Assessment under section 143(3) is invalid when the proceedings should have commenced under section 153C due to reliance on material from a third-party search.

ORDER

PER MANISH AGARWAL, AM :

The present appeal is filed by the assessee against the order dated 31.01.2024 of Ld. Commissioner of Income Tax (A)-30, New Delhi [“Ld.CIT(A)”] in Appeal No.10146/2020-21 passed u/s 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 30.12.2022 passed u/s 143(3) of the Act pertaining to assessment year 2020-21.

2. Brief fact of the case are that the assessee is an individual, having income from salary and interest income and filed his return of income on 10.01.2022, declaring income of INR 5,46,580/-. The assessment was selected for scrutiny by way of issue of notice on 30.06.2022 and after considering the submissions of the assessee and also placing reliance on the material found during the course of search carried out on M/s. Jainco Ltd. on 06.01.2021, an addition of INR 62,00,000/- is made to the total income of the assessee by holding that the same as undisclosed sales consideration received in addition to the agreed consideration received on the sale of 50% of shares in the property at G-174, 2nd Floor, Preet Vihar, New Delhi-110092.

3. Against this order, an appeal filed by the assessee before Ld.CIT(A) wherein the assessee has challenged the assessment order on merits of the additions which has been dismissed by the Ld.CIT(A) in terms of impugned order dated 31.01.2024.

4. Aggrieved by the said order, the assessee is in appeal before Tribunal wherein following grounds of appeal are taken:-

1. “That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in framing the impugned assessment order and that too without assuming jurisdiction as per law and without following the due procedure in accordance with law.

2. That having regard to the facts and circumstances of the case. Ld. CIT(A) has erred in law and on facts in not quashing the impugned assessment order passed by Ld. AO u/s 143(3) as the same was ought to have been passed u/s 153C and not u/s 143(3) for the reason that it was based upon the search on Jainco Ltd.

3. That in any case and in any view of the matter, action of Ld. CIT(A) in not quashing the impugned assessment order inter alia on the ground that the same was to be passed u/s 153C and not u/s 143(3), is illegal. bad in law and against the facts and circumstances of the case.

4. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AD in making addition of Rs.62,00,000/- on account of alleged cash received on sale of property and that too by recording incorrect facts and findings and without considering the submissions filed by the assessee and without following the principles of natural justice and without providing the entire adverse material on record and without providing the opportunity of cross examination of the deponents.

5. That in any case and in any view of the matter, action of Ld. CIT(A) in confirming the action of Ld. AO in making addition of Rs.62,00,000/-on account of alleged cash received, is bad in law and against the facts and circumstances of the case.

6. That having regard to the facts and circumstances of the case, Ld. CIT(A) has erred in law and on facts in confirming the action of Ld. AO in not allowing the deduction of Rs. 1,05,00,000/- as claimed by the assessee u/s 54 and that too without any basis and without appreciating the facts and circumstances of the case.

7. That in any case and in any view of the matter, Ld. CIT(A) has erred in law and on facts in confirming the addition made by Ld. AO is beyond jurisdiction and illeg