Income Tax Department vs. M/S Jaideep Ispat And Alloy Pvt. Ltd.

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ITA/228/2022HC Madhya Pradesh02 February 2023Bench: HON'BLE SHRI JUSTICE SUSHRUT ARVIND DHARMADHIKARI3 pages
For Petitioner: Veena Mandlik
AI SummaryDismissed

What did the High Court hold?

The High Court held that there is no substantial question of law arising from the ITAT's order. The Court referred to an identical substantial question of law that came up before a Division Bench of the same High Court at Gwalior Bench in ITA No. 21/2019, ITA No. 31/2019, and ITA No. 32/2019 (Principal Commissioner of Income Tax Vs. Gahoi Foods Private Ltd). In that case, vide order dated 12.07.2019, the appeals were disposed of by holding that since no incriminating documents were found during the search, the order under appeal could not be considered illegal. Consequently, those appeals were dismissed. Following this precedent, the High Court found no reason to take a different view in the present appeal. Therefore, the appeal was dismissed for not raising a substantial question of law.

What were the facts?

The appeal is filed by the Principal Commissioner of Income Tax (Central), Bhopal against the order dated 08.03.2022 passed by the Income Tax Appellate Tribunal (ITAT), Bench Indore. The ITAT order pertains to assessment years 2010-11 to 2015-16 under Section 153A read with Section 143(3) of the Income Tax Act, 1961, and for assessment year 2016-17 under Section 143(3). The Assessing Officer had made additions to the assessee's income based on presumptive income and estimated income. The fact that these additions were not based on any incriminating material found during a search is not disputed. The appeal before the High Court challenges the ITAT's decision on a substantial question of law.

What were the issues?

1. Whether, in the absence of any incriminating documents seized during a search, the Assessing Officer is justified in making additions in non-abated assessment orders under Section 153A read with Section 143(3) of the Income Tax Act, 1961? The appellant (Revenue) contends that the Assessing Officer is justified in making additions even without incriminating material if the assessment is under Section 153A. The respondent (Assessee) argues that additions under Section 153A can only be made if there is incriminating material found during the search. The judgment notes that the factum of addition not being based on any incriminating material is not disputed. The ITAT had dealt with appeals arising from orders passed by the Commissioner of Income Tax (Appeals), which in turn were against additions made by the Assessing Officer.

Which sections of the Income-tax Act were involved?

Section 260A,Section 153A,Section 143(3)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF MADHYA PRADESH AT INDORE BEFORE HON'BLE SHRI JUSTICE SUSHRUT ARVIND DHARMADHIKARI & HON'BLE SHRI JUSTICE PRAKASH CHANDRA GUPTA ON THE 2nd OF FEBRUARY, 2023 INCOME TAX APPEAL No. 228 of 2022 BETWEEN:- PRINCIPAL COMMISSIONER OF INCOME TAX (CENTRAL) AAYKAR BHAWAN HOSHANGABAD ROAD BHOPAL (MADHYA PRADESH) ....APPELLANT (MS VEENA MANDLIK, LEARNED COUNSEL FOR THE APPELLANT ) AND M/S JAIDEEP ISPAT AND ALLOY PVT. LTD. ADD: 103, LAXMI TOWER, 576, M.R. ROAD, INDORE (MADHYA PRADESH) .....RESPONDENTS (NONE PRESENT FOR THE RESPONDENT) This appeal coming on for admission this day, JUSTICE SUSHRUT ARVIND DHARMADHIKARI passed the following: ORDER This appeal u/S 260A of the Income Tax Act 1961(for short, the Act of 1961 hereinafter) is directed against the order dated 08.03.2022 passed by the Income Tax Appellate Tribunal, Bench Indore in IT(SS)A No. 261/IND/2019 for the Assessment Year 2010-11. The substantial question of law which has been raised by the appellant in this appeal is "whether in absence of any incriminating documents seized during 1 Signed by: SEHAR HASEEN Signing time: 2/3/2023 6:27:16 PM Signature Not Verified the course of search, the Assessing Officer is justified in making the addition in non-abated assessment orders u/S 153-A r/W Sec 143(3) of the Act of 1961." The assessment years are 2010-11 to 2015-16 u/S 153A/143(3) and u/S 143(3) for the assessment year 2016-17. Learned Tribunal was in seisin with the appellant and cross appeals arising from respective orders passed by the Commissioner Income Tax(Appeals). The appeal before the CIT(Appeals) was directed against the addition of income by the Assessing Officer taking production on presumptive basis and working out estimated income. The factum of addition not being based on any incriminating material found during the search is not disputed. Exactly identical substantial question of law came up for consideration before the Division Bench of this Court at Gwalior Bench in ITA No. 21/2019, ITA No. 31/2019 and ITA No. 32/2019(Principal Commissioner of Income Tax Vs. Gahoi Foods Private Ltd). Vide order dated 12.07.2019, these appeals were disposed of holding that in the given facts of the present case, as no incriminating documents during the course of search were found, the order in appeal cannot be said to have suffered any illegality as would give rise to proposed substantial question of law. Consequently, the appeals were dismissed. In view of the fact that the aforesaid question of law was dealt by the Division Bench of this Court in the aforesaid cases, no different view can be taken in this appeal. Accordingly, finding no substantial question of law, this appeal fails and is hereby dismissed. 2 Signed by: SEHAR HASEEN Signing time: 2/3/2023 6:27:16 PM Signature Not Verified (S. A. DHARMADHIKARI) JUDGE (PRAKASH CHANDRA GUPTA) JUDGE sh

3 Signed by: SEHAR HASEEN Signing time: 2/3/2023 6:27:16 PM Signature Not Verified

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