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2015 (4) TMI 542 - AT - Income TaxAddition on account of alleged advances to Shri Niranjan Shah out of undisclosed sources - whether CIT(A) erred in relying upon statement of assessee recorded by FEMA for drawing adverse inference without considering the fact that said statement in such transactions other than FEMA already stood reflected in his statement recorded by Income Tax Authorities - Held that:- In this particular case there are irrefutable evidences that not only the two parties were connected but admittedly entered into out of book transaction which even infringed against stringent laws like FERA. The transactions recorded in this account are held to be genuine and the appellant has failed to explain the same. The additions made by the AO on this issue, which are basically those confirmed by the then CIT(A) in the year 2000 on the issue. I agree and confirm the decisions made by him on the issue of the date and the sequence of the transactions and the working of required additions. The additions are therefore, confirmed in all the appeals. The evidence discussed i.e. the entries appearing in the seized documents coupled with the statements of the noticees, as well as other persons whose names are figuring in the documents seized, from Sh. Niranjan Shah as well as the admissions made by the notices, (other than Sh. Niranjan Shah) it is satisfying that the charges levelled against S/ Sh. Niranjan Shah, J.K. Doshi, Parag Kumar Pal, Nikhil R. Parikh and Sh, Nirish Babulat Shah as alleged in the SCN are proved and find them guilty of the said contraventions. S/Sh. j.k. Doshi, Parag Kumar Pal, Bhavnagari, Nikhil R. Parikh and Nirish Babulal Shah have submitted that they had entered into the transactions alleged in the SCN due to the circumstances beyond their control. While imposing penalties on these noticees, considering the fact that they had no deliberate intention to defy the law, but had undertaken the aforesaid transactions without any malafides, due to the exigency of the circumstance, the penalty of ₹ 4,50,000/- (Rs. Four Lacs and fifty thousand only) Imposed on Sh. Niranjan Shah, ₹ 90,000/- (Rs, Ninety thousand only) imposed on Sh. J.K. Doshi, ₹ 8,500/- (Rs. Eight thousand five hundred only) imposed on Sh. Parag Kumar Pal B, ₹ 1,500/- (Rs. One thousand five hundred only) imposed on Sh. Nikhil R. Parikh and ₹ 10.000/-(Rs.Ten Thousand only) imposed on Sh. Nirish Babulal Shah should be deposited in the office of the Enforcement Directorate at Mittal Chambers, 2nd Floor, Nariman Point, Mumbai 21 either by Demand Draft or Pay Order drawn in favour of the Drawing & Disbursing Officer within forty five days from the date of receipt of this order. According to us, FEMA proceeding has a bearing on the issue and latest position of same should be known. So, in view of submission of both parties and in the interest of justice, we restore whole issue to Assessing Officer with direction to decide the issue at hand as per fact and law and in light of subsequent development as discussed above, of course, after providing due opportunity of being heard to the assessee. Since we are restoring the issue on preliminary ground and on for the reasons discussed above, we are refraining to comment on merit at hand. - Decided in favour of assessee for statistical purposes.
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