DCIT Central Circle Ghaziabad vs M/s. Habitat Infrastructure Pvt. Ltd.

“1.

Whether on facts and circumstances of the case and in law, the Ld. CIT(A)-3, Noida has erred in deleting the addition of Rs. 2,31,75,000/- made by the Assessing Officer ignoring the facts that the addition made by the Assessing Officer is on the basis of incremating documents relating to other person found during search proceedings.

2.

Whether on facts and circumstances of the case and in law, the Ld. CIT(A)-3, Noida has erred in allowing the appeal of assessee and annulling the action of the AO i.e. initiation of proceedings u/s 153C for A.Y. 2011-12 without considering the facts that substitution of date of handing over of seized material in place of date of initiation of search as mentioned in the First Proviso under Section 153C was only for a limited purpose to determine the years of abatement of assessment proceedings as provided in Second Proviso to Section 153A and not at all with reference to powers of AO to make assessment under Section 153C, which was separately provided under Section 153C(1) itself by using the phrase 'for the relevant assessment year OR years referred to in Sub-Section (1) of Section 153A.

3.

Whether on facts and circumstances of the case and in law, the Ld. CIT(A)-3, Noida has erred by not considering the fact that even after amendment brought under Section 153C(1) w.c.f. 01.04.2017 by inserting the expression "six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted". The First Proviso has still not been amended. This fortifies the view that First Proviso to Section 153C never dealt with the period of reckoning six assessment years for purposes of making assessment under Section 153C(1).

4.

Whether on facts and circumstances of the case and in law, the Ld. CIT(A)-3, Noida has erred in allowing the appeal of assessee and annulling the action of the AO i.c. initiation of proceedings w/s 153C for AY 2011-12 without considering the facts that under Second Proviso to Section 153A, only the abatement of proceedings in case of searched person was provided as on date of initiation of search without referring to which assessment years the assessment under Section 153A OR Section 153C could be made due to initiation of search. Further, the act of abatement and the act of assessment are two different functions, having different connotations and purpose and hence the two cannot be equated/interchanged by any stretch of interpretation. The power to make assessment after initiation of search is separately provided in Section 153A(1) itself and not in Second Proviso to Section 153A. Therefore, First Proviso of Section 153C was entirely in different context and it clearly referred to Sec

5.

Whether on facts and circumstances of the case and in law, the Ld. CIT(A)-3, Noida has erred in deleting the addition of Rs. 2,25,00,000/- without appreciating the facts that the assessee has taken accommodation entry of Rs. 2,25,00,000/- in the form of unsecured loan and said loan was deposited in the bank account of the assessee, which is covered under the definition of assets in view of the provisions of Explanation-2 to section 153A(1) of the Income Tax Act, 1961. It is worthy to mention that the escaped amount i.e. Rs. 2,25,00,000/- is for the year under consideration which is much above Rs. 50 Lakhs in aggregate in the relevant assessment years. Thus, the case of the assessee for the year under consideration is also covered under the fourth proviso r.w.s. Explanation-1 to section 153A (1) of the Income Tax Act, 1961. Further, the period under consideration is beyond six assessment years but not later than ten assessment year and also covered Explanation -1 r.w.s. Explanation -2 o

6.

That the order of CIT(A) being erroneous in law and facts be set aside and order of the A.O. be restored.