M/S Soham Builders & Developers, Bhopal V. ACIT-Central-II, Bhopal, Bhopal

ITSSA 11/Ind/2023

• Counselvise Citation: [2023] 101 COUNSELVISE.COM (IT) 9423 (ITAT-INDORE)
• Duration Of Justice: 7 month(s) 2 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 20-12-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 19-12-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 18-05-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASSESSEE PLEADED
• Section: 132; 40A(3); 143(3); 153A

Judgement Text

Page 1 of 5 आयकर अपीलीय अिधकरण, इंदौर Ɋायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI B.M. BIYANI, ACCOUNTANT MEMBER IT(SS)A No.11/Ind/2023 Assessment Year : 2013-14 M/s. Soham Builders & Developers, Shop No. 4, Vyas Complex, Kolar Road, Bhopal बनाम/ Vs. ACIT, Central-II, Bhopal (Assessee / Appellant) (Revenue / Respondent) PAN: ACCFSO954K Assessee by Shri Ashish Goyal & Shri N.D. Patwa, Adv & AR Revenue by Shri Ashish Porwal, Sr. DR Date of Hearing 20.12.2023 Date of Pronouncement 21.12.2023 आदेश/O R D E R Per B.M. Biyani, A.M.: Feeling aggrieved by appeal-order dated 21.03.2023 passed by learned Commissioner of Income-Tax (Appeals)-3, Bhopal [“Ld. CIT(A)”], which in turn arises out of assessment-order dated 04.06.2021 passed by learned ACIT, Central-II, Bhopal [“Ld. AO”] u/s 143(3) of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2013-14, the assessee has filed this appeal. 2. Heard the learned Representatives of both sides at length and case- records perused. M/s. Soham Builders & Developers,Bhopal vs. ACIT, Central II, Bhopal IT(SS)A No. 11/Ind/2023 Assessment year 2013-14 Page 2 of 5 3. Brief facts are such that the assessee is a partnership firm engaged in the business of real estate. A search u/s 132 of the act was conducted upon assessee on 14.05.2018 pursuant to which assessments have been framed u/s 153A for various years including AY 2013-14 under consideration. While framing assessment, the AO made an addition of Rs. 18,00,000/- on account of disallowance u/s 40A(3) due to cash payments made by assessee against 5 transactions of purchase of lands held as stock- in-trade exceeding the permitted limit of Rs. 20,000/-, the details of such purchase-transactions are mentioned in a Tabular Format in Para 6 of assessment-order at S.No. 1 to 5. Aggrieved by such disallowance, the assessee carried matter in first-appeal whereupon the CIT(A) deleted disallowance qua transactions at S.No. 4 and 5 of the Table but upheld the disallowance qua the transactions mentioned at S.No. 1 to 3. Thus, the assessee got part-relief in first-appeal. Still being aggrieved, the assessee has come in next appeal before us. 4. The ground raised by assessee in appeal memo challenge the disallowance made by assessee on legality/maintainability aspect as well as on merit. However, during hearing before us, Ld. AR for assessee pleaded legality aspect without making any submission on merit. We proceed to decide appeal accordingly. 5. So far as legality aspect is concerned, Ld. AR submits that the search was conducted on 14.05.2018 and the present appeal involves AY 2013-14 for which the assessee filed original return on 04.03.2014 (details M/s. Soham Builders & Developers,Bhopal vs. ACIT, Central II, Bhopal IT(SS)A No. 11/Ind/2023 Assessment year 2013-14 Page 3 of 5 available in Para No. 4 of assessment-order) and no assessment of the said year was pending on the date of initiation of search. Therefore, the AY 2013- 14 with which we are concerned, was definitely a “completed/unabated year”. Then, Ld. AR carried us to aforesaid Para No. 6 of assessment-order where the AO has made the said addition/disallowance. The opening lines of said para mentions thus: “6. During the course of assessment-proceedings, various sale-deeds were submitted by the assessee. On perusal of the same, it is found that following cash payments have been made by the assessee to the sellers in course of his business .....” 6. The above noting by AO, Ld. AR contended, clearly reveals that the said addition/disallowance has been made on the basis of mere appraisal of documents submitted by assessee during assessment-proceedings of the transactions which were already existing in assessee’s books much prior to search. Further, there is no material whatsoever, much less incriminating material, referred by AO in assessment-order having been found/seized during search in relation to the impugned addition/disallowance. 7. Having shown this, Ld. AR submitted that under the scheme of section 153A, any addition/disallowance in a “completed/unabated year” in absence of any seized or incriminating material, is without jurisdiction, bad in law and unsustainable. Ld. AR submitted that the assessee made this claim even before CIT(A) but since there was a judicial controversy over this point at that time, the CIT(A) preferred the decision favouring revenue and thereby did not allow claim of assessee. But this claim of assessee is very much allowed by Hon’ble Delhi High Court in the landmark decision in CIT M/s. Soham Builders & Developers,Bhopal vs. ACIT, Central II, Bhopal IT(SS)A No. 11/Ind/2023 Assessment year 2013-14 Page 4 of 5 Vs. Kabul Chawla (2015) 61 taxmann.com 412 (Delhi HC) : (2016) 380 ITR 573 and the said decision was also followed by Hon’ble Jurisdictional High Court of Madhya Pradesh in the case of PCIT Vs. Gahoi Dal & Oil Mills (2021) 11 ITJ Online 314 (MP), ITA No. 21, 31 & 32 of 2019, order dated 12.07.2019. Recently on 24.04.2023, the Hon’ble Supreme Court has also approved Kabul Chawla’s decision in PCIT Vs. Abhisar Buildwell (P) Ltd. Civil Appeal No. 6580/2021, order dated 24.04.2023. Therefore, in view of recent decision of Hon’ble Supreme Court, the claim of assessee is very much valid. Hence, the addition/disallowance made by AO is not maintainable and has to be deleted. 8. Ld. DR for the revenue dutifully relied upon the orders of lower- authorities although he could not controvert the submissions of Ld. AR. 9. We have considered submissions of both sides and perused the orders of lower-authorities in the light of judicial decisions cited before us. We find that in the present matters, the AO has made addition/disallowance u/s 40A(3) without having recourse or reference to any seized or incriminating material. Further, the assessment-year involved in present appeal is a “completed/unabated year”. These vital aspects are not rebutted or disputed by revenue. When it is so, the addition made by AO and being contested by assessee in present appeal is not sustainable as per binding decisions cited above, more particularly the recent decision of Hon’ble Supreme Court in Abhisar Buildwell. In that view of matter, we are inclined to delete the impugned addition. Ordered accordingly. The assessee succeeds. 10. Since we have deleted the addition on legality/maintainability itself, it would be unnecessary to go into the merit of same. Even the Ld. AR has also M/s. Soham Builders & Developers,Bhopal vs. ACIT, Central II, Bhopal IT(SS)A No. 11/Ind/2023 Assessment year 2013-14 Page 5 of 5 not made any pleading on merit. Accordingly, the merits are left open without adjudication. 11. Resultantly, this appeal is allowed. Order pronounced in the open court on 21.12.2023. Sd/- (VIJAY PAL RAO) JUDICIAL MEMBER Sd/- (B.M. BIYANI) ACCOUNTANT MEMBER Indore िदनांक/Dated : 21.12.2023 CPU/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Indore Bench, Indore