DCIT Vs Mani Capital Limited (ITAT Delhi)
153C Assessment Quashed – Addition Below ₹50 Lakh Fails Monetary Threshold for Extended Block Period
The Delhi ITAT dismissed the Revenue’s appeal and upheld the CIT(A)’s order quashing the assessment made under Section 153C for AY 2015-16 on jurisdictional grounds. The Tribunal held that for non-searched persons, the block period under Section 153C has to be computed from the date of receipt of seized material by the AO of the non-searched person, following PCIT v. Ojjus Medicare (Delhi HC). In the present case, although the search on the Alankit Group was conducted in October 2019, the seized material relating to the assessee was handed over only on 22.06.2022, making AY 2023-24 the first relevant year and placing AY 2015-16 in the 9th year of the block.
The Tribunal further held that for invoking the extended 7th to 10th year block under the fourth proviso to Section 153A (as applicable to 153C), the escaped income must be represented in the form of an asset of ₹50 lakh or more. Since the alleged escaped income in the assessee’s case was only ₹8.84 lakh, far below the statutory threshold, assumption of jurisdiction itself was invalid. Accordingly, the additions were held unsustainable and the Revenue’s appeal was dismissed.
FULL TEXT OF THE ORDER OF ITAT DELHI
