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Judgment
PER ANUBHAV SHARMA, JM:
These are appeals preferred by the assessee and revenue against the orders of the Ld. Commissioner of Income-tax (Appeals)-26 (hereinafter referred to as the First Appellate Authority or ‘the ld. FAA’ for short) in appeals filed before him against the orders of the ld. Assessing Officer (hereinafter referred to as the Ld. AO, for short) passed u/s 143(3)/153Cof the Income-tax Act, 1961 (hereafter referred to as ‘the Act’). Further details of the orders of the lower authorities are as under:-
| ITA No. & AY | Ld. FAA who passed the appellate order | Appeal No. & Date of order of the Ld. FAA | AO who passed the assessment order & Date of order |
| 4014/Del/25 2017-18 | CIT(A)-26, New Delhi | DIN: ITBA/APL/N/250/2025-26/1075485097(1) Dated 04.04.2025 | DCIT, Central Circle-15, New Delhi Dated 31.03.2023 |
| 4741/D/25 2014-15 | CIT(A)-26, New Delhi | DIN: ITBA/APL/N/250/2025-26/1075484986(1) Dated 04.04.2025 | DCIT, Central Circle-15, New Delhi Dated 31.03.2023 |
| 4742/D/25 2016-17 | CIT(A)-26, New Delhi | DIN: ITBA/APL/N/250/2025-26/1075478144(1) Dated 04.04.2025 | DCIT, Central Circle-15, New Delhi Dated 31.03.2023 |
| 4743/D/25 2017-18 | CIT(A)-26, New Delhi | DIN: ITBA/APL/N/250/2025-26/1075485097(1) Dated 04.04.2025 | DCIT, Central Circle-15, New Delhi Dated 31.03.2023 |
| 4744/D/25 2018-29 | CIT(A)-26, New Delhi | DIN: ITBA/APL/N/250/2025-26/1075477768(1) Dated 04.04.2025 | DCIT, Central Circle-15, New Delhi Dated 31.03.2023 |
These appeals were heard together as they arise out of the same set of facts and involved similar question of law.
On going through the impugned order of ld. CIT(A) and the contentions as submitted we find that these appeals arise out assessment initiated in the case of assessee on the basis of a search and seizure operation conducted on 18.10.2019 in the case of Alankit Group. During the search allegedly from an employee of Alok Kumar Aggarwal certain data was recovered which revealed that parallel ledger account were maintained in the name of assessee and some other persons. The assessing officer of the searched person recasted the said ledger accounts and created a combined ledger account of the assessee from 01.04.2009 to 31.03.2018 in an excel sheet. The AO relying on these excel sheets data and statement of Sunil Kumar Gupta the employee of Alok Kumar Aggarwal, recorded a satisfaction note and based upon which notice were issued to the assessee u/s 153C on 23.06.2022.
We find that ld. CIT(A) has taken into consideration the fact that in regard to proceedings u/s 153C of the Act, it is necessary that incriminating material found during the search can be used, provided the incriminating material would have bearing in determination of total income for such years.
Ld. AR has established before us from material on record and the factual observations in the impugned order that the excel sheet content does not relate to assessee but to other persons also and based upon the same assessee have been benefitted by the held. CIT(A). As for completeness we reproduced the findings of ld. CIT(A) in the order for AY: 2017-18:
“6.58In the instant case, as discussed above, the aforesaid transactions do not belong/pertain/relate to the appellant and accordingly, such transactions would not have bearing on the determination of total income for such years as the transactions mentioned in clauses (e) and (f) pertains to Umesh Shukla. Similarly, transaction mentioned in clauses (b) pertains to Mr. Sanjay Agarwal. Further, Umesh Shukla and Mr Sanjay Agarwal are separate and independent taxable entities.
The AO has not disputed these facts in the assessment order. Hence, in view of the extant legal provisions and the decisions of the Apex court in Singhad Technical Education Society (supra), the additions made on account of item nos.mentioned in aforesaid clauses are unsustainable in law as such transactions do not have bearing on determination of income of the appellant and accordingly, such additions are liable to be deleted.
6.59Moreover, the above entry in clauses (e) and (f) has been identified by the department to be pertaining to Umesh Shukla and accordingly satisfaction for issue of notice u/s 153C was formed. In the assessment proceedings u/s 153C of the Act addition of Rs. 34,00,000/- u/s 69A of the Act on account of cash payments of Rs. 25,00,000/- on 18/03/2017 and Rs. 9,00,000/- on 31/03/2017has been made in his hand. Appellant had submitted a copy of assessment order of Umesh Shukla for the relevant assessment year in support of its claim. Hence, making addition of the same income in the hands of the appellant would tantamount to economic double taxation which is prohibited under the law. Accordingly, the appellant succeeds on this ground.”
Taking into consideration the copy of satisfaction note made available at page No. 10-15 in the paper book we find that consolidated satisfaction note was drawn without there being any observation as to how the alleged incriminating material found during the search has bearing on the income of the assessee for relevant assessment years from 2010-11 to 2020-21.
In fact, the similar satisfaction note has been subject matter of scrutiny before Hon’ble Delhi High Court in the case of Saksham Commodities Ltd. v. ITO (2024) 464 ITR 1 (Delhi) which has also been relied by ld. CIT(A) to give the aforesaid findings in favour of the assessee.
Thus, we find no substance in the ground of appeal of the revenue and corresponding ground No. 1 in appeal of the assessee for AY; 2017-18 deserves to be sustained and grounds raised in appeal of department deserve to be rejected.
Consequently, the appeals of revenue are dismissed and of assessee is allowed.