Jalaram Land Infrastructure P Ltd., Navi Mumbai V. ITO., Ward 3, Panvel

ITSSA 1/PUN/2021

AI Insights

The case involves Jalaram Land Infrastructure Private Limited, which was one of 62 companies linked to a search and seizure action against Mr. Dilip Dherai. The Assessing Officer (AO) added Rs.26,55,000 as unexplained expenditure to the assessee's income, based on documents found during the search. The CIT(A) upheld this addition. However, the Tribunal, referencing a previous decision involving 52 other companies from the same group, found that section 153C was incorrectly applied as no incriminating material specific to the assessee was discovered during the search. The Tribunal's decision was to allow the appeal, thereby removing the addition made by the AO.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137733 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 11 month(s) 14 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 15-01-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 15-01-2023
• Assessment Year: 2008-2009
• Appeal Filed On: 01-02-2021
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 153C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH, ‘A’ PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER IT(SS)A No.01/PUN/2021 नधा रण वष / Assessment Year : 2008-09 Jalaram Land Infrastructure Private Limited, D-22/1, MIDC TTC Industrial Area, Turbhe, Navi Mumbai, Thane 400 705 Maharashtra PAN : AABCJ8097Q Vs. ITO, Ward-3, Panvel Appellant Respondent आदेश / ORDER PER R.S. SYAL, VP : This appeal by the assessee is directed against the order passed by the CIT(A)-2, Thane on 25-03-2015 in relation to the assessment year 2008-09. 2. The only issue raised through various grounds is against the confirmation of addition of Rs.26,55,000/- made by the Assessing Officer (AO) u/s.153C of the Income-tax Act, 1961 (hereinafter also called ‘the Act’). Assessee by Shri Nimesh Vora Revenue by Shri Keyur Patel Date of hearing 16-01-2023 Date of pronouncement 16-01-2023 IT(SS)A No.01/PUN/2021 Jalaram Land Infrastructure Private Limited 2 3. Briefly stated, the facts of the case are that the assessee is engaged in the purchase and sale of lands. A search and seizure action was taken against one Mr. Dilip Dherai. Certain incriminating material found from him transpired that he had floated 62 land companies for purchase of lands. The AO noticed that a total sum of Rs.38.4518 crore was mentioned on certain pages found during the course of search indicating unexplained expenditure/investment in the hands of such 62 companies. By treating assessee’s proportionate share in such payment as unexplained expenditure, the AO made an addition of Rs.26,55,000/-. The ld. CIT(A) sustained the addition, against which the assessee has approached the Tribunal. 4. After considering the rival submissions and perusing the relevant material on record, we find that the assessee is one of such 62 companies. Case of other 52 companies from this group came up for consideration before the Tribunal. Vide its order dated 22-03-2013, the Tribunal has held that the authorities below were not justified in invoking the provisions of section 153C as no incriminating material pertaining to the assessee was found during the course of search. Though the addition was deleted by IT(SS)A No.01/PUN/2021 Jalaram Land Infrastructure Private Limited 3 the Tribunal on merits as well, but the Hon’ble High Court upheld the finding of the Tribunal on the legal issue of non- applicability of section 153C and did not go into the merits. Thus, it is seen that the case of 52 companies out of 62 have been disposed of by the Tribunal in assessees’ favour by holding that the provisions of section 153C cannot be applied to them. The ld. DR fairly admitted that the assessee in question is a part of such overall 62 companies and the facts and circumstances of the assessee are similar to such 52 companies whose appeals have since been disposed off. Respectfully following the precedent, we overturn the impugned order and hold that the provisions of section 153C were wrongly invoked in the case of the assessee, as a consequence of which no addition can be made. The issue on merits is left open in view of the finding on the preliminary legal issue. 5. In the result, the appeal is allowed. Order pronounced in the Open Court on 16 th January, 2023. Sd/- Sd/- ( S.S. VISWANETHRA RAVI) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; िदनांक Dated : 16 th January, 2023 सतीश IT(SS)A No.01/PUN/2021 Jalaram Land Infrastructure Private Limited 4 आदेश की ितिलिप अ ेिषत/Copy of the Order is forwarded to: 1. अपीलाथ / The Appellant; 2. थ / The Respondent 3. The CIT(A) concerned 4. 5. The Pr. CIT concerned DR, ITAT, ‘A’ Bench, Pune 6. गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune Date 1. Draft dictated on 16-01-2023 Sr.PS 2. Draft placed before author 16-01-2023 Sr.PS 3. Draft proposed & placed before the second member JM 4. Draft discussed/approved by Second Member. JM 5. Approved Draft comes to the Sr.PS/PS Sr.PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *