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2015 (12) TMI 1226 - ITAT AHMEDABAD

2015 (12) TMI 1226 - ITAT AHMEDABAD - [2015] 43 ITR (Trib) 628 (ITAT [Ahm]) - Unexplained capital gain ans sale proceeds - Held that:- Once Smt. Shardaben R. Patel has recognised the sale consideration by computing capital gain on transfer of the two flats and the return was filed before the search, then it has been demonstrated that source of the funds in purchasing two fixed deposits is the transfer of the two flats by Smt. Shardaben R. Patel. The assessee has discharged the onus before us als .....

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ed by 1. Rajpal Yadav (Judicial Member).-The present appeal is directed at the instance of the assessee against the assessment order dated December 26, 2007 passed under section 158BC read with sections 143(3) and 254 of the Income-tax Act, 1961. The grounds of appeal are not in consonance with rule 8 of the Income-tax (Appellate Tribunal) Rules, 1963. They are descriptive and argumentative in nature. In brief the grievance of the assessee is that the learned Assessing Officer failed to carry ou .....

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f the assessee raised in number of grounds of appeal we would like to discuss the brief history of the assessment. 3. A search and seizure operation was carried out at the premises of the assessee on September 21, 1995. Along with the assessee various firms and associated concerns were also covered under the search operations. In order to give logical end to the search proceedings, a notice under section 158BC of the Act was served upon the assessee. In response to the notice, the assessee has f .....

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back to the file of the Assessing Officer. The observations made and the directions given by the Tribunal are being reproduced at page 2 of the assessment order, they read as under : "The proper order to be passed in such a case would be to set aside the assessment and to direct the Income-tax Officer to make a fresh assessment in accordance with procedure prescribed by law. It would not be correct merely to uphold the assessment and direct the Income- tax Officer to make appropriate modif .....

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ng orders." 4. The learned Assessing Officer had issued a notice under section 143(2) read with section 158BC on August 7, 2007 under the set aside proceedings and thereafter framed the assessment order on December 26, 2007. The computation of income determined by the Assessing Officer reads as under: Computation of income indicating unaccounted income (Rs.) (Rs.) Assessment year 1986-87 House hold expenses 50,000 Assessment year 1987-88 House hold expenses 50,000 Assessment year 1988-89 Ho .....

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t 2,00,000 Visit of relatives from foreign country 2,50,000 House hold expenses 90,000 5,40,000 Assessment year 1994-95 Undisclosed bank account 2,00,000 Land at Sangrali village 2,42,000 Visit of relatives from foreign country 2,50,000 House hold expenses 80,000 Unaccounted deposits in NRE account 4,59,987 FDR as above 50,000 12,91,987 Less : Set off as discussed above 23,035 12,68,952 Assessment year 1995-96 Undisclosed bank account 2,00,000 House hold expenses 1,10,000 Visit of relatives from .....

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in FDRs 9,30,000 Unexplained expenditure 5,00,000 30,97,340 Less : Set off as discussed above 12,78,600 18,18,740 Total undisclosed income 55,15,066 Add : Total income including undisclosed income 10,58,438 65,73,504 Less : returned income/assessed income 8,01,711 Total undisclosed income 57,71,793 R/O 57,71,790 5. The learned authorised representative for the assessee while impugning the order of the Assessing Officer submitted that the assessee is a partner having 33.33 per cent. shares in 8 f .....

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in this concern. This concern has offered undisclosed income of ₹ 8,60,000. According to the learned counsel for the assessee the total amount of ₹ 63,57,387 has been offered by various firms which came to the share of the assessee. He submitted that even if the merits of additions are not to be looked into except one addition whereby the addition of unexplained investment in the bank account have been made, the assessee will be satisfied if telescopic benefit of the additions were g .....

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ng Officer read as under : "It has been emphasised by the assessee that he shall not be subjected to double taxation on the disclosed amount in view of the clear position of law laid down in Chapter XIV-B. The assessee has further requested that the disclosure made in the firms referred to above represents mainly the unaccounted money which was utilised by him along with Shri Ajay V. Bhatt and Shri Suresh A. Patel in the ratio of 33.33 per cent. Therefore, it has been requested by the asses .....

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made by the assessee have been examined carefully. The assessee will be allowed set off of one-third share from the disclosed income of the firms referred to above against the disclosed/accepted amount of undisclosed income against any amount which he has not accepted during the course of assessment proceedings." 8. The learned Assessing Officer had agreed that the assessee is entitled for telescopic benefit but, while giving actual benefit to the assessee, he restricted all these to a sum .....

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th a limited purpose that the learned Assessing Officer would ascertain the share of profit coming to the assessee from the 9 partnership firms to the extent of ₹ 63,57,387. The learned Assessing Officer shall give telescopic benefit of this amount against various additions made by him in the assessment order. 9. With regard to the additions made on account of unexplained deposits in the bank account is concerned, the assessee has contended that his sister Smt. Shardaben R. Patel was the o .....

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n as nil, because of indexation value of acquisition. An intimation to the assessee was sent by the Assessing Officer under section 143(1). Copy of such intimation is available at page 196 of the paper book. The contention of the assessee is that two fixed deposits were made by his sister though they were maintaining a joint bank account with the Bank of Maharashtra. The certificate of the bank is available at page 198. The assessee has also placed an affidavit of Smt. Shardaben Patel whereby sh .....

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