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Sheetal Abhinandan Lodha and Vinti Abhishek Lodha Versus Dy. Commissioner of Income Tax, Cen Cir-7 (3) , Mumbai

2015 (9) TMI 384 - ITAT MUMBAI

Validity of addition made in the assessment proceedings framed u/s 143(3) r.w.s. 153A - abatement of assessment - assessment of gift receipts - Held that:- Admittedly, these assessees have not filed original returns of income prior to the date of initiation of search under the regular provisions of the Act. The return of income filed by them under section 153A of the Act for the assessment year under consideration was the first return of income filed by the assessees. The second proviso to secti .....

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cases.

Whether the assessment year under consideration would fall in the category of unabated assessments or not? - Held that:- In the instant cases, we have noticed earlier that both the assessees have not filed the return of income for the year under consideration under regular provisions of the Act. There should not be any dispute that the question of assessment shall arise only if the assessees have filed returns of income or if the assessing officer passes any assessment order t .....

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ent or otherwise of the proceeding relating to AY 2006-07 also does not arise.

Both the assessees have failed to furnish the details relating to the gifts received by them. The gift receipts fall under the category of cash credits falling within the purview of the provisions of sec. 68 of the Act. There should not be any dispute that the initial burden of proof is placed upon the assessees under sec. 68 of the Act to prove the nature and source of cash credit, i.e., the assessees have .....

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ipts in the hands of both the assessees. - Decided against assessee. - I.T.A. No.3266/Mum/2015, I.T.A. No.3267/Mum/2015 - Dated:- 21-8-2015 - SHRI B.R.BASKARAN AND LALIT KUMAR, JJ. For The Appellant : Shri Vijay Mehta For The Respondent : Shri T Shashi Kumar Per B R Baskaran, AM: The appeals filed by the assessees cited above are directed against the orders passed by the ld. CIT(A)-48, Mumbai in their respective hands and both relate to the assessment year 2006-07. Since identical issue is urged .....

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in Lodha group and hence they were also subjected to search. Consequently, the AO issued notices u/s 153A to both the assessees. The assessee named as Smt.Sheetal Abhinandan Lodha declared a total income of ₹ 42,056/- and assessee named as Vinti Abhishekh Lodha declared a total income of ₹ 1,21,300/- in the return of income filed for AY 2006-07 in response to the notice issued u/s 153A of the Act. From the return of income filed by these assessees, the AO noticed that both the asses .....

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₹ 2,10,200/- as her income. Ms. Vinti Abhishek Lodha also could not furnish the details relating to the gift receipt of ₹ 1,04,100/- and hence the AO assessed the same as her income. 4. Before the ld. CIT(A), both the assessees contested the validity of addition of gift receipts by raising a legal ground, viz., the AO could not have made the additions, since the revenue did not unearth any incriminating materials relating to the gift receipts. According to the assessees, the assessme .....

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. V/s DCIT- [2012] 137 ITD 287(ITAT[Mum])(SB) Since there was no incriminating material relating to the gifts was stumbled upon by the revenue, it was contended that the AO was not right in law in assessing the gift receipts in the hands of the assessees herein. 5. However, the ld. CIT(A) did not agree with the said contentions of the assessees. The L.d CIT(A), on the contrary, placed reliance on the decision rendered by the Hon ble Delhi High Court in the case of CIT V/s Anil Kumar Bhatia (2012 .....

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ion, since the assessees have failed to furnish relevant details relating to gift receipts. Aggrieved, the assessees have filed these appeals before us. 6. The ld. AR submitted that the assessment relating to the AY 2006-07 would fall in the category of concluded assessment, since no proceeding relating to the same is pending as on the date of search. He submitted that the Special Bench of the Tribunal has held in the case of ALL CARGO GLOBAL LOGISTICS LTD. V/s DCIT-(supra) that the additions, i .....

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urther submitted that the department did not unearth any material with regard to the receipt of gifts and hence the AO was not justified in assessing the gift receipts as income of the assessees herein. 7. The assessee was specifically asked by the Bench as to whether these assesses had filed return of income earlier u/s 139 of the Act for the assessment year under consideration, the ld. AR fairly admitted that they have not filed return of income u/s 139 of the Act. He also conceded that the re .....

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tted that non-filing of the return due to lower income level will not disentitle the assessee from applying the ratio laid down by the Special Bench of the Tribunal in the case of ALL CARGO GLOBAL LOGISTICS LTD(supra). He invited our attention to the second proviso to sec. 153A(1) of the Act and submitted that the said proviso provides for abatement of assessments pending on the date of search. He submitted that the assessment pertaining to the AY 2006-07 was not pending as on the date of search .....

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ssessment order for the year under consideration in the hands of the assessees. He further submitted that the second proviso to sec. 153A(1) provides that the assessment or reassessment pending as on the date of initiation of search shall abate. He submitted that the provisions of sec. 153A do not provide anything about the assessment years, where the assessees have failed to file original return of income. Accordingly he submitted that the assessment pertaining to AY 2006-07 cannot be considere .....

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urns of income prior to the date of initiation of search under the regular provisions of the Act. The return of income filed by them under section 153A of the Act for the assessment year under consideration was the first return of income filed by the assessees. The second proviso to section 153A states that the assessment or re-assessment, if any, relating to any assessment year falling within the period of six assessment years referred to in section 153A(1) pending on the date of initiation of .....

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assessees have not filed the return of income for the year under consideration under regular provisions of the Act. There should not be any dispute that the question of assessment shall arise only if the assessees have filed returns of income or if the assessing officer passes any assessment order to the best of his judgement u/s 144 of the Act. Hence, in the absence of return of income filed for the year under consideration and also in the absence of any other proceeding leading to passing of .....

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of search and if the time limit prescribed for issuing notice u/s 143(2) had also expired by the date of initiation of search, then also it can be held that the assessment has become concluded by operation of law. In this regard, we may refer to the decision rendered by the Mumbai bench of Tribunal in the case of Gurinder Singh Bawa Vs. DCIT (2014)(150 ITD 40), wherein the Tribunal has observed that after the expiry of time limit prescribed for issuing notice u/s 143(2) of the Act, the assessmen .....

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dings u/s 153A of the Act has been summarised by the Special Bench of the Tribunal in the case of ALL CARGO GLOBAL LOGISTICS LTD. V/s DCIT-(supra) as under: 58. Thus, question No.1 before us is answered as under: (a) In assessments that are abated, the AO retains the original jurisdiction as well as jurisdiction conferred on him u/s 153A for which assessments shall be made for each of the six assessment years separately; (b) In other cases, in addition to the income that has already been assesse .....

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nswer given by the Special bench in (a) above does not apply to the assessee. Since the assessees have not filed any return of income for the year under consideration under regular provisions of the Act prior to the date of initiation of search, any item of receipt/income disclosed in the return of income filed in response to the notice issued u/s 153A of the Act cannot be considered to have been assessed prior to the date of initiation of search. Hence, in our view, the question of application .....

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