Seema Jain, New Delhi V. ACIT, New Delhi

ITA 4905/DEL/2016

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 5766 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 22-12-2016
• Assessment Year: 2012-2013
• Appeal Filed On: 14-09-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Assessee Lawyers: RAJ KUMAR CA SH SUMIT GOEL
• Keywords: Search and seizure
• Section: 153A; 153; 153C; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SH. R. K. PANDA, ACCOUNTANT MEMBER AND SH. KULDIP SINGH, JUDICIAL MEMBER ITA NO.4905/DEL/2016 ASSESSMENT YEAR: 2012-13 SEEMA JAIN 12, DAYANAND VIHAR DELHI-10092 PAN NO.AAFPJ6460J VS. ACIT CIRCLE 59 (1) NEW DELHI (APPELLANT) (RESPONDENT) APPELLANT BY SH.RAJ KUMAR, CA SH. SUMIT GOEL, CA RESPONDENT BY SH. S. S RANA, CIT DR DATE OF HEARING: 05/12/2019 DATE OF PRONOUNCEMENT: 17/02/2020 ORDER PER R.K PANDA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER DATED 04.07.2016 OF THE CIT(A)-19, NEW DELHI RELATING TO A.Y.2012-13. 2. THE GROUNDS OF APPEAL ARE AS UNDER :- 1. THAT UNDER THE FACTS AND CIRCUMSTANCES, THE IM PUGNED ASSTT. FRAMED U/S. 153 C IS ILLEGAL AND WITHOUT JUR ISDICTION IN THE ABSENCE OF ISSUANCE OF MANDATORY STATUTORY N OTICE U/S. 153 C, WHICH FACT STANDS ADMITTED AS PER RTI R EPLY DTD. 20.05.2016. PAGE | 2 2.THAT WITHOUT PREJUDICE, UNDER THE FACTS AND CIRCUMSTANCES, AS NO ASSTT. PROCEEDINGS WERE PENDIN G FOR A.Y. 2012 - 2013 AS ON THE DATE OF SEARCH, HENCE, T HE ASSTT. PROCEEDINGS WERE UNABATED IN VIEW OF SECOND PROVISO TO SEC. 153 A (1), CONSEQUENTLY THE AO EXCE EDED HIS JURISDICTION IN EXAMINING THE ISSUE OF ADDITION OF RS. 1 1,08,034/- WHICH IS NOT EMANATING FROM ANY MATERIAL / INCRIMINATING MATERIAL FOUND / SEIZED DURING SEARCH . 3.THAT WITHOUT PREJUDICE, UNDER THE FACTS AND CIRCUMSTANCES, ADDITION OF RS. 11,08,034/- ON THE B ASIS OF ALLEGED LESS DECLARED INTT. INCOME AS PER FORM - 26 AS IS UN - SUSTAINABLE IN LAW AS WELL AS ON MERITS. 3. THE LD. COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING DID NOT PRESS GROUND OF APPEAL NO.1 FOR WHICH THE LD. D R HAS NO OBJECTION. ACCORDINGLY GROUND OF APPEAL NO.2 FILED BY THE ASSESSEE IS DISMISSED AS NOT PRESSED. 4. SO FAR AS THE GROUND OF APPEAL NO.1 IS CONCERNED , THE FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND FILED HER RETURN OF INCOME ON 28.07.2012 DECLARING TOTAL INCOME AT RS.28,02,620/- WHICH WAS PROCESSED U/S. 143 (1). S UBSEQUENTLY THE CASE WAS SELECTED FOR SCRUTINY THROUGH CASS AND NOTICE U/S. 143 (2) AND 142 (1) WERE DULY ISSUED AND SERVED ON THE ASSESSEE. AS PER THE ASSESSMENT ORDER, A SEARCH AND SEIZURE O PERATION U/S. 132 (1) OF THE IT ACT 1961 WAS CARRIED OUT BY THE I NVESTIGATION WING, GHAZIABAD ON 19.10.2011 AT THE PREMISES OF AG ARWAL ASSOCIATES AND JAINCO GROUP OF CASES COMPRISING M/S . JAINCO PAGE | 3 PROMOTERS (P) LTD. & OTHERS. THE MATERIAL SEIZED DU RING THE SEARCH AND SEIZURE CONTAINED CERTAIN DOCUMENTS THAT RELATES TO MRS. SEEMA JAIN W/O SH. PRAVEEN KUMAR JAIN. THE AO COMPLETED THE ASSESSMENT U/S. 143 (3) R.W.S. 153 C AND 153 A OF THE ACT ON 31.03.2015 DETERMINING THE TOTAL INCOME AT RS.45,98 ,654/- WHEREIN HE MADE ADDITION OF RS.11,08,034/- ON ACCOU NT OF UNDISCLOSED INTEREST INCOME AND RS.6,70,000/- BEING UNSECURED LOAN RECEIVED FROM TWO PARTIES. 5. BEFORE CIT(A) THE ASSESSEE, APART FROM CHALLENGI NG THE ADDITION ON MERIT, CHALLENGED THE VALIDITY OF THE A SSESSMENT ORDER ON ACCOUNT OF INVOKING OF PROVISIONS OF SECTION 143 (3) R.W.S. 153C AND 153 A. THE LD. CIT(A) DELETED ONLY THE ADDITIO N OF RS.6,70,000/- BUT SUSTAINED ADDITION OF RS.11,08,03 4/- ON ACCOUNT OF UNDISCLOSED INTEREST INCOME. 6. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 7. THE LD. COUNSEL FOR THE ASSESSEE WHILE ARGUING T HE GROUND OF APPEAL NO.1 REFERRED TO THE REPLY OBTAINED FROM THE INCOME TAX DEPARTMENT UNDER RTI ACT, COPIES OF WHICH ARE PLACE D AT PAPER BOOK PAGE NO.1 AND 2. HE SUBMITTED THAT NO NOTICE U/S. 153C WAS ISSUED FOR A.Y.2012-13 AS ADMITTED BY THE DEPAR TMENT, THEREFORE, IN ABSENCE OF ISSUE OF NOTICE U/S. 153C THE ASSESSMENT ORDER PASSED U/S. 143 (3) R.W.S. 153 A/ 153 C IS VO ID AB INITIO. HE SUBMITTED THAT WHEN THE ASSESSMENT ORDER HAS BEEN F RAMED U/S. 153A/153C, THEREFORE, WITHOUT ISSUING MANDATORY NOT ICE U/S. 153C, THE AO COULD NOT HAVE ASSUMED JURISDICTION, S INCE SUCH PROCEEDINGS WERE INITIATED ON THE BASIS OF RECEIPT OF DOCUMENTS BY PAGE | 4 THE AO OF THE ASSESSEE FROM THE AO OF THE SEARCHED PERSON ON 06.03.2014. RELYING ON THE FOLLOWING DECISIONS HE SUBMITTED THAT THE ASSUMPTION OF THE JURISDICTION BY THE AO IN THE INSTANT CASE IS NOT IN ACCORDANCE WITH LAW SINCE NO MANDATORY NOTIC E U/S. 153 C WAS ISSUED BY THE AO. 1. DLF PROPERTIES (P) LTD. VS. DCIT 60 SOT 88 (DELHI-T RIB.) 2. PAVITRA REALCON (P.) LTD. VS. ACIT [2017] 87 TAXMANN.COM 142 (DELHI-TRIB.) 8. THE LD. DR ON THE OTHER HAND SUBMITTED THAT THIS CASE WAS SELECTED FOR SCRUTINY ON 28.07.2012 THROUGH CASS AN D NOTICE U/S. 143 (2) WAS ISSUED ON 06.08.2013 WHICH WAS DUL Y SERVED ON THE ASSESSEE ON 08.08.2013. HE SUBMITTED THAT IT I S A CASE OF SCRUTINY AND MENTION OF SECTION 143 (3) R.W.S. SECT ION 153 C/ 153 A OF THE IT ACT, 1961 IS A TYPOGRAPHICAL ERROR WHIC H MAY KINDLY BE IGNORED IN VIEW OF THE PROVISIONS OF SECTION 292 B. 8.1 THE LD. COUNSEL FOR THE ASSESSEE IN HIS REJOIND ER SUBMITTED THAT THE CIT(A) IN THE ORDER PASSED IN A. Y.2006-07 VIDE ITA NO. 29/2015-16 ORDER DATED 27.05.2016 HAS HELD THAT THE RELEVANT SIX YEARS IN THE CASE OF THE ASSESSEE SHOULD BE FRO M THE A. Y. 2008-09 TO 2013-14. THEREFORE, ASSESSMENT FOR THIS YEAR HAS TO BE U/S. 153C AND NOT U/S.143 (3). 9. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE PAGE | 5 VARIOUS DECISIONS CITED BEFORE US. WE FIND THE AO A T PARA-2 OF THE ORDER HAS MENTIONED AS UNDER :- 2. IN THE INSTANT CASE, A SEARCH AND SEIZURE OPERA TION U/S 132(1) OF THE I.T. ACT, 1961 WAS CARRIED OUT BY THE INVESTIGATION WING, GHAZIABAD ON 19.10.2011 AT THE PREMISES OF AGARWAL ASSOCIATES & JAINCO GROUP OF CASES COMPRISING M/S J AINCO PROMOTERS (P) LTD OTHERS AT G-10, PLOT NO.6, ADITYA COMMERCIAL COMPLEX, PREET VIHAR, DELHI-110092 & 12, DAYANAND -VIHAR, DELHI. THE MATERIAL SEIZED DURING THE SEARCH & SEIZ URE CONTAINED CERTAIN DOCUMENTS THAT RELATES TO MRS. SEEMA JAIN W/O SH. PRAVEEN KUMAR JA IN. 10. WE FIND FROM THE COPY OF THE ASSESSMENT ORDER T HAT THE AO AT PAGE-1 AND AT PAGE-3 HAS MENTIONED THAT THE ASSE SSMENT HAS BEEN COMPLETED U/S. 143 (3) R.W.S. 153 C / 153A OF THE IT ACT. 1961. A PERUSAL OF THE REPLY RECEIVED FROM THE INCO ME TAX DEPARTMENT BY THE ASSESSEE UNDER RTI ACT SHOWS THAT THE AO HAS CATEGORICALLY GIVEN A REPLY THAT NO NOTICE U/S. 153 C WAS ISSUED FOR A. Y. 2012-13. 