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Commissioner of Income Tax-7 Versus M/s Refam Management Services (P) Ltd.

2015 (11) TMI 410 - DELHI HIGH COURT

Assessment u/s 153A - Addition under Section 69C - Held that:- The only document seized during the search in question was a cheque book pertaining to the Assessee which reflected issue of cheques during the period August 2008 to October 2008, relevant to the AY 2009-10. The facts and the questions of law that arise in these appeals are similar to the facts and the controversy involved in RRJ Securities Ltd. (2015 (11) TMI 19 - DELHI HIGH COURT ) as documents seized had no relevance or bearing on .....

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015, ITA 174/2015 - Dated:- 5-11-2015 - S. Muralidhar And Vibhu Bakhru, JJ. For the Appellant : Mr N.P. Sahni, Senior Standing Counsel with MR Nitin Gulati, Junior Standing Counsel For the Respondent : Mr. Arvind Kumar and Mr. Vikas Jain JUDGMENT Vibhu Bakhru, J 1. The Revenue has preferred these appeals under Section 260A of the Income Tax Act, 1961 (hereafter the Act ) impugning a common order dated 26th August, 2014 passed by the Income Tax Appellate Tribunal (hereafter the Tribunal ) in a ba .....

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on 143(2) of the Act. The Revenue was aggrieved inasmuch as the CIT(A) had set aside the addition to the total income of the Assessee made by the AO under Section 69C of the Act in respect of the purchases as declared by the Assessee as well as set aside the AO s decision to disallow the entire expenses claimed by the Assessee. The Tribunal s order dated 26th August, 2014 also disposed of the cross objections preferred by the Assessee - 6 in number - as being academic. The Assessee had challenge .....

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s contention was that the material in the form of statement recorded during the search proceedings indicated that no genuine sale and purchase transaction was entered into by the assessee; and 2. Whether in the circumstances, the AO was justified in bringing to tax the amounts disallowed in the course of search assessment under Section 153C. 3. At the outset, Mr Kumar, learned counsel for the Assessee submitted that the AO had no jurisdiction to make an assessment under Section 153C of the Act a .....

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faction under Section 153C of the Act was recorded and, thus, outside the scope of Section 153C of the Act. He submitted that the present case also involved the question as to jurisdiction of the AO to make assessments under Section 153C of the Act; but, as the questions of law were framed prior to issuance of notice in these appeals, the Assessee had no opportunity to suggest the same. 4. Mr N.P. Sahni, learned Senior Standing Counsel for the Revenue, did not dispute that the substantial questi .....

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ers, decided on 30.10.2015. 6. Briefly stated, the relevant facts necessary to address the issues involved in the above captioned matters are as under:- 6.1 Search and seizure operations were undertaken under Section 132 of the Act in the case of Sh. B.K. Dhingra, Smt. Poonam Dhingra and M/s Madhusudan Buildcon Pvt. Ltd. (hereafter also referred to as searched persons ) on 20th October, 2008. Certain documents belonging to the Assessee Company were seized during the search. The AO of the Assesse .....

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also issued for the purpose of assessing the income of the Assessee with respect to AY 2003- 04. 6.3 The Assessee sent a letter dated 29th November, 2010 to the AO requesting the AO to provide copies of the seized material. The Assessee also contested the initiation of proceedings under Section 153C of the Act in addition to contending that the assessments were time barred. In reply to the said letter, the ACIT vide a letter dated 3rd December, 2010 observed that the Assessee interpreted the fi .....

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laimed that it was dealing only in tax free goods and was not required to file sales tax returns. 6.5 The AO observed that the case of the Assessee is connected with Thapar Group of cases in which it was declared that at least 15 concerns were operating from the address "B-340, Hari Nagar, New Delhi". These concerns were alleged to be capital formation concerns with huge reserves and surpluses that were reflected as invested in stock of textiles. The AO also found that no operations we .....

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2015 provided the Assessee with a photocopy of papers seized that contained Record Slips of a cheque book pertaining to a Bank Account with Centurion Bank of Punjab Limited, Tilak Nagar Branch, New Delhi. The said record slips - which formed a part of the cheque book - contained an entries pertaining to a cheques issued in 2008. 6.7 The CIT(A), however, allowed the appeal of the Assessee with regard to the disallowance of purchases under Section 69C of the Act and observed that Section 69C of th .....

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