Facts of the Case

The present appeals were filed by the Revenue before the Delhi High Court challenging the order of the Income Tax Appellate Tribunal dated 04.12.2019 concerning Assessment Years 2011-12 and 2012-13.

The core factual position was that:

  • The assessments for the relevant years were already completed.
  • During the course of search proceedings, no incriminating material was found relating to these assessment years.

The Revenue nevertheless sought to disturb the completed assessments.

 Issues Involved

  1. Whether additions can be made under Section 153A in respect of completed assessments when no incriminating material is found during search proceedings.
  2. Whether the issue is already settled by binding judicial precedents.

 Petitioner’s (Revenue’s) Arguments

  • The Revenue challenged the ITAT order and sought to justify interference with completed assessments.
  • However, the Revenue fairly conceded that the issue raised in the appeals is covered by binding precedent.

 Respondent’s Arguments

  • The Respondent did not appear; however, the position is implicit:
    • Completed assessments cannot be disturbed without incriminating material.
    • Established judicial precedents prohibit such additions.

 Court’s Findings / Order

  • It is undisputed that:
    • No incriminating material was found for the relevant assessment years.
    • The assessments were already completed.
  • The issue is squarely covered by:
    • CIT v. Kabul Chawla
    • Affirmed by the Supreme Court in
      Commissioner of Income Tax vs. Abhisar Buildwell Pvt. Ltd.
  • Accordingly:
    • No substantial question of law arises
    • Appeals were dismissed

Important Clarification

The judgment reinforces a critical legal principle:

 In absence of incriminating material, completed assessments cannot be reopened or disturbed under Section 153A.

This applies even where search proceedings are conducted.

 Link to download the order - 

https://delhihighcourt.nic.in/app/showFileJudgment/RAS21072023ITA5512022_181508.pdf

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