Late Ghanshyam Das Agarwal Vs DCIT (ITAT Kolkata)
ITAT Kolkata held that additions u/s. 153A of the Income Tax Act could only be made on the basis of seized material found during the course of search. Thus, making additions in regular assessment without any incriminating material relating to said addition not justified.
Facts-
Shri Ghanshyam Das Agarwal (appellant) was an individual running export business under the name and style of M/s. Bharat Export. There is one another business entity of the group called M/s. Navbharat Exports Pvt. Ltd. which is a company owned by Shri Uttam Kumar Agarwal. S/o. Late Shri Ghanshyam Das Agarwal and Smt. Rita Agarwal, W/o. Shri Uttam Kumar Agarwal are directors of the said Company.
The appellant filed his return of income u/s. 139(1) declaring a loss of Rs. 4,01,96,196/- in A.Y. 2010-11 and income of Rs. 15,07,080/- in A.Y. 2012-13.
The Income Tax Department conducted a search and seizure u/s. 132 of the Income Tax Act on 24.03.2015. AO has issued notices u/s. 143(2) and 142(1) on 24.10.2016. He has passed the impugned assessment orders on 30.12.2016 in all the three assessment years. He made the additions.
Conclusion-
Held that additions under section 153A could only be made on the basis of seized material found during the course of search. He submitted that assessment years involved herein are A.Ys. 2010-11 and 2012-13. The assesseees have filed regular returns under section 139(1). The time limit to issue notice for scrutinizing their return under section 143(2) expired long back before the search carried out upon the premises of the assessee on 24.03.2015. Thus, these assessment years attained finality. They could also abate if incriminating material was found during the course of search.
