DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE- AGARTALA , AGARTALA vs. RAJARSHI MOTORS PVT. LTD., AGARTALA

Facts

Rajarshi Motors Pvt. Ltd., a car dealership, underwent search and seizure operations for AYs 2008-09 to 2014-15. Seized documents indicated a higher net profit than audited accounts, and the MD disclosed Rs.19.55 crores as undisclosed income, which was not fully reflected in the assessee's return filed under Section 153A. The Assessing Officer made substantial additions for undisclosed income, fund diversion, and investment, but the CIT(A) granted partial relief by deleting some of these additions.

Held

The Income Tax Appellate Tribunal (ITAT) admitted the assessee's cross-objection regarding the validity of assessment orders, specifically questioning the consolidated approval granted under Section 153D for multiple assessment years. Citing a Supreme Court judgment, the ITAT restored both the legal issue concerning Section 153D approval and the merits of the case to the CIT(A) for fresh adjudication. The CIT(A) was directed to obtain comments from the AO, consider judicial precedents, and afford the assessee due opportunity of hearing.

Key Issues

1. Whether the assessment orders were invalid due to consolidated approval under Section 153D for multiple assessment years without specific consideration for each year. 2. Whether the CIT(A) was justified in deleting certain additions on merits given the assessee's alleged non-compliance during the assessment proceedings.