Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (9) TMI 604 - ITAT HYDERABAD

2016 (9) TMI 604 - ITAT HYDERABAD - TMI - Refund or adjustment of any amount deposited pursuant to the filing of the return of income in response to the notice U/s 153C - addition on account of adopting the revised return - withdrawal of admitted tax liability accepted by filing the revised return - Held that:- It is admitted case that the assessee received the notices for filing the return of income for the A.Y. 2003-04 to 2009-10 U/s 153C of the Act. The assesse filed the return of income for .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

0 lacs on account of adopting the revised return in pursuant to the notice U/s 148/153C of the Act was incorrect/unsustainable. In our view, the revised return of Rs. of ₹ 12,46,130/- was filed by the assessee in response to the notices issued by the A.O. under the provions of the Act. The ld CIT(A) has upheld the addition to the extent of ₹ 10.00 lacs by accepting the revised return filed by the assessee. In our view, the assessee has admitted the tax liability by filing the revised .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

reme Court in the case of CIT vs. Micro Nova Pharmaceutical (P.) Ltd. [2014 (2) TMI 948 - SUPREME COURT OF INDIA ]. - ITA No. 1781/HYD/2014 - Dated:- 3-8-2016 - SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI LALIET KUMAR, JUDICIAL MEMBER For The Assessee: Shri Vijay N Kale (AR) For The Revenue: Shri K.J. Rao (D.R.) ORDER PER LALIET KUMAR, J.M. : This is the appeal filed by the assessee arises against the order dated 26/08/2014 passed by the ld. CIT(A)-6, Hyderabad for the A.Y. 2004-05. The grou .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f the order of assessing officer being silent on satisfaction required U/s 153C. 4. The ld. CIT(A) erred in confirming the addition of ₹ 10,00,000/- based on presumptions and while ignoring errors in proceedings U/s 153A. 2. The brief facts of the case are that the assessee is engaged in the business of trading of marbles. The assessee filed his return of income for the year under consideration on 30/03/2005 declaring total income of ₹ 2,57,412/-. The assessee filed return of income .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

essee filed appeal before the ld CIT(A). Before the ld CIT(A), elaborate submissions were made by the assessee raising the issue that the satisfaction recorded by the ld. A.O. was not in accordance with law. Further, it was submitted that the provisions of Section 153 of the Act are not attracted as no incriminating material was found during the course of search connecting the assessee with the concealment of income. The ld CIT(A) has dealt with the issues in paragraph No. 5, which is as under:- .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rred with jurisdiction by the Addl.CIT, Central Range-2, Hyderabad vide her order dated 09/12/2010. Though, it is a fact that the status of the proprietory concern was mentioned as firm, apparently by mistake, which was not questioned by the assessee at the time of scrutiny proceedings and a return of income including revised return was filed for A.Y. 2004-05. Having failed to raise the issue at the time of scrutiny proceedings, and the omission being a technical error, I am of the considered op .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

0,000/- was declared as undisclosed income, based on the entries of diaries, which act was also supported by revision of returns, incorporating part of such declared amounts. In this context, it is relevant to refer to the submissions of the appellant dated 10/2/2014, wherein it was acknowledged that revised return of income was filed in response to the notice U/s 153C. Based on these facts of the case, I am of the considered opinion that there is no strength in the argument of the appellant, as .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r:- 6.5 The argument of the appellant that the addition of ₹ 20,00,000/- was made merely on the basis of the statement recorded during the survey proceedings, and the amounts paid should be taken as purchases on which profits only can be arrived and in the light of the fact that the assessee has already accepted the profit to the extent of ₹ 10,00,000/- constituting rate of profit at 50%, is not acceptable, based on facts. The fact of the case is that the appellant was in the busines .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sulted in net payment of ₹ 20,00,000/- lakhs during the F.Y. 2003-04 and ₹ 1,00,000/- during the F.Y. 2004-05, for which the appellant failed to explain the sources, which resulted in treating the same as unaccounted income of ₹ 20,00,000/- for A.Y. 2004-05. The argument of the appellant that the amounts represent purchases and no profit of 100% can be made on such purchases, is not acceptable for the reason that the appellant never established that the amounts represented purc .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

apable of earning 50% of profit on such transactions, nor shown the additional income as income from business. The onus was on the assessee to prove that such payments represented purchases and the income earned represented his business income. The head of income under which the additional income offered by assessee also indicate that it was an unexplained investment but not the profits earned on unaccounted purchases/sales made by the assessee. Hence, the addition made by the Assessing Officer .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rned income of ₹ 12,57,412/-, while treating the revised return filed for A.Y. 2004-05. Accordingly, the addition of ₹ 20,00,000/- is restricted to ₹ 10,00,000/- and this ground of appeal treated as partly allowed, for A.Y. 2004-05. Lastly, the ld CIT(A) has upheld the return of income filed by the assessee in pursuance to the notice U/s 153C and 153A of the Act and held as under:- 7.2 The appellant s submission on the subject was that the revised return was filed for A.Y. 2004 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

opted by the Assessing Officer for A.Y. 2005-06, due to incorrect adoption of total income as per the original returns of income, while furnishing the revised return. Having established that the revised return relates to A.Y. 2004-05, the addition resulting on account of adopting of the revised income, in the order U/s 153C for A.Y. 2005-06 is found to be unsustainable. Hence, the amount of addition of ₹ 10,00,000/- on account of adopting the revised returned income is held to be incorrect .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ted income of ₹ 2,46,130/-, as against ₹ 12,46,130/- as adopted by the Assessing Officer in the assessment order. The appellant succeeds in getting a partial relief and this ground of appeal for A.Y. 2005-06 treated as partly allowed. 4. The ld DR has produced ordersheet for satisfaction recorded in the name of M/s Suguna Marbles and the satisfaction recorded by the ld. DCIT was as under:- Search and Seizure operations were conducted in case of M/s Midwest Granites Pvt. Ltd. Group on .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

377; 10.00 lacs sustained by the ld CIT(A) whereby the return of income of ₹ 12,46,130/- is required to be modified and the original return of income filed by the assessee for ₹ 2,46,130/- is required to be upheld after the scrutiny assessment. The ld. AR after going through the ordersheet recording the satisfaction for issuance of notice U/s 153C of the Act has submitted that noting/ordersheet produced by the ld DR is not a satisfaction as contemplated U/s 153C of the Act, which has .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

333 ITR 0436 (ii) The Hon ble Allahabad High Court in the case of CIT VsGopi Apartment (2014) 365 ITR 0411 (iii) The Hon ble Delhi High Court in the case of Pepsi Foods P. Ltd. Vs. ACIT [2014] 52 taxmann.com 220 (Delhi) (iv) The Coordinate Bench in the case of Shettys Pharmaceuticals and Biological Ltd. Vs DCIT [2014] 47 taxmann.com 85 (Hyderabad - Trib.) (V) Commissioner of Income-tax, III, Hyderabad Vs. Shettys Pharmaceuticals &BiologicalsLtd.[2015] 57 taxmann.com 282 (Andhra Pradesh). 6. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

her than the assessee. In fact, the ld AR has submitted that the satisfaction recorded by the ld. A.O. is similar to the satisfaction recorded in case of SHETTY PHARMACEUTICALS & BIOLOGICAL LTD. (supra) wherein the Hon ble Jurisdictional High Court has upheld the order of the Tribunal. The Tribunal in the said matter has quashed the assessment proceedings being initiated without recording the satisfaction in accordance with law. The ld AR prayed for the dismissal of the assessment proceeding .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Dinesh Daliya. It was submitted that in the assessment order, it is mentioned that Suguna Marbles (a proprietorship of Dinesh Daliya). The ld DR, has submitted that even if the submissions of the assessee are accepted in respect of non-recording of satisfaction, then also the assessee shall not be entitled to refund of the tax deposited pursuant to the notice issued U/s 153C of the Act, in view of bar laid down in Section 240 of the Act. 8. We have heard the rival contentions of both the parties .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

clearly held that the recording of satisfaction by the A.O. is precondition for invoking the provisions and is not a mere formality because the recording of satisfaction postulate the application of mind, consciously as to the documents seized must be belonging to any other persons other than the persons referred to in Section 153A of the Act. Similarly, the Hon ble Delhi High Court in the case of Pepsi Foods P. Ltd. Vs. ACIT (supra) has held that as per law, once the documents are seized from t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed hereinabove), there is no satisfaction in our view. It is not reflected from the note that the documents recovered do not belong to the M/s Midwest Granites P. Ltd. but belongs to the assessee before us. It is also not recorded as to which documents pertains to the assesse on the basis of which the additions can be made by the ld. A.O. In view thereof, the satisfaction recorded by the A.O. is lacking in material particulars and only the cryptic mechanical direction was issued for issuance of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ue are dismissed. Since we are allowing the appeals of the assessee on the ground of non-recording of satisfaction in accordance with law, therefore, we have not dealt with the appeals of the revenue on merit. 9. If we see the satisfaction recorded in the ordersheet, in the present matter also, then the reasoning given by us in the case of M/s Victorian Granites Pvt. Ltd. can equally be applied to hold that the satisfaction recorded by the authority was not in accordance with law and was without .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

53C of the Act or not. It is admitted case that the assessee received the notices for filing the return of income for the A.Y. 2003-04 to 2009-10 U/s 153C of the Act. The assesse filed the return of income for an amount of ₹ 12,57,412/- for the A.Y. 2003-04 and has also deposited the tax with the department. However, the A.O. instead of accepting the return of income had made the addition of ₹ 20.00 lacs which was restricted to an amount of ₹ 10.00 by the ld. CIT(A). In the pro .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t. The ld CIT(A) has upheld the addition to the extent of ₹ 10.00 lacs by accepting the revised return filed by the assessee. In our view, the assessee has admitted the tax liability by filing the revised return and now therefore the assessee cannot be permitted to withdraw the admitted tax liability accepted by him by filing the revised return of income. Furthermore, this issue is no more res integra as the Hon ble Apex Court in its recent judgment in the case of CIT vs. Micro Nova Pharma .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ier noticed the scheme of the Act. Sec. 4 of the Act creates the charge, and provides inter alia for payment of tax in advance or deduction of tax at source. The Act provides for the manner in which advance tax is to be paid and penalises any assessee who makes a default or delays payment thereof. Similarly, the deduction of tax at source is also provided for in the Act and failure to comply with the provisions attracts the penal provisions against the person responsible for making the payment. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

amounts to an admission of tax liability which the assessee admits to have incurred in accordance with the provisions of the Finance Act and the IT Act. Both the quantum of tax payable and its mode of recovery are authorized by law. The liability to pay income-tax chargeable under s. 4(1) of the Act thus, does not depend on the assessment being made. As soon as the Finance Act prescribes the rate or rates for any assessment year, the liability to pay the tax arises. The assessee is himself requi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version