ITA No 190/2022

Page 1 of 7

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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ITA 190/2022 & CM APPL.29957/2022

PRINCIPAL COMMISSIONER OF INCOME TAX-20..... Appellant

Through:

Mr. Ajit Sharma, Sr. Standing

Counsel.

versus

KAVITA AGARWAL

..... Respondent

Through:

Mr. Gautam Jain, Advocate with

Mr.Piyush Kumar Kamal, Advocate.

%

Date of Decision: 14^thJuly, 2022

CORAM:

HON'BLE MR. JUSTICE MANMOHAN

HON'BLE MS. JUSTICE MANMEET PRITAM SINGH ARORA

J U D G M E N T

MANMEET PRITAM SINGH ARORA, J (Oral):

CM APPL.29957/2022 (condonation of delay)

For the averments made in the application, the delay of 177 days in

filing the present appeal is condoned.

Accordingly, the application stands disposed of.

ITA 190/2022

1.

The present Income Tax appeal arises out of common impugned order

dated 6^thOctober, 2020 passed by the Income Tax Appellate Tribunal

(hereinafter referred to as the ‘ITAT’) in ITA No. 6178/Del/2018 for

assessment year 2010-11.

2.

The facts giving rise to the present appeal are that the Investigation

Wing of the Income Tax Department carried out a search and seizure

This is a digitally signed Judgement.

NEUTRAL CITATION NO: 2022/DHC/002760

ITA No 190/2022

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operation against M/s K.R. Pulp & Papers Limited under Section 132(1) of

the Income Tax Act, 1961 (hereinafter referred to ‘the Act’) on 8^thJuly,

2015 at various residential and business premises. The said company is

stated to be managed and controlled by Shri Madho Gopal Agarwal, Shri

Raj Gopal Agarwal and Shri Gopal Agarwal. The statement of Shri Gopal

Agarwal was recorded on 8^thJuly, 2015 and the statement of Shri Madho

Gopal Agarwal was recorded during post search inquiry.

3.

Pursuant to the aforesaid search, notice under Section 153A of the Act

was issued on 26^thSeptember, 2016 by the Assessing Officer and the same

was duly served upon the assessee. In response, the assessee filed her

Income Tax Return declaring income of Rs. 5,98,600/- on 2^ndMarch, 2017.

The Assessing Officer after making reference to the documents discovered

during the raid, vide order dated 29^thDecember, 2017 made the following

additions to the income of the assessee under Section 69B and Section 68 of

the Act respectively:

Total income computed by the assessing officer

Rs

Income as declared

5,89,600

Add: Forfeiture amount against property Vatika

40,00,000

Add: Investment in share

5,18,75,175

Total taxable Income

5,64,64,775

4.

Being aggrieved by the same, an appeal was filed by the assessee

before the Commissioner of Income Tax (Appeals) [hereinafter referred to

as ‘CIT(A)’]. Vide order dated 17^thJuly, 2018, the CIT(A) allowed the

appeal of the assessee, deleted additions and held as under :-

This is a digitally signed Judgement.

NEUTRAL CITATION NO: 2022/DHC/002760

ITA No 190/2022

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5.

The department preferred an appeal before the ITAT which was

dismissed vide an order dated 6^thOctober, 2020.

6.

The

ITAT concluded that the additions made by the Assessing

Officer for the assessment year under consideration was not based on any

incriminating material found during the course of search on 8^thJuly, 2015. It

held that the documents referred to by the Assessing Officer pertains to the

period w.e.f. 1^stApril, 2010 to 31^stMarch, 2011 which relate to the

assessment year 2011-12 and not for the impugned assessment year 2010-

11. The ITAT observed that the original return of income was filed by the

This is a digitally signed Judgement.

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assessee for the assessment year under appeal on 28^thSeptember, 2011. The

search was conducted on 8^thJuly, 2015 and on the date of the search, the

assessment under appeal was completed as the time period to issue notice

under Section 143(2) of the Act for the said year has expired. The ITAT

thus, observed that on the date of search i.e. on 8^thJuly, 2015, assessment for

the assessment year 2010-11 had attained finality and was not pending

assessment. The ITAT, therefore, held that any additions o