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2024 (7) TMI 38 - AT - Income TaxAssessment u/s 153A - Unexplained advance u/s 68 - Whether any incriminating material found during the course of search? - CIT(A) deleted addition - HELD THAT - Perusal of the order of the CIT(A) reveals that remand report was called out by the CIT(A) and on the basis of remand report the Ld. CIT(A) passed the impugned order and deleted the additions made by the AO as no incriminating material was found during the search and seizure operation. The Hon ble Supreme Court in the case of ACIT Vs. Abhisar Buildwell Pvt. Ltd. 2023 (4) TMI 1056 - SUPREME COURT held that without any incriminating material no addition can be made u/s. 68 of the Act, therefore, we do not find any reason to interfere with the findings of the CIT(A). The appeal is liable to be dismissed. Appeal of the revenue is dismissed.
Issues Involved:
1. Deletion of addition of Rs. 1,76,00,000/- made by the AO on account of unexplained advance under Section 69 of the Income Tax Act, 1961. 2. Reliance on the judgment of the Apex Court in the case of PCIT Central-3 vs. Abhisar Buildwell Pvt. Ltd. 3. Initiation of penalty proceedings under Section 271(1)(c) of the Income Tax Act, 1961. Detailed Analysis: 1. Deletion of Addition of Rs. 1,76,00,000/-: The appeal by the revenue contested the deletion of Rs. 1,76,00,000/- by the CIT(A), which was initially added by the AO as unexplained advances under Section 68 of the Income Tax Act, 1961. The AO's assessment was based on the absence of addresses, PAN, and confirmations of the creditors. The assessee provided details of sundry creditors and claimed that Rs. 2,01,00,000/- was received from M/s Sigma Buildcrafts Pvt Ltd against the sale of land, with relevant documentation furnished. However, for the remaining Rs. 1,76,00,000/-, the assessee stated these were advances against land at Khichra village, which were later returned due to non-materialization of the deal. The AO concluded that the assessee failed to establish the genuineness of the transaction as no agreements or confirmations were provided. 2. Reliance on the Judgment of the Apex Court: The CIT(A) relied on the Supreme Court judgment in PCIT Central-3 vs. Abhisar Buildwell Pvt. Ltd., which stated that in the absence of incriminating material found during a search, the AO cannot make additions under Section 153A for completed/unabated assessments. The CIT(A) noted that the addition of Rs. 1,76,00,000/- was not based on any incriminating material found during the search, and thus, following the Supreme Court's decision, the addition could not be sustained. 3. Initiation of Penalty Proceedings: The CIT(A) dismissed the appellant's submission regarding the initiation of penalty proceedings under Section 271(1)(c), stating that no appeal lies against the initiation of penalty proceedings. Conclusion: The tribunal upheld the CIT(A)'s decision, emphasizing that no incriminating material was found during the search to justify the addition. The reliance on the Supreme Court's judgment in the case of Abhisar Buildwell Pvt. Ltd. was deemed appropriate, and without such material, the addition under Section 68 could not be made. Consequently, the revenue's appeal was dismissed. Order Pronounced: The appeal of the revenue was dismissed, and the order was pronounced in the open court on 27.06.2024.
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