Loading judgment…
Facts
The assessee's twin appeals arose against additions made in proceedings under Section 153C read with Section 143(3) of the Income Tax Act. The Revenue argued that the proceedings were rightly initiated based on seized material. However, the assessee was absent, and the appeals proceeded ex-parte.
Held
The Tribunal held that for proceedings under Section 153C to be valid, the seized documents/material must belong to or pertain to the assessee. In this case, no such material was found, and the addition was based on an alleged admission, which is insufficient without corroborating evidence as per CBDT circulars and Supreme Court decisions.
Key Issues
Whether proceedings under Section 153C are valid without seized material directly pertaining to the assessee, especially in unabated assessments?
Sections Cited
153C, 143(3)
AI-generated summary — verify with the full judgment below
Detected automatically from the text. The count shows how many other judgments on BharatTax rely on the same authority.
Income Tax Appellate Tribunal, DELHI BENCH ‘C’, NEW DELHI
Before: Sh. Satbeer Singh Godara & Sh. S. Rifaur Rahman
Asstt. Year : 2018-19 : Asstt. Year : 2020-21 M/s Aranya Infrastructure Pvt. Ltd. Vs Commissioner of Income 102, Nirmal Tower, Bara Khamba Tax (Appeal)-30, ARA Road, New Delhi-110001 Centre, Jhandewalan, New Delhi-110055 (APPELLANT) (RESPONDENT) PAN No. AAKCA6000B Assessee by : None Revenue by : Sh. Dayainder Singh Sidhu, CIT-DR Date of Hearing: 25.09.2025 Date of Pronouncement: 25.09.2025 ORDER Per Satbeer Singh Godara, Judicial Member: These assessee’s twin appeals in & 3205/Del/2025 for Assessment Years 2018-19 & 2020-21, arise against the CIT(A)-30, New Delhi’s DIN & order No. ITBA/APL/M/250/2024-25/1074347079(1) & 1074347258(1) dated 11.03.2025, in proceedings u/s 153C r.w.s. 143(3) of the Income Tax Act, 1961 (in short “the Act”), respectively.
Cases called twice. None appears at the assessee’s behest. It is accordingly proceeded ex-parte.
& 3205/Del/2025 Aranya Infrastructure Pvt. Ltd. 3. Learned CIT-DR vehemently argues during the course of hearing that both the lower authorities have rightly initiated section 153C proceedings against the assessee thereby making the corresponding identical additions in question on merits in it’s hands.
It is in this factual backdrop that we sought to know the alleged incriminating material found/seized during the course of search in question dated 23.07.2019 in M/s Kuldeep Bishnoi Group of cases. Mr. Sidhu invites our attention to the learned Assessing Officer’s detailed assessment discussion in both these cases dated 30.03.2023 at page 2 onwards that the corresponding seized material has indeed been extracted therein forming basis of the addition(s) made in the assessee’s hands.
We find no merit in the Revenue’s foregoing vehement contentions. This is for the precise reason that none of the seized documents/material extracted in the assessment discussion even contains the assessee’s names so as to satisfy the statutory criteria of setting into motion proceedings u/s 153C of the Act. Faced with this situation, learned CIT-DR again highlights the fact that the authorized person of the searched party had taken the assessee’s name qua the addition amount herein. We are afraid that merely on the basis of such & 3205/Del/2025 Aranya Infrastructure Pvt. Ltd. an admission of confession, as the case may be, in absence of the corresponding seized material found belonging or pertaining or relating to the assessee u/s 153C(1)(a)(b) of the Act, would hardly carry any significance as per the CBDT’s twin landmark circulars issued to the field authorities on 10.03.2003 and 18.12.2014; respectively. This is indeed coupled with the fact that hon’ble apex court landmark decision in PCIT vs. Abhisar Buildwell Pvt. Ltd. (2023) 454 ITR 212 (SC) has settled the issue in assessee’s favour and against the department that any addition in such an unabated assessment ought to be made based on the specific incriminating material only. We further wish to clarify here keeping in mind the fact that the impugned section 153C proceedings had been initiated against the assessee on 08.12.2021, both these assessment years 2018-19 and 2020-21 involving unabated assessments only squarely covered under their lordship’s decision. We thus annul the impugned section 153C twin assessments framed herein as non-est in the eyes of law in very terms. Ordered accordingly.
All other pleadings between the parties stand rendered academic.