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2017 (4) TMI 169 - AT - Income TaxAddition of cessation of liability u/s 41 - Held that:- There can hardly be any dispute that the assessee’s so-called marketing scheme is very much in the nature of a ponzy one wherein it collected moneys by exploiting aspirations of the lower income strata of the society by issuing the investors in question some marketing coupons valid for a year. Shri Shah fails in proving assessee’s bonafides since we find it very much and unjustifiable explanation that there was no coupon holder coming forward to encash the same in lieu of the specified electronic items between assessment years 2008-09 to 2013-14 including the impugned assessment year 2012-13. These facts constrain us to speak about the assessee’s marketing scheme alike “the pied piper of Hamlin” type fleecing poor investors. We further wish to highlight the fact that there is no privity of contract/agreement between the assessee and the above investors since the coupon in question is valid for a clear-cut expressly stated time period of one year wherein the coupon holder is otherwise nowhere in picture. We deem it appropriate to reject assessee’s argument that it has been entertaining its coupon holders’ claims and conclude that the express terms indicated in the coupons in question could not be further given a wider meaning than the specified one. Our detailed discussion hereinabove makes Shri Manish Shah to once again vehemently argue that the impugned liability; if at all is to be added u/s.41(1) of the Act, has not ceased to exist in the impugned assessment year as the period of one year after issuance of the relevant coupons has expired much earlier which is not liable to be accepted as section 153 of the Act prescribing time limit of completion of assessment very well deals with such an instance where the Assessing Officer concerned can reopen assessment in an assessee’s case in consequence to this tribunal’s findings. We notice that a co-ordinate bench in Mosbacher India Chennai vs. Addl.DIT [2016 (12) TMI 235 - ITAT CHENNAI] explains ambit of the above statutory provision in such a case wherein it can be clearly held that the amount in question in assesseble as income in earlier assessment year - Decided against assessee.
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