Income Tax Appellate Tribunal - Delhi
Basant Bansal, Gurgaon vs Acit, New Delhi on 5 October, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH "A", NEW DELHI
BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER
AND
MS. SUCHITRA KAMBLE, JUDICIAL MEMBER
ITA No.5164/Del/2012
Assessment Year : 2002-03
Basant Bansal, ACIT, Central Circle- 7,
C-13, Sushant Lok-I, New Delhi.
Vs.
Gurgaon.
PAN : AHYPB1973A
(Appellant) (Respondent)
Assessee by : Shri Satyen Sethi, Adv.
Shri Arta Trana Panda, Adv.
Department by : Smt. Aparna Karan, CIT(DR)
Date of hearing : 26-09-2017
Date of pronouncement : 05-10-2017
ORDER
PER R. K. PANDA, AM :
This appeal filed by the assessee is directed against the order dated 03.07.2012 of CIT(A)-I, New Delhi relating to assessment year 2002-03.
2. Although, a number of grounds have been raised by the assessee they all relate to the order of the CIT(A) in confirming the various additions made by the Assessing Officer in absence of any incriminating material found during the course of search.
2ITA No.5164/Del/2012
3. Facts of the case, in brief, are that the assessee is an individual and had filed his return of income on 20.08.2002 declaring total income of Rs2,19,617/-. A search and seizure operation u/s 132 of the I.T. Act was carried out in the case of the assessee on 12.09.2007. In response to notice u/s 153A of the I.T. Act dated 17.10.2008, the assessee filed the return of income on 26.08.2009 declaring an income of Rs.2,19,617/- which is the same as declared in the original return. During the course of assessment proceedings, the Assessing Officer examined the various details filed by the assessee from time to time and noted that the assessee had shown an amount of Rs.13,06,458/- as cash in hand as on 01.04.2002 in the Statement of Affairs, which was prepared for the first time and was never submitted in the preceding assessment years. The Assessing Officer, therefore, disbelieved the explanation of the assessee for showing such huge opening cash balance on the ground that the assessee has an average income of Rs.1,94,699/- for the last five years and the family of the assessee consists of self, his wife and two children and, therefore, the assessee cannot have cash in hand of Rs.13,06,458/-. Keeping in view the average income of the assessee for the last five years, the nature of family and the lifestyle maintained by him, the Assessing Officer considered Rs.2 lakhs as cash in hand and the balance amount of Rs.11,06,458/- was considered by him as income earned from undisclosed sources.
3ITA No.5164/Del/2012
4. The Assessing Officer further noted that the assessee has visited Switzerland with his family and on being questioned stated that the entire expenses have been incurred by M/s Misty Meadows Pvt. Ltd. in which he is a Director. Although, it was stated that the foreign travel was for the purpose of business, however, not a single document could be furnished to support the claim. The Assessing Officer, therefore, held that the expenses incurred by the company on account of foreign travel by the Directors as prerequisite in hands of the assessee and he added the same to his income u/s 2(24)(iv) of the I.T. Act. He accordingly determined the income of the assessee at Rs.14,50,887/- as against the returned income of the assessee at Rs.2,19,617/-.
5. In appeal, the ld. CIT(A) upheld the additions made by the Assessing Officer.
6. Aggrieved with such order of the CIT(A), the assessee is in appeal before the Tribunal.
7. Ld. counsel for the assessee at the outset submitted that the assessment for the year 2002-03 was not pending and the assessment had not abated. No incriminating material whatsoever was found during the course of search. Therefore, the additions made by the Assessing Officer in absence of any incriminating material find during the course of search which has been sustained by the ld. CIT(A) deserves to be deleted. For the above proposition, he relied 4 ITA No.5164/Del/2012 on the decision of the Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla reported in 380 ITR 573 and in the case of Meeta Gutgutia reported in 395 ITR 526.
8. Ld. DR on the other hand heavily relied on the order of the Assessing Officer and the CIT(A).
9. We have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and the CIT(A) and Paper Book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the additions made by the Assessing Officer in the body of the assessment order is not based on any incriminating material find during the course of search. Therefore, we find merit in the argument of the ld. counsel for the assessee that in absence of any incriminating material found during the course of search, the additions cannot be made in 153A proceedings. The Hon'ble Delhi High Court in the case of Kabul Chawla (supra) has held that invocation of section 153A is invalid in absence of any incriminating material found during the course of search. Similar view has been taken by the Hon'ble Delhi High Court in the case of Meeta Gutgutia (supra). Since in the instant case the addition is not based on any incriminating material found during the course of search, therefore, the addition made by the Assessing Officer in the 5 ITA No.5164/Del/2012 order passed u/s 153A which has been upheld by the CIT(A), in our opinion, is not justified. Accordingly, the same is directed to be deleted.
10. In the result, the appeal filed by the assessee is allowed.
Order pronounced in the open Court on this 05th day of October, 2017.
Sd/- Sd/-
(SUCHITRA KAMBLE) (R. K. PANDA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated: 05-10-2017.
Sujeet
Copy of order to: -
1) The Appellant
2) The Respondent
3) The CIT
4) The CIT(A)
5) The DR, I.T.A.T., New Delhi
By Order
//True Copy//
Assistant Registrar
ITAT, New Delhi