AI Structured Summary
Not yet generated for this judgment
Judgment
PER SANJAY AWASTHI, ACCOUNTANT MEMBER:
This appeal arises from order dated 18.11.2025, filed u/s 250 of the Income Tax Act, 1961 (hereafter as “the Act”), by Ld. CIT(A)-25, Delhi. In this case, the Ld. AO has passed an order dated 14.2.2024 u/s 153C of the Act, as a consequence of search and seizure action carried out on the Alankit Group. The Ld. AO is seen to have passed a detailed order through which additions u/s 69A & 69C of the Act were made.
The assessee approached the CIT(A) where also he could not succeed on the basis of rather cryptic findings given on page 10 (on merit), where it has been recorded that the contentions of the assessee were allegedly unsubstantiated. Needless to say, the assessee could not succeed before the Ld. CIT(A).
The assessee has thereafter approached the ITAT with as many as eleven grounds which are fairly detailed and has challenged the action of authorities below on merits as also on the ground of an alleged illegal assumption of jurisdiction. The assumption of jurisdiction has been challenged on account of the fact that the so called material relied on by the Ld. AO did not, allegedly, have any nexus with the assessee under consideration.
Before us the Ld. AR argued on legal grounds and stated that there were considerable lacuna in the action of Ld. AO whereby the seized material was not properly analyzed or even the assessee’s rebuttal on the allegations considered. The Ld. AR pointed out that the Ld. CIT(A) has summarily dismissed the challenge to the assumption of jurisdiction in para 9.2 of the impugned order. It was also pointed out that there was very little opportunity available with the assessee to present the facts before the lower authorities. The ld. AR concluded by pointing out that the Ld. CIT(A)’s findings were non speaking as could be seen on page 10 of the impugned order.
The Ld. AR relied on the orders of the authorities below and pointed out relevant paragraphs from the AO’s order to justify the impugned additions.
We have carefully considered the rival submissions and have gone through the documents before us. It is seen that the Ld. CIT(A) has dealt with the issues in a rather perfunctory manner, as a sample of his findings would adequately reveal: -
“9.2In the other general and legal grounds of appeal raised the appellant has challenged the proceedings initiated and order passed u/s 153C of the Act and the satisfaction note drawn in general terms, without raising any specific issue. As discussed in the assessment order, incriminating material was found in the name of the appellant and hence satisfaction note duly drawn and proceedings u/s 153C initiated. The appellant has also claimed it was not provided fair opportunity to rebut/cross examine the material collected/statement recorded during search. However, as seen from assessment order, the appellant was provided due opportunity by means of issuance of notices and being confronted with information gathered and proposed additions before completing the assessment. The AO was bound by time barring dates for completing the assessment. In any case, statutory proceedings cannot be kept pending indefinitely. On the issue of cross-examination, it has been held by various courts that the same cannot be a compulsive requirement before deciding a matter. The Hon'ble Delhi High Court in the case of Nath International Sales and Anr. V. Union of India & Ors., dated 17.01.1992 placed reliance upon the judgement of the Hon'ble Supreme Court in the case of state of J&K and others v. Bakshi Gulam Mohammad & Anr., holding that a right of hearing does not include a right to cross-examine and the right to cross-examine must depend upon the circumstances of each case. In the instant case, the AO has rightly held that there is enough material on record in the form of incriminating seized material, evidences, information gathered that have established that they have a bearing in determination of the total income of the assessee-appellant. Shri Sunil Kumar Gupta was the accountant and close associate of Alankit group and cannot be placed on the footing of being a third person. He was a director in key companies of the group and was managing the accounts/business for Shri Alok Kumar Agarwal, as brought out during the search proceedings. Further, the data obtained from the various ledgers of bank accounts, parallel cash book maintained etc. was cross verified, tallied and duly corroborated with sources such as bank account statements, accounts of various shell entities and group companies controlled by Alankit group etc. No merit is thus found in the contentions of the appellant. -------
3 During appellate proceedings, the unsubstantiated arguments relied upon by the appellant for its denial of the nature of transactions have not been found to have the strength to alter the conclusions arrived at during assessment. The appellant has brought no evidence or details on record during appellate proceedings in support of its counter claims or grounds of appeal. Merely denying the findings of search and AO in the assessment order without any concrete details does not help the case of the appellant. The appellant has also countered the addition on account of rate of commission. However, the commission has been added by the AO in assessments in various cases of Alankit group and related cases after taking into account various evidences, statements and facts of the case. There is no reason to deviate from such finding and no merit is found in the assertion of the appellant. In the order, the AO has elaborately discussed the modus operandi relating to accommodation entry transactions in lieu of cash as emerging from the search findings on Alankit group, which are relied upon. -----------"
It is seen from the assessment order also at para 15 on page 34 thereon that several notices issued to the assessee were responded by denying any involvement with respect to the material claimed to be pertaining to the assessee. We feel that the aspect of live nexus between the assessee and the seized material has not been appropriately explored and examined by either of the authorities below. Accordingly, we deem it fit to set aside the impugned order and remand this matter back to the file of Ld. AO for fresh assessment, after ensuring that the assessee is given an opportunity of being heard and his averments are duly considered.
In the result, appeal of the assessee is allowed for statistical purposes.