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III. Direct Taxes Case Law:
1. ACIT Vs. K.G. Finvest Pvt. Ltd, I.T.A. No. 6759/Del/2013, Date of Pronouncement: 28.04.2017, ITAT - Delhi
Issue:
Whether notice u/s 153A issued consequent to search u/s 132 lacks
jurisdiction if the search warrant executed doesn’t mention the name
and address of the assessee?
Held: Yes
Brief facts:
A search and seizure action was carried out in Swastik Pipes group of
cases on 28.08.2008. Notice u/s153A was issued and served on 25.08.2010
on the assessee. Assessment was completed on total income of
Rs.33,43,390/- after making addition of Rs.33,30,000/- on account of
share application money received from various persons. On appeal to
first appellate authority, assessee challenged the initiation of
proceedings u/s 153A contending that no warrant of search was executed
on assessee which was dismissed by Ld. CIT(A). However, Ld. CIT(A)
deleted the addition to the tune of Rs.30,80,000/- on merits of the
case.
Being aggrieved, the assessee and revenue have filed cross appeals before the Hon’ble ITAT.
Held
The Hon’bleITAT held that unless a search is initiated u/s 132 or
requisition is made u/s 132A on aperson, no jurisdiction can be assumed
for making assessment by issuing notice u/s 153A. In the present case,
the warrant of authorization included the name of “K.G. Finvest&
Trade Pvt.Ltd”, whereas the assessee’s name is “K.G. Finvest Pvt. Ltd”.
Moreover, the assessee had categorically submitted that none of its
directors had any directorships in companies mentioned in the warrant
&annexure and address mentioned didn’t belong to assessee, which was
not controverted by Ld.AO during assessment proceedings.
Also, during proceedings before Hon’be ITAT, no material or evidence
to prove actual conduct of search on assessee was provided by Ld.DR. As a
result, it was held that neither any search was “initiated” nor
“conducted’ on assessee and therefore, notice u/s 153A was issued
without any jurisdiction.
Therefore, the appeal was held in favour of assessee and against the revenue.
Cases Referred:
1. Gunjan Girishbhai Mehta VS. D.I. (2017)80 taxmann.com23(SC).
2. MDLR Resorts Pvt. Ltd. vs.CIT & Ors. (2014) 361 ITR 407 (Delhi HC).
(Please click here for judgment)
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