ITAT held that, consequent to search u/s 132, the AO was mandatorily required to proceed under the special reassessment regime u/s 147/148 (read with Expl. 2(iv) to s.148) with prior approval u/s 148B, and could not validly complete the pending scrutiny u/s 143(3). The approval purportedly granted u/s 153D was found to be mechanical and without proper application of mind, vitiating the assessment for lack of jurisdiction. The impugned assessment order was therefore declared void and annulled. On merits, in the alternative, ITAT upheld addition towards unexplained opening balance and 20% of unmatched seized entries, but directed recomputation of trading addition by applying a 14% gross profit rate instead of 14.12%/23.85%, to operate only if the jurisdictional defect is overturned by a higher forum.
ITAT held that, consequent to search u/s 132, the AO was mandatorily required to proceed under the special reassessment regime u/s 147/148 (read with Expl. 2(iv) to s.148) with prior approval u/s 148B, and could not validly complete the pending scrutiny u/s 143(3). The approval purportedly granted u/s 153D was found to be mechanical and without proper application of mind, vitiating the assessment for lack of jurisdiction. The impugned assessment order was therefore declared void and annulled. On merits, in the alternative, ITAT upheld addition towards unexplained opening balance and 20% of unmatched seized entries, but directed recomputation of trading addition by applying a 14% gross profit rate instead of 14.12%/23.85%, to operate only if the jurisdictional defect is overturned by a higher forum.
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