Sumitra Devi vs Deputy/Assistant Commissioner Of Income Tax

This assessee’s appeal for Assessment Year 2017-18 arises against the Commissio ner of Income Tax (Appeals)-3 (for short, “the CIT (A)”), Gurgaon’s order dated 13.01.2026 passed in order no. 10516/CIT(A)-3/GGN/19 -20, involving proceedings u/s 153C/ 143 (3) o f the Income Tax Act, 1961 ; hereinafter referred to as, “the Act” .

Heard both the parties at length. Case file perused.

The assessee canvasses her first and foremost legal gro und seeking to reverse bo th the learned lo wer authorities’ identical findings treating her unsecured loans of Rs. 19,42,500/- as unexplained money u/s 69A of the Act; in assessment order dated 27.12.2019 as upheld in the lower appe llate discussion, for the precise reason that the same is no t based on any specific incr iminating material as per DCIT vs Abhisar Buildwell Pvt. Ltd. (2023) 454 ITR 212 (SC).

We now advert to the admitted basic relevant facts. There does not appear much a dispute between the parties that the assessee/ individual had filed her original return for the impugned assessment year on 06.12.2017 declaring income of Rs. 24,70,350/-. Learned departmental authorities thereafter carried out the search in question dated 25.04.2017 in M/s. Skylark Group of cases etc. Be that as it may, the assessee’s case was thereafter centralized on 28.09.2018 followed by the learned Assessing Officer’s recording of section 153C satisfaction that the corresponding seized material related to her and had “a bearing” on determination of her total income. The said satisfaction was undisputedly recorded on 23.04.2019. And that the Assessing Officer thereafter issued section 153C notice to her on the very date followed by her “scrutiny” finally culminating in the assessment order dated 27.12.2019 making the aforesaid addition as upheld in the lower appellate discussion.

It is in this factual backdrop that the assessees’ case before us is that it is an instance of “ an unabated” assessment only inter alia going by the learned Assessing Officer having assigned her jurisdiction after receiving the search records and recording of section 153C satisfaction. The Revenue vehemently submits that the impugned assessment year A.Y. 2017-18 is very much an “abated” one going by date of search wherein the Assessing Officer had the jurisdiction to deal with all the various issues arising during scrutiny.

We have given our thoughtful consideration to the first and foremost issue i.e. whether it is a case of ‘unabated’ or ‘abated’ assessment in the assessee’s case. Various judicial precedents i.e., CIT-7 Vs. RRJ Securities Ltd. (2016) 380 ITR 612 (Del), PCIT Vs. Ojjus Medicare (P) Ltd., (2024) 465 ITR 101 (Del) and CIT Vs. Jasjit Singh (2024) 465 ITR 101 (SC); have recently settled the issue in light of section 153C(1) first proviso that the “the reference to the date of initiation of search…………. shall be construed as reference to the date of receiving of the books of accounts or documents or asset seized or requisitioned by the Assessing Officer having jurisdiction over such other person” only. We accordingly are of the considered view that once there is no rebuttal coming from the Revenue side, the reference to the date of search in the assessee’s case as per the receipt of the alleged seized material happens to be 23.04.2019 which renders the assessment year 2017-18 in her case as an “unabated” one wherein any addition to be made in her hands has to be mandatorily based on the corresponding seized material as per their lordships landmark decision(supra).

Learned CIT(DR) at this stage vehemently seeks to buttress the point that the assessment discussion herein has made it clear that the aforesaid unsecured loans have been added based on the relevant incriminating material as well as the searched party’s search statement recorded u/s 132(4) of the Act. She could hardly dispute that the assessee all along has declared here impugned loans in the regular books of account which couldn’t be treated as loans to be added as based on the seized material. We accordingly are of the considered view that both the learned Assessing Officer and the CIT(A) have erred in law and on facts in treating the assessee’s impugned unsecured loans declared in her regular books of accounts as liable to be assessed as unexplained in the impugned ‘unabated’ assessment which deserves to be deleted as per their lordships landmark decision. Ordered accordingly.

All other remaining pleadings between the parties stand rendered academic.

This assessee’s appeal is allowed.