GARIMA BHUSHAN ,NEW DELHI V. DCIT, CENTRAL CIRCLE, NOIDA

ITA 882/DEL/2018

AI Insights

The case involves an appeal by Garima Bhushan against the orders of the Commissioner of Income Tax (Appeals)-IV, Kanpur, and the assessing officer, which confirmed additions made to her income for the Assessment Year 2015-16. The additions were made on account of unexplained credit/transaction and household withdrawals, totaling Rs. 10,40,025. The primary legal contention was the improper application of section 153C of the Income Tax Act, 1961, following a search and seizure operation. The Tribunal's decision hinged on the procedural requirement of issuing a notice under section 153C, which was not followed, leading to the quashing of the assessment order.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 474862 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 23-10-2024
• Assessment Year: 2015-2016
• Appeal Filed On: 05-02-2018
• Other Referred Cases: BNB Investment & Properties Ltd. vs. DCIT, Vishnu Bhagwan vs. DCIT, Sanjay Thakur vs. DCIT, CIT vs. RRJ Securities Ltd., PCIT vs. Sarwar Agency P Ltd., CIT vs. Jasjeet Singh, Ojuss Investment vs. PCIT, Raja Varshney vs. ITO, Jasjit Singh vs. DCIT, Pavitra Realcon vs. DCIT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DAYAINDER SINGH SIDHU
• Assessee Lawyers: RAKESH GUPTA; SOMIL
• Keywords: Unexplained cash credit; Principle of natural justice; Search and seizure
• Section: 143(3); 142(1); 143(2); 132; 68; 153C

Judgement Text

" 1 ITA No. 882/Del/2018 Garima Bhushan Vs. DCIT IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’: NEW DELHI BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER ITA No. 882/Del/2018, (A.Y.2015-16) Garima Bhushan C/o RRA Tax India , D-28, South Extension, Part-1 New Delhi PAN No: AAZPY020H Vs. DCIT Central Circle, Noida Uttar Pradesh (Appellant) (Respondent) Appellant by Dr. Rakesh Gupta, Adv & Sh. Somil Agarwal, Adv Respondent by Shri Dayainder Singh Sidhu, CIT (DR) Date of Hearing 23/10/2024 Date of Pronouncement 27/11/2024 ORDER PER YOGESH KUMAR U.S., JM : This appeal is filed by the Assessee against the order of Commissioner of Income Tax (Appeals)-IV, Kanpur [“Ld. CIT(A)” for short], dated 21/11/2017for the Assessment Year 2015-16. 2. The grounds of Appeal are as under: - “1.) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. A.O. in making an addition of Rs.9,20,025/- on account of unexplained credit / transaction u/s 68 of the Act, and that too by alleging failure of the assessee to give any 2 ITA No. 882/Del/2018 Garima Bhushan Vs. DCIT satisfactory explanation/ evidence and more so when there was no incriminating material found as result of search. 2) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of the Ld. A.O. in making an addition of Rs. 1,20,000/- on account of household withdrawals vide para-7 of the assessment order and more so when there was no incriminating material found as a result of search. 3) That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making addition of Rs. 1,20,000/- is bad in law and against the facts and circumstances of the case. 4) That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. A.O. in passing the impugned order and that too without giving adequate opportunity of hearing and without observing the principle of natural justice.” 3. Brief facts of the case are that, a search and seizure operation u/s 132 of the Income Tax Act, 1961 (‘Act’ for short) was conducted on 27/11/2014 in the case of Maconns, Meenu and Yadav Singh group cases. Thereafter, notice u/s 142(1) of the Act was issued on 25/02/2016 to the Assessee. In response, the Assessee filed his return showing income of Rs. 1,16,990/-. Subsequently, a notices u/s 142(1) and 143(2) were issued to 3 ITA No. 882/Del/2018 Garima Bhushan Vs. DCIT the Assessee. The assessment order came to be passed u/s 153C r.w. Section 143(3) of the Act on 28/12/2016 by making an addition of Rs. 9,20,025/- on account of unexplained loan and deposit and Rs. 1,20,000/- on account of houses hold expenses. Aggrieved by the assessment order dated 28/12/2016, the Assessee preferred an Appeal before the CIT(A). The Ld. CIT(A) vide order dated 21/11/2017, dismissed the Appeal filed by the Assessee affirming the additions made by the A.O. Aggrieved by the order of the Ld. CIT(A) dated 21/11/2017, the Assessee preferred the present appeal. 4. The Assessee filed additional grounds of Appeal contending that the date of search in the searched person was 27/11/2014 and the satisfaction note u/s 153C of the Act was recorded in the case of the Assessee on 25/02/2016, therefore, the assessment could not have done without issuing notice u/s 153C. The Ld. Counsel relied on following judicial decisions and submitted that the additional ground of the Assessee deserves to be allowed by quashing the assessment order :- 1). BNB Investment & Properties Ltd. DCIT (PB 80-106) 2) Vishnu Bhagwan vs DCIT (PB 107-117) 3) Sanjay Thakur vs DCIT (PB 118-164) 4) CIT vs. RRJ Securities Ltd. 380 ITR 612 (Del) (PB 64-79 5) PCIT vs. Sarwar Agency P Ltd. 397 ITR 400 (Del)(PB 60-63) 4 ITA No. 882/Del/2018 Garima Bhushan Vs. DCIT 6) CIT vs. Jasjeet Singh 458 ITR 437 (SC) 7) Ojuss Investment vs. PCIT (Del)(HC) 8) Raja Varshney vs. ITO (Del) (ITAT) ITA 1459/Del/2024 dt. 9) Jasjit Singh (Del)(HC) 10) Pavitra Realcon Del (HC) 5. Per contra, the Ld. Departmental Representative relying on the orders of the Lower Authorities and sought for dismissal of the Appeal. 6. We have heard both the parties and perused the material available on record. It is observed that a search and seizure operation has been conducted u/s 132 of the Act on 27/11/2014 in the case of Maconns, Meenu and Yadav Singh group cases, thereafter notice u/s 142(1) and 143(2) was issued. Later on, an assessment has been framed u/s 153C read with Section 143(3) of the Act. Since the date of satisfaction note was 25/02/2016 the same date will be the deemed date of search in terms of Explanation to Section 153C and hence years falling u/s 153C would be preceding six years i.e. 2015-16, 2014-15 and so on. Thus, the assessment could not have been done without issuing notice u/s 153C of the Act in the year consideration. Considering above referred judicial precedents relied by the Assessee. Accordingly, the assessment order and the order of the Ld. CIT(A) are hereby quashed. 5 ITA No. 882/Del/2018 Garima Bhushan Vs. DCIT 7. In the result, the Appeal filed by the Assessee is allowed. Order pronounced in open Court on 27th November, 2024 Sd/- Sd/- (S. RIFAUR RAHMAN) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 27/11/2024 R.N, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "