TMI Blog2021 (2) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... an once. It is also well settled proposition that income pertaining to a particular year can be assessed only in that year, i.e., the income pertaining to one year cannot be assessed in any other year. In the case of CIT v. Milton Laminates Ltd [ 2013 (3) TMI 192 - GUJARAT HIGH COURT] held that the Assessing Officer is free to give effect to order of Commissioner (Appeals) without restricting income to returned income, i.e., the assessing Officer can compute income lower than that returned income. In the case of Nirmala L. Mehta v. A. Balasubramanian [ 2004 (4) TMI 43 - BOMBAY HIGH COURT] held that, There cannot be any estoppel against the statute, Article 265 of the Constitution of India in unmistakable terms provides that no tax shall be levied or collected except by authority of law. Acquiescence cannot take away from a party the relief that he is entitled to where the tax is levied or collected without authority of law . We hold that the income erroneously offered by the assessee in AY 2013-14 cannot be assessed in that year, merely for the reason that the assessee has offered the same voluntarily. Appeal of the assessee is allowed. - ITA No. 2029/Bang/2018 - - - D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opened the assessment of assessment years 2008-09 to 2013-14 by issuing notices u/s 148 of the Act. Since the assessment of the assessment year 2013-14 was already pending, the AO withdrew the notice issued u/s 148 of the Act for AY 2013-14. During the course of assessment proceedings, the assessee submitted a letter dated 24.3.2016 stating therein that additional income of ₹ 2,60,38,898/- offered by him in the return of income was erroneously offered. It was also stated that these creditors were outstanding as on 31.3.2012 also and the assessee had furnished confirmation letters from all the creditors during the course of assessment proceedings pertaining to AY 2012-13 and they were accepted by the AO without making any addition. Accordingly, the Ld A.R submitted that the cash credit surrendered in AY 2013-14 was actually received in the earlier years. Accordingly, the assessee prayed before the AO not assess the income surrendered in AY 2013-14, as they are genuine cash credits. 6. The Ld A.R submitted that the AO, however, did not accept the above said prayer put forth by the assessee. In the mean while, the assessee also filed a return of income for AY 2013-14 in respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt from remaining amounts were also not received during the year relevant to AY 2013-14. The Ld A.R submitted that the addition of unexplained cash credit can be made u/s 68 of the Act only in the year in which the cash credit was received. However, in the instant case, the amount of ₹ 2,60,38,898/- has not been received by the assessee during the financial year relevant to AY 2013-14. Accordingly, the Ld A.R submitted that the above said amount is not legally assessable as income of the assessee in AY 2013-14, even if it was voluntarily offered by the assessee. He submitted that there is no estoppel against law and hence the voluntary surrender of income made by the assessee is liable to be deleted. In support of these contentions, the Ld A.R placed his reliance on the Third Member decision rendered by Chennai bench of Tribunal in the case of R.Natarajan vs. ACIT (ITA No.1058 (Mds)/2010 dated 23rd January, 2012. 10. The Ld D.R, on the contrary, submitted that the assessee has not reduced the sundry creditors balance in his Balance Sheet as on 31.3.2013, meaning thereby, the voluntary surrender of income made by the assessee cannot be taken as surrender of sundry creditors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e AO as unexplained cash credits u/s 68 of the Act in AY 2008-009 forms part of the above said list of ₹ 9,89,89,527/-. (c) The assessee had furnished confirmation letters of all the creditors before the AO in AY 2012-13. Accordingly, the AO has accepted the genuineness of all the creditors and hence did not make any addition u/s 68 of the Act in that year. (d) We notice that the Ld CIT(A), while adjudicating the appeal filed by the assessee for AY 2008-09, has taken note of the fact that the AO has accepted the genuineness of the creditors in AY 2012-13. He also taken note of the fact that the additions made in AY 2008-09 formed part of the creditors list accepted by the AO in AY 2012-13. The Ld CIT(A) has also analysed the nature of details furnished by the assessee and accordingly deleted the addition to the extent of ₹ 3,80,93,238/-. (e) The sundry creditors amount of ₹ 2,60,38,898/- offered by the assessee in AY 2013-14 forms part of the list of sundry creditors outstanding as on 31.3.2012. 15. These facts would show that the sundry creditors amount of ₹ 2,60,38,898/- surrendered by the assessee in AY 2013-14 was in fact received in earlier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any revised return. In these circumstances, the question is whether the assessee is entitled for relief so that the amount of ₹ 4,28,750/- may be excluded from the taxable income of the assessee for the impugned assessment year 2007-08. For the sake of clarity, it is to be made clear that there is no dispute whatsoever as far as the assessment year 2008-09 is concerned. The dispute is only with reference to the impugned assessment year 2007-08 as to whether the said amount of ₹ 4,28,750/- should be again taxed for the impugned assessment year or it should be excluded from taxation for the impugned assessment year. 15. Article 265 of the Constitution of India reads as below:- Taxes not to be imposed save by authority of law.- No tax shall be levied or collected except by authority of law. 16. In the light of the above stated constitutional mandate on collection of tax, it is incumbent upon public authorities vested with the duty of collecting tax to see that what is demanded is only the legitimate tax due from an assessee. The above constitutional mandate is profoundly reflected in the Circular issued by the Central Board of Direct Taxes to give admin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessees the way in which entries should be made in various forms, they should not themselves make any in them on their behalf. Where such advice is given, it should be clearly explained to them that they are responsible for the entries made in any form and that they cannot be allowed to plead that they were made under official instructions. This equally applies to the Public Relation Officers. 6. The intention of this circular is not that tax due should not be charged or that any favour should be shown to anybody in the matter of assessment, or that where investigations are called for, they should not be made. Whatever the legitimate tax it must be assessed and must be collected. The purpose of this circular is merely to emphasis that we should not take advantage of an assessee's ignorance to collect more tax out of him than is legitimately due from him. 17. The Board has given clear instruction to assessing authorities that they should not take advantage of ignorance of an assessee as to his rights. In the present case, the assessee voluntarily offered the incentive income of ₹ 4,28,750/- for taxation in the assessment year 2007-08 on a bona fide belief ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticular assessment year. This is very certain. In the present case the subject income has already been assessed for the assessment year 2008-09 and that assessment has become final. Therefore, it is clear that it is not at all possible to assess the same income again for the assessment year 2007-08. There is no such enabling provision anywhere in the Income-tax Act; for that matter not under any other taxing statute. 19. The Income-tax Department is collecting tax not for itself. It is collecting tax for the Sovereign State, that is, Union of India. Union of India as the sovereign authority does not require to levy tax on an amount returned by mistake. The sovereign authority does not want to take advantage of a mistake committed by an innocuous assessee. It is not the policy of the Sovereign State to crave for undue enrichment. 20. When, under these circumstances, levy of tax on the sum of ₹ 4,28,750/- is altogether impermissible for the assessment year 2007- 08, how the prayer of the assessee could be brushed aside? If the Income-tax Act authorizes a designated authority to collect tax for State, the same Act always permits the said authority to rectify any proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of tax on the same amount of income more than once. It is also well settled proposition that income pertaining to a particular year can be assessed only in that year, i.e., the income pertaining to one year cannot be assessed in any other year. In the case of CIT v. Milton Laminates Ltd (2013) 218 taxman 108 (Mag.) (Guj.), in Paragraph 5, the Hon ble Gujarat High Court held that the Assessing Officer is free to give effect to order of Commissioner (Appeals) without restricting income to returned income, i.e., the assessing Officer can compute income lower than that returned income. In the case of Nirmala L. Mehta v. A. Balasubramanian (2004) 269 ITR 1 (Bom.)(HC), the Hon ble Bombay High court held that, There cannot be any estoppel against the statute, Article 265 of the Constitution of India in unmistakable terms provides that no tax shall be levied or collected except by authority of law. Acquiescence cannot take away from a party the relief that he is entitled to where the tax is levied or collected without authority of law . 18. Accordingly, following the decision rendered in the case of R Natarajan (supra), we hold that the income of ₹ 2,60,38,898/- erroneously offer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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