PCIT Vs LKG Builders P. Ltd. (Delhi High Court)
Summary: The Delhi High Court dismissed the Revenue’s appeals challenging the ITAT order dated 27 April 2020 deleting additions made under Section 153A of the Income-tax Act, 1961. The Revenue contended that the ITAT had erred in relying upon CIT Vs. Kabul Chawla, 380 ITR 573, since the Revenue had not accepted that decision and had challenged it before the Supreme Court. The High Court referred to PCIT Vs. Neeta Gutgutia, (2017) 82 com 287 Del, which had summarised the principles governing Section 153A, including that completed assessments can be interfered with only on the basis of incriminating material unearthed during search. In the present cases, the assessments had attained finality before the search and no incriminating documents or material had been found and seized. Accordingly, the Court held that no addition could be made under Section 153A in these non-abated assessments. The Court further observed that although some judgments had been challenged before the Supreme Court, there was no stay against them. Referring to Kunhayammed and Others Vs. State of Kerala And Another, (2000) 6 SCC 359 and Shree Chamundi Mopeds Ltd. Vs. Church of South India Trust Association CSI Cinod Secretariat, Madras, (1992) 3 SCC 1, the High Court dismissed the Revenue’s appeals as covered by the earlier Division Bench judgment.
