TaxTMI 
TaxTMI 
2026 (7) TMI 684
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....in appeals of the Revenue and pertain to same assessee, they were heard together and are disposed of by this common order for the sake of convenience and brevity. ITA No.8348/Del/2025 for AY 2012-13 3. First we take up as AY 2012-13 as the lead case. Brief facts of the case are that the assessee is a professional Chartered Accountant and partner in Firm M/s N. Sarda & Associates. Original return in this case was filed on 25.03.2013 declaring income of Rs. 2,40,100/- which was processed u/s 143(1) of the Income Tax Act, 1961. A search and seizure operation was carried out at the various premises of Bajaj Group and its associates including the assessee and its directors and others on 20.04.2017. Various documents/Books of A/c, etc. were found and seized and statements of various persons were recorded. Thereafter, final assessment order was completed by the AO and protective additions of Rs 12,06,13,509/- on account of accommodation entries u/s 69; Rs 12,06,135/- on account of commission and Rs. 40,67,500/- on account of bank deposit was made to the income of the assessee under section 69A of the Act as unexplained money during the year under consideration. 4. Aggrieved, the ....
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....dation entries. 7. Ld. CIT(A) erred in relying on judgement of Hon'ble Supreme Court in PCIT V Abhisar Buildwell P Ltd. and deleting addition of Rs. 10,00,000/- and Rs. 30,67,500/- of deposits including cash in bank accounts of assessee as various incriminating material were found during course of search and seizure action in Bajaj Group like tally data which shows transactions of assessee-controlled entities with RNB Overseas Ltd. 8. That the Ld. CIT(A) has erred in deleting the additions of Rs 10,00,000/- and Rs 30,67,500/- made u/s 69A of the Act on account of unexplained bank deposits, without appreciating that cheque books, passbooks and other banking documents of these accounts were found and seized during search, which constitute incriminating material within the meaning of section 153A. 9. That the Ld. CIT(A) has failed to appreciate that mere reliance on the judgment of the Hon'ble Supreme Court in PCIT v. Abhisar Buildwell (P) Ltd. (2023) is misplaced, as the present additions were based on material seized during search clearly linking the assessee with the impugned bank accounts. 10. That the order of the CIT (A) is perverse, erroneous....
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....hat a retracted statement cannot form the basis of any addition. This position has been authoritatively upheld by the Delhi High Court in Principal Commissioner of Income Tex (Central)-3 vs. Pavitra Realcon Pvt. Ltd. [2024 (5) TMI 1408). 6.4. Further, it is submitted regarding the protective assessment, that substantive additions made in the Bajaj Group cases have already been deleted by the appellate authorities, both on merits as well as for want of Incriminating material. Consequently, once the substantive additions do not survive, the protective addition made in the appellant's hands under Section 69 automatically falls to the ground, as a protective addition cannot stand independently. It is a well-settled principle of law that a protective addition can be sustained only in situations where there exists a genuine ambiguity regarding the person in whose hands the income is liable to be assessed. In the present case, there is no such ambiguity, and therefore, the protective addition made in the appellant's case is devoid of any legal foundation and deserves to be deleted in toto. 6.5 The ld AR stated that the Assessing Officer has relied on Tally data and other dig....
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....der. 7.1 The appellant relied upon the jurisdictional ITAT, Delhi 'F' Bench decision in RNB Overseas Pvt. Ltd. (ITA Nos. 285 & 286/Del/2022, order dated 06.11.2023). The ITAT after examination, recorded the following categorical finding on merit: *There is no dispute in so far as movement of goods is concerned... Stock details have been accepted... Therefore, we fail to understand how the AO could invoke section 68 for the impugned addition." 7.2 Further, on CIT (A)'a order, the ITAT noted: "14. We further fail to understand that when the Ld. CIT(A) has accepted the profit margin for rest of the sales, then why he has applied a different profit margin in respect of sales made to the three parties mentioned elsewhere. Considering the underlying facts, not only the assessment order is erroneous but the order of the first appellate authority is also erroneous. Accordingly, the appeals of the assessee are allowed on merits and those of the Revenue are dismissed." The substantive addition in RNB's hands was thus deleted on merits. Thus, once the substantive addition has been deleted on merits in the hands of RNB Overseas Pvt. ....