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2018 (2) TMI 113 - HC - Income TaxValidity of assessment framed u/s 16 (1) of the Gift Tax Act - whether condition precedent for reassessment of the proceedings under the said provision was not satisfied? - Held that:- It is not disputed that in Abhinandan Investments [2015 (11) TMI 1219 - DELHI HIGH COURT] this Court reversed the ITAT’s findings and held that the consideration received and shown by the assessee to be a capital loss in income tax proceedings was a device. At the same time while holding that the characteristic of the sale proceeds as a capital loss, was sham, the Court did not ignore the underlying validity of the share transaction or transfer. It proceeded to bring the amounts into question to tax – either as business receipts or as business losses. Such being the case, this Court is of the opinion that alike treatment had to be given. Furthermore, at the stage, when the ITAT intervened in gift tax proceedings (which are the subject matter in these appeals), it considered only the validity of the proceedings, but, did not consider whether in fact the transaction under Section 4(1)(a) amounted to a deemed gift; no conclusive finding in that regard was rendered; nor any finding could have been rendered or was given. For the above reasons, the impugned orders are hereby set aside. The matters are remitted to the ITAT for fresh consideration.
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