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Income Tax - Case Laws
Showing 41 to 60 of 674 Records
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2021 (4) TMI 1255
Attachment of the property envisaged under Section 132(9B) - HELD THAT:- As the provisional attachment of the property envisaged under Section 132(9B) is of property 'belonging to the assessee', meaning the person/assessee searched. In the light of the confirmation by the Standing Counsel to the effect that the aforesaid two individuals have not been subjected to search and seizure under Section 132, there is no justification for the provisional attachment of their assets. Thus the attachments of the fixed deposits in the name of the two individuals as aforesaid, as per the details furnished in warrant for attachment of properties dated 22.03.2021, will stand lifted forthwith.
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2021 (4) TMI 1253
Disallowance u/s 80IB - Commissioner of Income Tax (Appeals) confirming the action of assessing officer in holding that income from housing project in the name of “Hampton Park” belongs to AOP and not in the individual capacity as co-owner - HELD THAT:- We have further noted that the assessee filed appeal against the order of ld.CIT(A) for A.Y. 2011-12 and assessee was allowed deduction under section 80IB of the Act.- Further, while following the order of the Tribunal for A.Y. 2011-12, the assessee was further allowed similar relief in A.Y. 2012-13 [2020 (9) TMI 1198 - ITAT SURAT] For completeness of the order, the relevant part of order passed by the Tribunal for A.Y. 2012-13 [2020 (9) TMI 1198 - ITAT SURAT]].
Considering the decision of the Tribunal on identical set of facts for AY 2011-12,which was further followed in AY 2012-13, wherein no variation in facts is brought to our notice nor any contrary law shown to us, therefore following the decisions of Co-ordinate Bench decision, the appeal of the assessee is allowed with similar observation. - Appeal of assessee allowed.
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2021 (4) TMI 1252
Assessment u/s 153A - bogus LTCG - Addition u/s 68 - Reliance on statement u/s 132(4) - HELD THAT:- As no admission as alleged by lower authorities was made and secondly, the said statement stood retracted immediately on 14/04/2015. Therefore, since the statement stood rejected immediately after making thereof, the same would lose substantial evidentiary value. In such a case, the onus would be on revenue to establish that the earlier admission made was backed up by some cogent / corroborative material on record and the retraction was not valid one. However, we find that there is no such material with the revenue which would corroborate assessee’s statement that the gains were bogus in nature. Any statement on oath, to be valid, has to be supported by corroborative evidences. Thus, the statement made by the assessee, in our considered opinion, could not be considered as incriminating material which would justify additions in the hands of the assessee
Except for statement u/s 132(4), there was no incriminating material. The statement was retracted by the assessee. Therefore, the bench held that addition on the basis of retracted statement, without there being corroborative material would not be sustainable as held in various decisions. Similar are the facts before us. Therefore, applying the ratio of aforesaid decisions, since the additions are not with reference to any incriminating material, the same would not be sustainable in the eyes of law.
The impugned additions are not sustainable in the eyes of law. The assessee had discharged the primary onus of establishing the genuineness of the transactions whereas the onus as casted upon revenue to corroborate the impugned additions by controverting the documentary evidences furnished by the assessee and by bringing on record, any cogent material to sustain those additions, could not be discharged by the revenue. The whole basis of making additions is third-party statement and no opportunity of cross-examination has been provided to the assessee to confront these parties. As against this, the assessee’s position that that the transactions were genuine and duly supported by various documentary evidences, could not be disturbed by the revenue. Hence, going by the factual matrix and respectfully following the binding judicial precedents as enumerated in the order, the additions made by Ld. AO and confirmed by Ld. CIT(A), are not sustainable in the eyes of law. Therefore, we are inclined to delete the same. - Decided in favour of assessee.
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2021 (4) TMI 1249
Nature of expenditure - Disallowance of community welfare expenses - assessee incurred this expenditure on upkeep of road as per the direction of Deputy Commissioner, Bellary - AO treated the expenditure as capital expenditure - assessee contended that expenditure is revenue in nature allowable u/s. 37(1) - HELD THAT:- In the present case, the assessee being an individual, the restriction imposed under Explanation (2) to section 37 is not applicable to assessee’s case. See M/S GUJARAT NARMADA VALLEY FERTILIZER AND CHEMICALS LTD [2019 (8) TMI 1288 - GUJARAT HIGH COURT]
Disallowance is restricted to the expenses incurred by the assessee under a statutory obligation u/s. 135 of the Companies Act, 2013 and there is thus now a line of demarcation between the expenses incurred by the assessee on discharging corporate social responsibility under such a statutory obligation and under a voluntary assumption of responsibility. As for the former, the disallowance under Explanation 2 to section 37(1) comes into play, but as for latter, there is no such disabling provision as long as the expenses, even in discharge of corporate social responsibility on voluntary basis, can be said to be “wholly and exclusively for the purposes of business”. There is no dispute that the expenses in question are not incurred under the aforesaid statutory obligation. In the present case, the said expenditure is incurred by the assessee on discharging social responsibility so as to earn the goodwill of the society and it is wholly and exclusively for the purpose of business.
The provisions of Explanation to section 37 of the Act cannot be applied. Further, in the present case, the assessee being an individual, and not a corporation under the Companies Act, 2013, Explanation 2 to section 37 cannot be applied so as to deny the voluntary expenditure incurred by assessee towards community welfare. Accordingly, we are of the opinion that the expenditure incurred is wholly and exclusively for the purpose of business of assessee and has to be allowed as business expenditure. Accordingly, this ground of appeal is allowed.
Loss from derivatives – F&O - assessable under the head ‘capital gains’ OR 'business loss' thereby not allowing set off of the same - whether trading in F & 0 derivative is taxable under section 28(i) and not a speculative transaction under section 43(5) - HELD THAT:- When the AO had accepted the income from trading in F&O derivatives as business income in earlier year, specifically in the immediate preceding AY 2015-16, the revenue cannot be allowed to change its view with regard to fundamental aspect of a transaction taken in earlier year, unless it is able to demonstrate change in circumstances in the subsequent assessment year.
In the case of CIT v. Escorts Ltd.[2011 (2) TMI 579 - DELHI HIGH COURT] it was held that the principle of res judicata did not apply to income tax proceedings, the revenue cannot be allowed to change its view with regard to fundamental aspect of a transaction taken in earlier assessment year, unless it is able to demonstrate any change in the circumstances in the subsequent assessment year. It was held that as a fundamental aspect permeating through different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year.
On these reasonings, in the absence of any material change justifying the revenue to take a different view of the matter and if there is no change, it was in support of assessee that the AO is precluded to reopen that issue and take a contrary view of what he has taken in earlier assessment proceedings and taking such a contrary decision should be have been avoided
Whether the assessee is prevented to make such a claim without filing revised return? - Regarding the additional claim made during the assessment proceedings other than the claim made in the return of income u/s. 139, in our opinion, the assessee cannot make additional claim before the AO without revised return - as held by the Hon’ble Supreme Court in the case of Goetze (India) Ltd. [2006 (3) TMI 75 - SUPREME COURT] the appellate authorities are not precluded in entertaining such claim without any revised return. Being so, we do not find any infirmity in making such claim by the assessee before the CIT(Appeals) with regard to treatment of loss from F&O transaction as business loss. Therefore, this ground of appeal is allowed.
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2021 (4) TMI 1245
Reopening of assessment quashed - case made out by the Revenue that Tribunal was of the observation that reopening was made on the dictates of the superior authority and without any application of mind by the concerned AO, whereas the same was done on the basis of the information made by the CIT(A), Ahmedabad-V, in regard to the revisionary order under Section 263 in the case of Shri Prabhat Karshanbhai Desai for A.Y. 2009-10 one of the assessee herein - HELD THAT:- It appears that the proceeding under Section 263 of the Act in respect of Shri Prabhat Karshanbhai Desai for A.Y. 2009-10 has been mentioned by the Tribunal in the order dated 27.06.2019.
No observation on merit upon scanning of 263 proceeding is reflecting from the said order particularly the fact as has been placed on record by way of specific statement made by the Revenue in the instant Miscellaneous Application at Page 2 para (i) onwards. Such narration of facts need to be considered in its proper perspective which was not reflecting in the said order passed by the Ld. Tribunal. Thus, we find merit in the application filed by Revenue. In the light of the above observation, the order is, therefore, recalled. Registry is directed to put the matter on board for hearing in due course.
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2021 (4) TMI 1242
Deduction u/s 80P(2)(a)(i) - interest income received by assessee is not eligible for deduction u/s 80P(2)(a)(i) of the I.T.Act. as the same is not related to any banking activity - HELD THAT:- The Hon’ble Apex Court in the case of Mavilayi Service Co-operative Bank Ltd. v. CIT [2021 (1) TMI 488 - SUPREME COURT] had held that when the assessee is registered as a Co-operative Society under the respective State Acts, the interest income received for providing credit facilities to its members is entitled to deduction u/s 80P(2)(a)(i) .
We remit the issues raised in this appeal to the file of A.O. The A.O. is directed to examine the deduction u/s 80P(2)(a)(i) of the I.T.Act in the light of the dictum laid down in the case of Mavilayi Service Cooperative Bank Ltd. v. CIT (supra) - Appeal filed by the assessee allowed for statistical purposes.
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2021 (4) TMI 1240
Deduction u/s 10A - Tribunal held that set off of brought forward losses of non eligible unit against the income of the eligible 10A unit is to be allowed and deduction under section 10A should be allowed without reducing the unabsorbed depreciation and brought forward losses of the non 10A unit - HELD THAT:- Issue similar is decided against revenue as decided in M/s. Comstar Automative Technologies Private Ltd[2020 (3) TMI 814 - MADRAS HIGH COURT].
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2021 (4) TMI 1237
Deduction u/s 80-IA - AO held by the Assessing Officer that deduction computed under Section 80-IA of the Act could not be allowed against any source other than business - HELD THAT:- In the case before us, there is no discussion about Section 80-IA(5) by the Appellate Authority, nor the Tribunal and the High Court. However, we have considered the submissions on behalf of the Revenue as it has a bearing on the interpretation of sub-section (1) of Section 80-IA of the Act. We hold that the scope of sub-section (5) of Section 80- IA of the Act is limited to determination of quantum of deduction under sub-section (1) of Section 80-IA of the Act by treating ‘eligible business’ as the ‘only source of income’. Sub-section (5) cannot be pressed into service for reading a limitation of the deduction under sub-section (1) only to ‘business income’. An attempt was made by the learned Senior Counsel for the Revenue to rely on the phrase ‘derived … from’ in Section 80-IA (1) of the Act in respect of his submission that the intention of the legislature was to give the narrowest possible construction to deduction admissible under this sub-section. It is not necessary for us to deal with this submission in view of the findings recorded above. For the aforementioned reasons, the Appeal is dismissed qua the issue of the extent of deduction under Section 80-IA of the Act.
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2021 (4) TMI 1235
Orders passed by the Settlement Commission u/s 245D - sole grievance of the petitioner stems out of factual matters which have been duly considered by the second respondent after a thorough enquiry and a detailed 'speaking order' has been passed by the second respondent in this regard - HELD THAT:- In view of the fact that the petitioner could able to establish that the first respondent has not approached the second respondent/Settlement Commission with true and full disclosure of his income and during the course of proceedings, offered additional income and the findings of the Settlement Commission would also confirm the same, the said offerings of the additional income would be sufficient for the purpose of arriving a conclusion that the first respondent filed an application under Section 245C of the Act without disclosing true and full income.
Thus, the second respondent/Settlement Commission ought to have rejected the application, at the stage when it noticed that the first respondent has not disclosed true and full facts which was not done. Thus, the Settlement Commission has committed an error apparent and allowed the application filed by the first respondent which is in violation of the provisions of the Act. Thus, the order impugned passed by the second respondent in proceedings dated 14.09.2015 is quashed and the writ petition stands allowed
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2021 (4) TMI 1234
Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 - petition raises issues concerning wrongful assumption of jurisdiction by the assessing officer under the 2015 Act, and the violation of the principles of natural justice - HELD THAT:- The matter would require consideration.
Revenue's counter-affidavit, in this behalf, will be relevant. This is especially so, as Mr. Anand vehemently argues that the issues that arise in other writ petitions, to which a reference has been made to by Mr. Vohra, do not overlap with those, that have been raised in the instant petition.
It would, therefore, be in the interest of both parties to file, at least, the grounds taken in the other petitions, to which a reference has been made in the instant petition.
Accordingly, issue notice. Mr. Anand accepts notice on behalf of the revenue.
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2021 (4) TMI 1230
Reopening of assessment u/s 147 - undisclosed contract receipts - HELD THAT:- The reasons for reopening of assessment intimated to the writ petitioner reveals that from revised 26AS details, the assessee company has received contract receipts of ₹ 5,78,10,06,904/-, on which, tax at source has been deducted to the tune of ₹ 12,54,24,815/-. The assessee company claimed the TDS of ₹ 12,41,50,256/-. However, the assessee company credited P & L account as contract receipts and sales for ₹ 521,79,70,864/- only. Thus, the assessee has not offered receipts of ₹ 56,30,36,040/- for taxation, resulting in escapement of income due to failure on the part of the assessee company to correctly account its income. Thus, the Assessing officer has reason to believe that income of ₹ 57,97,88,686/- has escaped assessment within the meaning of Section 147 of the Income Tax Act due to the failure on the part of the assessee company to disclose fully and truly all material facts necessary for its assessment.
in the presence of materials on record, if the power under Section 147 is invoked by the competent authority, then the authorities competent must be allowed to proceed with the reopening proceedings by following the procedures as contemplated. High Court cannot adjudicate the disputed facts and materials to form an opinion in a writ proceedings. The High Court, under Article 226 of the Constitution of India, is empowered to scrutinize the process, through which, the decision is taken and the reasons and in consonance with the statutory requirements, but not the decision by itself. Thus, the scope of Article 226 of the Constitution of India cannot be expanded for the adjudication of the disputed facts and circumstances with reference to the documents, evidences produced by the respective parties and such an adjudication must be allowed to be done by the competent authorities under the provisions of the Statutes by following the procedures as contemplated and by affording opportunity to the assessee.
As in these writ petitions, the respondent could able to establish that sufficient materials are available for the purpose of reopening of assessment for the Assessment Years 2009-10 and 2010-11 and thus, the respondent must be allowed to proceed with the reopening of assessment by following the procedures as contemplated and the writ petitioner is bound to co-operate by defending their case by availing the opportunities to be provided under the Statute. - Decided against assessee.
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2021 (4) TMI 1228
Reopening of assessment u/s 147 - notice issued on non-existig entity - Scheme of Amalgamation - HELD THAT:- When Section 170(ii) contemplates that the successor Company is liable and responsible, mere service of notice in respect of company, which was not existing cannot be a ground to assail the proceedings instituted for reopening of assessment under Section 147.
On perusal of the said letter reveals that the address of the sender as well as the change of the address is one and the same. HCL Peripherals Limited merged with HCL Corporation Limited with effect from 01.04.2009 and both the offices are running in the same premise. Further, acknowledgement of the notice issued by the respondent has not been disputed by the petitioner. Therefore, Section 170(ii) would be applicable in the present case and the said ground cannot be considered for the purpose of quashing the entire proceedings initiated under Section 147 of the Act. Even on merits, the respondent could able to establish that there is a "reason to believe" in view of certain new materials noticed in the matter of purchased units of mutual funds to the extent of ₹ 52,39,18,310/-.
his being the facts and circumstances established, the petitioner has to participate in the reassessment proceedings by submitting their documents, evidences to establish their case. Thus, the respondents have to proceed with reopening of the assessment already made and the proceed with the assessment by following the procedures as contemplated under the Act and by affording opportunity to the assessee. In view of the fact that the petitioner has not established any acceptable reason for the purpose of assailing the impugned order, the writ petition stands dismissed.
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2021 (4) TMI 1227
Reopening of assessment u/s 147 - LTCG on sale property - HELD THAT:- Sale consideration shown by the assessee in the return of income for the assessment year 2013- 14 is not disputed. The document registered, which is now in appeal under Section 47A of the Indian Stamps Act is also not in dispute. Thus, the market value as stated in the document is disputed and the actual market value and the stamp duty paid is also in dispute. Thus, the disputes are providing new material facts and informations to the Income Tax Department for reopening of the assessment.
The manner in which the sale deed was valued by the assessee and the stamp duty paid at the time of registration as well as the appeal filed under Section 47A of the Indian Stamp Act and the actual market value prevailing during the relevant point of time with reference to the subject property, provides new information and an additional material, which were not considered by the Assessing Officer at the time of original assessment. Thus, the said factors would be new material for the purpose of reopening of assessment. Thus, the reopening of the assessment by the Assessing Officer is in consonance with the provisions of Section 147 and no further inference is required from the hands of this Court.
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2021 (4) TMI 1226
Reopening of assessment u/s 147 - huge difference between data reflected in Form 26AS and assessee's statement - HELD THAT:- As seen from the Form 26AS downloaded that assessee was in receipt of income of ₹ 419,47,44,777/-, whereas the total amount credited in P & L account is ₹ 387,30,50,376/-. In this context, the Assessing officer relied on the breakup details. In view of large discrepancy and mismatch, the Assessing officer has reason to believe that income of ₹ 41,59,51,722/- has escaped assessment within the meaning of Section 147 due to the failure on the part of the assessee to disclose all and true material facts necessary for assessment.
The rectification application dated 20.07.2011, submitted by the assessee company was also considered by the Assessing Officer and the Assessing Officer verified the informations provided in the rectification application and found that very Form 26AS that was downloaded in view of assessee's application for the rectification, it was found that there was huge mismatch in receipts appearing in 26AS vis-a-vis receipts credited in P & L Account. Assessing Officer has reason to believe that the income of the assessee as escaped assessment and decided to reopen the assessment. This apart, the Assessing officer relied on the MB Shah Commission, set up by the Government of India to enquire into the cases of illegal mining in the State of Odisha. The petitioner/assessee was a raising contractor, employed by one KJS Ahulwalia, who was a lessee found in the Shah Commission report. For all these reasons, the Assessing officer has reason to believe for reopening of assessment.
The respondents have placed on record the materials and informations and evidences that gave them reason to believe that there is escapement of income.
The grounds placed before this Court for reopening of assessment is “sufficient reason” to believe that there is escapement of income and the “sufficiency” of the reasons cannot be gone into by the High Court in a writ proceedings under Article 226 of the Constitution of India. The contents of the breakup details, evidences, documents, invoices etc., have to be adjudicated during the course of hearing and certainly, not by the High Court in a writ proceedings - there is no illegality or irregularity as such, which can be attached to the reasoning of the competent authority for arriving a conclusion that there is a reason to believe for reopening of assessment. Thus, the grounds raised in the present writ petition are neither candid nor convincing and the petitioner has to co-operate with the Assessing Officer in the reassessment proceedings by availing the opportunities to be provided as contemplated under the Statute. WP dismissed.
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2021 (4) TMI 1225
Violation of the provisions of the Act - final assessment order passed erroneously, even while the title of the order reads as “Draft Assessment Order u/s 143(3) r.w.s. 144C - HELD THAT:- Prima facie, we are of the view that the petitioner appears to be correct in its contention, that there is a violation of the provisions of the Act.
Assessing Officer was perhaps required to pass, in the first instance, an order under Section 144 C (1) of the Act, which would have enabled the petitioner to file, if so aggrieved, its objections with the Dispute Resolution Panel.
Mr. Zoheb Hossain, who appears on advance notice, contends that for the moment, he does not have instructions in the matter. He, however, says that the timeline for passing the draft assessment order, as of now, expires on 30.06.2021.In the aforesaid circumstances, issue notice, both in the writ petition and the interlocutory application.
Mr. Hossain accepts service on behalf of the respondent/revenue. In the interregnum, there shall be a stay on the operation of the impugned order.
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2021 (4) TMI 1224
Cancellation of registration u/s 12AA(3) - Principal Commissioner or Commissioner power to cancel registration - HELD THAT:- As scope of Sections 11, 12, 12A and 12AA of sub-clause (3) in the aforementioned paragraphs, the Principal Commissioner or Commissioner was vested with the power even prior to 01.06.2010 to cancel the registration made u/s 12A of the Act, if the Commissioner is satisfied that the activities of such Trust or Institution are not genuine or are not being carried out in accordance with the objects of the Trust or Institution, as the case may be, and he shall pass an order in writing cancelling the registration of such Trust or Institution.
In the present case, the Commissioner of Income Tax in impugned proceedings considered the merits and demerits of the case and assigned reason for cancellation of registration, which reads as under:-
“3. Coming to the merits, search and seizure operations on 06.06.2007 at your premises, inter alia, have brought to light the following violations:
a) Capitation Fee was collected by the assessee Trust.
b) The funds of the Trust at least to the tune of ₹ 22 crores have been misused by the Trustees.
c) The provisions of Tamil Nadu Educational Institutions [Prohibition of Capitation Fee] Act, 1992 have been grossly violated.
d) The provisions of Section 11(2) of the I.T. Act, 1961, have not been adhered to.”
The reasons assigned for the purpose of cancellation are undoubtedly in consonance with the powers conferred on the Commissioner under sub-clause (3) to Section 12AA of the Act and therefore, the order of cancellation can at any stretch of time be stated as infirm or perverse.
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2021 (4) TMI 1220
Promulgation of the Ordinance titled The Tribunals Reforms (Rationalisation and Conditions of Service) Ordinance, 2021 - members whose tenures subsisted up until that date, have had their tenures brought to an end - Members entitled to claim compensation not exceeding three months’ pay and allowances for the premature termination of their respective tenures - HELD THAT:- Insofar as this Court is concerned, for the moment, we cannot issue any directions with regard to the pending cases, filed before the Authority for Advance Rulings [in short the “AAR”].
Having said so, we tried to impress upon Mr. Venkataraman that if some interim arrangement could be made, till the Board for Advance Ruling is constituted, then, perhaps, some pending cases could be disposed of, as has been done in the case of the Income Tax Settlement Commission.
Mr. Venkataraman will revert on this aspect of the matter. As prayed, another four weeks are granted to the respondents to file their counter-affidavits in the captioned matters. Rejoinders, thereto, if any, will be filed before the next date of hearing.
List for directions on 24.05.2021.
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2021 (4) TMI 1218
Property attached in respect of arrears of tax due to the Income Tax Department - HELD THAT:- In this case, the petitioner has been fighting for her rights over the property in terms of a sale agreement dated 30.06.1994. The Hon’ble Supreme Court ultimately accepted the contention of the petitioner that the third and fourth respondent’s mother late Mrs.J.Padmini ought to have executed a sale deed in favour of the petitioner in terms of the aforesaid sale agreement dated 30.06.1994.
The third and the fourth respondents who were minors at the time of execution of the sale agreement on 30.06.1994 ought to have executed the sale deed in favour of the petitioner. Therefore, the subsequent tax liability of the fourth respondent and her husband for the Assessment Years 2012-13 and 2013 -14 cannot be to the disadvantage of the petitioner, since the petitioner has been diligently litigating since 2004. Therefore, fruits of the decree in a contested suit cannot be denied merely because the seller or one of the persons had incurred subsequent tax liability. The fruits of a decree will date back to the date of the suit.
Section 281 of the Income Tax Act, 1961 applies only to a situation where an assessee during the pendency of any proceeding under the Act, or after completion thereof, but before the service of a notice under Rule 2 of the Second Schedule, creates a charge on, or parts with the possession (by way of sale, mortgage, gift, exchange or any other mode of transfer whatsoever) of, any of his/her assets in favour of any other person.
Only such charge or transfer is void as against any claim in respect of any tax or any other sum payable by the assessee as a result of completion of the said proceedings or otherwise.
In this case admittedly the transfer was on account the final culmination of the litigation by the order of Hon’ble Supreme Court.There was only a delay in the execution of sale deed due to the pendency of the proceedings as the third and fourth respondent’s mother declined to execute sale deed under the sale agreement dated 30.6.1994.
Therefore the impugned communication dated 06.07.2018 asking the petitioner to obtain clearance from the second respondent cannot be countenanced. Further as per proviso to section 281 of Income Tax Act, 1961 such charge or transfer shall not be void if it is made-
(i) for adequate consideration and without notice of the pendency of such proceeding or, as the case may be, without notice of such tax or other sum payable by the assessee ; or
(ii) with the previous permission of the Assessing Officer.
The tax liability of the aforesaid firms of which the fourth respondent and her husband were the partners are subsequent to the commitment in the sale agreement dated 30.6.1994. Therefore, there is no justification in not releasing the registered sale deed in favour of the petitioner as the petitioner is a bonafide purchaser who has purchased the property after a long drawn litigation .
This Court is inclined to allow this writ petition as prayed for. Thus, this writ petition deserves to be allowed. The second respondent is directed to release the sale deed dated 29.06.2018 registered vide Document No. 89 of 2018 in favour of the petitioner within a period of two weeks from date of receipt of this order.
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2021 (4) TMI 1214
Application u/s 245D (4) to Settlement Commission rejected - learned Senior Standing Counsel is of the opinion that in the present case, the Settlement Commission formed an opinion that the petitioner had not made full and true disclosure with reference to certain incriminating evidence. Therefore, the order of rejection is in consonance with the provisions of the Act - HELD THAT:- This Court is of the considered opinion that it is a pre-requisite condition that an assessee, who approaches the Settlement Commission under Section 245C of the Act, must disclose true and full income. How to form an opinion regarding true and full disclosure of the assessee.
Undoubtedly, it is a difficult procedure to be adopted and further, various facts and circumstances are also to be ascertained. Thus, the procedures are contemplated under Section 245D of the Act. Various stages are provided for the purpose of deciding the application filed under Section 245C. While the process of adjudication of an application is in progress, the Authorities Competent are empowered to provide additional informations, report enabling the Commission to decide the issues in a proper perspective.
The application filed under Section 245C is a special provision contemplated for the purpose of settling the cases in a speedy manner, only in the event of furnishing the true and full disclosure of income by an assessee along with the application.
Doubts raised based on incriminating evidence by the Department and the particulars produced by the assessee are sufficient enough to form an opinion that there was no true and full disclosure. The true and full disclosure contemplated under the provision must be understood that the said disclosure must be an acceptable disclosure with reference to the documents and evidences available with the Department. The very settlement is a consensus to arrive a settlement and the parties are expected to be fair and honest. With this idea, the concept of true and full disclosure is contemplated in the provision.
As far as the writ proceedings are concerned, such disputed facts and circumstances with reference to the documents and evidence cannot be adjudicated under Article 226 of the Constitution of India. Such an adjudication must be done by the Competent Authority by conducting a fullfledged enquiry/trial. In the event of rejection of an application filed under Section 245C, the matter shall go before the Assessing Officer before whom the assessee would get an opportunity to submit his explanation or documents or otherwise. Thus, the High Court under Article 226 cannot adjudicate or made any finding with reference to the disputed facts. Thus, the contention raised by the writ petitioner in this regard need not be considered.
The entire findings of the Settlement Commission reveal that certain contra materials were produced by the Department before the Settlement Commission and disputed statements are also made. All such disputed statements and evidences cannot be adjudicated by the High Court.
This being the factum, this Court is not inclined to entertain the writ petition and further, the procedures followed for deciding the issues as well as the decision arrived are in consonance with the provisions of the Act and there is no perversity or infirmity as such. Accordingly, the writ petition stands dismissed.
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2021 (4) TMI 1211
Reopening of assessment u/s 147 - assessee has claimed erroneous reduction in the value of inventory being flats under construction as per joint venture development, which will be complete on receipt of share of flats apart from cash by the assessee company as agreed in the Joint Venture document which has not taken place during the year - HELD THAT:- In the reasons given for reopening the assessment, it is stated that the issue of reduction in respect of inventory was not considered during the course of scrutiny proceeding.
As further stated that the Tripartite agreement dated 12.3.2012 and the financial submitted by the petitioner are itself tangible materials for reopening of the assessment and there was no change of opinion by the AO.
The impugned order further states that the assessment were scrutinised to find out the difference between the opening stock of the current year with the closing stock of the previous year and the details and evidence were called for were restricted to that issue only and that the issue relating to reduction in the value of inventory was not considered during the course of scrutiny and therefore the notice has been issued to reopen the assessment.
As find substantial merits in the submission of the learned counsel for the respondent. The assessment is driven based on the returns filed by an assessee and therefore it is for the assessee to make correct computation of income for the purpose of payment of income tax. If there is any irregular claim for deduction/exemption, the respondent assessing officer is well within his rights to reopen the assessment as long as which reopening of the assessment is not on account of any change of opinion as has been held by the Honourable Supreme Court has followed by all the High Courts.
It cannot be stated that the impugned notice has been issued merely on account of change of opinion. Further, the petitioner has also not clearly explained how a reduction in the value of inventory was made at the time of filing of the returns. In these proceedings, the petitioner is hiding behind the cloak of the few ratios of the Court which may not be applicable to the facts of the case. Therefore, In my view, the respondent Income tax Department was justified in reopening the assessment under section 148 of the Income Tax Act, 1961. It is still open to the petitioner to substantiate its defence before the respondent by filing suitable reply and explain how the computation of the income was made for the purpose of payment of tax and thus, the taxable income was correctly determined.
Therefore, am inclined to dismiss this writ petition. I however give liberty to the petitioner to participate in the proceedings pending before the respondent. The petitioner may therefore file additional reply, if any, within a period of 30 days from date of receipt of copy of this order before the respondent explaining its stand. The respondent is directed to examine the issue a fresh and pass an assessment orders on merits in accordance with law within a period of 90 days from the date of receipt of copy of this order.
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