ACIT, New Delhi V. Late Smt. Bhawna Gupta (Through Legal Heir Sh. Sameer Gupta), Uttar Pradesh

ITA 517/DEL/2017

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 2436 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 30-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AGAINST DATED PASSED
• Keywords: Search and seizure; Question of law
• Section: 143(3); 153A; 201; 139(1); 132; 15

Judgement Text

1 ITA NO. 517/DEL/2017 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: A NEW DELHI BEFORE MS SUCHITRA KAMBLE, JUDICIAL ME MBER AND DR. B. R. R. KUMAR, ACC OUNTANT MEMBER I.T.A. NO. 517/DEL/201 7 (A.Y 2012-13) (THROUGH VIDEO CON FERENCING) ACIT CENTRAL CIRCLE-04, ROOM NO. 331, ARA CENTRE, JAHANDEWALAN EXTENSION, NEW DELHI (APPELLANT) VS LATE SMT. BHAWNA GUPTA (THROUGH LEGAL HEIR SH. SAMEER GUPTA) R/O. A-43, PHASE-II NOIDA EXTENSION, UTTAR PRADESH AAEPG7683B (RESPONDENT) ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORD ER DATED 24/11/2016 PASSED BY CIT(A)-23, NEW DELHI FOR ASSESSMENT YEAR 2012-13. 2. THE GROUNDS OF APPEALS ARE AS UNDER:- 1. THE ORDER OF LD.CIT(A) IS NOT CORRECT IN LAW A ND FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN LAW IN DELETING THE ADDITION OF S. 95,16,400/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF GAIN ON SALE OF INVESTMENT. 3. THE ASSESSEE IS AN INDIVIDUAL AND EARNED INCOME FROM HOUSE PROPERTY APPELLANT BY SH. V. K. KATARIA, SR. DR RESPONDENT BY SH. VED JAIN, ADV DATE OF HEARING 17.02.2021 DATE OF PRONOUNCEMENT 17 .02.2021 2 ITA NO. 517/DEL/2017 AND OTHER SOURCES DURING THE RELEVANT ASSESSMENT YE AR. THE ORIGINAL RETURN U/S 139(1) WAS FILED BY THE ASSESSEE ON 30/03/2013 DECLARING TOTAL INCOME OF RS. 7,50,310/-. SEARCH AND SEIZURE OPERATION WAS C ONDUCTED ON JACKSON GROUP OF CASES U/S 132 OF THE ACT ON 3/10/2014. TH E GROUP IS HEADED BY SHRI SATISH KUMAR GUPTA (CHAIRPERSON) AND THE ASSESSEE SHRI BHAWNA GUPTA, THE WIFE OF SH. SAMEER GUPTA WHO IS MANAGING DIRECTOR O F M/S JACKSON GROUP OF COMPANIES . CORRESPONDINGLY, THE ASSESSMENT U/S 15 3(A) INITIATED IN CASE OF ASSESSEE. NOTICE U/S 153A (1) OF THE ACT WAS SERVE D UPON THE ASSESSEE AND THE ASSESSEE FILED ORIGINAL ITR IN RESPONSE TO SAME. N OTICE U/S 132(1) ALONG WITH QUESTIONNAIRE WE HAVE HEARD BOTH THE PARTIES AND PE RUSED THE MATERIAL AVAILABLE ON RECORD SERVED UPON THE ASSESSEE AND TH E ASSESSEE THROUGH ITS AUTHORIZED REPRESENTATIVE ATTENDED THE PROCEEDINGS FROM TIME TO TIME AND FILED NECESSARY DETAILS AND PRODUCE BOOKS OF ACCOUNTS. T HE ASSESSING OFFICER ASSESS THE INCOME AT RS. 1,18,89,120/- AS AGAINST I NCOME OF RS. 9,08,750/- AS PER ORDER U/S 153A/143(3) DATED 30/03/2016, THEREBY MAKING ADDITION OF RS. 1,09,80,369/- ON ACCOUNT OF BOGUS EXEMPT LONG TERM CAPITAL GAIN 4. BEING AGGRIEVED BY THE ASSESSMENT ORDER, THE ASS ESSEE FILED APPEAL BEFORE THE CIT(A). THE CIT(A) ALLOWED THE APPEAL OF THE ASSESSEE. 5. THE LD. DR SUBMITTED THAT THE CIT(A) ERRED IN LA W IN DELETING THE ADDITION OF RS. 95,16,400/- MADE BY THE ASSESSING O FFICER ON ACCOUNT OF GAIN ON SALE OF INVESTMENT. THE LD. DR RELIED UPON THE A SSESSMENT ORDER. 6. THE LD. AR RELIED UPON THE ORDER OF THE CIT(A) A ND FURTHER SUBMITTED THAT THE CIT(A) PASSED THE ORDER IN FAVOUR OF THE ASSESS EE AS THE SIMILAR FINDINGS FOR ASSESSMENT YEAR 2011-12 & 2012-13 WHEREIN THE C IT(A) HAS QUASHED THE REASSESSMENT ORDER FOR BOTH THE ASSESSMENT YEARS RELYING UPON THE ORDER PASSED IN CASE OF SON OF THE ASSESSEE SHRI SAMEER G UPTA. THE DEPARTMENT HAS ALSO FILED AN APPEAL FOR ASSESSMENT YEAR 2011-12 IN LATE SMT. BHAWNA GUPTA THROUGH LEGAL HEIR SH. SAMEER GUPTA BEARING ITA NO. 516/DEL/2017 BEFORE THE 3 ITA NO. 517/DEL/2017 TRIBUNAL AND THE SAME WAS DISMISSED BY THE TRIBUNAL ON THE CONTEXT THAT IN THE CASE OF SON OF THE ASSESSEE SH. SAMEER GUPTA. THE HON'BLE HIGH COURT HAS CONFIRMED THE DECISION OF THE TRIBUNAL WHEREIN THE SE ADDITIONS WERE DELETED IN ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH IN CASE OF COMPLETED ASSESSMENTS RELYING UPON THE DECI SION OF JURISDICTIONAL HIGH COURT IN CASE OF CIT VS. KABUL CHAWLA 61 TAXMAN.COM 412. THE LD. AR FURTHER SUBMITTED THAT IN PRESENT ASSESSEES CASE A S WELL NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH. TH US, THE REASSESSMENT MADE BY THE ASSESSING OFFICER IS INVALID AND ASSESSEES CASE IS SQUARELY COVERED BY THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FO R ASSESSMENT YEAR 2011-12 AS WELL AS ORDER PASSED BY THE JURISDICTIONAL HIGH COURT IN CASE OF SON OF THE ASSESSEE SH. SAMEER GUPTA . THE LD. AR RELIED UPON THE FOLLOWING JUDGMENTS:- PRINCIPAL CIT VS. BEST INFRASTRUCTURE INDIA PVT. LT D. 397 ITR 82 PRINCIPAL CIT VS. BABA GLOBAL LTD. 2017 (2) TMI 346 PRINCIPAL CIT VS. DHARAM PAL PEM CHAND LTD. 2017 (8 ) TMI 958 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. IT IS PERTINENT TO NOTE THAT IN ASSESSEES CASE FOR ASSESSMENT YEAR 2011- 12 THE TRIBUNAL HAS DELETED THESE VERY ADDITION AS PER THE SEARCH AND SEIZURE CONDUCTED AT JACKSON GROUP OF CASES. THE TRIBUNAL IN CASE OF SON OF THE ASSESSEE HEREIN HELD AS UNDER :- 24. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. WE FIND THE ASSESSEE IN THE INSTANT CASE HAS FILED HIS ORIGINAL RETURN OF INCOME ON 30 TH MARCH, 2012 DECLARING TOTAL INCOME OF RS. 3,92,11,220/-. IN RESPONSE TO NOTICE U/S 153A OF TH E IT ACT, THE ASSESSEE FILED RETURN IN RESPONSE TO NOTICE U/S 153A ON 5 TH JANUARY, 2015 DECLARING THE SAME INCOME. THE ASSESSEE IN HIS RETURN OF INCOME H AD CLAIMED EXEMPTION OF LONG TERM CAPITAL GAIN OF RS. 5,62,61,726/-. THE AS SESSMENT ORDER WAS PASSED U/S 143(3) READ WITH SECTION 153A BY MAKING ADDITION OF THE LONG 4 ITA NO. 517/DEL/2017 TERM CAPITAL GAIN AS BOGUS. FROM THE ORDER OF THE A SSESSING OFFICER, WE FIND NOWHERE IT IS MENTIONED THAT ANY INCRIMINATING MATE RIAL WAS FOUND DURING THE COURSE OF SEARCH. THE ENTIRE ADDITION MADE BY THE A O IS BASED ON POST SEARCH INQUIRIES. THERE IS ALSO NO GROUND BY THE REVENUE T HAT ANY SUCH INCRIMINATING MATERIAL WAS FOUND OTHER THAN THE STATEMENT OF SHRI SUNDEEP GUPTA AT THE TIME OF SEARCH. UNDER THESE CIRCUMSTANCES, WE HAVE TO ADJUDICATE AS TO WHETHER THE CIT(A) HAS ERRED IN DELETING THE ADDITI ON MADE BY THE AO IN ABSENCE OF ANY INCRIMINATING MATERIAL. 25. WE FIND THE ID. CIT(A) WHILE DELETING THE ADDIT ION HAS RELIED ON VARIOUS DECISIONS INCLUDING THE DECISION OF THE HON 'BLE JURISIDICTIONAL HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWALA REPORTED IN 21 TAXMAN.COM 412 (234 TAXMAN 300). FINDING OF THE CIT(A) ON THIS ISS UE HAS ALREADY BEEN REPRODUCED IN THE PRESIDING PARAGRAPHS. SO FAR AS T HE RELIANCE BY THE LD. DR IN THE CASE OF SMT. DAYAWANTI VS. CIT (SUPRA) IS CO NCERNED, WE FIND THE FACTS OF THAT CASE ARE COMPLETELY DIFFERENT FROM THAT OF THE FACTS OF THE PRESENT CASE. IN THAT CASE THE SON OF THE ASSESSEE HAD CATEGORICA LLY ADMITTED THAT THERE WERE UNACCOUNTED PURCHASE AND SALE OF VARIOUS ITEMS IN SUPARI FROM DIFFERENT PARTIES. HE HAD ALSO ADMITTED THAT CERTAIN PURCHASE S ARE UNACCOUNTED AND ACCORDINGLY HE HAD SURRENDERED CERTAIN INCOME. HOWE VER, IN THE PRESENT CASE THERE IS NO UNACCOUNTED TRANSACTION FOUND DURING TH E COURSE OF SEARCH. THE CAPITAL GAIN THAT AROSE FROM THE SALE OF SHARES ARE ALREADY RECORDED IN THE BOOKS OF ACCOUNTS AND NO INCRIMINATING MATERIAL WHA TSOEVER WAS FOUND DURING THE COURSE OF SEARCH . THEREFORE, THE SAID D ECISION IN OUR OPINION IS NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. 26. IT HAS COME TO OUR NOTICE SUBSEQUENT TO THE HEA RING THAT THE HON'BLE DELHI HIGH COURT IN THE CASE OF PR. CIT VS. MEETA GUTGUTI A REPORTED IN 2017 (5) TMI 1224 HAS HELD THAT ADDITION CANNOT BE MADE IN ABSEN CE OF ANY INCRIMINATING MATERIAL AND THE DECISION IN THE CASE OF SMT. DAYAW ANTI GUPTA HAS BEEN DULY CONSIDERED. SO FAR AS THE DECISION OF HON'BLE KERAL A HIGH COURT IN THE CASE OF E. N. GOPAL KUMAR (SUPRA) RELIED BY THE LD. DR IS C ONCERNED, WE FIND THE SAID DECISION IS OF A NON-JURISDICTIONAL HIGH COURT AND THE TRIBUNAL IS BOUND BY THE DECISION OF THE JURISDICTIONAL HIGH COURT. SINCE TH E HON'BLE HIGH COURT IN A NUMBER OF CASES RECENTLY HAS HELD THAT ADDITION CAN NOT BE MADE IN ORDER PASSED U/S. 153A R.W.S. 143(3) IN ABSENCE OF ANY IN CRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH IN THE CASE OF CO MPLETED ASSESSMENTS, THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDE R OF THE CIT(A) DELETING THE ADDITION IN ABSENCE OF ANY INCRIMINATING MATERIAL F OUND DURING THE COURSE OF SEARCH. 5 ITA NO. 517/DEL/2017 27. WE FURTHER FIND THE REVENUE HAS NOT CHALLENGED THE VITAL LEGAL GROUND ON WHICH THE LD. CIT(A) HAS DELETED THE ADDITION. SINC E THE HON'BLE JURISDICTIONAL HIGH COURT HAS CLEARLY HELD THAT ADDITION IN ORDER PASSED U/S 143(3)/ 153A CANNOT BE MADE IN ABSENCE OF ANY INCRIMINATING MATE RIAL AND SINCE IN THE INSTANT CASE, THERE IS NO EVIDENCE WHATSOEVER ON RE CORD THAT ANY INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH AND SINCE THE ADDITION WAS MADE ON THE BASIS OF CERTAIN INQUIRIES CONDUCTED SUBSEQUENT TO THE SEARCH ON THE BASIS OF RETURN ALREADY FILED, TH EREFORE, ON THIS ISSUE ITSELF ADDITION HAS TO BE DELETED. WE, THEREFORE, UPHOLD T HE ORDER OF THE CIT(A) AND DISMISS THE GROUND RAISED BY THE REVENUE. THE HONBLE HIGH COURT IN THE SAID CASE HELD AS UND ER :- IN THIS CASE THE SEARCH TOOK PLACE IN THE PREMISES ON 03.10.2013. A NOTICE UNDER SECTION 153A WAS ISSUED TO THE ASSESSEE WHICH RE-AFFIRMED ITS EARLIER RETURNS. THE ASSESSING OFFICER COMPLETED THE SECTIO N 153A ASSESSMENT BY ADDING AMOUNTS UNDER SECTION 60A TO THE TUNE OF ?5, 62,61,726/- FOR AY 201 1-12. THE CIT (A) AND THE ITAT CONCURRENTLY GRANTED RELIEF TO THE ASSESSEE IN THE APPELLATE PROCEEDINGS HOLDING THAT NO FRESH INC RIMINATING MATERIAL WAS SEIZED WARRANTING THE ADDITIONS DURING THE SEARCH. BOTH THE APPELLATE AUTHORITIES RELIED UPON THE JUDGMENT OF THIS COURT IN CIT V. KABUL CHAW LA, 380 ITR 573. IN THESE CIRCUMSTANCES, THE COURT IS OF TH E OPINION THAT NO QUESTION OF LAW ARISES AS THE RATIO IN KABUL CHAWLA (SUPRA) APP LIED. THE APPEAL IS, THEREFORE, DISMISSED. IN THE PRESENT CASE ALSO THERE IS NO UNACCOUNTED TR ANSACTION FOUND DURING THE COURSE OF SEARCH. THE CAPITAL GAIN THAT AROSE FROM THE SALE OF SHARES ARE ALREADY RECORDED IN THE BOOKS OF ACCOUNTS AND NO IN CRIMINATING MATERIAL WHATSOEVER WAS FOUND DURING THE COURSE OF SEARCH. SINCE THE HON'BLE JURISDICTIONAL HIGH COURT HAS CLEARLY HELD THAT ADD ITION IN ORDER PASSED U/S 143(3)/ 153A CANNOT BE MADE IN ABSENCE OF ANY INCRI MINATING MATERIAL AND SINCE IN THE INSTANT CASE, THERE IS NO EVIDENCE WHA TSOEVER ON RECORD THAT ANY INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH AND SINCE THE ADDITION WAS MADE ON THE BASIS OF CERTAIN INQUIRIES CONDUCTED SUBSEQUENT TO THE SEARCH ON THE BASIS OF RETURN ALREADY FILED, TH EREFORE, ON THIS ISSUE ITSELF 6 ITA NO. 517/DEL/2017 ADDITION HAS TO BE DELETED. THE ISSUE IN THE PRESEN T CASE IS IDENTICAL WITH THAT OF THE DECISION GIVEN BY THE TRIBUNAL AS THE SAME I S SON OF THE ASSESSEE HEREIN. IN FACT, NOW THE SON IS REPRESENTING THE ASSESSEE A FTER HER DEATH. THE CIT(A) HAS TAKEN PROPER COGNIZANCE OF THE SAME AND ALLOWED THE APPEAL OF THE ASSESSEE ON LEGAL ISSUES AS WELL AS ON MERIT. THUS , APPEAL OF THE REVENUE IS DISMISSED. 8. IN RESULT, THE APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT IN PRESENCE OF B OTH THE PARTIES ON THIS 17 TH DAY OF FEBRUARY, 2021. SD/- SD/- (B. R. R. KUMAR) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEM BER DATED: 17/02/2021 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 7 ITA NO. 517/DEL/2017