DCIT Vs E-Homes Infrastructure Pvt. Ltd. (ITAT Delhi)
Wrong Section Applied Post-Search: ITAT Upholds Quashing of AY 2021-22 Assessment Framed Under 143(3) Instead of 153C
The Delhi Bench “B” of the ITAT, in DCIT v. E-Homes Infrastructure Pvt. Ltd. (AY 2021-22), dismissed the Revenue’s appeal and upheld the CIT(A)’s order quashing the assessment, holding that once proceedings under section 153C are triggered, the AO cannot frame a regular assessment under section 143(3).
The case arose from a search on the Hans Group on 06.01.2021, during which digital data seized from a third party (Parveen K. Jain) was found to belong to the assessee. The AO of the searched person recorded a satisfaction note on 27.09.2022, and the AO of the assessee recorded a consolidated satisfaction note on 30.09.2022. Applying the law laid down by the Supreme Court in Jasjit Singh and the Delhi High Court in Ojjus Medicare Pvt. Ltd., the Tribunal held that for the assessee (a non-searched person), the deemed date of search was 30.09.2022.
Since AY 2021-22 fell within the six years preceding the year of search (AY 2023-24), assessment for that year had to be framed only under section 153C. Any pending regular assessment stood abated, and therefore the AO lacked jurisdiction to pass an order under section 143(3) on 30.12.2022. Such an assessment was held to be void ab initio.
Finding no infirmity in the CIT(A)’s application of binding precedents, the ITAT dismissed the Revenue’s appeal. As the assessment itself was quashed, the assessee’s cross-objection was held infructuous and dismissed accordingly
FULL TEXT OF THE ORDER OF ITAT DELHI
