Kamal Sharma Vs DCIT (ITAT Delhi)
The appeals before the Income Tax Appellate Tribunal (ITAT), Delhi, arose from a common order of the Commissioner of Income-tax (Appeals)-3, Gurgaon, relating to Assessment Years (AYs) 2008-09 and 2014-15.
The assessee challenged the validity of proceedings initiated under Section 153C and the additions made by the Assessing Officer (AO). The case was reopened under Section 153C based on documents allegedly found during a search conducted on the Sunstar Group on 19.12.2013. A notice under Section 153C was issued to the assessee on 20.01.2016.
Issue Relating to AY 2008-09
The assessee contended that the notice under Section 153C was issued in AY 2016-17 and that the six assessment years covered under Section 153C would be AYs 2010-11 to 2015-16. Since AY 2008-09 fell outside this six-year period, it was argued that the AO lacked jurisdiction to assess that year under Section 153C.
The assessee also challenged the validity of proceedings on the grounds that no incriminating material belonging to the assessee was found during the search, no satisfaction was properly recorded, and the additions were not based on incriminating material.
Issue Relating to AY 2014-15
The assessee argued that AY 2014-15 fell within the block period covered by Section 153C, but the AO incorrectly completed the assessment under Section 143(3) instead of Section 153C. According to the assessee, issuance of notice and assessment under Section 153C was mandatory and failure to follow that procedure resulted in a jurisdictional defect rendering the assessment invalid.
