TaxTMI 
TaxTMI 
2026 (10) TMI 1328
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.... is held to be invalid, the entire assessment ought to have been quashed. ii) On the facts and circumstances of the case, the learned CIT(A) has erred in holding that proceedings ought to have been initiated under section 153C without observing that the seized material belongs to the assessee, as statutorily required. iii) On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the protective addition merely on the ground that substantive addition in the hands of Shri Sanjay Singhal was confirmed by the CIT(A). The said substantive addition is under appeal before the ITAT and has not attained finality, hence, deletion of protective addition is premature and contrary to law. 2. The brief facts of the case are that a search and seizure action u/s. 132 of the Act was carried out in the Sanjay Singhal Group of cases on 15.11.2017 in FY 2017-18. A search warrant of authorization, u/s. 132, was issued in the name of M/s Rajyog Buildtech Pvt. Ltd. and M/s Som Hari Infrastructure Pvt. Ltd. to search premise at Flat No. 202, 25/33, 2nd floor, East Patel Nagar, New Delhi on 15.11.2017. Search in this case was initiated on 15.11.2017. Assessee had....
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....g amounts received from "Paandan" or Sh. Sanjay Singh which correspond to match with the cheques of purported advance given by OPG to Assessee. AO further noted that neither this advance has been returned nor any transfer of property has taken place between OPG and assessee. Further it was noted that there is very close temporal correlation between the cash paid by Paandan and receipts of cheques claimed as advance for property. Thus, AO noted that purported advance received against property by Assessee is clearly accommodation entry given by OPG. He further noted that the cash was received by Sh. Sanjay Gupta from Sh. Sanjay Singhal (Paanda) and thereafter cheques of the same amount were paid to M/s Rajyog Buildtech Pvt. Ltd. after deducting TDS. Thus Rs. 15.50 crore shown in the book of assessee as advance against property from OPG Securities Pvt Ltd. have been obtained in lieu of cash provided by Sh. Sanjay Singhal. AO further noted that the assessee company is controlled and managed by Sh. Sanjay Singhal. AO noted that Sh. Sanjay Singhal has given cash to OPG Group in order to take advance against the property in assessee company by routing his unaccounted cash. Thus, the basis....
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.... substantive addition is under appeal before the ITAT and has not attained finality, hence, deletion of protective addition is premature and contrary to law. 4. On the other hand, Ld. AR for the assessee submitted that ld.CIT(A) deleted the addition by holding that the addition was not based upon any incriminating material found during the course of search in the case of the assessee and he also held that if the AO relied upon the material seized from third party, he should have followed the provisions of section 153C of the Act, thus he submitted that there is no infirmity in the findings of the Ld. CIT(A) on this issue, hence, the action of the CIT(A) may be upheld by rejecting the grounds raised by the revenue. As regards merits of the case is concerned, Ld. AR submitted that substantive addition of Rs. 7.50 crore was made in the case of Sh. Sanjay Singhal, thus, the said protective addition did not survive as the assessment has been quashed in the case of Sh. Sanjay Singh by the Coordinate Bench of the Delhi Tribunal in ITA No. 5418 to 5422/Del/2025 (Ayrs 2012-13 to 2016-17) vide order dated 21.1.2026. In support of this contention, he relied upon the decisions of the Hon'bl....
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....of M/s OPG Securities Pvt. Ltd. from its premises at 3072, Old Ranjeet Nagar, Street No. 4, Delhi, which is very much evident from Panchnama and Warrant of the said premises, which are in the name of Sanjay Gupta and M/s OPG Securities Pvt. Ltd.. Thus, in view of the aforesaid factual matrix and in our considered view, the Ld. CIT(A) has rightly held that even in coordinated searches, incriminating material derived from third party premises could be assessed only under section 153C of the Act, which does not need any interference on our part, hence, we uphold the same and reject the grounds raised by the revenue. 6. As far as merits of the case is concerned, we note that AO completed the assessment at income of Rs. 7,58,90,502/- instead of Rs. 8,90,520/- as returned by the assessee. It is noted that AO has made the protective addition of Rs. 7.50 crore on account of alleged unexplained cash credit u/s. 68 of the Act and therefore, the addition is not sustainable, as the substantive addition of Rs. 7.50 crore was made in the case of Sanjay Singhal for AY 2015-16 which was confirmed by the Ld. CIT(A) vide his order dated 5.8.2025, thus, consequently, he rightly deleted the protect....