HARSHIL RAMAKANT DALAL,AHMEDABAD vs. THE ACIT, CENTRAL CIRCLE-2(2), AHMEDABAD

ITSSA 81/AHD/2023Status: DisposedITAT Ahmedabad29 February 2024AY 2014-155 pages
AI SummaryAllowed

What were the facts?

The assessee, Harshil Ramakant Dalal, an individual and Global Chief Financial Officer of Dishman Group, is in appeal against orders confirming additions made by the Assessing Officer (AO) for Assessment Years (AYs) 2014-2015, 2015-2016, and 2017-2018. These assessments were framed under Section 153A read with Section 143(3) of the Income Tax Act, 1961, following a search and seizure operation on December 19, 2019, at the Dishman Group premises, which also covered the assessee's residence. The AO disallowed a donation of Rs. 2,27,000/- claimed under Section 80GGA for AY 2014-15, based on the assessee's admission of making a bogus donation of Rs. 7,00,000/- in Financial Year 2018-19 (AY 2019-20) during a statement recorded under Section 132(4). The Commissioner of Income Tax (Appeals) upheld this disallowance. Similar issues arose for AYs 2015-16 and 2017-18.

What did the Tribunal hold?

The Tribunal held that for unabated assessment years, assessments under Section 153A of the Act can only be disturbed if incriminating material pertaining to the year under consideration is found. The Tribunal noted that while the assessee admitted to making bogus donations in FY 2018-19 (AY 2019-20) in a statement recorded under Section 132(4), no such incriminating document was found for the years under dispute (AYs 2014-15, 2015-16, and 2017-18). Citing the Supreme Court's decision in *Abhisar Buildwell (P.) Ltd.*, which agreed with the view that no addition can be made in respect of completed assessments in the absence of incriminating material, the Tribunal ruled that the assessment for these unabated years could not be disturbed. Furthermore, following the Delhi High Court's decision in *CIT vs. Best Infrastructure (India) (P) Ltd.*, the Tribunal held that statements recorded under Section 132(4) do not by themselves constitute incriminating material for unabated assessment years. Consequently, no addition could be made on account of bogus donations without incriminating documents. The additions were set aside, and the AO was directed to delete them. The appeals for all three assessment years were allowed.

What were the issues?

1. Whether the assessment framed under Section 153A read with Section 143(3) of the Income Tax Act, 1961, is valid for unabated assessment years in the absence of any incriminating material pertaining to the year under consideration? (Question of law) Assessee's contentions: - No incriminating documents were found for the disputed assessment years, making the assessments unabated and thus invalid without such material. The admission of bogus donations in FY 2018-19 (AY 2019-20) cannot be extrapolated to earlier years. Relied on *Abhisar Buildwell (P.) Ltd.* (SC) and *CIT vs. Best Infrastructure (India) (P) Ltd.* (Delhi HC). - Statements recorded under Section 132(4) do not by themselves constitute incriminating material for unabated assessment years unless corroborated by documents. Relied on *CIT vs. Best Infrastructure (India) (P) Ltd.* (Delhi HC). Revenue's contentions: - The assessee was involved in tax evasion, and therefore, the bogus donation should be disallowed. The orders of the lower authorities were supported.

Which sections of the Income-tax Act were involved?

Section 153A,Section 143(3),Section 132(4),Section 80GGA,Section 132,Section 133A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘’ C’’ BENCH, AHMEDABAD

Before: SHRI WASEEM AHMED

For Appellant: Shri Biren Shah, AR
Hearing: 31/01/2024Pronounced: 29/02/2024

PER BENCH: The captioned three appeals have been filed at the instance of the assessee against the separate orders of Learned Commissioner of Income Tax (Appeals)-12, Ahmedabad, arising in the matter of assessment order passed under s. 153A r.w.s.

IT(SS)A nos.81,82 & 83/AHD/2023 A.Ys. 2014-15, 2015-16 & 2017-18 2

143(3) of the Income Tax Act, 1961 (here-in-after referred to as "the Act") relevant to the Assessment Years 2014-2015, 2015-16 & 2017-18. First, we take up IT(SS)A No. 81/Ahd/2023, an

The order continues below.

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