Byrapura Gowde Gowda Deepu Vs DCIT (ITAT Bangalore)
Summary: A search produced diaries, loose sheets and digital records containing notings of transactions running into crores. The Assessing Officer examined the material, verified a sample of more than 2,000 supporting documents, made third-party enquiries and added ₹2.30 crore to the assessee’s income. The PCIT nevertheless set aside the assessment under section 263, primarily because he considered the verification insufficient.
The Bengaluru ITAT has quashed that revision. Its finding was that the PCIT wanted a wider enquiry, but had not established that the assessment already made was erroneous and prejudicial to the interests of the Revenue.
Search, Scrutiny and a Substantial Addition
The assessee was an architect and Vastu consultant carrying on business through a proprietorship concern. He returned income of ₹46,97,800 for AY 2023–24. A search under section 132 was conducted on 14 October 2023, during which the search team found substantial cash, jewellery, luxury watches, pocket diaries, scribbling pads, loose sheets and digital records.
The return was selected for compulsory scrutiny. The Assessing Officer examined the seized material and completed the assessment on 31 March 2025 at ₹2,77,42,580, making an addition of ₹2,30,44,780. Thus, he had neither accepted the returned income nor accepted the assessee’s explanation in full.
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