MAYA AND CO,ALMORA V. DCIT CENTRAL CIRCLE,HALDWANI, HALDWANI

ITA 43/DDN/2024

AI Insights

The case involves M/s. Maya & Co., which appealed against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (CIT(A)/NFAC), Delhi, concerning an assessment for the year 2020-21. The primary issue was the addition of unexplained cash amounting to Rs.10.80 lakhs, which was seized during a routine vehicle check and allegedly represented liquor sale receipts. The Assessing Officer added this amount under section 69 read with section 115BBE of the Act, which was upheld by the CIT(A)/NFAC. The Tribunal, however, found procedural discrepancies in the assessment's initiation under section 143(3) following a requisition, leading to the quashing of the assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 126675 (ITAT-DEHRADUN)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2020-2021
• Other Referred Cases: PCIT -7 vs. Naveen Kumar Gupta, Amar Jewellers Ltd vs. ACIT
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.K. CHATERJEE
• Keywords: Principal; National Faceless Appeal; HRA; Commissioner; Commissioner of Income Tax; 153C; 153A; Department
• Section: 143(3); 153A; 69; 153C

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL, DEHRADUN “SMC” BENCH, DEHRADUN BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER (THROUGH VIDEO CONFERENCING) ITA No.43/DDN/2024 Assessment Year: 2020-21 M/s. Maya & Co., Talla Danya Dharanaula Almora, Uttarakhand Vs. DCIT, Central Circle, Haldwani. PAN :AAHAM6723A (Appellant) (Respondent) ORDER PER SATBEER SINGH GODARA, JM This assessee’s appeal for assessment year 2020-21, arises against the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre [in short, the “CIT(A)/NFAC”], Delhi’s DIN and order no. ITBA/NFAC/S/250/2023-24/1059720469(1), dated 15.01.2024, involving proceedings under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’). Assessee by None Department by Sh. S.K. Chaterjee, CIT(DR) Date of hearing 17.03.2025 Date of pronouncement 23.04.2025 ITA No.43/DDN/2024 2 | P a g e 2. Case called twice. None appears at the assessee’s behest. It is accordingly proceeded ex-parte. 3. Learned CIT(DR) vehemently argues during the course of hearing that both the learned lower authorities have rightly added unexplained money/cash of Rs.10.80 lakhs in the assessee’s hands as it could not explain the source thereof during the course of hearing of assessment framed on 31st March, 2022 as upheld in the lower appellate discussion. 4. We next note with the able assistance coming from CIT(DR) side and from a perusal of the case file that the above stated cash was seized by the appellate authority on 06.04.2019 in routine checking of vehicles. Learned Assessing Officer very fairly records in the assessment order that the driver of the vehicle and his alleged accomplice, Sh. Chandan Sabharwal got recorded their statement that the said cash represented liquor sale receipts of the shop located at Premnagar, Dehradun, which was run by Smt. Sarita, who happened to the member of assessee AOP M/s. Maya & Co. The Principal Director of Income Tax (PDIT) thereafter issued his warrant on 06.04.2019 requisitioning the said cash, which in turn, led to section 69 r.w.s. 115BBE addition made in the ITA No.43/DDN/2024 3 | P a g e assessee’s hands. The CIT(A)/NFAC has upheld the said assessment findings. 5. It is in this factual backdrop that there arises the first and foremost clinching issue of the validity of the impugned section 143(3) assessment itself as the instant case involves the PCIT, Kanpur’s requisition dated 06.04.2019, which amounts to initiation of search attracting either section 153A proceeding in case of the searched person or under section 153C, involving any third person. 6. Learned CIT(DR) vehemently argues in light of [2024] 168 taxmann.com 574 (Delhi-HC), PCIT -7 vs. Naveen Kumar Gupta and Amar Jewellers Ltd vs. ACIT (2022) 444 ITR 97, that it is nowhere mandatory to only initiate section 153C proceedings in such an instance which could also lead to setting into motion a reopening under section 148/147 of the Act. 7. We are of the considered view that the Revenue’s arguments carry no merit once it is a case of a “requisition” and the learned Assessing Authority has framed its assessment under the regular provisions i.e. under section 143(3) of the Act than either taking recourse of section 148/147, as the case may be. We thus see no ITA No.43/DDN/2024 4 | P a g e reason to sustain the impugned assessment framed on 31st March, 2022, which is hereby quashed in very terms. All other assessee’s remaining grounds in the instant appeal stand rendered academic. 8. This assessee’s appeal is allowed in above terms. Order pronounced in the open court on 23rd April, 2025 Sd/- Sd/- (M. BALAGANESH) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 23rd April, 2025. RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi "