9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (9) TMI 1288 - AT - Income TaxAssessment proceedings u/s 153A - no valid search had been conducted on the assessee - Whether no incriminating document was found in the search on the Bank accounts as mentioned in the Panchnama? - HELD THAT - Copy of the warrant is never given to the assessee. It is only the copy of the Panchnama that goes to the assessee. A perusal of the provisions of section 132(1) shows that the warrant is to be specifically in the name of the person and it has to specify the place. A perusal of the Panchnama clearly shows that the name of the assessee is mentioned in the Panchnama the place has been identified categorically as the Bank account. On a specific direction to the ld. CIT DR he has shown the copy of the warrant to the Bench. The warrant also contains the name of the assessee and the Bank account number and the Branch name etc. In any case when an assessee is challenging the warrant to be illegal then it is required to be challenged by filing affidavit alleging the same. In any case such an affidavit has not been filed in any of the Cross Objections in the bunch of appeals. Consequently we are of the view that the search had validly been conducted on the assessee. Warrant was served on the Bank Manager and not on the assessee and that the Panchnama is signed by the Bank Manager and not the assessee and therefore the search is invalid - The Bank account of an assessee is his private accounts nobody not even the Bank itself can do any transaction through such Bank account unless otherwise authorise to do so by the account holder. In effect the Bank acts as the agent of the assessee. The Bank Manager the representative of the Bank is admittedly responsible for anything that goes on in respect of the specified Bank accounts of the account holders. The Bank is answerable to the account holder for any act done with the account of the account holder without the instruction of the account holder. Thus the execution of the warrant on the Bank Manager of the Branch where the assessee was maintaining its accounts which were searched cannot be faulted with. Once it is held that the search on the Bank account is valid then admittedly the provisions of section 153A would operate. In the case of Dr. Mansukh Kanjibhai Shah-vs.-ACIT 2010 (5) TMI 536 - ITAT AHMEDABAD shows that in the said decision the Coordinate Bench of this Tribunal has not held that the execution of the warrant by drawing of the Panchnama was not the search on the assessee. In that case the service of the warrant was on the Bank Manager of the Trust. It was because the service of the warrant was on the Bank Manager of the Trust it was held that it was not search on the assessee in the individual case of the assessee. In the assessee s case the search warrant is executed on the Bank Manager of the Branch where the account of the assessee is operating. In fact the decision in the case of Dr. Mansukh Kanjibhai Shah goes against the argument raised by the assessee. As we have held that the search warrant has been rightly executed the question of abatement does not arise. Levy of interest u/s 234B - Though the ld. A.R. has filed a detailed note at pages 140-145 of the paper book we are unable to agree with the ld. A.R. in so far as the levy of interest under section 234B is now consequential in nature. The argument that there was no advance tax liability does not hold water in so far as the addition are on which TDS was not liable to be made and the assessee had the liability to pay advance tax. The additions made are clearly under sections 68 69 of the Act. In these circumstances the Cross Objections filed by the assessee stand dismissed. Addition of share application money receipt - Allegation of unaccounted monies as laundered - Shri Santosh Kumar Shah had created a number of shell companies and in his statement subsequently recorded that he is a Director in the assessee-company - HELD THAT - The web of the intricacies of the transactions being so vast and the facts are being hidden in such web with the intention not coming forward from the assessee we are left with no other alternative but to restore the issue in the Revenue s appeals in respect of the share application money to the file of the Assessing Officer for re-adjudication and we do so. The arguments raised by the ld. A.R. that the decision of Nova Promoters Finlease Pvt. Ltd. 2012 (2) TMI 194 - DELHI HIGH COURT does not apply and it is the decision in the case of Gangeswari Metals Pvt. Ltd. 2013 (1) TMI 624 - DELHI HIGH COURT that is to be applied also does not hold water in so far as in the present case Shri Santosh Kumar Shah is the Director of the assessee-company he is the signatory to the return he is the signatory to the Bank accounts and he has admitted categorically in his statement in the search that he is providing entries. He has explained the methodology adopted by him though not all the beneficiaries in its entirety and he has also gone to the extent of filing settlement application which has been rejected by the Settlement Commission. AO has not been sitting idle he has been attempting to collect the information which is under the control of the assessees and Shri Santosh Kumar Shah which the assessee has been successfully delaying and thwarting for reasons best known to assessee and when the case is getting time barred has demanded the explanation from the Assessing Officer as to on what basis he is raising the allegation when all the evidences are being hidden by the assessee. But instead of dismissing the assessee s claim following the decision in the case of Nova Promoters Finlease Pvt. Ltd. Supra in the interest of justice the assessee is being granted another opportunity to clean up its case and place all the facts and details before the Assessing Officer for proper adjudication.
Issues Involved:
1. Validity of search u/s 132 of the Income Tax Act, 1961. 2. Legality of assessment orders passed u/s 153A of the Income Tax Act, 1961. 3. Consideration of incriminating documents found during the search. 4. Levy of interest u/s 234B of the Income Tax Act, 1961. Summary: 1. Validity of Search u/s 132: The assessee challenged the validity of the search conducted on their bank accounts, arguing that the search warrants were executed on the bank managers and not on the assessee itself. The Tribunal held that the search was valid as the warrants specified the assessee's name and the bank account details. The Tribunal stated, "The Bank account of an assessee is his private accounts, nobody, not even the Bank itself can do any transaction through such Bank account unless otherwise authorized to do so by the account holder." Therefore, the execution of the warrant on the bank manager was considered valid. 2. Legality of Assessment Orders u/s 153A: The assessee contended that no incriminating documents were found during the search, and thus, proceedings u/s 153A should not have been initiated. The Tribunal noted that the search on one Shri Santosh Kumar Shah revealed that the bank accounts of the assessee were used for entry operations. The Tribunal concluded, "Once it is held that the search on the Bank account is valid then admittedly the provisions of section 153A would operate." The Tribunal upheld the legality of the assessment orders passed u/s 153A. 3. Consideration of Incriminating Documents: The Tribunal examined the evidence, including statements from Shri Santosh Kumar Shah, who admitted to providing accommodation entries. The Tribunal found that the assessee's bank accounts were used for routing unaccounted funds. The Tribunal emphasized, "The revenue has proved its claim with the evidences found in the course of search and the unretracted statement of the Director of the assessee company Shri Santosh Kumar Shah." The Tribunal restored the issue to the Assessing Officer for re-adjudication, granting the assessee another opportunity to present its case. 4. Levy of Interest u/s 234B: The assessee argued against the levy of interest u/s 234B, claiming no liability to pay advance tax. The Tribunal held that the levy of interest u/s 234B was consequential in nature, stating, "The additions made are clearly under sections 68 & 69 of the Act." Therefore, the Tribunal upheld the chargeability of interest u/s 234B. Conclusion: The Tribunal dismissed the cross-objections filed by the assessee and allowed the appeals of the Revenue for statistical purposes, directing the Assessing Officer to re-adjudicate the issues after granting the assessee adequate opportunity to substantiate its case. The order was pronounced on 12th September 2014.
|
