VIVEK SAHGAL,GURUGRAM V. ACIT CENTRAL CIRCLE 8, NEW DELHI

ITA 1888/DEL/2023

AI Insights

The case involves twin appeals by Rachita Sahgal and Vivek Sahgal against the orders of the CIT(A)-24, New Delhi, which upheld the additions made to their income following a search operation under section 153C of the Income Tax Act, 1961. The search, conducted on 03.01.2018, was part of an investigation into the M/s Navneet Dawar group, during which incriminating documents indicating on-money payments in property transactions were seized. The Tribunal, after considering the arguments and evidence presented, concluded that the additions were improperly made as the seized documents did not conclusively belong to the assessees and the legal provisions applied were misinterpreted.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 38273 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BALJEET KAUR
• Section: 153C

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’, NEW DELHI Before Sh. Satbeer Singh Godara, Judicial Member & Sh. S. Rifaur Rahman, Accountant Member ITA No. 1836/Del/2023 : Asstt. Year: 2018-19 Rachita Sahgal, C-2, Flat No. 601, Uni World City, Sector-30, Gurgaon-122001 Vs ACIT, Central Circle-8, New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. ANTPS4874Q ITA No. 1888/Del/2023 : Asstt. Year: 2018-19 Vivek Sahgal, C-2, Flat No. 601, Uni World City, Sector-30, Gurgaon-122001 Vs ACIT, Central Circle-8, New Delhi-110002 (APPELLANT) (RESPONDENT) PAN No. AAMPS2422E Assessee by : None Revenue by : Ms. Baljeet Kaur, CIT-DR Date of Hearing: 27.01.2025 Date of Pronouncement: 07.02.2025 ORDER Per Satbeer Singh Godara, Judicial Member: These twin assessees as many appeals i.e. ITA Nos. 1836 & 1888/Del/2023, for A.Y. 2018-19 arise against the CIT(A)-24, New Delhi’s case Nos. CIT(A), Delhi-24/10339/2017-18 and CIT(A), Delhi-24/10336/2017-18 dated 16.05.2023, in proceedings u/s 153C of the Income Tax Act, 1961 (in short “the Act”), respectively. ITA Nos. 1836 & 1888Del/2023 Rachita & Vivek Sahgal 2 2. Case called twice. None appears at the assessees’ behest. They are accordingly proceeded ex-parte. 3. The Revenue is indeed very fair in rendering it’s able assistance to us during the course of hearing that these twin assessees Smt. Rachita Sahgal & Vivek Sahgal; are infact a couple, proceeded u/s 153C of the Act, in furtherance to the department’s search action dated 03.01.2018 in M/s Navneet Dawar group wherein the letter had found/seized incriminating material “belonging” to them indicating on-money payments in property transaction(s), resulting in identical addition of Rs.42,94,000/- each in their respective hands. Learned CIT-DR further takes us the corresponding Exhibit-13 at pages 4 & 5 of the assessment order dated 31.12.2012 to this effect to buttress the Revenue’s stand that the impugned identical addition has been rightly made in the assessees’ hands. 4. We have given our thoughtful consideration to the assessees pleadings and Revenue’s foregoing vehement contentions reiterating their respective stands. We see no reason to uphold validity of the impugned assessments as the learned assessing authority had held the foregoing seized document(s) as “belonging” to the assessees, in the assessment ITA Nos. 1836 & 1888Del/2023 Rachita & Vivek Sahgal 3 order, whereas such a material could only “pertains” or “pertain” or “relates” to as per amended section 153C(1)(b) of the Act by the Finance Act, 2015 w.e.f. 01.06.2015. We wish to clarify here that clause (a) to section 153C(1) stipulates certain specific items i.e. money, bullion or other valuable articles …………………..as “belongs” to than the latter clause (b) hereinabove applicable in a different situation. We thus hold that the learned lower authorities have erred in law and on facts in proceedings against these twin assessee’s based on an invalid satisfaction in these facts and circumstances. 5. Next comes merits of the impugned on-money addition wherein the department vehemently quotes section 292C of the Act qua the above seized material Exhibit-13. We are of the considered view that such a presumption u/s 292C of the Act applies only against the person from whom the corresponding incriminating material has been found and seized than a third person and therefore, the impugned addition without any supportive evidence or corroboration does not deserve to be upheld on merits as well. Deleted accordingly. ITA Nos. 1836 & 1888Del/2023 Rachita & Vivek Sahgal 4 6. These twin assessees appeals are allowed in above terms. A copy of this common order be placed in the respective case files. Order Pronounced in the Open Court on 07/02/2025. Sd/- Sd/- (S. Rifaur Rahman) (Satbeer Singh Godara) Accountant Member Judicial Member Dated: 07/02/2025 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR "