ANSHU GUPTA,JAIPUR vs. ACIT, NOIDA

“That the order passed by the Learned Assessing Officer u/s 153A/143(3) of the Income Tax Act, 1961 is void ab-initio deserves to be quashed.

Facts giving rise to the present appeal are that the Assessing Officer has recorded that a search and seizure operation was conducted on 15.09.2009.

Aggrieved against this, the assessee is in appeal before this Tribunal.

At the outset, Ld. Counsel for the assessee submitted that the assessment order is ex facie, legal and nonest. He submitted that in this case, no search action was carried out. He submitted that the stand of the Revenue is self-contradictory and against the facts that the assessment as framed u/s 143(3) of the Act. He submitted that the entire assessment order speaks about search and provision of sections 153A and 153D of the Act. Even the penalty proceedings are evitable u/s 271AAA of the Act.

On the contrary, Ld.CIT DR, Sh. Satpal Gulati vehemently opposed these submissions and submitted that it is a fact that the Assessing Officer has mentioned section 153A of the Act but it is only a mistake. He took us through the Remand Report filed before the Ld.CIT(A) where it has been categorically stated that the assessment for Assessment Year 2011-12 was completed u/s 153A which is beyond the purview of section 153A/153C of the Act as the date of search was 15.09.2009. Accordingly, six previous years from the date of search were to be completed u/s 153A/153C and the current year’s assessment for the year under consideration was completed u/s 143(3) of the Act. Ld.CIT DR submitted that section 292B of the Act comes to the rescue of Page | 3 the Revenue under the facts and circumstances of the present case. He submitted that in view of provision of section 292B of the Act, the assessment order cannot be annulled.

In re-joinder, Ld. Counsel for the assessee submitted that section 292B of the Act would not come for the rescue of the revenue as the intent of the assessment order is with regard to framing the assessment u/s 153A of the Act. It is not the assessment framed u/s 143(3) of the Act, as submitted by Ld.CIT DR. He submitted that Ld.CIT(A) has conceded the fact that no search took place in the case of the assessee.

We have heard the rival contentions and perused the material available on records and gone through the orders of the authorities below. The dispute is with regard to the legality of the impugned assessment order. Therefore, for the sake of effective adjudication, the relevant contents of impugned assessment order are reproduced as under:-

In response to questionnaire, assessee filed reply same is placed on record. During the year assessee has shown income from Shree Salasar Page | 4 Jewellers. Investment made by the assessee during the year, cross- examined and details thereof is placed on record. Assessee claimed deduction under chapter VIA of Income Tax Act. Assessee has also filed audited balanced, P&L A/c, which are placed on record. In the case of assessee, Shri Subhash Gupta, father in law, made statement under section 132(4) of Income Tax Act during the course of search and has surrender amount of Rs. 73,70,671/- on account of different in stock in the hands of M/s Salasar Jewellers under the proprietorship of assessee i.e. Mrs. Anshu Gupta, addition in this regard for Rs.73,70,671/- is being made in this current year. Addition Rs. 73,70,671/- 3. Books of accounts with vouchers and banks statements were produced and test checked on random basis. Assessee has made cash sales for which it was submitted that it is in their trade that generally cash sales are made. The cash sales are prevailing in their region. Assessee also filed a write up from Sarafa Association that cash sales are prevalent in the region and they are doing their business on the basis of cash sales although purchases are made in cheque only. Details thereof are placed on record.

With these remarks total income of the assessee is computed as under : Return income : Rs.1,58,460/- Add: as per para 2 : Rs73,70,671/- Total taxable income : Rs.75,29,131/- or Rs.75,29,130/- Assessed. Issued demand notice and challan. Give credit to prepaid taxes. Charge interest accordingly. Penalty proceedings under section 271AAA of Income Tax Act is being initiated separately. I am satisfied that this is a fit case for initiation of penalty under section 271AAA of income Tax Act.

From the assessment order, it is clear that same has been framed u/s 153A r.w.s 143(3) of the Act. It is also evident from the assessment order that it speaks of search and seizure operation was carried out on 15.09.2009. It further states that the assessment order was passed in the prior approval of Ld. Addl. CIT, Central Range, Meerut within the meaning of section 153D of the Act vide F.No. Addl.CIT/CR/MRT/S&S/153D2011-12/681 dated 29.12.2011.

The aforesaid provision speaks about “No return of income, assessment, notice, summons or other proceeding, furnished or made or issued or taken or purported to have been furnished or made or issued or taken in pursuance of Page | 6 any of the provisions of this Act shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such return of income, assessment, notice, summons or other proceeding if such return of income, assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of this Act.”

Looking to the assessment order, the Assessing Officer has consciously made assessment u/s 153A of the Act and on the basis of alleged statement recorded during the search. Therefore, it cannot be construed that recordings of such facts is by mistake. Therefore, the impugned assessment order do not satisfy the test of law, the same deserves to be quashed. We, therefore, hereby quash the impugned assessment order. Thus, Ground No.1 raised by the assessee is allowed.

Ground Nos. 2 & 3 raised by the assessee are on merit of the case. Since we have quashed the assessment order, these grounds have become of academic interest only hence, are not being adjudicated.

Ground No.4 raised by the assessee is general in nature, needs no separate adjudication.

In the result, the appeal of the assesse is partly allowed.