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1984 (5) TMI 98
... ... ... ... ..... by Hon rsquo ble the Supreme Court this cannot be done. In that case (1979) 12 CTR (SC) 190 (1979) 119 ITR 996 (SC), it was argued before Hon rsquo ble the Supreme Court that realisation by the ITO that he had committed an error when making the assessment amounts to information within the provisions of s. 147(b) of the IT Act. This argument was rejected by Hon rsquo ble the Supreme Court observing that it was inconsistent with terms of s. 147(b). The Hon rsquo ble Supreme Court further laid down that an error, discovered on a reconsideration of the same material and not more, does not confer power to reopen the assessment. We are, therefore, of the view that there was no information with the WTO entitling him to reopen the assessment under s. 17(1)(b) and therefore the ld. AAC has rightly quashed the assessments. In view of our this finding we need not decide the other issues raised in the grounds of appeal. 6. In view of the above discussions all three appeals are dismissed.
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1984 (5) TMI 97
A Partner, Minor Child, Share In Firm ... ... ... ... ..... ver to them only after attaining majority. Any benefit actually conferred on them by way of expenditure on maintenance and education would no doubt be a benefit which will attract section 64(1)(iii). There is none during the year. There is only accumulation beyond the period of minority. There is not even deferred benefit during minority. Under these circumstances, we do not think that the phrase as it stands can be taken to confer any vested right on the minors during the accounting year. It is in this view, we do not consider it necessary to go into the further question whether the amendments substituting trust fund for beneficiary/beneficiaries is valid as contended by the assessee or not valid as contended by the revenue. We do not also consider the other alternative arguments urged by the learned counsel for the assessee for non-aggregation. 16. In the result, the appeals are allowed and the addition of the share incomes pertaining to the trust/minor children is deleted.
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1984 (5) TMI 96
Applied To, Assessment Proceedings ... ... ... ... ..... this case are in any way comparable. An ex parte assessment was made for non-compliance. It was reopened at the assessee s instance. Even partners did not respond to all the notices and summons had to be issued to ensure their presence more than once. The assessee asked for time for production of books. There are so many other factors which could show that a similar allegation for lack of bona fides cannot be lightly made in the facts and circumstances of the assessee s case. Though the ITO might have well been justified in having passed the order with or without assistance from the taxpayer, the mere fact that he accommodated the assessee and tried to get materials could work to the advantage of the taxpayer. All enquiries, we should presume, are ultimately to help a reasonable assessment. Under the circumstances, we find no merit whatsoever on the contention relating to the question of jurisdiction. 6 to 8. These paras are not reproduced here as they involve minor issues.
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1984 (5) TMI 95
... ... ... ... ..... ess must be carried on by all the partners or any of them acting for all. In the present case, both these requirements stand fully satisfied. The date on which the accounts were to be closed as mentioned in the partnership deed was purely a matter of internal arrangement as observed by the Supreme Court in Kamath rsquo s case in relation to the duties of various partners. So far as the outside world is concerned, there was in fact a valid firm in existence in the present case and merely because an internal arrangement regarding the date of closure of accounts was not adhered to according to the letter of the deed, it would not vitiate the genuineness of the otherwise validly constituted firm. In these circumstances, we hold that there is no justification for declining to grant registration. Registration is allowed as also the appeal. 4. Before parting with the appeal, we may state that there was a delay of one day, but this having occurred in past, we have condoned the delay.
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1984 (5) TMI 94
Assessment Year, Foreign Company, Manufacture And Sale, Original Assessment, Reopening Assessment
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1984 (5) TMI 93
1961 Act, Set Off, Supreme Court ... ... ... ... ..... Under the circumstances, we have to accept the departmental alternative ground, incidentally the only ground raised originally in the appeal. We have also to point out that the determination of the loss in the relevant year is not the only factor to be considered. Apparently, the loss relates to proprietary business by the assessee while set off claimed is against a partnership share income. It is necessary to consider whether the set off would be available considering the conditions prescribed for set off in Chapter VI of the Act. It is under these circumstances that we accept this ground and set aside these two assessments for having the loss for the earlier year determined and for considering the claim for set off before passing fresh orders after giving due opportunity to the taxpayer. 6. The appeals will be treated as partly allowed. The assessments are set aside for being redone in accordance with law and the directions contained in the immediately preceding paragraph.
