2024 (1) TMI 161 - HC - Income Tax

Assessment u/s 153A - Undisclosed profit/loss made from trading in pulses and menthe on MCX/NCDEX - AO invoked the provisions of Section 69A - addition in the hands of assessee, on substantive basis, and in the hands of Sharp Group of Companies Ltd., albeit on protective basis - HELD THAT - As indicated above, insofar as the Sharp Group of Companies Ltd. and respondent/assessee were concerned, the search and survey was conducted on 07.04.2017. This aspect has been recorded by the Tribunal in the impugned order. Clearly, no incriminating material vis- -vis the respondent/assessee was found in the search conducted on 07.04.2017. Even according to Appellant AY in issue would have to be treated as a concluded assessment. Given the position that no incriminating material was found in the AY in issue, the addition made by the AO cannot be sustained. See CIT vs. Kabul Chawla 2015 (9) TMI 80 - DELHI HIGH COURT Principal Commissioner of Income Tax vs. Abhisar Buildwell 2023 (4) TMI 1056 - SUPREME COURT We are therefore sustaining the impugned order, having regard to only this aspect of the matter.The appeal is accordingly closed in view of what we have recorded above. The conclusion arrived at by the Tribunal is correct and therefore, no other substantial question of law requires to be adjudicated by us.

Summary

Issues involved: Appeal concerning Assessment Year (AY) 2015-16, sustainability of addition made by the Assessing Officer (AO) regarding undisclosed profit/loss from trading in pulses and menthe on MCX/NCDEX.

Summary:
The appellant sought to challenge the order passed by the Income Tax Appellate Tribunal regarding the addition made by the AO concerning undisclosed profit/loss from trading in pulses and menthe. The AO concluded that the profit/loss was booked in connivance with an entity named Raj Laxmi Commodities Private Limited and that Raj Laxmi had given a User ID to an employee of another company. The AO invoked Section 69A of the Income Tax Act, 1961, to make the addition in the hands of the respondent and the Sharp Group of Companies Ltd. The Tribunal concluded that since nothing incriminating was found during a search and survey, the provision was not applicable. The appellant argued that material recovered showed the respondent was the owner of the money, but the order was based on a statement from a director of Raj Laxmi. As no incriminating material was found during the search, the addition made by the AO was not sustainable. The Tribunal's order was upheld based on this aspect, and the appeal was closed accordingly.

Judge's Conclusion:
The conclusion arrived at by the Tribunal was deemed correct, and no other substantial question of law required adjudication. The application for condonation of delay in re-filing was rendered infructuous and closed. Parties were instructed to act based on the digitally signed copy of the order.