PCIT Vs Kapoor Industries Limited (Delhi High Court)
Cash Seized From Another’s Locker Cannot Become Department’s Permanent Locker-Delhi HC Orders Refund After Adjustment u/s 132B
The Delhi High Court has held, at the interim stage, that once the assessment of the searched person stood completed without fastening any liability upon the seized cash & the Department accepted that the cash belonged to another assessee, the protection available to the Revenue under section 132B came to an end. The Department could not continue retaining the money merely because reassessment proceedings were subsequently initiated against its real owner.
However, the Court has admitted the Revenue’s appeal on the larger legal question whether cash seized from the lockers of searched persons could be claimed by another assessee as its self-assessment tax.
Facts of the Case
During search proceedings, cash of ₹17,66,50,000 was seized from lockers belonging to Shakun Tamang & Ashish Kapoor. Kapoor Industries Ltd. claimed that the seized cash represented its cash sales.
Before Kapoor Industries filed its return for AY 2024-25, Ashish Kapoor addressed a letter to the AO stating that the cash belonged to Kapoor Industries & requesting that the seized amount be treated as the company’s self-assessment tax. Significantly, the AO was common to both Ashish Kapoor & Kapoor Industries.
