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

Facts

A search and seizure operation was carried out on Rajarshi Motors Pvt. Ltd. on 23.08.2013, revealing that the net profit in seized Tally data was higher than audited accounts. The company's MD, Mr. Swapan Kumar Paul, disclosed undisclosed income during the search, but it was not fully reflected in the return filed under Section 153A. Due to the assessee's non-compliance with statutory notices, the Assessing Officer made additions for undisclosed income, fund diversion, and investment, parts of which were later deleted by the CIT(A).

Held

The Tribunal admitted the legal issue regarding the validity of assessments due to consolidated approval under Section 153D as an additional ground. It restored both the legal issue and the merits of the additions to the file of the CIT(A) for fresh adjudication. The CIT(A) is directed to call for comments from the AO and approving authority on the Section 153D approval and to decide the merits in accordance with Section 250(6) after affording due opportunity to the assessee.

Key Issues

1. Whether assessment orders passed under Section 153A/143(3) are invalid due to consolidated approval under Section 153D instead of year-wise approval. 2. The correctness of additions made for undisclosed income, fund diversion, and undisclosed investment.