SURINDER SINGH RYAIT,LUDHIANA V. ACIT, CC-II, , LUDHIANA

ITA 154/CHANDI/2023

AI Insights

The case involves two separate appeals by Ms. Amarjeet Kaur Ryait and Shri Surinder Singh Ryait against the orders of the Commissioner of Income Tax (Appeals)-5, Ludhiana, which confirmed the additions made by the Assessing Officer under section 68 of the Income Tax Act, 1961. The additions were made following a search operation and subsequent information suggesting that the entities involved were bogus. The appellants contested these additions, arguing that their regular returns had attained finality and no incriminating material was found to justify the additions. The Tribunal, after considering the submissions and precedents, ruled in favor of the appellants, allowing the appeals and setting aside the additions.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 361251 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2012-2013
• Other Referred Cases: Pr. CIT vs. Abhisar Buildwell Pvt. Ltd. (149 Taxmann.com 399), Kabul Chawla (380 ITR 573), Saumya Construction (P.) Ltd. (387 ITR 529)
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KUSUM BANSAL LD
• Assessee Lawyers: P.K.GOEL; SUNIL ARORA
• Keywords: Capital Gains; Wrong claim; Bogus
• Section: 143(3); 132; 153A; 68

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, CHANDIGARH BEFORE HON’BLE SHRI LALIET KUMAR, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM 1. आयकरअपील सं. / ITA No.153/CHANDI/2023 (िनधाŊरणवषŊ / Assessment Year: 2012-13) Ms. Amarjeet Kaur Ryait # 224-H Bhai Randhir Singh Nagar Ludhiana-141012 बनाम/ Vs. ACIT Central Circle-II Ludhiana. ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. ABNPR-0576-N (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) & 2. आयकरअपील सं. / ITA No.154/CHANDI/2023 (िनधाŊरणवषŊ / Assessment Year: 2012-13) Shri Surinder Singh Ryait # 224-H Bhai Randhir Singh Nagar Ludhiana-141012 बनाम/ Vs. ACIT Central Circle-II Ludhiana. ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. ABMPR-3196-H (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Shri P.K. Goel (CA) and Shri Sunil Arora (Advocate) – Ld. ARs ŮȑथŎकीओरसे/Respondent by : Ms. Kusum Bansal (CIT) – Ld. DR सुनवाईकीतारीख/Date of Hearing : 19-05-2025 घोषणाकीतारीख /Date of Pronouncement : 22-05-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeals by two different assessee for Assessment Year (AY) 2012-13 have identical facts. First, we take up ITA No.153/Chandi/2023 which arises out of an order of learned 2 Commissioner of Income Tax (Appeals)-5, Ludhiana [CIT(A)] dated 09- 01-2023 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) r.w.s. 153A of the Act on 31-12-2016. The sole grievance of the assessee is confirmation of addition of Rs.46.65 Lacs as made by Ld. AO u/s 68 of the Act. The Ld. AR relied on the decision of Hon’ble Apex Court in the case of Pr. CIT vs. Abhisar Buildwell Pvt. Ltd. (149 Taxmann.com 399) to submit that in the absence of any incriminating material, no such addition could have been made in the hands of the assessee. The Ld. AR placed on record events chart to bolster the said claim. The Ld. CIT-DR, on the other hand, relied on the orders of lower authorities. Having heard rival submissions and upon perusal of case records, our adjudication would be as under. 2. The assessee was searched on 03-12-2014. However, the regular return of income was already filed by the assessee on 31-07- 2012 which attained finality since no notice u/s 143(2) was issued by due date i.e., 30-09-2013. In the regular return of income, the assessee reflected Long-Term Capital Gains (LTCG) on sale of shares of an entity viz. M/s Vindus Holdings Ltd. The same was claimed exempt u/s 10(38). However, in the assessment proceedings, Ld. AO referred to information received from ADIT (Inv.), Kolkata vide letter dated 09-12- 2016 stating that this entity was a bogus entity and accordingly, held that the said claim was not in order. Though the assessee refuted the allegation of Ld. AO, the same got rejected by Ld. AO and the gains were treated as unexplained money u/s 68. The Ld. CIT(A) dismissed 3 the legal grounds and confirmed the impugned addition on merits against which the assessee is in further appeal before us. 3. Upon perusal of case records, it emerges that the regular return of income as filed by the assessee had attained finality. No incriminating material is shown to have been received from the assessee which would dislodge the claim of the assessee that the gains were bogus claim. The Ld. AO has merely relied upon subsequent information as received from investigation wing alleging that the entity in consideration was a bogus entity. This being so, the ratio of cited decision of Hon’ble Apex Court in the case of Pr. CIT vs. Abhisar Buildwell Pvt. Ltd. (149 Taxmann.com 399) would squarely apply to the facts of this case. Approving the decision of Hon’ble Delhi High Court in the case of Kabul Chawla (380 ITR 573) as well as the decision of Hon’ble Gujarat High Court in Saumya Construction (P.) Ltd. (387 ITR 529), it was held that in respect of completed assessments / unabated assessments, no addition could be made by Assessing Officer in the absence of any incriminating material found during course of search under section 132 or requisition made under section 132A. Respectfully following the same, we allow the legal ground as urged by Ld. AR. The impugned addition is not sustainable on this score only. Delving into the merits of the case has been rendered infructuous. The appeal stand allowed accordingly. 4. It is admitted position that facts in ITA No.154/Chandi/2023 are quite identical. Accordingly, our aforesaid adjudication would mutatis- mutandis apply to this appeal also. This appeal also stand allowed. 4 5. Both the appeals also stand allowed. Order pronounced on 22-05-2025. Sd/- Sd/- (LALIET KUMAR) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 22-05-2025. आदेश की Ůितिलिप अŤेिषत / Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT CHANDIGARH "