TMI BlogReaffirming the Bounds of Section 153A: Analysis of Delhi High Court's Approach: Assessment post search and seizureX X X X Extracts X X X X X X X X Extracts X X X X ..... ivotal judgment by the Delhi High Court in a series of appeals under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act ). The central issue revolves around the implications of Section 132(4) statements in assessments under Section 153A , particularly in the context of long-term capital gains (LTCG) and the admissibility of evidence obtained during search and seiz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers in obtaining accommodation entries to convert unaccounted cash into legitimate LTCG. The AO made additions to the income based on these statements, which were later challenged and set aside by the ITAT. Legal Issues Admissibility and Evidentiary Value of Section 132(4) Statements : A critical issue was the use of statements recorded under Section 132(4) during the search opera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urposes of Section 153A assessments. The necessity for corroborative material was emphasized, aligning with the principle that evidence must be reliable and robust, especially in matters of taxation. Interpretation of Section 153A : The judgment sheds light on the scope of Section 153A , affirming the need for incriminating material as a prerequisite for making additions post-search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te and corroborative evidence when making additions to a taxpayer's income, especially in the context of search and seizure operations. The judgment serves as a reminder of the legal requirement for the AO to base their assessments on substantial and reliable evidence, and the indispensability of adhering to the principles of natural justice, particularly the right to cross-examination. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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