2023 (1) TMI 176 - HC - Income Tax

Assessment u/s 153A - incriminating material concerning such additions were found during the course of search or not? - HELD THAT - Having regard to the decision rendered by not only the coordinate bench of this Court in CIT v. Kabul Chawla 2015 (9) TMI 80 - DELHI HIGH COURT but also by the Orissa High Court in Smt. Jami Nirmala 2021 (8) TMI 594 - ORISSA HIGH COURT , Rajasthan High Court Jai Steel (India), Jodhpur 2013 (6) TMI 161 - RAJASTHAN HIGH COURT and Jayaben Ratilal Sorathia 2013 (7) TMI 850 - GUJARAT HIGH COURT , prima facie, the submission advanced by Mr Upadhayay, that incriminating material should relate to the AY in issue is correct. Since in this case, the incriminating material relates to AY 2021-2022, prima facie, the impugned order appears to be, at least at this stage, without jurisdiction. - Decided in favour of assessee.

Summary

Issues involved: Challenge to assessment order for AY 2018-19 based on interception at the airport with cash, jurisdiction of assessment order without incriminating material, reliance on judgments, interpretation of Section 153A of the Income Tax Act, 1961.

Analysis:
1. The writ petition challenges the assessment order for AY 2018-19 issued after the petitioner was intercepted at the airport with Rs.20,00,000 in cash. The petitioner argues that no incriminating material was found for the AY in question, rendering the assessment order without jurisdiction.

2. The petitioner's counsel relies on judgments like Smt. Jami Nirmala, Smt. Smrutisudha Nayak, and others to support the contention that incriminating material should pertain to the relevant AY. The court notes the importance of incriminating material being linked to the specific AY under assessment, as per the decision in CIT v. Kabul Chawla and judgments from different High Courts.

3. The court agrees with the petitioner's argument that incriminating material should be related to the AY in question. Since the incriminating material in this case pertains to AY 2021-2022, the assessment order for AY 2018-19 seems to lack jurisdiction at this stage. Therefore, the court issues notice to the respondents and directs the filing of counter-affidavits within two weeks.

4. The matter is scheduled for the next hearing, and in the interim, no hasty action shall be taken against the petitioner regarding the assessment year in question. The judgment emphasizes the necessity of incriminating material being specific to the AY under assessment, as per the provisions of Section 153A of the Income Tax Act, 1961.

This comprehensive analysis of the judgment highlights the issues raised, the arguments presented, and the court's interpretation of the law and relevant precedents in determining the jurisdiction of the assessment order.