DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-4(3), KOLKATA, KOLKATA vs. RAJESH AUTO MERCHANDISE PRIVATE LIMITED, KOLKATA

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ITA 1318/KOL/2025Status: DisposedITAT Kolkata15 October 2025AY 2013-14Bench: SHRI RAJESH KUMAR (Accountant Member), SHRI PRADIP KUMAR CHOUBEY (Judicial Member)3 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 condoned a 17-day delay in filing the appeal by the department. It upheld the CIT(A)'s decision, ruling that the AO lacked jurisdiction under Section 153A to make additions in an unabated assessment year without incriminating material found during a search, especially when the assessment had achieved finality. The CIT(A) had correctly applied the Supreme Court's decision in PCIT v. Abhisar Buildwell P. Ltd.

What were the facts?

The Revenue appealed against the CIT(A)'s order which deleted additions made by the AO for foreign exchange fluctuations loss of ₹1,92,00,000 and unexplained cash credit of ₹79,82,162 for AY 2013-14. The AO had made these additions based on the assessee's books of accounts, not on incriminating material found during a search conducted after the assessment for the relevant year had attained finality.

What were the issues?

Whether the AO had jurisdiction under Section 153A to make additions to an assessment that had attained finality, based on books of accounts, without any incriminating material found during a search. Whether the CIT(A) correctly followed the principles laid down by the Supreme Court regarding search assessments.

Which sections of the Income-tax Act were involved?

Section 153A,Section 143(2)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, “D” BENCH, KOLKATA

For Appellant: Shri S. Jhajaria, AR
For Respondent: Shri S.B. Chakraborthy, DR
Hearing: 08.10.2025Pronounced: 15.10.2025

This is an appeal preferred by the Revenue against the order of the Commissioner of Income-tax (Appeals) Kolkata-27, (hereinafter referred to as the “Ld. CIT(A)”] dated 22.02.2025 for the AY 2013-14.

2.

At the outset, we observe from the appeal folder that there is a delay of 17 days in filing the appeal by the department and in support of this a condonation petition was filed. It was stated in the condonation petition that the delay has occurred due to obtaining the administrative approvals from the competent authoritiesand accordingly, the delay may be condoned. The ld. AR, on the other hand, did not oppose the condonation of delay. Considering the

3.

The Revenue has challenged the order of learned CIT (A) deleting the addition on merit of ₹1,92,00,000/- in respect of foreign exchange fluctuations loss and ₹79,82,162/- on account of unexplained cash credit on the ground that the learned CIT (A) followed the order of the learned PCIT v. Abhisar Buildwell P. Ltd. (2023)454 ITR 212(SC).

4.

After hearing the rival contentions and perusing the materials available on record, we find that the learned AO has made two additions namely; (i) in respect of foreign exchange fluctuations loss of ₹1,92, and ₹79,82,162/- as comprising 60 lacs + 19,82,162/- on account of unexplained cash credit. We find that the learned AO while making the addition has relied on the books of accounts to make these additions as all these items of income/ loss were part of the books of accounts maintained by the assessee. We note that the learned AO has not referred to any incriminating material found and seized during the course of search while making these additions.

5.

We further note that in the appellate proceedings, the learned CIT (A) in Para no.5.2.1 to 5.2.3, has discussed the issues and recorded a clear-cut finding that the additions made by the learned AO were not linked to any incriminating material found during the course of search and were in fact the part of the books of accounts maintained by the assessee. Therefore, the learned AO has no jurisdiction in terms of Section 153A of the Act to make these additions as the assessment has attained finality on the date of search. Pertinent to note that in this case the search was conducted on the assessee on 25.09.2020 and on the date of search there was

6.

In the result, the appeal of the Revenue is dismissed.

Order pronounced in the open court on 15.10.2025.

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