Deputy Commissioner Of Income Tax, Central Circle-2(1), Bengaluru V. M/s. Chaitanya Properties Private Limited, Bengaluru

ITA 418/BANG/2021

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 2684 (ITAT-BANGALORE)
• Duration Of Justice: 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-05-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 06-09-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMER SINGH MEENA
• Section: 143(3); 48; 153C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCHES “A”, BANGALORE Before Shri George George K, JM & Shri Laxmi Prasad Sahu, AM ITA No.418/Bang/2021 : Asst.Year 2012-2013 The Assistant Commissioner of Income-tax, Central Circle 2(1) Bengaluru. v. M/s.Chaitanya Properties Private Limited No.17 Sankey Road, Bangalore – 560 020. PAN : AAACC5900A. (Appellant) (Respondent) Appellant by : Sri.Sumer Singh Meena, CIT-DR Respondent by : Sri.Narendra Sharma, Advocate Date of Hearing : 10.05.2022 Date of Pronouncement : 10.05.2022 O R D E R Per George George K, JM : This appeal at the instance of the Revenue is directed against CIT(A)’s order dated 25.06.2021. The relevant assessment year is 2012-2013. 2. The grounds raised read as follows:- “1. The order of the CIT(A) is opposed to law and facts of the case. 2. The CIT(A) has erred in holding that there is no incriminating material to support initiation of proceedings u/s 153C of the I.T.Act. 3. The CIT(A) has failed to appreciate the fact that the reassessment proceedings were initiated consequent to separate search action on 23.09.2016 in the group case of M/s.Srinivasa Trust at the office of M/s.KBD Sugars and Distilleries during which incriminating evidences were found against the assessee which were seized. 4. The CIT(A) failed to appreciate that satisfaction was recorded in the case of the assessee on 14.09.2018 in pursuance to the provisions of section 153C of the I.T.Act. ITA No.418/Bang/2021. M/s.Chaitanya Properties Private Limited. 2 5. The CIT(A) has failed to consider the decision of Hon’ble High Court of Karnataka in the case of M/s. Canara Housing Development Co. Ltd. v. DCIT 48 taxmann.com 98 wherein it is held that the assessing authority can take note of the income disclosed in the earlier return or which is not unearthed before the search in order to find out what is the total income of the year.” 3. At the very outset, the learned AR submitted that the issue in question is covered in favour of the assessee by the order of the Tribunal in assessee’s own case for assessment years 2011-2012, 2013-2014 to 2015-2016 in ITA Nos.494 to 497/Bang/2021 (order dated 19.04.2022). 4. The learned Departmental Representative was unable to controvert the above assertion of the learned AR. 5. We have heard rival submissions and perused the material on record. The details of the income returned, the income assessed and the reason for the addition for the relevant assessment year are as follows:- A.Y. Income returned Income assessed Addition made Reason for addition 2012-13 26,01,97,012 33,55,69,172 7,53,72,159 As per original assessment order. 5.1 The unearthing of incriminating material in a search conducted is sine qua non in making addition u/s 153C of the I.T.Act. In the instant case, the assessment was completed u/s 143(3) r.w.s. 153C of the I.T.Act prior to the present assessment proceedings. The said assessment which was completed prior to the present assessment proceedings has not abated and the same is pending in different stages of ITA No.418/Bang/2021. M/s.Chaitanya Properties Private Limited. 3 appeal. In the assessment order it is clear that the addition has not been based on any search material but only repeated addition made in the earlier assessment proceedings, which is subject matter of appeal at different stages of appellate proceedings. This has only resulted in duplicity of addition and duplicity of demand, as the additions were made in the earlier proceedings and in the present proceedings on a substantive basis. The interest of the Department is not in any way disturbed on this issue as the earlier assessment proceedings which were completed are in the various stages of appeal. On identical facts, the Tribunal in assessee’s own case for assessment years 2011-2012, 2013-2014 to 2015-2016, had decided the issue in favour of the assessee by observing as under:- “12. We have heard the submissions of the learned DR who reiterated the stand of the Revenue contained in the grounds of appeal filed before the Tribunal. Learned Counsel for the assessee relied on the order of the CIT(A). Considering the rival submissions, we are of the view that the order of the CIT(A) does not call for any interference. Admittedly, none of the additions made in these 4 appeals are based on any incriminating material found in the course of search in the case of M/s.Srinivasa Trust on 23.09.2016. In such a scenario, the additions made in the order of Assessment cannot be sustained. As far as the decision of the Hon’ble Karnataka High Court in the case of Canara Housing Development Co. Ltd. 48 taxmann.com 98 (Karn.), the Hon’ble Karnataka High Court in the decision rendered in the case of M/s.Delhi International Airport Pvt. Ltd. ITA No.322/2018 order dated 29.9.2021, wherein the law was explained that in an unabated assessments completed prior to search, there can be no addition in an assessment under section 153C of the Act without material having been found in the course of search. The earlier decisions rendered by the Hon’ble Karnataka High Court and other High Courts were duly considered and there is no dispute on this aspect and the fact that the said decision is the law as of today on the subject rendered by the Hon’ble Karnataka High Court. ITA No.418/Bang/2021. M/s.Chaitanya Properties Private Limited. 4 13. In view of the above, we find no grounds to interfere in the order of the CIT(A). Consequently, these appeals by the Revenue are dismissed. In view of the above conclusions, we do not deem it necessary to examine whether the initiation of proceedings under section 153C of the Act were valid.” 5.2 In the light of the above Tribunal order in assessee’s own case, we reject the grounds raised by the Revenue. 6. In the result, the appeals filed by the Revenue is dismissed. Order pronounced on this 10 th day of May, 2022. Sd/- (Laxmi Prasad Sahu) Sd/- (George George K) ACCOUNTANT MEMBER JUDICIAL MEMBER Bangalore; Dated : 10 th May, 2022. Devadas G* Copy to : 1. The Appellant. 2. The Respondent. 3. The CIT(A)-11, Bangalore. 4. The Pr.CIT (Central), Bangalore. 5. The DR, ITAT, Bengaluru. 6. Guard File. Asst.Registrar/ITAT, Bangalore