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2023 (5) TMI 1355 - HC - Income TaxAssessment u/s 153A - completed assessment/un-abated assessment - incriminating material found during the course of search u/s 132 or not? - HELD THAT - As in Abhisar Buildwell P. Ltd 2023 (4) TMI 1056 - SUPREME COURT confirmed the view taken by this court in Saumya Construction 2016 (7) TMI 911 - GUJARAT HIGH COURT as well as that of Kabul Chawla 2015 (9) TMI 80 - DELHI HIGH COURT which were in favour of the assessee. The supreme court held that no addition can be made in respect of completed/ unabated assessment in absence of any incriminating material. Decided in favour of assessee.
Issues:
1. Interpretation of section 260A of the Income Tax Act, 1961. 2. Validity of additions made under sections 68 and 69C of the Act. 3. Scope of assessment under section 153A of the Act. 4. Jurisdiction of the Assessing Officer in absence of incriminating material. 5. Applicability of the Supreme Court judgment in Abhisar Buildwell P. Ltd. 6. Consideration of completed assessment in absence of incriminating material. Analysis: Issue 1: Interpretation of section 260A of the Income Tax Act, 1961 The Tax Appeal under section 260A arose from an order of the Income Tax Appellate Tribunal, Ahmedabad, concerning the Assessment Year 2011-2012. Issue 2: Validity of additions made under sections 68 and 69C of the Act The Assessing Officer had made additions under section 68 for alleged bogus long term capital gain and under section 69C for expenses related to the same. The Commissioner of Income Tax (Appeals) deleted these additions, leading to the appeal by the Revenue. Issue 3: Scope of assessment under section 153A of the Act The controversy revolved around the scope of assessment under section 153A, with the Revenue arguing for a broader interpretation allowing consideration of all material, while some High Courts favored a more restricted approach limited to incriminating material found during a search. Issue 4: Jurisdiction of the Assessing Officer in absence of incriminating material The Supreme Court clarified that no additions can be made in completed assessments without incriminating material, aligning with the views of the Gujarat High Court and the Delhi High Court. The Assessing Officer cannot reopen completed assessments without such material. Issue 5: Applicability of the Supreme Court judgment in Abhisar Buildwell P. Ltd. The Supreme Court judgment in Abhisar Buildwell P. Ltd. confirmed that assessments in absence of incriminating material during a search are impermissible, emphasizing the importance of seized material in making additions. Issue 6: Consideration of completed assessment in absence of incriminating material The Supreme Court held that no additions can be made in completed assessments without incriminating material, reiterating the principles laid down by the Delhi High Court and the Gujarat High Court in Kabul Chawla and Saumya Construction cases. In conclusion, the appeal was dismissed as no question of law, especially no substantial question of law, arose in light of the Supreme Court's decision in Abhisar Buildwell P. Ltd., which clarified the limitations on the Assessing Officer's jurisdiction in absence of incriminating material during assessments.
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