DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-1(4), KOLKATA, KOLKATA V. NAND KISHORE PANSARI, KOLKATA

ITSSA 115/KOL/2024

AI Insights

The case involves appeals by the revenue against the orders of the CIT(A) for the Assessment Years 2017-18 to 2019-20, which pertained to additions made by the AO following a search and seizure operation under section 132 of the Income-tax Act, 1961. The AO had made additions based on a statement recorded during a separate search operation in the case of third parties, which the assessee denied. The CIT(A) deleted these additions, citing the absence of incriminating material found during the search at the assessee's premises and the non-abated status of the assessments. The Tribunal affirmed the CIT(A)'s decision, referencing the Supreme Court's ruling that no additions can be made in non-abated assessments in the absence of incriminating material found during the search.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 298958 (ITAT-KOLKATA)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 31-12-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2019-2020
• Other Referred Cases: Pr. CIT Vs. Abhiser Buildwell (P) Ltd. [2023] 149 taxmann.com 399 (SC)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Condonation of delay; Search and seizure
• Section: 250; 132; 153A; 113; 153C

Judgement Text

"आयकर अपीलीय अिधकरण, कोलकाता पीठ ‘A’, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH KOLKATA Before Shri Sanjay Garg, Judicial Member and Shri Sanjay Awasthi, Accountant Member I.T(SS)A. Nos.113 to 115/Kol/2024 Assessment Years: 2017-18 to 2019-20 DCIT Central Circle-1(4), Kolkata .………. Appellant vs. Nand Kishore Pansari ……..… Respondent 18, Poddar Court, Rabindra Sarani, Lal Bazar, West Bengal-700001. (PAN: AEWPP6438D) Appearances by: Shri Subhendu Datta, CIT, DR appeared on behalf of the Appellant Shri Manish Tiwari, FCA appeared on behalf of the Respondent Date of concluding the hearing: 10/12/2024 Date of pronouncing the order: 31/12/2024 आदेश / ORDER Per Sanjay Garg, Judicial Member : All the captioned appeals have been preferred by the revenue against the separate orders of even date 11.06.2024 for Assessment Years (AYs) 2017-18 to 2019-20 respectively of the Ld. Commissioner of Income Tax (Appeals), Kolkata-20 [hereinafter referred to as the “Ld. CIT(A)”] passed u/s. 250 of the Income-tax Act, 1961 (hereinafter referred to as the “Act”). 2. Since common issues are involved in all these appeals, hence, the same have been heard together and are being disposed of by this common order. 3. The appeal for AY 2017-18 is time barred by 32 days. A separate application for condonation of delay has been filed. Considering the 2 IT(SS)A Nos. 113 to 115/Kol/2024 Nand Kishore Pansari AYs 2017-18 to 2019-20 averments made in the condonation petition and the shortness of the delay period, the delay in filing the said appeal is hereby condoned. 4. The brief facts of the case are that a search and seizure operation was carried out in the case of the assessee u/s. 132 of the Act on 05.01.2021. Consequent upon the said search action, the assessment proceedings u/s. 153A of the Act were carried out for the assessment years under consideration. The AO noted that earlier a search and seizure operation was conducted in the cases of some third parties namely, M/s. RKS Nirman Pvt. Ltd., M/s. Keshari Nandan Projects Pvt. Ltd., and M/s. Sumit Projects Pvt. Ltd. on 30.11.2018. During the course of said search action, statement of one Sri Hitesh Kanodia, Accountant of the aforesaid three companies was recorded u/s. 132(4) of the Act, whereby, it was acknowledged by him that the assessee Shri Nand Kishore Pansari had made payment of Rs.1.47 Cr. as cash loan to Shri H. K. Choudhury at an interest rate of 1.5% on 01.10.2018. Further, an amount of Rs.0.75 Cr. Cash loan was paid by the assessee Shri Nand Kishore Pansari to premier Marketing during the financial year 2016-17 and an amount of Rs.0.75 Cr. in cash loan was paid by the assessee to Premier Marketing during FY 2017-18. The AO confronted the assessee during the present assessment proceedings relating to the aforesaid statement of Shri Hitesh Kanodia recorded on 03.11.2018. However, since the assessee denied the aforesaid transaction, the AO made the impugned additions for the assessment years under consideration in the separate assessment orders passed u/s. 153A/143(3) of the Act. The AO made impugned additions of Rs.81,75,000/- for AY 2017-18, Rs.81,00,000/- for AY 2018-19 and Rs.1,47,60,000/- for AY 2019-20 holding that the assessee could not prove the source of the aforesaid loan amounts given by the assessee during the previous years relevant to assessment years under consideration. 3 IT(SS)A Nos. 113 to 115/Kol/2024 Nand Kishore Pansari AYs 2017-18 to 2019-20 5. In appeal, the Ld. CIT(A), however, deleted the impugned additions observing that since no incriminating material was found during the course of search action carried on 05.01.2021 at the premises of the assessee and the assessment years under consideration were not abated but completed on the date of search action, therefore, the impugned additions were not sustainable as per the law laid down by the Hon’ble Supreme Court in the case of Pr. CIT Vs. Abhiser Buildwell (P) Ltd. [2023] 149 taxmann.com 399 (SC), wherein the Hon’ble Supreme Court has held that in the case of non-abated/completed assessments, no addition can be made by the Assessing Officer in an assessment carried out u/s.153A of the Act in the absence of any incriminating material found during the search action. 6. In this case, the impugned additions have been made by the AO on the basis of statement recorded during the course of search action carried out in the case of the third parties on 03.11.2018. If during the course of said search action in case of third parties, any incriminating material was found that could be linked to the assessee, the proper course for the AO of the searched person was to send those material to the AO of the assessee and to proceed u/s. 153C of the Act. Admittedly, no such proceedings u/s. 153C of the act were carried out against the assessee during or after the search action dated 03.11.2018, in case of third parties. Thereafter, after about more than two years of the said search action, a fresh search action was carried out in the case of the assessee u/s. 132 of the Act. However, admittedly, no incriminating material was found during the said course of search action. Under the circumstances, the AO was not justified in making the impugned additions by relying upon the statement of a third party recorded in case of a separate search action that was carried out more than two years back. The case is squarely covered by the decision of the Hon’ble Supreme Court in the case 4 IT(SS)A Nos. 113 to 115/Kol/2024 Nand Kishore Pansari AYs 2017-18 to 2019-20 of Abhiser Buildwell (P) Ltd. (supra), wherein it has been held that in the case of non-abated/completed assessments, no addition can be made by the Assessing Officer in an assessment carried out u/s.153A of the Act in the absence of any incriminating material found during the search action. 7. The Ld. DR could not point out any distinguishing fact in this case. 8. In view of the above, we do not find any infirmity in the orders of the Ld. CIT(A) and the same are hereby upheld. 9. In the result, all the captioned appeals of the revenue are hereby dismissed. Order is pronounced in the open court on 31.12.2024. Sd/- Sd/- [Sanjay Awasthi] [Sanjay Garg] लेखा सद˟/Accountant Member Ɋाियक सद˟/Judicial Member Dated: 31.12.2024. JD Sr. P.S Copy of the order forwarded to: 1. Appellant – DCIT Central Circle 1(4), Kolkata 2. Respondent – Nand Kishore Pansari 3. CIT(A), Kolkata-20. 4. Pr. CIT 5. CIT(DR), True Copy By Order Assistant Registrar, ITAT, Kolkata 5 IT(SS)A Nos. 113 to 115/Kol/2024 Nand Kishore Pansari AYs 2017-18 to 2019-20 "