SH. NAVEEN SHIVHARE, ,GWALIOR vs. ITO.,-WARD-3(2), GWALIOR

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ITA 318/AGR/2018Status: DisposedITAT Agra23 April 2025AY 2003-04Bench: us. 4. It is quite clear that the impugned additions are not based on any incriminating material as found during the course of search on assessee. This is unabated year. This being so, the ratio of cited decision of Hon'ble Apex Court in the case of Pr. CIT vs. Abhisar Buildwell Ltd. (149 Taxmann.com 399) would squarely apply to the fact of this case. In this decision, it was held that in respect of completed1 pages

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Facts

The assessee filed returns which were processed under section 143(1). A search was conducted, and since no assessment proceedings were pending, the year was considered unabated. The Assessing Officer (AO) made additions based on bank deposits, household expenses, and estimated business income. The CIT(A) confirmed and enhanced these additions.

Held

The Tribunal held that the impugned additions were not based on any incriminating material found during the search. Following the Supreme Court's decision in Pr. CIT vs. Abhisar Buildwell Pvt. Ltd., it was ruled that for unabated assessments, additions cannot be made without incriminating material. Therefore, the additions made by the AO and enhancement by the CIT(A) were deleted.

Key Issues

Whether additions made in an unabated year, in the absence of incriminating material found during search, are sustainable.

Sections Cited

153A, 143(3), 143(1), 271(1)(c)

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Income Tax Appellate Tribunal, “DB” BENCH, AGRA

Before: HON’BLE SHRI SATBEER SINGH GODARA, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

For Respondent: Dr. Arun Kumar Yadav – Ld. CIT-DR

सुनवाईकीतारीख/Date of Hearing : 19-02-2025 घोषणाकीतारीख /Date of Pronouncement : 23-04-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid quantum appeals as well as penalty appeals by assessee for Assessment Years (AY) 2003-04 to 2006-07 arises out of separate orders of first appellate authority. First, we take up quantum appeal for AY 2003-04 which arises out of an order passed by learned Commissioner of Income Tax (Appeals), Gwalior [CIT(A)] on 22- 11-2013 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 153A r.w.s. 143(3) of the Act on 20-12-2010.

The Ld. AR argued that this year is unabated year and the impugned additions are not based on any incriminating material as found during search. Therefore, the impugned additions are not sustainable as per recent decision of Hon’ble Apex Court in the case of Pr. CIT vs. Abhisar Buildwell Pvt. Ltd. (149 Taxmann.com 399). The Ld. CIT-DR controverted the arguments of Ld. AR. Having heard rival submissions and upon perusal of case records, our adjudication would be as under.

It emerges that the assessee filed return of income on 26-12-2003 which was processed u/s 143(1). The assessee was subjected to search on 12-05-2008 and admittedly, no assessment proceedings were pending against the assessee for this year. Accordingly, this year was an unabated year. In the assessment order, Ld. AO made addition of cash deposit in bank account for Rs.5.51 Lacs, addition of low household personal expenses for Rs.0.30 Lacs and estimated business income of Rs.5 Lacs. The Ld. CIT(A) not only confirmed the assessment but also enhanced income by adding LIC premium and opening capital balance. Aggrieved, the assessee is in further appeal before us.

It is quite clear that the impugned additions are not based on any incriminating material as found during the course of search on assessee. This is unabated year. This being so, the ratio of cited decision of Hon’ble Apex Court in the case of Pr. CIT vs. Abhisar Buildwell Pvt. Ltd. (149 Taxmann.com 399) would squarely apply to the fact of this case. In this decision, it was held that in respect of completed assessments / unabated assessments, no addition could be made by Assessing Officer in the absence of any incriminating material found during course of search under section 132 or requisition made under section 132A. Respectfully following the same, we delete the impugned addition as made by Ld. AO and also the enhancement as made by Ld. CIT(A). The appeal succeeds on this foremost legal ground alone.