ASHOK SINGH,JAIPUR vs. ACIT, CIRCLE-2 JAIPUR, JAIPUR

ITA 1540/JPR/2025Status: DisposedITAT Jaipur21 October 2026AY 2015-167 pages
AI SummaryAllowed

What were the facts?

The assessee, Ashok Singh, filed a regular income tax return for assessment year 2015-16. Subsequently, a search and seizure action under Section 132 was conducted on the Kiran Fine Jewellers Group, of which the assessee is a member. A notice under Section 153A was issued, and the assessee filed a return declaring the same income. During assessment proceedings, the Assessing Officer (AO) noticed cash deposits aggregating to Rs. 36,75,715 in the assessee's bank account. The assessee explained these deposits were from cash withdrawals for unmaterialized plot purchases and cash received from a plot sale. The AO did not accept the explanation, noting a significant time gap between withdrawals and redeposits. The AO treated Rs. 10,00,000 of these deposits as unexplained money under Section 69A and taxed it under Section 115BBE. The assessment order was passed under Section 143(3) read with Section 153A. The assessee appealed to the CIT(A), who confirmed the addition. The assessee then appealed to the ITAT.

What did the Tribunal hold?

The Tribunal held that the jurisdictional condition for making an addition under Section 153A in respect of an unabated assessment is the existence of incriminating material found during the search. The Supreme Court in PCIT v. Abhisar Buildwell (P.) Ltd. [2023] 454 ITR 212 (SC) settled this legal position. In the present case, the assessment year 2015-16 was an unabated assessment as no notice under Section 143(2) was issued within the prescribed period. The addition of Rs. 10,00,000 was based on AIR and CIB transaction information and the rejection of the assessee's explanation, not on any incriminating material found during the search. Therefore, the jurisdictional condition for Section 153A was not satisfied. Consequently, the addition of Rs. 10,00,000 under Section 69A could not be sustained. The consequential application of Section 115BBE, being dependent on the addition, also did not survive. The grounds challenging the addition on merits were rendered academic and not adjudicated upon. The Tribunal set aside the order of the CIT(A) and directed the AO to delete the addition.

What were the issues?

1. Whether, in the facts and circumstances, the assessment order passed under Section 143(3) read with Section 153A is illegal and void-ab-initio due to the absence of any incriminating document or material relating to the assessment year under appeal found or seized during the search? (Question of law, turning on Section 153A). 2. Whether, without prejudice to Ground No. 1, the addition of Rs. 10,00,000 under Section 69A as unexplained money is arbitrary, unjustified, illegal, and contrary to the facts and evidence on record? (Question of mixed law and fact, turning on Section 69A). 3. Whether, in the facts and circumstances, the invocation of Section 115BBE is unjustified, misplaced, illegal, and bad in law? (Question of mixed law and fact, turning on Section 115BBE). Assessee's contentions: The AO erred in passing the assessment order under Section 153A without any incriminating material found during the search, making the assessment without jurisdiction. Alternatively, the addition of Rs. 10,00,000 as unexplained money under Section 69A is arbitrary and not supported by evidence. The invocation of Section 115BBE is also unjustified. The assessee relied on the principle that Section 153A proceedings require incriminating material in cases of unabated assessments. Revenue's contentions: The judgment records no specific contentions for the revenue on these grounds.

Which sections of the Income-tax Act were involved?

Section 153A,Section 143(3),Section 69A,Section 115BBE,Section 139(1),Section 132,Section 143(2)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JAIPUR BENCHES, “SMC” BENCH, JAIPUR

For Appellant: CA (through V.C.)
Hearing: 14.10.2026Pronounced: 21.10.2026

Per Shri Om Prakash Kant, AM :- This appeal by the assessee is directed against order dated 26.09.2022, passed by the Ld. Commissioner Of Income Tax, Appeal, Jaipur-4 [in short as “Ld. CIT(A)”] for assessment year 2015-16 raising grounds of appeal:-

2 Asst. Year: 2015-16

1.

In the facts and in the circumstances of the case and in law, the ld. Assessing Officer “AO has grossly erred in passing the assessment order under section 143(3) read with section 153A of the Income-tax Act, 1961 ("the Act"), without any incriminating document or material relating to the assessment year under appeal being found or seized during the search. Consequently, the impugned assessment is without juri

The order continues below.

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