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Shilpi Securities Pvt. Ltd., Vaidahi Lease and Finance Pvt. Ltd. Versus DCIT, Central Circle 23, New Delhi

2016 (2) TMI 127 - ITAT DELHI

Undisclosed income in the block assessment - interest income received by the assessee on which tax has already been deducted at source - Held that:- When the TDS has already been deducted by the Citi Bank on the interest income in question as referred to by the Assessing Officer in the assessment order, the same cannot be again put to tax by declaring undisclosed income, so it cannot be again subjected to tax. So, we are of the considered view that the Assessing Officer has erred in declaring th .....

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authority to take benefit of any such TDS. So, we find no ground to interfere into the findings returned by the Assessing Officer - Decided against assessee. - I.T. (SS) A. No. 02/Del/2012, I.T.(SS) A No.05/Del/2012 - Dated:- 29-1-2016 - Shri G. D. Agarwal, Hon ble Vice President And Shri Kuldip Singh, Judicial Member For the Appellant : Shri Vinod Kr. Bindal Ms. Sweety Kothari, CA For the Respondent : Sh. Ram Bilash Meena, CIT DR ORDER Per Kuldip Singh, JM Since common question for determinatio .....

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the grounds inter alia that: A. IT(SS)A No.02/Del/2012: 1. The assessing officer erred in law and on facts in making an addition of ₹ 8,93,034/- being interest on NCD with Citibank ignoring the facts and evidences placed on record that the transactions regarding NCD were duly recorded in the books of account and the said interest was duly declared as income in the regular return of income filed before the due date. Thus the addition so made should be deleted. 2. Without prejudice to the a .....

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ded in the interest of ₹ 8,93,034/-. Thus directions should be issued' to allow credit of the said amount against tax due to the assessee. B. IT(SS)A No.05/Del/2012: 1. The assessing officer erred in law and on facts in making an addition of ₹ 8,96,459/- being interest on NCD with Citibank ignoring the facts and evidences placed on record that the transactions regarding NCD were duly recorded in the books of account and the said interest was duly declared as income in the regular .....

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TDS certificate of ₹ 62,226/- issued by Citibank and submitted to the department though the said amount is included in the interest of ₹ 8,96,459/-. Thus directions should be issued to allow credit of the said amount against tax due to the assessee. 3. Briefly stated, the facts of these case are: the assessees, being related to Prakash Chand Yadav group of cases, one of the accused in ₹ 133 crore urea import scam, were searched u/s 132(1) of the Act on 20.09.1996 regarding the .....

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before Hon'ble High Court, New Delhi and then, Hon'ble High Court, New Delhi vide order dated 31.10.2007, restored the appeals to ITAT, Delhi benches, New Delhi for deciding afresh. Then ITATA, New Delhi vide order dated 30.04.2008 held the block assessment invalid because of the illegality in the warrant issued u/s 132(1), which had again been challenged before Hon'ble High Court, which has passed order dated 30.11.2009 reversing the decision of ITAT and restoring back the appeals .....

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e notices u/s 143(2) and 142(1) of the Act along with questionnaire and in response thereof, Shri Anil Sanghi attended the proceedings, filed necessary details and has discussed the case. Perusal of record goes to show that the total amount of ₹ 1,20,00,000/- credited in the accounts of the assessee has been received from Shri Anil Sanghi in account No. 0-412419-006 in Citi Bank, Connaught Place, New Delhi from his current account No.612 having been transferred out of the amount of ₹ .....

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the FDRs maintained with Citi Bank in F.Y. 1996-97, the tribunal in view of clause (c) and (d) of section 158BB(1) of the Act, excluded the same from the Assessment Years 1996-97 and 1997-98 and thus, the Assessing Officer excluded the income recorded in the books of accounts of the assessee after proper verification. 7. The assessee company having been incorporated on 29.01.1996, filed its first return for the Assessment Year 1996-97 and the block assessment u/s 158BC(c) of the Act was complete .....

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₹ 1,18,74,089/- on 27.03.1996 in Citi Bank, New Delhi as against 8,93,034/-/- added by the Assessing Officer and this contention has also not been accepted by the Assessing Officer and thereby assessed the undisclosed income of ₹ 8,93,034/- qua the Assessment Year 1997-98. 8. Feeling aggrieved, the assessees have again come up before the Tribunal by way of filing the present appeals. 9. We have heard Authorized representatives of both the sides and perused the material placed on reco .....

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004 maintained with Citi Bank, Connaught Place, New Delhi from the current account No.612 of Shri, Anil Sanghi and Associates in J & K Bank, NOIDA out of the amount of ₹ 27,64,93,670/- declared by Anil Sanghi as his undisclosed income for the block period offered for taxation by him, has not been declared as undisclosed income. 10.2 However, the Assessing Officer has assessed the total undisclosed income of the assessee at ₹ 8,96,459/- in appeal No.05/Del/2012 and ₹ 8,93,03 .....

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as Dr. (Mrs.) Surjit Tosaria Vs JCIT 92 TTJ 338, which has been answered in favour of the assessee. Operative part of the judgement cited as Dr. (Mrs.) Surjit Tosaria (supra) is reproduced as under for ready reference: Search and Seizure - Block assessment - computation of undisclosed income - tax at the appropriate rate has been deducted at source from the salary by the employer, and deposited with the Government - though the assessee has not filed returns for the years falling in the block pe .....

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ESSMENTUNDISCLOSED INCOME- MEANING OF TAX DEDUCTED AT SOURCE FROM INCOME AND ADVANCE TAX PAID BY RECIPIENT - INCOME NOT UNDISCLOSED INCOME OF PARTNERS- FIRM DISCLOSING REMUNERATION TO PARTNERS AND DEDUCTING TAX AT SOURCE ON THEM - NO UNDISCLOSED INCOME IN HANDS OF PARTNERS -I.T. ACT, 1961 S.158BC. Undisclosed income for the purpose of block assessment has been defined under the I.T. Act, 1961. The proceedings under the regular assessment and the assessment for the block period stands to operate .....

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firm pays remuneration in terms of the agreement to its partner and reflects in the books of account as well as in the return filed to the Department well in time, the income stands disclosed to the Department. Therefore, merely because the recipient of the income did not file the return and he filed only after the search makes no difference. 12. The ratio of judgements cited as Dr. (Mrs.) Surjit Tosaria Vs. JCIT and CIT and Another Vs H. E. Mynuddin Pasha (supra) clearly establish that when adm .....

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ome has been deducted by Citi Bank at source for which TDS certificate has been issued and the income declared by the assessee in its regular return of income has already been accepted u/s 143(1) and 143(3) of the Act, the question does not arise to declare the interest income as undisclosed income . The said income cannot be treated as undisclosed income because when the advance tax / TDS has been deducted by the bank itself then the income becomes disclosed income of the assessee. The Assessin .....

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