Appellant: Forsan Healthcare P.Ltd, New Delhi
Respondent: DCIT, Central Circle-3, New Delhi
Assessment Year: 2012-13
Case Number: ITA 2861/DEL/2022
Date of Filing: 2022-12-07
Order Type: Final Tribunal Order
Date of Order: 2023-03-17
Pronounced On: 2023-03-17
Forsan Healthcare P.Ltd, a company based in New Delhi, filed its return of income for the assessment year 2012-13 on 31.03.2013, declaring a total income of Rs. 2,85,45,910/-. The return was processed under Section 143(1) of the Income Tax Act, 1961 on 14.02.2014. Subsequently, a search and seizure operation was conducted under Section 132 of the Act on 09.09.2017, leading to an assessment under Section 153A of the Act, determining the total income at Rs. 3,33,35,740/-.
The primary issues under dispute were:
Forsan Healthcare P.Ltd raised several grounds in its appeal, challenging the reassessment proceedings and the additions made by the Assessing Officer (AO):
The Income Tax Appellate Tribunal (ITAT) bench, consisting of Shri Anil Chaturvedi (Accountant Member) and Shri Chandra Mohan Garg (Judicial Member), heard the case on 28.02.2023 and pronounced the order on 17.03.2023.
The tribunal found that the CIT(A) dismissed the appeal without considering the issues on their merits, which was contrary to the principles of natural justice. The tribunal emphasized that sufficient opportunity of hearing should be provided to the parties, and no party should be condemned unheard. Therefore, the impugned order of the CIT(A) was set aside, and the issue was restored to the file of the CIT(A) for re-adjudication.
The tribunal noted that the reassessment proceedings under Section 153A were initiated without any discovery of incriminating material during the search, which made the proceedings invalid. The excel sheet found during the search was deemed to be unauthenticated and uncorroborated, and hence, not valid incriminating material for assuming jurisdiction under Section 153A.
Since the reassessment proceedings were quashed, the addition of Rs. 47,89,833/- based on the excel sheet was also rendered invalid. The tribunal held that the addition was misconceived and based on an arbitrary interpretation of the excel sheet, which had no evidentiary value.
The ITAT allowed the appeal for statistical purposes, setting aside the order of the CIT(A) and restoring the issue for re-adjudication after providing sufficient opportunity to the assessee. The tribunal ruled in favor of Forsan Healthcare P.Ltd, highlighting the importance of procedural fairness and the requirement for valid incriminating material in reassessment proceedings.
Order Pronounced in Open Court on 17.03.2023
Signatories:
CHANDRA MOHAN GARG, JUDICIAL MEMBER
ANIL CHATURVEDI, ACCOUNTANT MEMBER
Assistant Registrar, ITAT, New Delhi
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