11. A PERUSAL OF THE ORDER OF THE CIT(A) FOR A. Y. 2006-07 SHOWS THAT THE LD. CIT(A) IN ASSESSEES OWN CASE FOR A.Y. 2006-07 VIDE APPEAL NO. 29/15-16 ORDER DATED 27.05.2016 AT PARA 7 OF THE ORDER HAS ANNULLED THE ASSESSMENT BY OBSERVING AS U NDER : ALTHOUGH THE PROVISO TO SECTION 153C CONSIDERS THE DATE OF RECEIPT OF DOCUMENTS AS THE DATE OF INITIATION OF SEARCH ONLY FOR THE PURPOSE OF SECOND PROVISO TO SECTION 153 A WHICH DEALS ONLY WITH THE ABATEMENT OF PENDING CASES, THE HON'BLE DELHI HIGH COURT HAS HELD THAT DATE OF RECEIPT OF DOCUMENTS AND BOOKS OF ACCOUNTS SHALL ALSO BE CONSIDERED AS THE D ATE OF SEARCH FOR THE PURPOSE OF COUNTING THE SIX YEARS FOR WHICH THE ASSESSMENTS HAVE TO BE CARRIED OUT, SINCE THE RELEVANT SIX YEARS IN THE CASE OF APPELLANT SHO ULD BE FROM ASSESSMENT YEAR 2008-09 TO 2013-14. BEING BOUND BY THE DECISION OF JURISDICTIONAL HIGH COURT, THE ASSESSMENT YEAR 2006-07 HAS TO BE TREATED AS BE YOND THE PERIOD OF SIX YEARS AND THE ASSESSMENT IS ANNULLED. SINCE THE ASSESSMEN T HAS BEEN HELD TO BE INVALID, THE OTHER GROUNDS ARE NOT BEING DISCUSSED. PAGE | 6 12. SINCE THE ORDER OF THE CIT(A) HAS ATTAINED FINA LITY AS NOTHING CONTRARY BROUGHT TO OUR NOTICE, THEREFORE, THE ASSESSMENT FOR A.Y. 2012-13 HAS TO BE U/S. 153C/153A OF THE IT ACT. SINCE THE AO HAS NOT ISSUED THE MANDATORY NOTICE U/S. 153 C AS ADMITTED BY THE AO IN HIS REPLY TO THE INFORMATION OBTAINED BY THE ASSESSEE UNDER RTI ACT, THEREFORE, THE MANDATORY PR OCEDURE PRESCRIBED U/S. 153 C HAS BEEN VIOLATED AND, THEREF ORE, ASSESSMENT ORDER SO PASSED BY THE AO IS NOT IN ACCO RDANCE WITH LAW. HENCE, THE SAME HAS TO BE QUASHED. WE ACCORDI NGLY HOLD THAT THE ASSESSMENT ORDER FRAMED BY THE AO U/S. 143 (3) / 153 C AND 153 A IS VOID AB INITIO AND, THEREFORE, HAS TO BE QUASHED. THE GROUND RAISED BY THE ASSESSEE IS ACCORDINGLY ALLOWE D. 13. IN THE RESULT, THE APPEAL FILED BY THE ASSESSE E IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 17.02.2020. SD/- SD/- (KULDIP SINGH) (R.K PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER *NEHA* DATE:- 17.02.2020 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI PAGE | 7 DATE OF DICTATION 05.02.2020 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 05.02.2020 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS 17.02.2020 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 17.02.2020 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/ PS 17.02.2020 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 17.02.2020 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 17.0 2.2020 DATE ON WHICH FILE GOES TO THE HEAD CLERK. THE DATE ON WHICH FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER