V.L. Khandge Vs ITO (ITAT Pune)
The ITAT Pune decided cross appeals filed by the assessee and the Revenue for Assessment Year 2006-07 arising from assessment orders passed under Section 143(3) read with Section 147 of the Income-tax Act, 1961. During the hearing, the assessee raised an additional legal ground contending that the Assessing Officer (AO) had wrongly invoked Sections 147/148 when the provisions of Section 153C were applicable.
The assessee argued that the additions made in the assessment were based entirely on documents and information found during a search conducted under Section 132 at the premises of Shri Ganesh Khandge on 12.02.2013. The assessee contended that since the material relied upon belonged to or related to the assessee and was discovered during the search of another person, proceedings could only be initiated under Section 153C and not under Sections 147/148.
The Tribunal admitted the additional ground, holding that it raised a pure question of law requiring no further investigation of facts.
The record showed that the assessee had originally filed a return of income which was processed under Section 143(1). Subsequently, the AO received information from the Deputy Director of Income Tax (Investigation), Pune, regarding material unearthed during the search on Shri Ganesh Khandge. Based on that information, the AO recorded reasons and issued a notice under Section 148.
