Deletion of the addition made by the AO on account of disallowance under Section 14A.

This Income Tax Appellate Tribunal ruling addresses an appeal by the Revenue and a cross-objection by the assessee concerning the assessment year 2009-10. The key issue involves the deletion of an addition made by the Assessing Officer (AO) under Section 14A of the Income Tax Act. The tribunal also considers whether proceedings under Section 153A were validly initiated, particularly when no incriminating documents were found during a search.

IN THE INCOME TAX APPELLATE TRIBUNAL,
DELHI BENCH: ‘B’ NEW DELHI

BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER
AND
MS. SUCHITRA KAMBLE, JUDICIAL MEMBER
[Through Video Conferencing]

ITA No.5963/Del./2017
Assessment Year: 2009-10

DCIT,
Circle-1(1),
Gurgaon
(Appellant) 

Vs.

M/s. DLF Universal Ltd.,
9th Floor, DLF Centre,
Sansad Marg,
New Delhi
PAN :AAACJ1655P
(Respondent)

And
C.O. No. 12/Del./2018
[Arising out of ITA No.5963/Del./2017]
Assessment Year: 2009-10

DLF Universal Ltd.,
3rd Floor, Shopping Mall,
Arjun Marg, Phase-1,
Gurgaon
(Appellant) 

Vs. 

DCIT,
Circle-1(1),
Gurgaon
PAN :AAACJ1655P
(Respondent)

Department by Ms. Nidhi Srivastava, CIT(DR)
Assessee by Sh. Satyajeet Goel, CA

Date of hearing 17.03.2021
Date of pronouncement 26.03.2021

ORDER

PER O.P. KANT, AM:

This appeal by the Revenue and the Cross objection by the assessee are directed against order dated 30/07/2017 passed bythe Learned Commissioner of Income-tax (Appeals)-1, Gurgaon [in  short ‘the Ld. CIT(A)’] for assessment year 2009-10. The respective grounds raised by the Revenue and assessee are reproduced as under:

(i) Grounds of appeal of the Revenue:

1. The Ld. CIT(A) has erred on facts and in law in observing that the proceedings u/s 153A of the Act are not initiated where no incriminating documents found during the course of search and seizure operation in view of decision of Hon’ble Delhi High Court in the case of CIT Vs. Kabul Chawla (2015) 380 ITR 573 (Del.).

2. The Ld. CIT(A) has erred on facts and in law in deleting the addition of Rs.3,84,01,375/- made by the AO on account of disallowance under Section 14A.

3. That the appellant craves for the permission to add, delete oramend grounds of appeal before or at the time of hearing of appeal.

(ii) Grounds of Cross Objection of the assessee:

1. In law and in the facts and circumstances of the case, the learnedCIT (A) has grossly erred by not adjudicating on the ground raised by the respondent challenging the initiation of proceedings u/s 153 A when no search has been conducted on the respondent, as

a) the respondent was merely joint owner of the searched lockersnamely, 733 and 852 of Corporation Bank and was not intimatedabout search, even no copy of Panchnama was served on completion of the search.

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