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1984 (5) TMI 92
Fixed Deposit ... ... ... ... ..... transfer. In the present case no expenditure on the sale has been incurred and, therefore, net consideration is equivalent to gross consideration on the facts. The net consideration in the present case is Rs. 73,500. The amount invested is only Rs. 59,200. Therefore, the assessee is entitled to exemption from capital gains only in such proportion as Rs. 59,200 Rs. 73,500. The amount of capital gain which has been considered for the assessment year 1979-80 is Rs. 28,500. On the proportionate basis aforesaid, the amount of Rs. 23,113 will fall to be exempt. Again capital gain to be considered for purposes of tax would be Rs. 5,389. Out of this the assessee will be entitled to deduction under section 80T of the Act of Rs. 5,000 leaving a balance of Rs. 389. Further exemption of 25 per cent thereof is due to the assessee, i.e., Rs. 97 and the assessable capital gain will, thus, be Rs. 292. This makes the total income below the taxable limit. 9. The result, the appeal is allowed.
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1984 (5) TMI 91
... ... ... ... ..... erted by the learned departmental representative. The fact of theft was also supported by the FIR lodged by the assessee with the Kotwali Sadar, Agartala, being No. 9/324 dated 4th May, 1974. The possibility of inconvenience in re-preparation of books of account in the absence of the supporting documents or the books of account which was stolen cannot be ruled out. On a consideration of these facts, it has to be held that the delay in filing the return by the assessee was not without any reasonable cause. As stated in Stroud s judicial Dictionary , the word lsquo reasonable rsquo has in law the prima facie meaning of being reasonable in regard to those circumstances of which the actor, called on to Act reasonably, knows or ought to know , Viewed thus, we uphold the order of the Commissioner (Appeals). 4. The cross objection filed by the assessee without having any special ground is fit to be dismissed. 5. In the result, the appeal as well as the cross objection are dismissed.
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1984 (5) TMI 90
... ... ... ... ..... led to the benefit of registration. 3. I find no material in the departmental appeal. The ITO refused to register the firm on the ground that the two partners were found to be regularly absent from the place of business and that the assessee firm advanced huge amount of money to M/s Shyam Sunder Agarwalla and Co. in which one of the partners of the assessee firm was also a partner. In my opinion, none of the grounds can be said to be a sound ground for rejection of the registration. There is nothing in the IT Act to show that all the partners of a firm should remain present in the place of business throughout the year. There is nothing to prevent a firm to advance money to another firm in which one of the partners of the assessee firm is a partner. It is to be mentioned that the ITO has not given any reason for coming to the conclusion that the firm was not genuine. I, therefore, find no reason to interfere with the order of the AAC. 4. In the result, the appeal is dismissed.
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1984 (5) TMI 89
... ... ... ... ..... eme Court has categorically observed in the case of Shah Mohandas Sadhuram so also in the case of Kylasa Sarabhaiah vs. CIT (1965) 56 ITR 219 (SC) that for the purpose of granting registration the partnership deed has to be construed in a reasonable manner and the deed read as whole and in the context of the relevant circumstances of the case. As has been stated above, the assessee firm was constituted by three partners as mentioned in the recital of the partnership deed, none of the partners were found to be ingenuine. As per agreement the three partners were to share the profit and loss at 32 per cent each, the firm was found to have carried on the business. All these facts go to suggest that there was a genuine firm in existence during the previous year relevant to the assessment year under appeal and, therefore, the lower authorities were wrong in cancelling the registration under s. 186 which was already granted to the assessee firm. In the result, the appeal is allowed.
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1984 (5) TMI 88
... ... ... ... ..... the case of Chandrakant Damodardas vs. ITO (1980) 16 CTR (Guj) 1 (1981) 123 ITR 748 (Bom) and Bombay High Court in the case of CIT vs. Traub (India) (P) Ltd. (1979) 118 ITR 525 (Bom). Sec. 214 also refers to the payment made before the end of the financial year and interest is payable from the first April of the assessment year. This ground has, therefore, to be rejected. 4. As far as question of the period for which the interest has to be granted, the CIT (A) has directed that the same should be allowed to the date of granting of refund. We find that this would find support from the decision of the Delhi High Court in the case of National Agricultural Co-operative Marketing Federation of India Ltd. vs. Union of India and Others (1981) 130 ITR 928 (Del). In this decision a reference has been made to the provisions of s. 214(2) which clearly provides that interest has to be allowed upto the date on which the refund is made. I see no merit in these appeals which are dismissed.
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1984 (5) TMI 87
... ... ... ... ..... eals). 5. After taking into consideration the rival submission and going through the orders of the two lower authorities both in respect of assessment and penalty, we are unable to confirm the action of the Commissioner (Appeals). When we carefully go through the order of the Commissioner (Appeals), we find that it was in the absence of any satisfactory explanation given by the assessee firm that he observed that the ITO was justified to impose the penalty. Undoubtedly, the fact of raid or search and seizure does effect the Revenue authorities mentally about the conduct of an assessee but even, in such cases there can be explanations which are made available and sometimes also accepted in the instant case it was explanation not having been found satisfactory that addition was maintained. Secondly the addition was in a lump sum form. Levy of penalty in the instant case is not called for and the same is, therefore, hereby cancelled. 6. In the result, assessee appeal is allowed.
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1984 (5) TMI 86
... ... ... ... ..... the Tribunal has already allowed the claim of registration. The first basis, therefore, no longer survives. The registration, having already been granted in the immediately preceding assessment year, we hold that the assessee was entitled to the benefit of continuance of registration for the assessment year under appeal. Consequently the order made by the authorities below on this point are reversed. We also agree with Shri Gupta that it was a case of cancellation of registration under s. 186(2) of the IT Act. Since the conditions laid down thereunder have not been complied with by the ITO i.e., he has not given any notice of his intention nor any opportunity was given before cancelling the registration even though the assessment was made under s. 144, the registration cannot be refused to the assessee. In view of above discussion, we direct the ITO to grant the benefit or registration to the firm for the assessment year under appeal. 6. In the result, the appeal is allowed.
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1984 (5) TMI 85
... ... ... ... ..... could not have referred that question for the decision of this Court as that tantamounted to its questioning the correctness of the binding decision of this Court. Their Lordships in the case of Shiv Parshad even went to suggest a remedy for the Revenue in such cases, which was to take the matter before the Supreme Court to have the case heard, their Lordships meant the case which was decided against the Revenue by the High Court earlier. Normally, in view of consistency, we should have referred this case to the High Court, as the same has been referred earlier mainly on the basic contention of the Revenue that they wanted to carry the matter before the Supreme Court and no question is settled till it is laid at rest by the Supreme Court, but having guidance from the two cases, referred to above, and as per our reasoning given in RA No. 149/Chandi/83 dt. 17th Jan., 1984, we are unable to accept the request of the Revenue. 5. In the result, reference application is dismissed.
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1984 (5) TMI 84
Agricultural Income, Agricultural Land ... ... ... ... ..... ome, such part of the remuneration as was proportionate to the agricultural income of the company, was itself agricultural income and as such exempt from income-tax. It was on the basis of these facts that their Lordships held ...that the assessee received no agricultural income as defined by the Act, that it received remuneration under a contract for personal service calculated on the amount of profits earned by the employer, payable, not in specie out of any item of such profits, but out of any moneys of the employer available for the purpose, and that the remuneration therefore was not agricultural income and was not exempt from tax. It is apparent that the above finding, on which the learned departmental representative relied, is on different set of facts. In the light of above discussion and mainly relying on the case of Mustafa Ali Khan and for the reasons given by the AAC in his order, his action is hereby confirmed. 5. In the result, the revenue s appeal is dismissed.
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1984 (5) TMI 83
... ... ... ... ..... the mistake pointed out by the CIT was not at all applicable in the instant case. The ld. counsel s further objection that the CIT ought to have enhanced the assessment and could not, in the circumstances, restore the assessment on the ITO s file for making a de novo assessment in our opinion, is also not tenable as the CIT observed in his order that as desired by Shri Moitra he was setting aside the assessment with a direction to the ITO to reframe the assessment in accordance with law. The aforesaid direction of the CIT, in any way, cannot be considered as illegal. The issue now raised that the ITO did not carry out the CIT s order in reframing the set aside assessment, in our opinion, cannot make the CIT s order invalid. The assessee admittedly can avail of the remedial measures as provided under the Act in regard to the subsequent assessment completed by the ITO under s. 144 of the Act. We would accordingly, uphold the CIT s order and dismiss the appeal of the assessee.
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1984 (5) TMI 82
Revision Of Order ... ... ... ... ..... able in the instant case. The learned counsel s further objection that the Commissioner ought to have enhanced the assessment and could not, in the circumstances, restore the assessment on the ITO s file for making a de novo assessment, in our opinion, is also not tenable as the Commissioner observed in his order that as desired by the Shri Moitra he was setting aside the assessment with a direction to the ITO to reframe the assessment in accordance with law. The aforesaid direction of the Commissioner, in any way, cannot be considered as illegal. The issue now raised that the ITO did not carry out the Commissioner s order in reframing the set aside assessment, in our opinion, cannot make the Commissioner s order invalid. The assessee admittedly can avail of the remedial measures as provided under the Act in regard to the subsequent assessment completed by the ITO under section 144. We would, accordingly, uphold the Commissioner s order and dismiss the appeal of the assessee.
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1984 (5) TMI 81
... ... ... ... ..... of the matter. He has also not expressed any opinion as to what had happened in relation to the other co-sharers of the assessee and what was the value adopted in respect of their shares. Under these circumstances, we are of the opinion that the matter requires a fresh examination by the AAC. While the report of the Valuation Officer might be binding upon the WTO, it was open to the AAC to come to a different estimate of the value thereof than the one arrived at by the Valuation Officer. Since he has not expressed any opinion on this aspect of the matter and the Valuation Officer was not actually present before us to enable us to decide the entire issue ourselves, we are of the opinion the entire issue ourselves, we are of the opinion that it would be in the fitness of things that this matter is decided afresh by the AAC in the light of our aforesaid observations. We direct accordingly. 6. For statistical purposes, these appeals shall be deemed to have been allowed as such.
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1984 (5) TMI 80
... ... ... ... ..... assessment was wrong and whether such mistake was one about which not debate was possible inasmuch as the ITO has not stated even a word on this subject-matter, it is not possible to accept his bald conclusion that the allowance of the aforesaid amount in the original assessment was a mistake. Even the learned Commissioner (Appeals) has not indicated in his order as to what were the relevant provisions of law under the West Bengal Estate Acquisition Act, 1953, in terms of which the liability arose, whether the statute contained any fixed basis for the determination of the arrear rent, and as to how in terms of the said provisions, the plea taken by the assessee and accepted by the ITO was wrong. 9. In view of what we have stated above, we deem it expedient in the interest of justice to quash the orders of the authorities below. The order under section 154 is palpably beyond the jurisdiction of the provisions of that section. 10. In the result, the assessee s appeal succeeds.
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1984 (5) TMI 79
... ... ... ... ..... ssessee s income in view of the decision in (1972) 83 ITR 470 (Cal). We do not know what had happened to the case of that year. What had happened to the case of that year. The whole facts and circumstances would have to be seen and it would to be found out as to whether the owner is being taxed to annual value in accordance with the decision of the Calcutta High Court in Ganga Properties Ltd. In that case, the assessee may be exempted but if it is found as matter of fact that the registered owner is not being considered to be its owner either by him or by the department and has been effectively the full owner for all purposes she may be liable for it. The full facts in the matter have to be found out and them the same case be decided. The appeal is accordingly accepted and the matter is restored back to the file of the AAC for fresh decision in the light of our aforesaid observations. 4. In the result, the appeal shall be deemed to have been allowed for statistical purposes.
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