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Commissioner of Income Tax Versus Shri. Deepak Kumar Agarwal, Govind Agarwal, Manidevi Agarwal And Pr. Commissioner of Income Tax Versus Nikki Agarwal, Govind Agarwal

2017 (9) TMI 1036 - BOMBAY HIGH COURT

Validity of the notice under Section 153A - addition under Section 68 on account of unexplained gifts received from the family members - Held that:- No addition could have been made while completing assessment under Section 153A of the IT Act in the case of completed assessment if no undisclosed income was determinable from the material found as a result of search. The concurrent finding of fact is that no one could form an opinion that the subscribers to the share capital had any income exigibl .....

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PEAL (L) NO. 469 OF 2017 INCOME TAX APPEAL (L) NO. 470 OF 2017 INCOME TAX APPEAL (L) NO. 472 OF 2017 INCOME TAX APPEAL (L) NO. 477 OF 2017 INCOME TAX APPEAL (L) NO. 483 OF 2017 INCOME TAX APPEAL (L) NO. 566 OF 2017 INCOME TAX APPEAL NO. 914 OF 2017 INCOME TAX APPEAL NO. 1169 OF 2014 INCOME TAX APPEAL NO. 1178 OF 2014 NOTICE OF MOTION NO. 1194 OF 2017 IN INCOME TAX APPEAL NO. 1169 OF 2014 NOTICE OF MOTION NO. 1197 OF 2017 IN INCOME TAX APPEAL NO. 1178 OF 2014 S. C. Dharmadhikari And Prakash D. Na .....

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he Tribunal and taking a view that the grounds raised are covered, in majority of the cases, by the earlier order of the Tribunal. 4. A reference is also made to the same in as much as a Special Bench of the Tribunal was constituted so as to deal with similar grounds as were raised in the present Appeals. 5. In fact, the Tribunal has done nothing except reproducing relevant paragraphs of the order of the Special Bench and its earlier view based on that Special Bench order. 6. In Income Tax Appea .....

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ment proceedings under Section 153A of the IT Act were initiated. The Assessing Officer made several additions to the total income and passed an order under Section 143(3) read with Section 153A on 31st December, 2009, on a total income of ₹ 40,07,379/. Being aggrieved by this order, the assessee preferred an Appeal before the Commissioner of Income Tax (Appeals). 7. The Commissioner of Income Tax (Appeals) directed the Assessing Officer to recompute the disallowances made under Section 14 .....

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peal of the assessee. 9. In delivering a common order dealing with about 12 Appeals, the Tribunal, on 10th April, 2014, held that the additions were made beyond the scope of Section 153A/153C of the IT Act as no incriminating material in support of the additions made under Section 68 and under Section 14A were brought on record by the Revenue. That is how the Tribunal allowed the assessee's Appeal and dismissed that of the Revenue. 10. Mr. Ahuja, appearing in support of this Appeal would sub .....

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Karnataka High Court in the case of Canara Housing Development Co. Vs. DCIT (unreported)? 6.2 Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT was justified in deleting the addition made u/s.68 of the IT Act of unexplained gift received, which could not be proved to be genuine by the assessee, by not going into the merits of the case, but by holding that only income related to incriminating documents found during the search u/s. 132 of the IT Act can be .....

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012] 23 Taxman.Com 103 (Mum.) (SB) cannot be said to be correct. 13. During the course of the arguments, Mr. Ahuja has tendered a chart of the questions proposed by the Revenue for the assessment years 2005-2006 and which he states were proposed based on the lead matter, namely, Income Tax Appeal No. 1178 of 2014 for the assessment year 2002-2003. The other question based on the Special Bench decision is common to Income Tax Appeal No.1709 of 2014 for the assessment year 2004-2005 and the Income .....

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posed by the Revenue in these Appeals ought to be entertained. These are substantial questions of law and the Division Bench judgment in Continental Warehousing Corporation and All Cargo Global Logistics (supra) is rendered in ignorance of a judgment of the Hon'ble Supreme Court reported in [2007] 291 ITR 500 (SC) (Assistant Commissioner of IncomeTax vs. Rajesh Jhaveri Stock Brokers Private Limited). 16. It is also contended by Mr. Ahuja that on 12th July, 2017, Income Tax Appeal No. 1874 of .....

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Palkhivala. Our attention is also invited, on the interpretation of Section 68 of the IT Act, to a judgment of the Calcutta High Court in the case of Bhola Shankar Cold Storage Pvt. Ltd. vs. Joint Commissioner of IncomeTax which is reported in [2004] 270 ITR 487 (Calcutta). 18. On the other hand, the argument of the respondent throughout is that the Special Bench decision of the Tribunal has now been upheld by this Court in Continental Warehousing Corporation and All Cargo Global Logistics (supr .....

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of Income Tax challenged the correctness of the decision rendered by a Division Bench of the Gujarat High Court. That Division Bench judgment allowed the Writ Petition/Special Civil Application of the assessee. 22. The respondent assessee, a private limited company, filed its return of income for the assessment year 2001-2002 on October 30, 2001, declaring total loss of ₹ 2,70,85,105/. That return was proposed under Section 143(1) of the IT Act accepting the loss returned by the responden .....

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ject matter recorded in the reasons. The Revenue disposed of these objections on 4th February, 2005 holding that the initiation of reassessment proceedings was valid and it had jurisdiction to undertake such an exercise. The notice under Section 148 of the IT Act dated 12th May, 2004 was challenged by the respondent assessee. 23. That Writ Petition was allowed and hence, the Revenue was in Appeal. 24. Mr. Ahuja's argument overlooks this factual aspect and when he relies upon the observations .....

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eed under Section 143(2). The right preserved was not taken away. The Hon'ble Supreme Court referred to the period between April 1, 1989 and March 31, 1998, and the second proviso to Subsection (1) Clause (a) of Section 143 and its substitution with effect from 1st April, 1998. The sending of intimation between 1st April, 1998 and 31st May, 1999 under Section 143(1)(a) was mandatory. That requirement continued until the second proviso was substituted by the Finance Act, 1997, which was opera .....

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made in the context of the Assessing Officer being authorized and permitted to assess or reassess income chargeable to tax if he has reason to believe that income for any assessment year has escaped assessment. Before us, such is not the position, and even if this judgment of the High Court had been brought to the notice of the Division Bench deciding the Continental Warehousing Corporation and All Cargo Global Logistics (supra), there would not have been any difference. 26. The argument before .....

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68 on account of unexplained gifts received from the family members of Mr. B. R. Agarwal, the arguments have been noted. 28. The Special Bench order in the case of All Cargo Global Logistics Ltd. (supra) has been referred in the impugned order at the internal page 8 (running page 70 of the paper book). 29. The relevant paragraphs of the same have been reproduced. 30. The Tribunal concluded that the arguments relating to the validity of the notice under Section 153A and though that provision coul .....

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rted judgment in Continental Warehousing Corporation and All Cargo Global Logistics (supra) can be taken. 32. Once we are of the firm view that the question no.1 proposed by the Revenue is already answered by this Court in a series of judgments, and particularly referred above, then we do not think that we should allow Mr. Ahuja to argue that these judgments are rendered in ignorance of the binding judgment of the Hon'ble Supreme Court in the case of Rajesh Jhaveri Stock Brokers Private Limi .....

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lied upon its order in the case of Govind Agarwal (HUF) vs. DCIT (ITA No.8917/M/2010) decided on 16th May, 2013 for the assessment year 2005-2006. 34. There as well, reliance was placed on All Cargo Global Logistic Ltd. (supra) and equally, the conclusion that has been reached that once there is no incriminating material in support of the addition and brought on record by the Revenue, then, the earlier view of this Court binds the Revenue even on this addition. Thus, even this question cannot be .....

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