DY COMMISSIONER OF INCOME TAX , KOLKATA vs. PRIMARC RETAIL STORES PVT LTD, KOLKATA

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ITSSA 9/KOL/2024Status: DisposedITAT Kolkata20 December 2024AY 2016-174 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the additions made by the Assessing Officer under Section 153A of the Income-tax Act, 1961, were invalid. The reasoning was based on the Hon'ble Supreme Court's decision in Pr. CIT Vs. Abhiser Buildwell (P) Ltd. [2023] 149 taxmann.com 399 (SC). This decision states that in cases of completed or non-abated assessments, the Assessing Officer cannot make additions under Section 153A if no incriminating material is found during the search action. The Ld. DR for the Revenue fairly admitted that the issue was covered by this Supreme Court judgment. Consequently, the Tribunal found no merit in the revenue's appeals. The operative direction was that all the appeals of the revenue were dismissed. No issue was expressly left undecided.

What were the facts?

The appeals were filed by the Revenue (DCIT, Kolkata) against the orders of the Ld. CIT(A), Kolkata-20, dated 15.12.2023. These orders were passed under Section 250 of the Income-tax Act, 1961, for Assessment Years (AYs) 2013-14 to 2017-18. The common issue in all appeals relates to additions made by the Assessing Officer (AO) under Section 153A of the Act, following a search action under Section 132 on 05.01.2021, in the case of the Primarc Group of companies, to which the assessees belong. The lead case is ITA No. 06/Kol/2024 for AY 2013-14 concerning Primarc Retails Stores Pvt. Ltd. The original assessment for this year was completed and had not abated at the time of the search.

What were the issues?

1. Whether additions made by the Assessing Officer under Section 153A of the Income-tax Act, 1961, are valid in the case of a completed assessment where no incriminating material was found during the search action conducted under Section 132 of the Act? Assessee's Contention: The assessee argued that the additions made by the AO, treating unsecured loans as bogus, were invalid. They relied on the Ld. CIT(A)'s finding that the original assessment was completed and not abated, and no incriminating material was found during the search. The assessee cited the Hon'ble Supreme Court's decision in Pr. CIT Vs. Abhiser Buildwell (P) Ltd. [2023] 149 taxmann.com 399 (SC). Revenue's Contention: The Ld. DR conceded that the issue was squarely covered by the Hon'ble Supreme Court's decision in Abhiser Buildwell (P) Ltd. (supra), acknowledging that no addition can be made under Section 153A in a non-abated assessment without incriminating material found during the search.

Which sections of the Income-tax Act were involved?

Section 153A,Section 132,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH KOLKATA

Before: Shri Sanjay Garg & Shri Rakesh Mishra

आदेश / ORDER Per Bench :

All the captioned appeals have been preferred by the revenue against the separate orders of evenly dated 15.12.2023 of the Ld. Commissioner of Income Tax, (Appeal), Kolkata-20 [hereinafter referred to as the “Ld. CIT(A)”] passed u/s. 250 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”) for Assessment Years (AYs) 2013-14 to 2017-18. 2. Common issue involved in all the captioned appeals is relating to the validity of additions made by the Assessing Officer (in short “AO”) in the assessments carried out for different assessment years u/s. 153A of the Act, pursuant to the search action carried out u/s. 132 of the Act in the case of the Primarc Group of companies on 05.01.2021. The assessees, herein, belong to the said Primarc Group of companies and were covered in the said search action. Therefore, all the captioned appeals were heard together and are being disposed of by this common, order for the sake of convenience. 3. ITA No. 06/Kol/2024 in the case of Primarc Retails Stores Pvt. Ltd. for AY 2013-14 is taken as lead case for the purpose of narration of facts. ITA NO. 06/KOL/2024, AY: 2013-14 : 4. At the outset, the Ld. Counsel for the assessee inviting our attention to the impugned order of the Ld. CIT(A) has submitted that the impugned

3 ITSSA Nos. 06 to 12/Kol/2024 AYs 2013-14 to & 2017-18

additions were made by the AO by treating the unsecured loans received by the assessee as bogus. He has further demonstrated from the order of the Ld. CIT(A) that in this case, the original assessment stood completed and not abated on the date of search action. No incriminating material, whatsoever, was found during the course of search action. The Ld. CIT(A), therefore, relying on the decision of the Hon’ble Supreme Court in the case of Pr. CIT Vs. Abhiser Buildwell (P) Ltd. [2023] 149 taxmann.com 399 (SC), wherein the Hon’ble Supreme Court has held that in the case of non-abated/completed assessments, no addition can be made by the Assessing Officer in an assessment carried out u/s.153A of the Act in the absence of any incriminating material found during the search action, deleted the impugned addition made by the AO in this case. 5. The Ld. DR has been fair enough to admit that the issue involved in this appeal is squarely covered by the aforesaid decision of the Hon’ble Supreme Court in the case Abhiser Buildwell (P) Ltd. (supra), wherein the Hon’ble Supreme Court has held that in case of completed/non-abated assessment, no addition can be made by the Assessing Officer in an assessment carried out u/s.153A of the Act in the absence of any incriminating material found during the search action. Therefore, there is no merit involved in the appeal of the revenue and the same is accordingly, dismissed.

ITA NOS. 07 TO 10, 07, 11 & 12/KOL/2024:

6.

The facts and issue involved in all the captioned appeals are identical. Our findings given above will mutatis mutandis apply to all the

4 ITSSA Nos. 06 to 12/Kol/2024 AYs 2013-14 to & 2017-18

appeals. Therefore, all the appeals of the revenue are ordered to be dismissed. 7. In the result, all the appeals of the revenue stand dismissed. Order is pronounced in the open court on 20.12.2024. Sd/- Sd/- [Sanjay Garg] [Rakesh Mishra] लेखा सद�/Accountant Member �ाियक सद�/Judicial Member

Dated:20 .12.2024. JD Sr. P.S

Copy of the order forwarded to:

Appellant – 1. 2. Respondent – 3. CIT(A), Kolkata-20. 4. Pr. CIT 5. CIT(DR),

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