FRIENDS BULK HANDLERS LTD.,GANDHIDHAM vs. THE DY. COMMR. OF INCOME TAX, CEN. CIR.-2(3), AHMEDABAD

ITA 153/RJT/2016Status: DisposedITAT Rajkot25 March 2022AY 2007-0810 pages
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What did the Tribunal hold?

The Tribunal held that in cases of unabated assessments, additions under section 153A are permissible only if based on incriminating material found during the search. Since no such material was found, the PCIT erred in initiating section 263 proceedings.

What were the facts?

The assessee's original assessments for AY 2007-08 and 2008-09 were finalized before a search operation. Post-search, assessments under section 153A were completed, reiterating the original income as no incriminating material was found. The PCIT initiated proceedings under section 263, citing issues with foreign exchange rate differences and disallowance of interest expenses under section 14A.

What were the issues?

Whether additions under section 153A are permissible in unabated assessments without incriminating material found during search, and if the PCIT's revisionary powers under section 263 were correctly exercised.

Which sections of the Income-tax Act were involved?

Section 153A,Section 263,Section 14A

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Cases cited in this judgment(6)Show list

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Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT

Before: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri K.C. Thacker, A.R
For Respondent: Shri Rajesh Kumar, CIT-D.R

PER : SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER:- These are two appeals filed by the assessee against the orders passed by the Principal Commissioner of Income Tax, Rajkot-1 u/s. 263 of the Act dated 29-02-2016 for Assessment Years 2007-08 & 2008-09. 2. As the facts and issues involved in both the appeals are similar, so, we shall take ITA No. 153/Rjt/2016 A.Y. 2007-08 as the lead case and its I.T.A Nos. 153 & 154/Rjt/2016 A.Y. 2007-08 & 2008-09 Page No 2 findings will be applicable to ITA No. 154/Rjt/2016 (A.Y. 2008-09) for the sake of convenience.

ITA No. 153/Rjt/2016 A.Y. 2007

The order continues below.

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