This case involves Atul Kumar Gupta who faced several additions to his income as assessed by the ACIT, Central Circle-28, New Delhi. The focal point of the litigation was whether these additions were supported by any incriminating evidence found during a search and seizure operation.
The ITAT Delhi in ITA No. 206/DEL/2021 upheld the CIT(A)’s decision that dismissed the revenue’s addition of unexplained investments and credit card payments to Gupta’s income. The tribunal agreed that the additions were made without any incriminating materials found during the search, relying on judicial precedents that restrict adjustments post-search to those supported by concrete evidence.
The tribunal’s decision reinforces the principle established in cases like Kabul Chawla, where it was held that absent incriminating evidence discovered during a search, no additions should be made to previously completed assessments. This ruling protects taxpayers from arbitrary additions based on unsubstantiated claims by the revenue department.
The case is significant for taxpayers and professionals as it underscores the need for the revenue authority to rely on substantial evidence when making any post-search adjustments. This verdict reaffirms the legal safeguard against undue tax demands based on non-existent evidence.
Atul Kumar Gupta vs. ACIT Central Circle-28, New Delhi for AY 2015-16 – ITA No. 206/DEL/2021
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