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Facts
A search under Section 132 of the Act was conducted on Shri Parveen K. Jain, leading to the seizure of his mobile phone. A whatsapp chat revealed a property sale transaction relevant to the assessee, which was used to make an addition of Rs. 62 lakhs. Records were handed over to the assessee's AO on 19.09.2022, and satisfaction was recorded on 22.09.2022.
Held
The Tribunal held that for search assessments, the relevant period for assessment is six years preceding the assessment year in which the search was conducted. In this case, AY 2021-22 should have been assessed under Section 153C, not Section 143(3).
Key Issues
Whether the assessment for AY 2021-22 was correctly framed under Section 143(3) instead of Section 153C of the Income Tax Act, considering the search conducted in the premises of a third party.
Sections Cited
132, 143(3), 153C
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Income Tax Appellate Tribunal, DELHI BENCHES : E : NEW DELHI
Before: SHRI M. BALAGANESH & SHRI ANUBHAV SHARMA
Assessment Year: 2021-22 Neelam Maheshwari, Vs DCIT, B-16, Second Floor, Central Circle-31, Preet Vihar, New Delhi. Delhi – 110 092. PAN: AAUPM3201B (Appellant) (Respondent) Assessee by : Shri Somil Agarwal, Advocate & Shri Shery Jain, Advocate Revenue by : Shri Amit Katoch, Sr. DR Date of Hearing : 19.03.2025 Date of Pronouncement : 21.03.2025 ORDER
PER ANUBHAV SHARMA, JM:
This is an appeal preferred by the assessee against the order dated 31.01.2024 of the Commissioner of Income-tax (Appeals)-30, New Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in Appeal No.10106/2020-21 arising out of the appeal before it against the order dated 30.12.2022 passed u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) by the DCIT, Central Circle-31, New Delhi (hereinafter referred to as the Ld. AO).
On hearing both the sides, we find that amongst other grounds on merits, the assessee has challenged the impugned assessment order on the basis that the assessment for relevant year 2021-22 should have been concluded u/s 153C of the Act and not u/s 143(3) of the Act.
The ld. DR has although defended the assumption of jurisdiction, however, what we find is a search was conducted u/s 132 of the Act at the premises of Shri Parveen K. Jain on 06.01.2021 and the mobile phone of Shri Parveen K. Jain was seized. On the basis of his whatsapp chat, a transaction of sale of property was found which was relevant to the present assessee and that evidence was relied for making an addition on account of receipt of on money of Rs.62 lakhs. As a matter of admitted fact, on 19.09.2022, the record of the assessee was handed over by the jurisdictional AO of the searched person, Shri Parveen K. Jain to the AO of the present appellant and on 22.09.2022, a satisfaction was recorded by the AO of the present appellant.
It is now settled provision of law that as for the purpose of search assessments, the period of six years immediately preceding the assessment year relevant for the previous year in which search was conducted has to be reckoned from the date of receipt of documents by the AO of the assessee (other person) which in the case in hand is 19.09.2022. The search year in the case of the present assessee, thus, has to be construed as AY 2023-24. Reliance for the aforesaid proposition of law can be placed on the decision of the Hon’ble Supreme Court in the case of CIT vs. Jasjit Singh, 458 ITR 437 (SC). 2
Thus, the year under consideration, i.e., AY 2021-22 falls within the block period of assessment to be framed u/s 153C of the Act whereas the ld. AO has completed this assessment u/s 143(3) of the Act based on the original date of search of 06.01.2021.