2019 (12) TMI 90 - HC - Income Tax

Assessment u/s 153C - additions sought to be made by the Assessing Officer - HELD THAT - No substantial question of law arises for our consideration for the following reasons. A search was conducted at the premises of one Dinesh Kaushal and during the search, an Agreement to Sell was unearthed wherein the Respondent assessee was the seller and Dinesh Kaushal was the purchaser. The Assessing Officer assumed jurisdiction on the premise that the said document belonged to the assessee. On this aspect, the position of law is covered against the Revenue by the decision in Pepsico India Holding Pvt. Ltd v. Assistant Commissioner of Income Tax and Anr. 2014 (8) TMI 898 - DELHI HIGH COURT . On this short ground, the impugned order passed by the Tribunal is liable to be sustained. Even otherwise, we find that the Assessing Officer did not make any additions on the basis of the agreement dated 05.09.2006 attributed to the assessee. The Assessing Officer proceeded to make additions dehors the said agreement, which in any event, was not justified.

Summary

Issues:
Assessment years 2005-06 and 2006-07 - Jurisdiction based on Agreement to Sell - Additions by Assessing Officer - Substantial question of law - Dismissal of appeal by Tribunal.

Analysis:
The High Court addressed the appeals filed by the Revenue against the order of the Income Tax Appellate Tribunal pertaining to the assessment years 2005-06 and 2006-07. The Tribunal had dismissed the Revenue's appeal against the CIT (A)'s decision to delete the additions made by the Assessing Officer after issuing a notice under Section 153C of the Income Tax Act, 1961 to the Respondent assessee. The Court examined the jurisdictional aspect based on a search conducted at Dinesh Kaushal's premises, where an Agreement to Sell involving the Respondent assessee was found. The Assessing Officer assumed jurisdiction on the grounds that the document belonged to the assessee. However, the Court referred to the decision in Pepsico India Holding Pvt. Ltd v. Assistant Commissioner of Income Tax, which favored the assessee. The Court noted that the Assessing Officer did not base the additions on the agreement dated 05.09.2006 attributed to the assessee, rendering the additions unjustified. Consequently, the Court found no substantial question of law arising from the appeal and dismissed it, stating that other grounds raised did not require consideration.