PCIT Vs Atria Wind (Kadambur) Pvt Ltd (Karnataka High Court)
Karnataka High Court held that no incriminating material was found during the search proceedings and therefore no reassessment of income for the relevant assessment year could be made under Section 153A of the Income Tax Act. Accordingly, appeal of revenue dismissed.
Facts- Office premises of the assessee was searched on 17.12.2020. Thereafter notice u/s. 153A of the Act was issued. AO determined the total income of the assessee at ₹1,89,11,81,757/-. The said determination was based on an addition of a sum of ₹1,91,95,68,251/- made on account of capital gains. During the previous year relevant to AY 2017-18, a partnership firm namely M/s. Perpetual Investments, was converted into a private company [the assessee]. The said conversion entailed the transfer of the entire assets and liabilities from the partnership firm to the assessee company.
CIT(A) rejected the assessee’s appeal. ITAT allowed the appeal of the assessee. Accordingly, being aggrieved, revenue has preferred the present appeal.
Conclusion- The Supreme Court in CIT v. Abhisar Buildwell (P) Ltd. : ( [2024] 2 SCC 433). The Supreme Court had expressly upheld the decisions of the Gujarat High Court in CIT v. Saumya Construction (P) Ltd. : 2016 SCC Online Guj 9976 and the decision of the Delhi High Court in CIT v. Kabul Chawla : 2015 SCC Online Del 11555 holding that no reassessment u/s. 153A or 153C could be done in absence of any incriminating material found in a search u/s. 132 of the Act or by requisition u/s. 132A of the Act.
