Case Law Details
ACIT Vs Karsan Bhai Khimabhai Patel (ITAT Delhi)
Introduction: In the case of ACIT Vs Karsan Bhai Khimabhai Patel, the Income Tax Appellate Tribunal (ITAT) in Delhi dealt with various additions made by the Assessing Officer (AO) during an assessment for the year 2011-12. The key issues revolved around the deletion of additions related to unexplained investment and capital gains. This article provides an analysis of the ITAT’s decision, which primarily focused on the lack of independent inquiry by the AO.
Background: The case stemmed from a search and seizure operation conducted under Section 132 of the Income Tax Act, 1961, by the Investigation Wing of the Income Tax Department. Following the search, a notice under Section 153A of the Act was issued to the taxpayer, Karsan Bhai Khimabhai Patel. However, the taxpayer did not file the return of income within the allotted time. Later, in response to a notice under Section 142(1) of the Act, the taxpayer filed their return, declaring an income of INR 22,68,140 on August 17, 2018.
Subsequently, the AO framed the assessment under Section 153A read with Section 144A of the Act on December 26, 2018. The AO made various additions, including those related to agricultural income, purchase of agricultural lands, purchase agreements for properties, and sale consideration received for certain properties. The AO ultimately assessed the taxpayer’s income at INR 3,14,70,018, significantly higher than the declared income.
Key Issues and Findings:
Please become a Premium member. If you are already a Premium member, login here to access the full content.
