SH. BISHAN BANSAL,NEW DELHI vs. DCIT, FARIDABAD

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ITA 1187/DEL/2017Status: DisposedITAT Delhi28 February 2020AY 2007-083 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that in the absence of any incriminating material found during the search and with no pending assessment that abated on the date of search, no addition could be made under Section 153A. Therefore, the addition made by the AO was not legally sustainable.

What were the facts?

The assessee's appeal concerns an addition of Rs. 1,90,000 made by the AO on account of cash deposited in the bank for FY 2006-07. The addition was made in proceedings under Section 153A, following a search on 09.05.2012, but no incriminating material was found.

What were the issues?

Whether an addition can be made under Section 153A in the absence of incriminating material when the assessment was not pending or abated at the time of search.

Which sections of the Income-tax Act were involved?

Section 153A

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, DELHI BENCH ‘A’, NEW DELHI

Before: Sh. Amit ShuklaDr. B. R. R. Kumar

Hearing: 18.02.2020Pronounced: 28.02.2020

Per Dr. B. R. R. Kumar, Accountant Member:

1.

The present appeal has been filed by the assessee against the orders of the ld. CIT(A), Karnal dated 20.01.2017.

2.

Following grounds have been raised by the assessee:

1. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in upholding the action of the Ld. A.O. in making an addition of Rs. 1,90,000/- on account of cash deposited in the bank account by treating as alleged income from undisclosed sources and that too in the proceedings u/s 153A of the Act in the absence of any incriminating material found during the course of search.

2. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making an addition of Rs. 1,90,000/- is bad in law

Bishan Bansal bad in law and against the facts and circumstances of the case.”

3.

The facts relevant for adjudication of the case are as under: Assessment year involved: 2007-08 Date of filing of the return u/s 139(1): 22.10.2007 Returned income: Rs.3,85,050 Due date of issuing of notice u/s 143(2): 30.09.2008 Date of search: 09.05.2012 Date of filing of return post search: 09.05.2012 Returned income: Rs.3,85,050 Whether any addition made based on seized material: No The basis of addition made: Deposits in the bank account for the FY 2006-07.

4.

Thus, from the above it can be observed that no proceedings are pending as on the date of search.

5.

Keeping in view the proposition laid down by Hon’ble Delhi High Court in case of CIT Vs Kabul Chawla (2016) 380 ITR 573 (Delhi) that no addition to be made in assessment framed u/s 153A of the Act in the absence of any incriminating material, where assessments were not abated. The Hon’ble High Court held that in the absence of any incriminating material found during the course of search action, when there was no pending assessment which could be said to have abated on the date of search, any addition could not have been made.

6.

Hence, following the order of the Hon’ble Jurisdictional High Court, we hereby hold that the addition made by the AO

Bishan Bansal doesn’t stand the test of legality and the same is directed to be deleted.

7.

In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 28/02/2020.

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