2023 (11) TMI 443 - AT - Income Tax

Assessment u/s 153A - incriminating material unearthed during the search or not? - HELD THAT - The entire issue stands settled in the case of M/s. Abhisar Buildwell P. Ltd. 2023 (4) TMI 1056 - SUPREME COURT wherein held that in case no incriminating material is unearthed during the search, the AO cannot assess or reassess taking into consideration the other material in respect of completed assessments/unabated assessments. Hence, we hold that no addition can be made in the case of the assessee sans seized material. Appeal of the assessee is allowed.

Summary

Issues involved: Assessment u/s 153A based on absence of incriminating material.

Summary:

The appellate tribunal ITAT Delhi heard an appeal by the Revenue against the order of the ld. CIT(A)-27, New Delhi. The issue revolved around the addition made without incriminating material found during search & seizure operations. The tribunal, guided by established judgments of the Hon'ble Jurisdictional High Court, referred to various case laws including CIT v. Kabul Chawla. The Hon'ble Delhi High Court in the case of CIT Vs Kabul Chawla emphasized that completed assessments can only be interfered with based on incriminating material unearthed during search. Another case, Pr. CIT vs. Meeta Gutgutia, highlighted the necessity of incriminating material for additions. The tribunal concluded that the Revenue was not justified in invoking Section 153A without incriminating material. The decisions of the Hon'ble Jurisdictional High Court, along with the judgment of the Hon'ble Apex Court in M/s. Abhisar Buildwell P. Ltd., supported the stance that no addition can be made without seized material. Consequently, the appeal of the assessee was allowed.