ACIT-CC-1(3), NEW MARINE LINES, CHURCHGATE vs. MS. SHANTI ENTERPRISES, VASHI

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ITA 1349/MUM/2024Status: DisposedITAT Mumbai08 October 2024AY 2012-13Bench: SHRI PRASHANT MAHARISHI, AM AND SHRIRAJ KUMAR CHAUHAN (Judicial Member)1 pages

AI SummaryAllowed

Facts

This case involves appeals and cross-objections concerning assessment years 2012-13 and 2015-16 for Bhagwati Developers and Shanti Enterprises. The appeals stem from a search and seizure action that uncovered 'on money' receipts and unexplained expenditures. The primary issue revolves around the validity of notices issued under Section 153A of the Income Tax Act and additions made by the Assessing Officer (AO).

Held

The Tribunal held that the notice under Section 153A was invalid for assessment years beyond the six-year limit as the 'on money' and cash expenditure did not constitute an 'asset' as defined in the Act. The addition on account of unexplained cash expenditure under Section 69C was deleted as the source was explained. Regarding the unsecured loans, the Tribunal found that the assessee had provided sufficient evidence regarding the identity and creditworthiness of the lenders and the genuineness of the transactions, and thus, the additions made by the AO were deleted.

Key Issues

Whether the notices issued under Section 153A were valid for assessment years beyond the prescribed limit, and whether the additions made on account of 'on money', unexplained expenditure, and unsecured loans were justified.

Sections Cited

Section 69C, Section 153A, Section 143(3), Section 133(6), Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, MUMBAI

Before: SHRI PRASHANT MAHARISHI, AM & SHRIRAJ KUMAR CHAUHAN, JM

For Appellant: Shri Mani Jain &, Shri Prateek Jain

For Respondent: Shri S. Srinivasu, CIT (DR)

This is the bunch of three appeals filed by The Assistant Commissioner of Income tax , central Circle -1 (3) , Mumbai [The learned AO] and 2 cross objections filed by the assessee in case of 2 entities namely M/s Bhagwati developers and Shanti enterprises [ Assessee] for two assessment years i.e. assessment year 2012 – 13 and 2015 – 16, involving similar issues arising out of same search, similar arguments of the party contesting similar assessment and appellate orders , therefore, disposed of by this common order. Bhagwati Developers A Y 2012-13 & CO No 80/MUM/2024

First we take up the appeal in case of BHAGWATI DEVELOPERS (the assessee) for assessment year 2012 – 13 wherein ITA number 1346/M/2024 is filed by The Assistant Commissioner Of Income Tax – Central Circle – i. whether on the facts and in the circumstances of the case and in law, the learned CIT (A) is justified in restricting the addition to 12.25% of money of ₹ 64,322,169/– received by the assessee without appreciating the fact that the assessee has failed to submit any detail in respect of the cash receipts and profit element arising cannot be asserted as such. ii. Whether on the facts and in the circumstances of the case and in law, the learned CIT (A) is justified in deleting the addition of unexplained cash expenditure under section 69C of the income tax act, 1961 amounting to ₹ 64,832,240/– without going into the merits of the case discussed in the assessment order.

Assessee is aggrieved and has filed cross objection in CO number 80/M/2024 raising the following grounds of cross objections: – i. on the facts and circumstances of the cross objector's case and in law, the learned CIT A Shanti Developers ITA number 1349/M/2024 and CO number 110/M/2024 (Assessment Year 2012 – 13) 37. The facts in the case of M/S Shanti enterprises in ITA number 1349/M/2024 filed by the learned assessing officer for assessment year 2012 – 13 and cross objection filed by the assessee in CO number 110/M/2024 are identical to the ITA number 1346/M/2024 and CO 80/MUL/2024 for assessment year 2012 – 13 in case of Bhagwati developers.