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Sardar Vallabhbhai Patel Education Society Versus Income Tax Officer, Ward 1

2017 (9) TMI 747 - GUJARAT HIGH COURT

Reopening of assessment - non appreciating the petitioner's objections - Held that:- Assessing Officer without appreciating the petitioner's objections to the notice of reopening, rejected the same. In facts of the case, we would like to request the Assessing Officer to reexamine the objections in peculiar facts pointed out in such objections as well as those urged before us. For the above purpose, following directions are issued: - (i) It will be open for the petitioner to file supplementar .....

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ion directing the Assessing Officer not to pass the final order on assessment shall continue. - Special Civil Application No. 17878 of 2016 - Dated:- 11-9-2017 - MR. AKIL KURESHI AND MR. BIREN VAISHNAV, JJ. For The Respondent : Mrs Mauna M Bhatt, Advocate ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. This petition is filed by one Sardar Vallabhbhai Patel Education Society, which is an educational society and is also a trust registered under the Bombay Public Trust Act. The petition .....

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ons run by the society would receive sizable amounts by way of cash through fees paid by the students. Only in order to maintain the separation of funds, N.G.Patel polytechnic desired to open a bank account. According to the counsel for the petitioner, bank insisted on a separate Permanent Account Number ('PAN' for short) of the customer only upon which a separate account can be opened. N.G.Patel polytechnic therefore applied for PAN which was duly issued by the Incometax department whic .....

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was accepted by the Assessing Officer without scrutiny. 3. The Assessing Officer noticed that N.G.Patel polytechnic had a separate PAN and in its savings bank account of Bank of Baroda, sizable cash amount of ₹ 2.37 crores was deposited, on which, it had also received interest of ₹ 2.40 lakhs. Despite this, N.G.Patel polytechnic had not filed return of income for the said assessment year 2009-10. On such basis, N.G.Patel polytechnic was served with an impugned notice dated 22.03.201 .....

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olytechnic did not have any independent legal existence and was merely a college run by the society. The society therefore raised detailed objections before the Assessing Officer under a communication dated 02.07.2016 urging him to drop the notice for reopening. In such objections, the petitioner stressed that it was the society which had maintained the books of accounts and filed the audited accounts along with the return, in which, the said amount of ₹ 2.37 crores was also reflected. Thu .....

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ic had not filed the return despite the fact that sizable cash amount was deposited in its bank account. 6. Section 139A of the Act pertains to permanent account number. Subsection (1) of section 139A provides various categories of persons who are required to pay tax or for some other reason required to furnish return of income, would apply to the Assessing Officer for allotment of a PAN. Under subsection( 1B), the Central Government may for the purpose of collecting any information which may be .....

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Assessing Officer for allotment of PAN, upon which, the Assessing Officer shall allot the same. 7. It can thus be seen that mere allotment of PAN under section 139A of the Act would not make the allottee necessarily a separate entity for the purpose of assessment of tax. The statute recognizes certain eventualities where quite outside the requirement of payment of tax and for filing return of income, the Assessing Officer may allot a PAN to individual. The contention of the Assessing Officer the .....

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ons against the notice for reopening, requiring the Assessing Officer to dispose of such objections flow from the decision of Supreme Court in case of G.K.N.Drive Shaft (India) Ltd. V. ITO reported in (2003) 259 ITR 90 (SC). The clear intention of the Supreme Court in devising such a formula was that in genuine cases where the Assessing Officer may have reopened the assessment which need to be dropped, such cases may be filtered out avoiding unnecessary hardships to the assessee as well as protr .....

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