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2022 (9) TMI 572 - AT - Income TaxAssessment u/s 153A - Unrecorded sales & lower G.P ratio - Addition based on loose papers seized during search indicated unrecorded cash sales - main argument taken up by the assessee before the ld. CIT(A) was that there was no seized incriminating material found based on which the assessment was completed and also that during the regular assessment, the receipt of the share capital has been duly examined and accepted - CIT-A deleted the addition - HELD THAT:- As in the absence of any incriminating material relating to AY 2010-11 and following the ratio of judgement of Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] and Meeta Gutgutia [2017 (5) TMI 1224 - DELHI HIGH COURT] the action of the AO in assuming jurisdiction u/s 153A and thereafter framing assessment u/s 153A/143(3) of the Act is not justified. The AO failed to appreciate that the assessment for AY 2010-11 had already attained finality and the proceedings for AY 2010-11 were not abated and therefore fresh assessment proceedings u/s 153A were not justified when no incriminating material relating to AY 2010-11 was found during the search action. We decline to interfere with the order of the ld. CIT(A). Addition made on account of extra profit - CIT(A) after obtaining the remand report dated 10.12.2018 categorically held that the AO has failed to point out any incriminating material found during the search on the basis of which addition on account of extra profit was made. AO has stated in the remand report that goods sold in cash were not recorded in the books of accounts and this was extrapolated for all the Assessment Years falling in the block period. Thus, it is clear that there was no incriminating material found in course of search action relating to Assessment Year in question. Hence, we decline to interfere with the order of the ld. CIT(A). Decided against revenue.
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