AO hauled up for repeatedly disregarding ITAT’s directions & directed to pay costs

Sushila Suresh Malge vs. ACIT (ITAT Mumbai)

Pursuant to a search u/s 132, the assessee’s statement was recorded u/s 132(4) in which he offered Rs. 1.50 crores as undisclosed income. This was modified/ retracted subsequently by stating that the admission was only to the extent of the evidence found during the course of search operation. Despite the retraction, the AO passed a s. 158BC assessment order in which he determined the total undisclosed income at Rs. 1.50 crores. In the first round of appeal, the Tribunal remanded the matter to the AO to make a fresh assessment on the basis of the evidence found in the search and not only on the basis of the retracted/ modified statement. The AO passed a fresh assessment order in which he again determined the total undisclosed income at Rs. 1.50 crores on the basis of the s. 132(4) statement. In the second round, the Tribunal again remanded the matter back to the AO for framing a fresh assessment after imposing costs of Rs. 5000 upon the AO. The AO once again repeated the conclusions drawn in the earlier orders and determined the income at the same figure of Rs. 1.50 crores on the basis of the s. 132(4) statement. HELD by the Tribunal in the third round: