2025 (4) TMI 152 - AT - Income Tax

Revision u/s 263 - Completion of section 153A assessment by the AO inter alia making a protective addition of amount allegedly paid for purchase of immovable property at New Delhi - CIT proposing to exercise his revisional jurisdiction on the issue of 2(22)(e) deemed dividend commission payment made to the broker and for having made transactions exceeding Rs. 20, 000/- respectively. HELD THAT - We find no reason to sustain the impugned revision directions. This is for the precise reason that as on the date of search i.e. 29.05.2018; the assessment year before us i.e. AY 2013- 14 involves an unabated assessment wherein any addition ought to be made based on the specific seized material only as per Abhisar Buildwell Pvt. Ltd. 2023 (4) TMI 1056 - SUPREME COURT Revenue could hardly pinpoint any specific seized material so far as the PCIT s impugned proposal pertaining to deemed dividend commission payments and banking transactions is concerned. This being the clinching case we are of the considered view that the impugned section 153A assessment framed in the assessee s case on 04.05.2021 could neither be termed as erroneous one nor that causing prejudice to the interest of the revenue in light of Malabar Industrial Co. Ltd. 2000 (2) TMI 10 - SUPREME COURT Assessee s appeal is allowed.

Summary

The judgment from the ITAT Delhi involves an appeal by the assessee for the assessment year 2013-14, challenging the Principal Commissioner of Income Tax (PCIT), Delhi's order under section 263 of the Income-tax Act, 1961. The case arose from a search conducted on the assessee on 29.05.2018, leading to section 153A proceedings and a protective addition of Rs. 70 lakhs by the Assessing Officer.The PCIT issued a section 263 show-cause notice proposing revisions concerning a deemed dividend of Rs. 88,87,728, commission payments of Rs. 4,13,625, and transactions exceeding Rs. 20,000. The PCIT reiterated these issues in the final revision order, rejecting the assessee's explanations.The Tribunal, upon reviewing the case, found no basis to sustain the PCIT's revision directions. It emphasized that any additions should be based on specific seized material, as established in PCIT Vs. Abhisar Buildwell Pvt. Ltd. (2023) 454 ITR 212. The Revenue failed to provide specific seized material supporting the PCIT's proposals. Citing Malabar Industrial Co. Ltd. vs. CIT 243 ITR 83 (SC), the Tribunal concluded that the section 153A assessment was neither erroneous nor prejudicial to the interests of the Revenue. Consequently, the Tribunal reversed the PCIT's revision directions, allowing the assessee's appeal. The order was pronounced on 28th March 2025.