Ador Ceramic Pvt. Ltd. Vs D/ACIT (Gujarat High Court)
The Gujarat High Court decided a batch of tax appeals involving common substantial questions of law, with Tax Appeal No. 157 of 2025 treated as the lead matter. The appeals challenged orders passed by the Income Tax Appellate Tribunal, Rajkot, which had disposed of 46 appeals arising from assessments framed under Sections 153C/143(3) and 153A of the Income Tax Act, 1961. These assessments stemmed from a search conducted in the group cases of the Coral Group of Morbi, including the residential premises of an individual from whom diaries and loose papers recording alleged cash transactions were seized. His statement was recorded under Section 132(4), in which he explained a modus operandi for assisting group companies and other entities in collecting proceeds of unaccounted sales.
The assessees contended that they were implicated solely on the basis of the seized material and statements of this individual. They consistently sought an opportunity to cross-examine him, as his statements and documents were relied upon to make additions. Such requests were made before the Assessing Officer and the Commissioner (Appeals) but were denied. Before the Tribunal, the assessees argued that denial of cross-examination violated principles of natural justice, particularly since presumptions under Sections 132(4A) and 292C apply primarily to the person from whose possession material is seized.
