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2020 (6) TMI 407 - AT - Income TaxReopening of assessment u/s 147 - undisclosed income from bank accounts addition(s) - Assessee was one of the beneficiaries of M/s Ambrunova Trust and made investment in LGT Bank - proportionate share of benefit - HELD THAT:- There is no material evidence coming from the departmental side that the corresponding twin trusts deeds have formed part of records which could even remotely indicate that these assessees are beneficial owners of the trusts’ assets to the extent of 1/5th share each as on 31.12.2001 we quote Mukesh Kumar Gupta vs. Commissioner of Income Tax [2013 (4) TMI 444 - ALLAHABAD HIGH COURT] that such a re-opening initiated beyond a period of four years from the end of the relevant assessment year is not sustainable in absence of the specified amount of taxable income having escaped assessment being recorded in reopening reasons There is further no quarrel that sec. 5(1)(a-c) defines total taxable income in case of a resident that the income which is received or deem to be received in India, accrued or arise or is deem to accrue or arise in India and accrues or arises to him outside India during such year. We reiterate that learned lower authorities have assessed these two assessees qua the overseas trust’s balance amount to the extent of 1/5th share each u/s 5(1)(c) only. The clinching aspect of the trust deeds nowhere forming part of records that there is no cogent material indicating the assessees as having 1/5th share each in the trusts’assets. And also as to whether the trust deeds herein pin-point the trusts as discretionary or specific ones and whether the balance amount therein was to devolve upon them in a vested or contingent manner. We note that once the Assessing Officer has himself not suggested that the impugned sums have been in fact accrued or arisen to them, thus that the department’s impugned action adding the trust’s balance in these two taxpayers’ hands does not deserve to be concurred with. The Assessing Officer’s re-opening reasons nowhere allege that these assessees had any right to receive the alleged 1/5th shares as well. We wish to make it clear that our foregoing detailed discussion sufficiently proves in absence any material on record, these two assessees did not have right to receive the alleged 1/5th share each in the trust’s balance. We observe in view of the foregoing detailed discussion that both the lower authorities have erred in law and on facts in initiating sec. 148 /147 proceedings against these two assessee - Decided in favour of assessee.
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