Divjot Singh Mainee Vs DCIT (ITAT Delhi)
Summary : The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) in Divjot Singh Mainee vs DCIT examined the validity of search assessments under Section 153A of the Income Tax Act, 1961, for Assessment Years (AYs) 2013–14 and 2014–15. The Tribunal addressed two core legal issues — whether additions could be made in the absence of incriminating material and whether the approval granted under Section 153D was mechanical and devoid of application of mind.
Background
A search and seizure operation under Section 132 was conducted on the assessee and related entities on 19 November 2018. The assessments for AYs 2013–14 and 2014–15 had already been concluded under Sections 143(1) or 143(3) before the search and were thus unabated. Pursuant to the search, the Assessing Officer (AO) issued notices under Section 153A and completed assessments under Section 143(3) read with Section 153A.
During these proceedings, the AO made additions of ₹10,13,780 for AY 2013–14 and ₹3,63,448 for AY 2014–15 under Section 69A, alleging unexplained intra-group transactions lacking commercial justification.
Proceedings before CIT(A)
Before the Commissioner of Income Tax (Appeals) [CIT(A)], the assessee challenged the legality of additions on three principal grounds:
1. The additions were made without any incriminating material discovered during the search.
2. The approval granted by the Additional Commissioner of Income Tax (Addl. CIT) under Section 153D was mechanical and without application of mind.
3. The additions were factually and legally unsustainable.
The assessee submitted that since the assessments were unabated, the AO could not disturb completed assessments unless incriminating material was found during the search. It was further contended that the 153D approval was issued in a consolidated and perfunctory manner for multiple assessment years, based solely on assurances from the AO.
