DCIT Vs Rajyog Buildtech Private Limited (ITAT Delhi)
Searched Together, Assessed Separately: ₹7.5 Crore Protective Addition Fails
The alleged property advance
A search conducted on 15 November 2017 covered the Sanjay Singhal Group, including Rajyog Buildtech Private Limited. A coordinated search also involved the OPG Group. The Assessing Officer (AO) subsequently assessed Rajyog under Section 153A for assessment years 2015–16 and 2016–17.
The dispute centred on an agreement under which Rajyog was to sell commercial space at Dheerpur, Delhi, to OPG Securities Private Limited for ₹21 crore. The records described an advance of ₹15.50 crore. The AO suspected that the apparent property advance was an accommodation entry: unaccounted cash allegedly supplied by Sanjay Singhal was said to have moved through the OPG Group and returned to Rajyog as an advance by cheque.
For assessment year 2015–16, the AO added ₹7.50 crore received as an advance during the relevant financial year to Rajyog’s income on a protective basis under Section 68. A corresponding substantive addition was made in Sanjay Singhal’s hands. The CIT(A) deleted Rajyog’s protective addition, and the Revenue appealed to the Delhi ITAT.
Where was the incriminating material found?
Although Rajyog itself was covered by a search warrant, the material on which this particular addition rested came from someone else’s premises. The AO relied on Excel sheets and a cash book recovered from the laptop of Saurabh Gupta, an employee associated with OPG Securities. The Tribunal referred to the panchnama and search warrant for those premises, which stood in the names of Sanjay Gupta and OPG Securities.
