Seema Jain Vs DCIT (ITAT Delhi)
ITAT Delhi held that assessment u/s. 143(3) of the Income Tax Act based on material searched at third party is untenable in law. The assessment should be completed u/s. 153C instead of 143(3).
Facts- A search and seizure action u/s 132 of the Act was carried out at the premises of Shri Parveen K Jain / M/s Jainco Ltd on 6.1.2021. During the course of search, it was found that sale of property at C-117, First Floor, Nirman Vihar, Delhi-110092 was done for total sale consideration amounting to Rs 2,35,00,000/-. However, on perusal of the ITR of the assessee, it was found that the property was sold by the assessee for a consideration of Rs 80,00,000/- through proper banking channel. AO observed that the cash receipt of Rs 1,55,00,000/- was not disclosed in the ITR as sale consideration of the above mentioned property.
Accordingly, a satisfaction note was recorded in the hands of the assessee to proceed in the hands of the assessee in terms of section 153C of the Act on 26.9.2022 by the ld AO of the searched person. Based on this satisfaction, a separate satisfaction note stood recorded u/s 153C of the Act in the hands of the assessee on 3.10.2022 by AO of the assessee. Hence the date of search in the case of the assessee becomes 3.10.2022 relevant to Asst Year 2023-24. The assessment year under consideration is Asst Year 2021-22. Hence any information pertaining / relating / belonging to Asst Year 2021-22 could be proceeded in the hands of the assessee only u/s 153C of the Act for which notice u/s 153C of the Act need to be issued to the assessee and assessment should be framed u/s 153C of the Act. But, AO had framed the assessment of the assessee u/s 143(3) of the Act for Asst Year 2021-22.
