2, 2021. The assessee filed a belated return declaring Nil income. The Investigation Wing found that the assessee, along with other political parties, was involved in a bogus donation scam, facilitating tax evasion by returning donations to donors who claimed deductions under Section 80GGB/80GGC. The National President admitted the party's involvement in providing accommodation entries and not carrying out actual political activities. Consequently, receipts of Rs. 103,44,14,314/- were treated as undisclosed income. Additionally, unexplained money of Rs. 3,35,00,552/- found in bank accounts and seized was added protectively in the assessee's hands under Section 69A r.w.s. 115BBE, with the assessee claiming it was payable to Shri Tribhavan Ojha.

What did the Tribunal hold?

The Tribunal held that the CIT(A) was correct in deleting the protective addition of Rs. 3,35,00,552/-. The CIT(A) had found that this amount was part of the total deposits in the State Bank of India account, which had already been brought to tax in the hands of the assessee under Section 68 r.w.s. 115BBE. Furthermore, the CIT(A) noted that a substantive addition was made in the hands of Shri Tribhavan Ojha for this amount. The Tribunal agreed with the CIT(A)'s reasoning that adding this amount again to the assessee party's income would constitute double taxation of the same receipt. The Revenue failed to contravene this finding. Therefore, the Tribunal found no merit in the Revenue's ground of appeal and upheld the CIT(A)'s decision.

What were the issues?

1. Whether, in law, the CIT(A) was correct in deleting the addition of Rs. 3,35,00,552/- made on a protective basis under Section 69A r.w.s. 115BBE, considering that the substantive addition was not accepted by Shri Tribhavan Ojha? Assessee's Contentions: The assessee filed written submissions. The CIT(A) held that the amount of Rs. 3,35,00,552/- was part of the total deposits in the State Bank of India account which had already been brought to tax in the assessee's hands. Therefore, adding it again to the assessee's income, without prejudice to the substantive addition in the hands of Shri Tribhavan Ojha, amounted to double taxation and was not justifiable. Revenue's Contentions: The Revenue argued that since Shri Tribhavan Ojha had not accepted the substantive addition made in his hands, the CIT(A) was incorrect in deleting the protective addition in the hands of the assessee.

Which sections of the Income-tax Act were involved?

Section 132,Section 143(3),Section 153A,Section 80GGB,Section 80GGC,Section 13A,Section 69A,Section 115BBE,Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “C” BENCH

Before: Shri T.R. Senthil Kumar & Shri Makarant Vasant Mahadeokar

PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:-

This appeal is filed by the Revenue as against the appellate order dated 05.01.2024 passed by the Commissioner of Income Tax (Appeals)-12, Ahmedabad arising out of the assessment order passed under section 143(3) r.w.s. 153A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year 2021-22. I.T.(SS)A No. 25/Ahd/2024 A.Y. 2021-22 Page No 2

2.

Brief facts of the case is that the assessee is a Political Party established on 14-03-2014 having its registered office at Maninagar, Ahmedabad and Shri Ram Bhavan Ojha as its National President and his broth

The order continues below.

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