Clarion Agro Products Private Limited Vs ACIT (ITAT Hyderabad)
Hyderabad ITAT: Wrong Section Mentioned (69 Instead of 69A) Doesn’t Invalidate Addition; Section 153D Approval Protected by New Section 292BC
The Hyderabad ITAT partly allowed the assessee’s appeal for statistical purposes in a search assessment. The Tribunal upheld the addition of ₹67,43,098 relating to excess cash found during the search, holding that mentioning Section 69 instead of Section 69A did not invalidate the addition since the nature of the addition as unexplained cash remained unchanged, and the CIT(A)’s correction of the applicable provision neither enhanced the assessment nor violated principles of natural justice. The Tribunal also rejected the challenge to the validity of approval under Section 153D, observing that, after the retrospective insertion of Section 292BC, technical defects such as absence of DIN, clerical discrepancies or advisory observations in the approval did not invalidate it. On merits, the Tribunal found the assessee’s explanation regarding the source of excess cash unsupported by contemporaneous records and documentary evidence and upheld the addition. However, regarding the addition of ₹5,83,932 on account of alleged stock shortage, the Tribunal restored the matter to the Assessing Officer for fresh examination after considering work-in-process, manufacturing loss, quantitative details and supporting evidence, with an opportunity of hearing to the assessee.
