Error in holding that no additions could be made u/s 153A on basis of statement recorded u/s 132(4) of the Act.

The Income Tax Appellate Tribunal has reviewed appeals concerning additions made under Section 153A of the Income Tax Act. The core issue is whether statements recorded under Section 132(4) can form the sole basis for such additions. The Tribunal is examining the Commissioner of Income Tax (Appeals)'s previous decision, which suggested that additions under Section 153A were restricted to material found during a search, and that statements alone were insufficient. This ruling clarifies the scope of the Assessing Officer's powers in reassessment proceedings following a search.

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

BEFORE SHRI O.P. KANT, ACCOUNTANT MEMBER
AND
SHRI K.N. CHARY, JUDICIAL MEMBER
[Through Video Conferencing]

ITA No.4223/Del./2018
Assessment Year: 2009-10
And
ITA No.4225/Del./2018
Assessment Year: 2011-12
And
ITA No.4226/Del./2018
Assessment Year: 2013-14 

ACIT,
Central Circle-30,
New Delhi
(Appellant) 

Vs. 

M/s. Kuber Khadyan Pvt.
Ltd.,
1/8, West Patel Nagar,
New Delhi
PAN :AABCK0600L
(Respondent) 

Appellant by Ms. Aashna Paul, CIT(DR)
Respondent by Shri P.C. Yadav, Adv.

Date of hearing 15.03.2021
Date of pronouncement 26.03.2021

ORDER

PER O.P. KANT, AM:

These appeals by Revenue are directed against three separate orders, all dated 22/03/2018, passed by the Learned Commissioner of Income Tax(Appeals)-30, New Delhi [in short “the Ld. CIT(A)”] for assessment years 2009-10, 2011-12 and 2013-14 respectively. In these appeals, a common dispute is involved and therefore, these appeals were heard together anddisposed off by way of this consolidated order for convenience.

ITA No.4223/Del./2018 for AY : 2009-10

2. First, we take up the appeal of the Revenue (ITA No.4223/Del/2018) for assessment year 2009-10. The grounds raised in the appeal are reproduced as under: 

1. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in holding that no additions could be made u/s 153A on the basis of statement recorded u/s 132(4) and the power of the AO to assess or reassess total income u/s 153 A is restricted to the material found during search.

2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in relying upon the decision of Hon’ble Supreme Court in the case of CIT vs. Singhad Technical Education Society when the facts and circumstances of the instant case are different from that case.

3. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred by ignoring the fact that the assessee during the assessment proceedings failed to produce the Directors of the company that gave accommodation entries to the assessee company and thereby failed to prove the genuineness and creditworthiness of the credits received in their books of account.

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