Assessment under Section 153A quashed for lack of jurisdiction when incriminating material belongs to third party

Sh. Nasir Ahmad Dar Versus DCIT/ACIT Central Circle, Srinagar

Sh. Nasir Ahmad Dar Versus DCIT/ACIT Central Circle, Srinagar - TMI Issues:
1. Addition of undisclosed income under various heads
2. Condonation of delay in filing appeal
3. Jurisdiction of assessment under Section 153A vs. Section 153C

Analysis:
1. The appellant contested the addition of Rs. 21,03,912/- made by the CIT(A) under different heads of undisclosed income. The grounds of appeal included challenges to the confirmation of additions under Section 69A for credits in saving accounts and difference in undisclosed profit, as well as the increase in net profit rate and reduction in declared gross income under the head PGBP. The appellant also argued against the denial of benefits related to contra entries and CC bank interest. The Tribunal assessed each ground and found in favor of the appellant on the basis of legal and factual arguments presented.

2. The appeal was filed 432 days late, and the appellant sought condonation of delay citing exceptional circumstances related to medical issues. The Tribunal granted the condonation of delay based on the appellant's explanation and reference to relevant case law supporting such a decision. This allowed the appeal to be admitted for hearing on the merits of the case.

3. The appellant raised additional grounds challenging the jurisdiction of the assessment under Section 153A, contending that it should have been framed under Section 153C due to the material seized from another company's premises. The Tribunal considered the arguments presented by both parties and referenced case law to determine that the assessment order under Section 153A was without jurisdiction. The Tribunal quashed the assessment order, highlighting the importance of following the correct procedural requirements for initiating assessment proceedings based on seized materials.

In conclusion, the Tribunal allowed the appeal, quashing the assessment order under Section 153A due to lack of jurisdiction and providing relief to the appellant on legal grounds. The decision was based on a thorough analysis of the issues raised by the appellant and the procedural requirements for conducting assessments under the Income Tax Act.