ITAT Ahmedabad Judgments — October 2023

2 orders · Page 1 of 1

THE ACIT, CENTRAL CIRCLE-3, VADODARA vs M/S. MERIT SALES PVT. LTD., VADODARA

ITSSA 83/AHD/2021[2011-12]Status: Disposed27 Oct 2023AY 2011-12Dismissed

The Tribunal dismissed the Revenue's appeal. The Tribunal held that for assessments under Section 153A, in the case of completed/unabated assessments, no addition can be made by the Assessing Officer in the absence of any incriminating material found during the course of search under Section 132 or requisition under Section 132A. The Tribunal relied on the Supreme Court's decision in PCIT, Central-3 vs. Abhisar Buildwell Pvt. Ltd. (2023), which affirmed the principle that in the absence of incriminating material, additions cannot be made in respect of completed assessments under Section 153A. The Supreme Court had agreed with the views of the Delhi High Court in Kabul Chawla and the Gujarat High Court in Saumya Construction. The Tribunal noted that while completed assessments can be reopened under Section 147/148, this is subject to their conditions. Since the CIT(A) had deleted the addition on this technical ground, the Tribunal found no infirmity in the CIT(A)'s finding and dismissed the Revenue's grounds of appeal. As the issue was decided on a technical ground, other grounds on merit were rendered infructuous and also dismissed.

DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1(1), AHMEDABAD vs M/S. PRIYA BLUE IMPORT & EXPORT PRIVATE LIMITED, MUMBAI

ITSSA 7/AHD/2022[2020-21]Status: Disposed18 Oct 2023AY 2020-21Dismissed

The Tribunal held that the addition made by the AO under Section 68 of the Income Tax Act was not sustainable. The Tribunal agreed with the CIT(A) and the assessee's counsel that no addition could be made based on an undated cheque that was never deposited. The Tribunal emphasized that a prerequisite for invoking Section 68 is that a sum must be "credited in the books of the assessee for the relevant previous year." Since the cheque was not deposited and the amount was not credited in the assessee's books, Section 68 could not be invoked. Furthermore, the Tribunal found no basis to presume that cash was given in lieu of the undated, undeposited cheque. The assessee had provided an explanation that the cheque was received against amounts recoverable from VHCL, which was supported by evidence and not disproved by the AO. The Tribunal concluded that the CIT(A) had not erred in allowing the assessee's appeal. The appeal of the Department was dismissed.