ACIT, CENTRAL CIRCLE- 2, NEW DELHI vs. EMAAR MGF LAND LTD., NEW DELHI

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ITA 5661/DEL/2017Status: DisposedITAT Delhi25 May 2023AY 2009-104 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that in the absence of incriminating material for a completed assessment, no additions can be made under Section 153A. The assessment was deemed illegal as it did not pertain to any findings from the search.

What were the facts?

The assessee appealed against an assessment order passed under Section 153A/143(3) of the Income Tax Act. The assessee raised additional grounds challenging the legality of the assessment, particularly in the absence of incriminating material for a completed assessment.

What were the issues?

Whether additions made under Section 153A are valid in a completed assessment without incriminating material. Whether the issuance of a Section 143(2) notice was within the prescribed time.

Which sections of the Income-tax Act were involved?

Section 153A,Section 143(3),Section 143(2),Section 153D,Section 14A

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Income Tax Appellate Tribunal, DELHI BENCH ‘B’ : NEW DELHI

Before: SH. ANIL CHATURVEDI & SH.ANUBHAV SHARMA

For Appellant: Adv. And Sh
Hearing: 15.05.2023Pronounced: 25.05.2023

Heard together (2 matters)

ITA No. 5276/Del/2017
ITA No. 5661/Del/2017

Read from the judgment's own cause title. This page is filed under one of them.

The appeal is preferred by the Assessee & Revenue against the order dated 05.07.2017 of CIT(A)-23, New Delhi (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in appeal No. 249/16-17 arising out of an appeal before it against the assessment order dated 28.12.2016 passed u/s 153A/ 143(3) of the Income Tax Act, 1961 (hereinafter referred as ‘the Act’) by the ACIT, Central Circle-2, New Delhi (hereinafter referred as the Ld. AO).

2. Heard and perused the record. Apart from raising grounds on merits by application dated 27th 3. January, 2022 the assessee has raised following additional grounds :-

1. That on the facts and circumstances of the case and in law, the assessment completed and the additions made therein under section 153A r.w.s. 143(3) of the Income Tax Act, 1961 (“the Act ) are illegal, bad in law, void ab initio, without jurisdiction and barred by limitation.

2.

That, on the facts and circumstances of the case and in law, the issuance of Section 143(2) notice is illegal and beyond the time prescribed in law. Hence, as issuance of Section 143(2) is barred by limitation, the entire assessment is illegal and made to be quashed.

3.

That, on the facts and circumstances of the case and in law, the AO has erred in not appreciating that this is a case of ‘completed assessment’ and in the absence of any incriminating material qua each issue, the said additions are illegal and liable to be deleted.

4. That, on the facts and circumstances of the case and in law, the AO has erred in not appreciating that no 5276 & 5661/Del/2017 M/s. Emaar MGF Land P. Ltd. incriminating material has been found for the year under consideration which belongs to the said year, and hence the said additions are illegal and liable to be deleted. 5.That, on the facts and circumstances of the case and in law, the approval under Section 153D of the Act is mechanical and without any application of mind and thus the impugned assessment order is illegal, bad in law liable to be quashed.

6.

That on the facts and circumstances of the case and in law, the addition made on account of Section 14A disallowance is illegal, bad in law and without jurisdiction. The same is illegal in the absence of any satisfaction recorded by the AO and also the same is illegal worked out/ wrong computed and highly excessive. It is not as per the mandate of law.”

4.

Ld. Counsel for the assessee submitted that in the light of judgment of Hon’ble Supreme Court of India in PCIT vs. Abhisar Buildwell P. Ltd. Civil Appeal No. 6580 of 2021 dated 24.04.2023, the issue is settled that no addition can be made in respect of completed assessment in absence of any incriminating material and the judgment of Hon’ble Delhi High Court in CIT v. Kabul Chawla, (2015) 61 taxmann.com 412 (Delhi) has been sustained.

4.1. Ld. DR did not dispute the position of law after the judgment of Hon’ble Supreme Court of India in the case of Abhisar Buildwell P. Ltd.(Supra) however submitted that there was sufficient material during the search and submitted that there was suppression of income by claiming inaccurate expenditures.

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