Dasna Agro Infratech Pvt. Ltd. Vs DCIT (ITAT Delhi Bench)
A Ledger May “Pertain” to the Assessee, but Must Also “Bear” on Its Income: Assessment u/s 153C Quashed
Background:Dasna Agro Infratech Pvt. Ltd. was engaged in agricultural & allied activities. It filed its original return of income for AY 2017-18 on 28.10.2017.
A search u/s 132 was conducted on the Alankit Group & its key managerial persons on 18.10.2019. Proceedings u/s 153A were thereafter initiated against the searched persons.
During those proceedings, a ledger account relating to Dasna Agro Infratech was noticed. The ledger concerned a loan transaction between the assessee & M/s Diwakar Commercial Pvt. Ltd. Significantly, the loan transaction was not with the Alankit Group or the searched entity.
Treating the ledger as incriminating material pertaining to the assessee, the AO recorded a satisfaction note & transferred the material to the assessee’s jurisdictional AO. Proceedings u/s 153C were initiated against Dasna Agro Infratech.
The AO ultimately passed an assessment order dated 25.01.2024 making an addition of ₹50 lakh u/s 68 towards the loan, ₹1.50 lakh u/s 69C as alleged commission & ₹2,15,753 u/s 69C representing interest on the loan. The aggregate additions amounted to ₹53,65,753.
The CIT(A) dismissed the assessee’s appeal. The company therefore approached the Tribunal.
