Deepak Purshottam Shah (HUF) Vs ACIT (ITAT Mumbai)
Seized Papers Related to AY 2011-12; ₹14.80 Crore Addition for AY 2009-10 Quashed by Mumbai ITAT
Summary: A satisfaction note under section 153C cannot support proceedings for an assessment year merely because that year appears in a list of years covered by the note. The seized material must have a connection with the particular year sought to be assessed. Applying this principle, the Mumbai ITAT quashed the AY 2009-10 assessment of Deepak Purshottam Shah (HUF). The documents identified in the satisfaction note related to FY 2010-11, corresponding to AY 2011-12, and the note disclosed no seized material bearing on AY 2009-10.
The result was that an assessment carrying an addition of ₹14.80 crore, described as profit from a land sale to Tata Housing Development Co. Ltd., was quashed for want of jurisdiction. The Tribunal did not decide whether the alleged profit had in fact been earned.
Search and the ₹14.80 Crore Addition
A search under section 132 was conducted in the Swastik Group on 31 July 2014. The assessee HUF was stated to be a partner in various concerns of that group. For AY 2009-10, it had filed a return on 21 December 2010 declaring income of ₹85,36,940. Following the search, proceedings under section 153C were initiated and an assessment making additions was completed.
