Addition of Unverified Share Capital without Incriminating Material is not sustainable u/s 153: ITAT [Read Order]

The Income Tax Appellate Tribunal (ITAT), Delhi bench has held that the addition of unverified share capital without incriminating material is not sustainable u/s 153 of Income Tax Act 1961.

A search and seizure operation u/s 132 of the Income-tax Act, 1961 was conducted on the premises of the assessee comprising an Apple group of cases. Assessment for years 2011-12 was completed after making an addition on account of unverified share application money amounting to Rs. 8,70,71,936/- and in Assessment Year 2014-15, addition on account of unverified share capital amounting to Rs. 30,00,600/- was made.

 On appeal, CIT(A) held that no incriminating material has been referred to by the Assessing Officer while making the impugned addition relied on the decision of the Supreme Court in the case of Singhal Technical. The appellant contended that the impugned order was made in the absence of incriminating material from the search. It was observed that notice u/s 153C was issued without appreciating the material seized during the search operation.

In light of the precedent, the Coram of consisting Shri Narendra Kumar Billaiya, AM, and Shri Narender Kumar Choudhry, JM held that the impugned order lacks the verification of the incriminating material and upheld the findings of the CIT(A). Shri Amit Goel & Shri Nippun Mittal appeared on behalf of the appellant and Shri Ishtiyaque Ahmed appeared on behalf of the respondent.

To Read the full text of the Order CLICK HERE

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