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Income Tax - Case Laws
Showing 361 to 380 of 173317 Records
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2025 (4) TMI 1046
Inquiry conducted in response to the Tax Evasion Petition [TEP] filed by petitioner - Income Tax Department obligation to disclose the full investigation report conducted pursuant to a Tax Evasion Petition - entitlement to receive the investigation report despite confidentiality provisions - income reflected in the petitioner's ITR which is denied to be hers but of spouse - HELD THAT:- First things first, there is nothing confidential about the report dated 29.08.2024, a bare perusal of which would show that, pursuant to directions of this Court, notices under Section 133 (6) of the Income Tax Act, 1961 were issued to various banks seeking the bank statements of the petitioner as well as her husband, including the companies in which he happens to be a Director/Shareholder.
Summons under Section 131 (1A) of the Income Tax Act, 1961 were also issued to her husband,for furnishing of relevant details and for his personal deposition. In response to the notices, both petitioner and her husband appeared before the concerned authority. The findings are to the effect that no case of tax evasion on the part of Mr. Sanjay Srivastava was found upon examining the ITRs for the assessment years 2018 to 2022-23.
Insofar as the petitioner is concerned, although the ITRs filed up to the assessment year 2021-22 mentioned the contact details and email address of her husband, it was found that the same were linked with the Aadhar Card of the petitioner, and the OTP [One Time Password] for re-verification of the ITRs had been sent to the personal mobile number of the petitioner. It is also noted in the report dated 29.08.2024 that the ITRs of the petitioner up to the assessment year 2021-22 had been filed by her Chartered Accountant, Mr. Ajay Aggarwal, presumably based on the information supplied by her as well as her husband. No ITR for the assessment year 2022-23 has been filed by the petitioner. As regards the assessment year 2023-24, the contact details of the petitioner, namely her mobile number and email address, are mentioned in the ITR.
The aforesaid facts do not constitute any matters that could be said to be confidential or disclosure of which would prejudice the respondent/Department of Income Tax in any manner.
Accordingly, CM APPL is hereby dismissed. The respondent/Department of Income Tax is directed to supply a copy of the report dated 29.08.2024 to the petitioner within two weeks from today, failing which, the petitioner shall be at liberty to avail a certified copy of the same from this Court.
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2025 (4) TMI 1045
Delay of 161 days in filing the appeal before the ITAT - appellant has assigned the reason that the CIT (Appeals) had dismissed the appeal vide its order dated 21.03.2022 and uploaded the order on ITBA portal about which the appellant was not aware and he came to know about this development while filing Tax Audit Report for assessment year 2022-23 and, therefore, he could not prefer an appeal right in time
HELD THAT:- The Supreme Court vide its Order in the matter of Vidya Shankar Jaiswal [2025 (1) TMI 1526 - SC ORDER] while setting aside the order of this Court rejecting the appeal on the ground of delay, has held that the High Court ought to have adopted justice oriented and liberal approach by condoning the delay.
In view of above and also for the reason shown by the assessee/appellant herein coupled with the fact that though the application of the appellant was supported by the affidavit, but the Revenue did not file any counter-affidavit controverting the reason assigned by the assessee and, as such, the delay of 161 days occurred in filing the appeal remained uncontroverted and also for the reason that the assessee was not aware of order passed by the CIT(Appeals) as it was only uploaded on ITBA portal, therefore, the sufficient cause has been show by the assessee/appellant for the delay of 161 days occurred in filing the appeal. Accordingly, the delay of 161 days occurred in filing the appeal deserves to be and is hereby condoned.
The matter is remitted back to the ITAT for deciding the appeal on merits.
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2025 (4) TMI 1044
Addition u/s 56(2)(ix) - assessee has forfeited the said amount received in advance against agreement to sale of land by making various incorrect & irrelevant observations - HELD THAT:- When the assessee filed the additional evidence, considering the specific prayer of the assessee same was forwarded for AO’s comments and without considering the merits of the dispute and without verifying the veracity of the documents the documents signed by third party cannot be directly held to be colorable devise. Therefore, the bench is of the view that lis between the parties has to be decided on merits, providing opportunity of being heard to the assessee.
We deem it fit to remand the matter to the file of the AO who will consider the factual aspect of the matter as raised by the assessee after due verification of the facts and charge the correct income in hands of the assessee after affording due opportunity to the assessee and dealing with the evidence placed on record. The assessee will not seek any adjournment on frivolous ground and remain cooperative during proceedings before the AO. Appeal filed by the assessee is disposed off for statistical purposes.
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2025 (4) TMI 1043
Denial of registration u/s 12AB - CIT(E) observed that the objects of the Trust are for the benefit of the residents of the Dwarika Green Society and its member and are not for the benefit of the public at large - HELD THAT:- In the present case, CIT [E] has considered the provisions of sec 13(1)(b) of the Act, which is applicable only in a case of Charitable Trust or Institution created or established after commencement of this Act and only for the benefit of the residents of the Dwarika Green Society and its members and thereby denied the registration, which in our considered view is well within the provision of amended law and therefore the order denying registration passed by Ld CIT[E] does not require any interference.
Case law relied by assessee namely Bayath Kutuchhi Dasha Oswal Jain Mahajan Trust [2016 (9) TMI 8 - GUJARAT HIGH COURT] held that the Trust had large number of other objects for the benefit of General Public apart from objects for benefit of Religious Community, therefore held that the Tribunal was correct in allowing Registration to the Trust
Thus the ratio of the above judgment will not be applicable to the facts of the assessee case, since the objects of the Assessee Trust which is meant only for the residents and members of the Society not for Public at Large. Thus we don’t find any infirmity in the order passed by Ld. CIT(E) and the same does not require any interference. Decided against assessee.
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2025 (4) TMI 1042
Unexplained investment in a property transaction which was not reflected in the books of accounts - reliance on loose unsigned hand written paper found at the premises of third party - HELD THAT:-The loose sheet has been recovered from the searched person i.e. Gurvinder Singh Duggal who is a third party, which bears no signature of either the Assessee or searched person and the same is not in the hand writing of either searched person or the Assessee.
Further, third party has specifically denied receiving any cash payment.
In the absence of any corroborative material brought on record during the assessment proceedings, the AO has committed error in making the addition based on the said loose sheet. Therefore, CIT(A) has erred in upholding the addition made by the A.O - Thus, addition made u/s 69B which has been sustained by the Ld. CIT(A) is hereby deleted. Appeal of the Assessee is allowed.
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2025 (4) TMI 1041
Issuance of a Standby Letter of Credit (SBLC) by the assessee in favor of its Associated Enterprise (AE) constitutes an international transaction or not? - HELD THAT:- We find that the issue has been extensively examined by the Bench on which both of us were in quorum and the Bench has considered the ratio in the case of CIT v. Everest Kento Cylinders Ltd. [2015 (5) TMI 395 - BOMBAY HIGH COURT] and has concluded that there is no difference between bank guarantee and SBLCs as compared to corporate guarantees. Further, we have also concluded that issuance of SBLC in the international transaction can be put to ALP tests. As for completeness, the observations and finding of the Bench in the case of Anand NVH Products Pvt. Ltd. [2025 (1) TMI 1003 - ITAT DELHI]
Thus, we are inclined to hold that the AO/TPO shall consider rate of 0.5% as against 1.3% to ALP for international transaction and accordingly determine the adjustment required to be made. Ground no.2 and its sub-grounds are accordingly decided in favour of the assessee.
Deduction u/s 80G - assessee made a donation to FCS Foundation a trust registered u/s 80G - AO has made the disallowance of cheque of Rs. 55 lakh on an allegation that the receipt issued by the said foundation is not of period ending 31.03.2016 as there was a cutting in the date - HELD THAT:- The assessee has produced the affidavit of the director as additional evidence before the DRP. However, the assessee could not produce any evidence from the recipient as to how this fund was received and acknowledged in the financials of the recipient.
At the same time, the AO has also not made any effort to enquire into the alleged fact of the receipt being dated 31.03.2016, thus we consider it appropriate to restore the issue to the file of the AO to give liberty for enquiry afresh with regard to the correctness of the claim of the assessee with respect to the disputed receipt number 400 to the extent of the date on which it was received by the trust namely FCS Foundation and the year in which it was accounted for. AO will allow the deduction u/s 80G if it was satisfactorily demonstrated by the assessee before the AO that the trust namely FCS Foundation has accounted the receipt paid by cheque. Accordingly, the ground allowed with the above observations.
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2025 (4) TMI 1040
Disallowance of late payment of Provident Fund - HELD THAT:- This issue is covered against the assessee by the Hon’ble Supreme Court judgment in the case of Checkmate Services Pvt. Ltd. [2022 (10) TMI 617 - SUPREME COURT]
Rectification orders passed u/s 154 reducing the refund claimed by the assessee when the intimation under section 143(1) was not served on the assessee - HELD THAT:- As perused the rectification order dated 08-11-2022 in that there is a column “details of previous order to be rectified” wherein it is mentioned as “143(1) dated 26-07-2022” but it is without DIN number. This makes it very clear since there is no DIN allotted to the 143(1) intimation, the same to be treated as not passed and therefore not served on the assessee.
As per 2nd proviso to Section 143(1) of the Act no intimation under sub-section shall be sent after the expiry of nine months from the end of the financial year in which the return was filed. Further as per 1st proviso to Section 143(1) of the Act, the intimation shall be sent to the assessee declaring the loss assessed/adjusted but no tax, interest or fee payable or no refund due to the assessee. Since the intimation made u/s. 143(1) of the Act was not served on the assessee, therefore, there cannot be adjustment or rectification u/s.154 of the Act, consequently the additions made by CPC are liable to be deleted and the refund claimed by the assessee is to be allowed.
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2025 (4) TMI 1039
Validity of revision proceedings against the reassessment order - scope of 'reason to believe’ v/s 'reason to suspect' - HELD THAT:- The case of the assessee was reopened on the ground that the assessee has deposited, during the financial year 2008-09, the amount in cash into his saving account maintained with HDFC Bank Ltd., despite the fact that the assessee had filed return of income on 30.09.2009 for the impugned assessment year which stood accepted as such. It is thus evident that the AO re-opened the case only for the purpose of verification of the source of deposits in the bank account. It is now well settled that no re-assessment can be done to make an enquiry or verification of the deposits in the bank account.
Hon’ble Delhi High Court in the case of United Electrical Co. (P) Ltd. [2002 (10) TMI 86 - DELHI HIGH COURT] has held that existence of tangible material, for the formation of opinion is a pre-requisite for initiation of action u/s 147. It is noted that there was no information on record which could provide foundation for the Assessing Officer’s belief that the source of the deposits in the bank account was not explained and income had escaped assessment on that account. Therefore, the impugned action of the AO cannot be sustained. Further, in the case of CIT vs. Indian Oil Corporation [1986 (5) TMI 1 - SUPREME COURT] has held that the, `reason to believe’ is not the same thing as `reason to suspect'.
We hold that the present proceedings being collateral proceedings and if the assessment order is inherently invalid or bad in law, then validity of such an order can be challenged at any stage in the collateral proceedings including the proceedings u/s. 263, because invalid order cannot be set aside or can be revised to make it valid; therefore, the order of assessment u/s 147/143(3) and the impugned order u/s 263 of the Act are held to be without jurisdiction.
Even otherwise proceedings u/s 263 have been initiated on the basis of audit objection - As relying on Raghuvir Singh [2023 (11) TMI 1273 - ITAT DELHI] and Maharashtra Hybrid Seeds Co. Ltd. [2018 (9) TMI 294 - BOMBAY HIGH COURT] proceedings u/s 263 of the Act is based on audit objection raised by the audit party which is not in accordance with law.
The final order is restricted to disallowance as deduction of interest paid to partnership firm and claimed in the computation of income which apparently is without any opportunity and therefore not in accordance with law in view of the judgment Amitabh Bachchan [2016 (5) TMI 493 - SUPREME COURT]
Thus we set aside the impugned order passed u/s. 263 of the Act and appeal of the assessee is allowed.
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2025 (4) TMI 1038
Reassessment proceedings u/s 147 as barred by limitation u/s 149 - HELD THAT:- By virtue of section 3(1) OF TOLA time for completion of specified acts was extended till 30-06-2021. Thus, the notice dated 22-06-2021 was issued 8 days prior to the expiry of period of limitation for issuing a notice u/s 148 of the Act as the extended time by TOLA. The period between 04-05-2022 to 30- 05-2022, the date on which the AO has issued the notice u/s 148A(b) of the Act in furtherance of his earlier notice dated 22- 06-2021 is also required to be excluded by virtue of the third proviso to section 149(1) of the Act as held in Rajeev Bansal Case [2024 (10) TMI 264 - SUPREME COURT (LB)]
AO has issued notice to the assessee dated 19-05-2022 and the two weeks-time was granted to respond the notice. The assessee had furnished its response to the notice u/s 148A(b) of the Act on 02-06-2022.
AO was issued the second notice dated 06-07-2022 to the assessee and the assessee has filed the response in the compliance on 11-07-2022.Thus, the period of limitation began running from that date i.e11-07-2022.
By virtue of TOLA, the AO had period of 8 days limitation left on the date of commencement of the reassessment proceedings, which began on 22-06-2021, to issue a notice u/s 148 of the Act.
AO was required to pass an order u/s 148A(d) of the Act within the 8 days notwithstanding the time stipulated u/s 148A(b) of the Act. This period expired on 19-07-2022. Since the period of limitation, as provided u/s 149(1) of the act had expired prior to issuance of the reassessment order dated 23-07-2022. Thus, the reassessment order is beyond the period of limitation. Decided in favour of the assessee.
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2025 (4) TMI 1037
Exemption u/s. 11 - applicability of section 2(15) - claim denied no educational activities has been carried out by the Appellant and receipts of consultancy charges, seminar fees sponsorship are in the nature of services provided to trade and commerce - HELD THAT:- The arguments raised on behalf of the assessee with respect to non-applicability of Hon’ble Apex Court case of AUDA [2022 (10) TMI 948 - SUPREME COURT] are more convincing than the arguments raised by the revenue/appellant in that regard. The ratio of the Hon’ble Jurisdiction High Court squarely covers the facts and circumstances of the case in hand.
As is evident from the para 6.3 onwards of the impugned judgment as Ld. CIT(E) held that if 12A registration was not withdrawn on the date of the assessment order then the income of the assessee was exempt in entirety and the Ld. AO could not have travelled beyond the certificate of registration granted u/s 12A of the Act. It was further held by Ld. CIT(E) that once the 12AA registration is granted, there is no power with the AO to ignore such registration and the Ld. AO was wrong in denying exemption u/s 11 when the appellant is approved u/s 12AA.
CIT(E) further held that since the AO exceeded his authority in denying exemption u/s 11, he was not going into merit of whether the appellant was engaged in “Education” as contemplated in section 2(15) of the Act. While deciding so, the Ld. CIT(E) has relied upon the judgment of Hon’ble Supreme Court in Surat City Gymkhana [2008 (4) TMI 16 - SUPREME COURT] wherein it was held that the registration u/s 12A was a fait accompli to hold the AO back from further probe into the objects of the trust. The Surat City Gymkhana case (supra) has been relied in Gemological Institute of India [2016 (4) TMI 1357 - BOMBAY HIGH COURT]. It is to be noticed that the SLP filed by revenue against the Jurisdictional High Court judgment was dismissed by the Hon’ble Supreme Court [2019 (5) TMI 1365 - SUPREME COURT OF INDIA].
Only ground no. 1 pertains to the matter decided by Ld. CIT(E) and the ground no. 2 and 3 pertains to applicability of section 2(15) of the Act and the said aspect has not been decided by the Ld. CIT(E) because the AO has exceeded his authority in denying exemption u/s 11 and therefore the question of applicability of section 2(15) in the case of assessee was left open being academic as there was no need to decide the said question on merit. We do not find any illegality in the impugned order passed by Ld. CIT(E) which may warrant interference by this Tribunal.
Decided against revenue.
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2025 (4) TMI 1036
Addition u/s 68 - unsecured loan received by the assessee - assessee has mismanaged his loan received and repayments made and has also failed to offer proper explanation with regard to the loans shown in his balance sheet, hence, the creditworthiness of lender and genuineness of transaction remained unverified - CIT(A) deleted addition - HELD THAT:- The assessee has claimed that the loan from the above parties were received in earlier years and there is no case of any inflow or credit of funds in the year under reference thus negating the applicability of section 68 of the Act and rendering the addition as factually incorrect. The copies of confirmed ledger account of parties are placed and copy of bank statement are placed.
Appreciating the ledger account, it can be seen that the loan from Mr. Ajay Katara was taken in FY 2015-16 and loan from Mr. Kumar Bombay (Director of M/s. Panorma Studios P. ltd.) was taken in FY 2016-17 and other than cheque reversal entry, there is no case of any fresh credit in the year under reference. The CIT(A) after verifying the factual position including bank statement and confirmed ledger account of the parties deleted the addition by giving a factual finding to the effect that the loan transactions do not pertain to the year under consideration. In fact, even in the ground as raised the assessing officer has not disputed the factual position. Thus in absence of any credit in the year under consideration, the provision of section 68 of the Act do not apply and order of ld. CTI(A) needs no interference.
Part disallowance of claim of cost and denying benefit of indexation by computing short term capital gain as against long term capital loss computed by the assessee in respect of sale of property - HELD THAT:- We find that the CIT(A) after examining the documentary evidences in support of purchase of property at A1/1, Loha Mandi, Ghaziabad and appreciating the overall position, held that the said property was long term capital asset and rejected the action of AO in making addition of Rs. 54,65,640/- on account of STCG. The CIT(A) accepted the computation of Long term capital loss (LTCL) of Rs. 32,54,636/- in respect of the said property after considering benefit of indexation.
CIT(A) upheld the action of AO in restricting the claim of exemption u/s 54 and the same is not in dispute in this appeal. Accordingly, we are of the considered view that the CIT(A) rightly computed the net taxable LTCG at Rs. 1,47,82,585/- as against Rs. 2,18,40,380/- computed by the assessing officer.
Rejection of books of account u/s 145(3) and estimation of gross profit - Bogus purchases - HELD THAT:- AO has accepted sales made out of purchases made from M/s. Panna lal & Co. and the goods purchased from M/s. Panna lal & Co. were sold at a profit thus the allegation of bogus purchase, suppression of profit or manipulation is self destructive. There is substance in the contention that no discrepancy was found in the stock record at the time of search which was physically verified, thus the allegation of manipulation and bogus purchase, is not justified. The reliance of ld. AR on the decision of this Tribunal in the case of Gorja Steel Processors [2024 (10) TMI 1651 - ITAT DELHI] is squarely applicable as under identical circumstances and purchases made from the very same party, the rejection of books of account and estimation of Gross profit was held to be invalid.
Thus the allegation of bogus purchases, rejection of books of account and consequential addition based on estimation of gross profit to the extent as also sustained by the ld. CIT(A) deserve to be deleted. The ground is sustained.
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2025 (4) TMI 1035
Addition u/s 68 - unexplained cash credit - AO observing that assessee has taken unsecured loan from the company during the year, however, as per the Inspector report, no such company was in existence at the address provided by the assessee and subsequently, a statement of Director of the assessee company submitted that assessee has taken unsecured loan through banking channel and returned the same through banking channel - HELD THAT:- Assessee has submitted all the relevant information to prove the identity, creditworthiness and genuineness of the transactions and it is also fact on record that assessee has repaid the unsecured loan within three months and all the transactions were routed through banking channel. Therefore, respectfully following the decision of Signature Global India Pvt. Ltd. [2025 (2) TMI 393 - ITAT DELHI] we do not find any reason to disturb the findings of the ld. CIT (A) and accordingly, the grounds taken by the Revenue are dismissed.
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2025 (4) TMI 1034
Disallowance u/s 36(1)(va) - delayed payments of employee contributions towards PF and ESIC - HELD THAT:- As decided in Suzlon Energy Ltd [2020 (2) TMI 792 - GUJARAT HIGH COURT] where assessee had not deposited employees' contributions towards PF and ESI within prescribed period in law and AO by invoking provisions of section 36(1)(va) read with section 2(24)(x) made addition of aforesaid amount to income of assessee, impugned addition made to income of assessee was justified. Section 38 of the Employees Provident Funds and Miscellaneous Provisions Act, 1952 makes it obligatory for the employer before paying him his wages to deduct the employee's contribution along with the employer's own contribution as fixed by Government. The employer is further obliged to pay the same within fifteen days of the close of every month pay i.e. such contribution and administrative charges. The reference to fifteen days of the close of the month must be in relation to month during which the payment of wages is to be made and corresponding liability to deduct employee's contribution to the fund arises. Decided against assessee.
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2025 (4) TMI 1033
Validity of reopening of assessment - reason to believe or suspect - assessment was reopened to make addition u/s 68 but ultimately AO has made no such addition and he has ended up making addition u/s 28(ii) - HELD THAT:- The less strict interpretation of the words "reason to believe" vis-à-vis an intimation issued u/s 143(1) cannot be permitted. There is no whisper in the reasons recorded, of any tangible material which came to the possession of the AO subsequent to the issue of the intimation which reflects an arbitrary exercise of the power conferred under section 147. The ratio of cited decision would squarely apply to the facts of present case.
The decision in Cognizant Technology Solutions India P. Ltd. [2022 (8) TMI 1095 - MADRAS HIGH COURT] is also on the same lines. Considering the ratio of this decision, the adjudication of CIT(A) on legal grounds could not be faulted with. We would hold that the impugned order is liable to be quashed since Ld. AO did not have valid jurisdiction to reopen the case of the assessee.
Assessment was reopened to make addition u/s 68 but ultimately AO has made no such addition and he has ended up making addition u/s 28(ii) - The ratio of decision of Jet Airways (I) Ltd. [2010 (4) TMI 431 - BOMBAY HIGH COURT] would also apply as held by Hon’ble Court that Explanation-3 could not override the necessity of fulfilling the conditions set out in the substantive part of Sec.147. An Explanation to a statutory provision is intended to explain its contents and cannot be construed to override it or render the substance and core nugatory. Section 147 has this effect that the Assessing Officer has to assess or reassess the income ("such income") which escaped assessment and which was the basis of the formation of belief and if he does so, he can also assess or reassess any other income which has escaped assessment and which, comes to his notice during the course of the proceedings. However, if after issuing a notice under section 148, he accepted the contention of the assessee and holds that the income which he has initially formed a reason to believe had escaped assessment, has as a matter of fact not escaped assessment, it is not open for him to independently assess some other income.
If he intends to do so, a fresh notice under section 148 would be necessary, the legality of which would be tested in the event of a challenge by the assessee. This decision has been followed in the case of Ranbaxy Laboratories Ltd. [2011 (6) TMI 4 - DELHI HIGH COURT] Thus, the impugned additions are not sustainable on this score only. The corresponding grounds raised by the assessee in the cross-objection succeeds.
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2025 (4) TMI 1032
Short Term Capital Gain earned on account of sale of flat - Period of holding - whether the holding period of the property should be computed from the date of the conveyance deed or from the date of the allotment letter? - HELD THAT:- AO has pointed out certain mistakes in the computation of the deduction u/s 54F of the Act for AY 2010-11, but said assessment year is not available before us and, therefore, we can’t go into correctness of the same. But the assessing officer cannot ignore the said long term capital gain declared in A.Y. 2010-11 and assessee the gain arising from the sale of the property in the year under consideration as short term capital gain, without any valid reason for rejection of capital gain shown in AY 2010-11. Thirdly, assessee has rightly pointed out the assessee has purchased those flats under sale component of the SRA scheme and not under the slum occupation category. The finding recorded by the AO to that extent is incorrect.
We are of the opinion that the registration of the flat No. 1404 and 1405 for purchase and sale entered into the year under consideration are liable for any capital gain tax as the assessee had already declared the said transaction of the sale in A.Y. 2010-11, which has been duly accepted by the department. Appeal of the assessee are accordingly allowed.
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2025 (4) TMI 1031
Revision u/s 263 - denial of exemption u/sec. 11 on the ground that assessee is registered u/sec. 12A treating the amount being excess utilization over the receipts during the year as unexplained anonymous donation u/sec. 115BBC and treating the sum spent towards ‘Charities & Donations” as not being towards attainment of the objectives of the assessee-society - HELD THAT:- Explanation (1)(c) provided u/section 263 of the Act is based on the Doctrine of Merger and according to which, there cannot be more than one operative order governing the same subject matter at a given point of time. In the instant case, it is undisputed that the issues which are considered by the CIT(E) in the impugned order, which are under challenge, has been subject matter of appeal before the First Appellate Authority namely, CIT(A), pending for adjudication.
Therefore, CIT(E) in terms of Explanation (1) to section 263 of the Act, cannot assume a valid jurisdiction to revise an order when an appeal filed by the assessee on identical issues pending for adjudication before the CIT(A) and therefore, on this account itself, order passed by the CIT(E) u/sec. 263 of the Act cannot be sustained and liable to be quashed. This principle is supported by the decisions of various courts, including in the case of CIT vs Farida Prime Tannery [2002 (8) TMI 44 - MADRAS HIGH COURT] and also in the case of Renuka Philip [2018 (12) TMI 129 - MADRAS HIGH COURT] A very similar issue has been considered by the Hon’ble Madhya Pradesh High Court in the case of CIT vs Shalimar Housing & Finance Ltd [2009 (4) TMI 406 - MADHYA PRADESH HIGH COURT]
It is relevant to consider the decision of Ranka Jewellers [2010 (3) TMI 544 - BOMBAY HIGH COURT], where the Hon’ble High Court under identical set of facts and in light of powers of CIT and PCIT u/s. 263 of the Act, held that once the issue has been considered and decided in the appeal then there is no scope for the PCIT to invoke his jurisdiction u/s. 263 of the Act on said issue and set aside the assessment order.
In this view of the matter and considering the facts of the case and also in the light of ratio of various case laws discussed hereinabove, we are of the considered view that, the assessment order passed by the AO u/sec. 143(3) is neither erroneous nor prejudicial to the interest of revenue on three issues questioned by the learned CIT(E). CIT(E) without appreciating the relevant facts has simply set-aside the assessment order passed by the AO by exercising powers conferred u/sec. 263. Thus, we quash the order passed by the CIT(E) u/sec. 263. Appeal of the Assessee is allowed.
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2025 (4) TMI 1030
Addition u/s 69A r.w.s. 115BBE - unexplained cash - AR submitted that the assessee has made cash withdrawals on various dates which was deposited subsequently - HELD THAT:- It is an admitted fact that the assessee has made cash deposits and cash withdrawals on various dates during the impugned assessment year and has shown the opening balance of cash of Rs. 32,25,000/- as on 07.11.2016. The contention of the AO is opening balance of cash of Rs. 32,25,000/- was not deposited during the demonetization period wherein the assessee has retracted her own statement regarding the availability of cash as on 07.11.2016.
AO therefore did not consider the reply of the assessee regarding the availability of cash as on 07.11.2016. Further Ld. AO has also observed that when the assessee held huge cash questioned the necessity of withdrawal of further cash by the assessee from the bank accounts.
No documentary evidences have been produced for verification. We therefore find no infirmity in the order of the Ld. CIT(A) and hence no interference is required.
Application of the amended higher tax rate of 60% u/s 115BBE - Respectively following the decision of Naranbhai Samatbhai Bharwad [2025 (1) TMI 1545 - ITAT AHMEDABAD] as held from the language of the object “that instead of allowing people to find illegal ways of converting their black money into black again”, it is evident that the government is intended to impose the same for future transactions. Especially the use of word “again” in the object would clearly indicate it is for future transactions i.e. from 01.04.2017. Therefore this Court is of the considered opinion that the revenue is empowered to impose 60% rate of tax for the transactions from 01.04.2017 onwards and not prior to the said cut-off date. And for prior transaction the revenue is empowered to impose only 30% rate of tax - we allow this ground of appeal raised by the assessee on the issue of section 115BBE.
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2025 (4) TMI 1029
Rejection of application for grant of registration u/s 12A and cancelling the provisional registration granted earlier u/s 12AB - as argued adequate opportunity was not granted to the assessee by the CIT(E) - HELD THAT:- Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the CIT(Exemption) with a direction to grant one final opportunity to the assessee to substantiate its case by filing the requisite details to his satisfaction and decide the issue as per fact and law. Appeals filed by the assessee are allowed for statistical purposes.
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2025 (4) TMI 1028
Reopening of assessment u/s 147 - assessee has not filed any return of income u/s 139(1) and the AO has initiated the proceedings u/s 148 on the basis of information in his possession that assessee has made time deposit in his bank account - HELD THAT:- We find no merit in the conclusion drawn by the AO and the ld.CIT (A) which are based on suspicion and without application of mind. Thus, the proceedings initiated vide notice under section 148 is void- ab-initio since the ld. PCIT, Alwar has not recorded proper satisfaction and gave approval without application of mind and in mechanical manner which is unjustified and bad-In-law.
In view of the reasons set out above, as also bearing in mind entirety of the case, we are of the considered view that the reasons recorded by the Assessing Officer, as set out earlier, were not sufficient reasons for initiating the assessment proceedings under section 147 read with section 148 of the IT Act, 1961. We, therefore, quash the reassessment proceedings.
Time deposit in the bank account - Assessee failed to furnish documentary evidence regarding time deposit made during the year under consideration - AO considered the said information as reason to believe that income of the assessee has escaped assessment. Thus, the AO initiated proceedings for reopening of assessment and ultimately made addition on account of unexplained time deposit in the bank account.
From perusal of Assessment order, we note that the AO has failed to make any enquiry in respect of the time deposits in the bank account reflecting the name of the bank, account numbers, nature of time deposit, source of time deposit etc. and further we note that the AO has not brought on record any evidence on the basis of which the reasons and conclusion was drawn.
We also note that both the assessment order and appellate order has made no reference of specific section under which the addition has been made which is very much required to be mentioned by the AO so as to enable the assessee to represent his case accordingly and effectively.
Therefore, non-mentioning the precise provision of law makes the impugned addition bad in law. We note that the Coordinate Bench of the Tribunal, Jaipur in the case of Shri Ram Lal [2024 (8) TMI 1554 - ITAT JAIPUR] held that non-mentioning the precise provision of law makes the entire impugned addition bad in law.
The assessee submitted that he was in service in the Indian Navy for 11 years (retired in 1988) Post retirement, he was actively and exclusively engaged in farming and driving agriculture income therefrom. Therefore, it will not be abnormal to assume that the appellant had accumulated fund over the period of time since it is a general practice of a person to save money in bank.
We note from the submission of assesee that assessee in his first reply dated 23.07.2023, submitted that he had savings from Indian Navy Service and the time deposit were made from the agriculture income gathered over the time. Therefore, the source of time deposit was very well explained by the appellant that the time deposit was made from the available fund out of past savings and we note that neither the AO nor the ld. CIT (A) had brought any record to suggest that the assessee was not serving in the Indian Navy or have any other source of income. Thus addition made by the lower authorities deserves to be deleted. Appeal of assessee allowed.
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2025 (4) TMI 1027
Validity of reassessment proceedings - specified authority to give sanction u/s 151 - addition u/s 69A - notice u/s 148 issued beyond 3 years from the end of the relevant AY - HELD THAT:- Since, the issue of sanctioning authority is no more res integra, as has been specifically deliberated upon and guided by the Hon'ble Apex Court in the case of Rajeev Bansal [2024 (10) TMI 264 - SUPREME COURT (LB)] analyzing the order of Ashish Agrawal [2022 (5) TMI 240 - SUPREME COURT] wherein it is categorically held that, as per the provisions of new regime the sanctioning authority shall be decided as prescribed amended section 151(new regime). In the present case because the reopening has been initiated after 3 years therefore, clause(ii) of section 151 shall apply.
We, thus, find substance in the contention of the Ld. AR that the approval granted u/s 151(ii) (new regime) was not by the Ld. PCIT, who do not have jurisdiction to do so in a case wherein the process of reopening has been triggered beyond 3 years from the end of the relevant assessment year. The contention of the revenue, placing reliance on the judgment in the case of Ashish Agrawal [2022 (5) TMI 240 - SUPREME COURT] that in present case the prescribed authority is Principal CIT-1, Raipur found to be misplaced or misconstrued, as the directions by the Hon'ble Apex Court are clear, which are further clarified that the provisions of amended section 151 shall be applied in the cases in which the revenue has availed the benefit of extended life limit under TOLA and had proceeded for reopening assessment under the provisions of new regime. We, thus, are unable to persuade and concur with the response of the Ld. AO as per their report dated 12.12.2024.
We are of the considered view that the impugned assessment order framed u/s 147 r.w.s. 144 r.w.s. 144B passed by the Ld. AO is liable to be struck down, being invalid for the want of valid assumption of jurisdiction on account of sanction u/s 151 by an authority, who is not vested with jurisdiction to grant such approval or other than the specified authority under clause (ii) of section 151 (new regime). Consequently, the assessment u/s 147 r.w.s. 144 r.w.s. 144B stands quashed. Decided in favour of assessee.
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