TaxTMI 
TaxTMI 
2026 (4) TMI 26
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....he ground, issue of notice under Section 143(2) for the Asst Year 2022-23 is bad in law and also notice U/s 143(2) issued is without Jurisdiction. 4. On the facts and circumstance of the case, the learned CIT(A) is not justified in sustaining the addition of Rs. 6,56,70,914/-. 5. On the facts and circumstance of the case, the Learned CIT(A) is not justified in sustaining the addition of Rs. 93,36,497/-. 6. Any other legal and factual ground or grounds that may be urged at the time of hearing of the appeal." 3. The brief facts of the case are that the assessee company is part of Exel group was subjected to Search on 04.01.2023. The group consists of M/s Exel Rubber Private Limited, M/s Ace Tyres Private Limited and M/s Vilas polymers private Limited. The Assessments were done for all the three companies for 10 years for each company. Simultaneously search proceedings were also conducted in the residential premises of Sri Sanaka Ramesh Kumar, Sr. Accounts Manager who looks after the financial and accounting matters of M/s Exel Rubber group of business Concerns. During the course of Search in the residential premises of Sri Sanaka Ramesh Kumar, the depart....
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....ther submitted that the manner of arriving income is from sales of Scrap only. Based on the unaccounted transactions the MD of the group admitted unaccounted income of Rs. 107.63 crores for the three companies put together. Out of such unaccounted income, an amount of Rs. 28.22 crores pertained to the assessee company. 5. Consequent to the search, the case was selected for scrutiny and notice under section 143(2) of the Act dated 20/06/2023 was issued and duly served on the assessee. In response, the assessee has filed relevant details as called for by the A.O. The assessment has been completed under section 143(3) of the I.T. Act, 1961 on 27.09.2024 and determined the total income at Rs. 30,44,89,645/- by making an addition towards undisclosed business receipts, as per the transactions entered into FOCUS 5.5 software for Rs. 93,36,497/- and undisclosed business receipts as per evidence found in VPPL office for Rs. 7,50,99,088/-. 6. Aggrieved by the assessment order, the assessee preferred an appeal before the Ld. CIT (A). During the course of appellate proceedings, the assessee company has challenged the legal ground regarding the assessment barred by limitation and also cha....
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.... of the assessment is hereby extended from 31/03/2024 to 27/09/2024. However, as per clause (xii) of Explanation (1) to section 153, the period (not exceeding 180 days) commencing from the date on which a search is initiated under section 132 or a requisition is made under section 132A of the Act and ending on the date on which the books of account or other documents or any money, bullion or jewellery or other valuable articles or thing seized under section 132 or requisitioned under section 132A of the Act, as the case may be are handed over to the A.O having the jurisdiction over the assessee shall be excluded. In the present case, as per the letter of the A.O, the seized material in the group was received by the A.O on 22/08/2023 and if we consider clause (xii) of Exp.(1) to section 153 of the Act, the period needs to be excluded for the purposes of computing the limitation is the period lost by the A.O in the process of receiving the books or other valuable articles from the A.O for the purpose of assessment and such exclusion to be made only in a case where time taken by the A.O for handing over books. In the present case, the time limit for completing the assessment for the A....
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....uld not exceed 180 days and if we add 180 days to the normal time limit provided under section 153(1) of the I.T. act, then the time limit available for the A.O to complete the assessment was up to 27/09/2024 and the A.O has rightly passed the assessment order on 27/09/2024. Therefore, the argument of the learned Counsel for the assessee that the order passed by the A.O is beyond the limitation and barred by limitation is devoid of any merit and cannot be accepted. 10. We have heard both the parties, perused the material available on record and had gone through the orders of the authorities below. It is an admitted fact that a search & seizure operation under section 132 of the I.T. Act was carried out in the case of the assessee on 4/1/2023. It is also an admitted fact that the seized material is handed over to the A.O on 22/08/2023, which is evident from the letter of the A.O dated 22/03/2024. The normal time limit for completion of the assessment under section 153(1) of the Act is 21 months from the end of the A.Y in which the income was first assessable. Fourth proviso to section 153 inserted by the Finance Act, 2021 reduced the time limit from 21 months to 12 months in resp....
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....inancial year or non-limitation period, then only the time lapsed by the A.O during the limitation period alone should be excluded, because clause (xii) of explanation (1) to section 153 of the Act is only excludes the period taken by the A.O for handing over the books of account but, it shall not extend the period up to 180 days. Therefore, it is necessary for us to examine the argument of the learned Counsel for the assessee, in the light of date of initiation of search and date of handing over of the books of account and other valuable materials and the date of the assessment order in light of clause (xii) of explanation (1) of section 153 of the Act. 11. In the present case, search was conducted on 4/1/2023. The A.O of the assessee received seized material on 22/08/2023. As per clause (xii) of Exp. (1) to section 153 of the Act, the period commencing from 4/1/2023 to 22/08/2023 shall be excluded for the purpose of computing the limitation period. Admittedly, the period starting from 4/1/2023 and up to 22/08/2023 falls in two financial years i.e. (i) from 4/1/2023 to 31/03/2023 falls under financial year 2022-23 and (ii) date commencing from 1/4/2023 to 22/08/2023 falls in fi....