TMI Blog2017 (11) TMI 130X X X X Extracts X X X X X X X X Extracts X X X X ..... unal whereby tribunal has dismissed the appeal preferred by the assessee. 2. This court while admitting the appeal on 3.10.2016 framed following substantial questions of law:- (1) Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that issuance of second notice u/s 148 for re-opening of the assessment during the pendency of appeal against the first notice issued u/s 148, is valid and consequently order passed by the lower authorities is proper, such conclusion is proper? (2) Whether the Tribunal was justified is holding that the appellant could not discharged the burden to provide the credit worthiness as required u/s 68 of the Act while sustain the addition of ₹ 11,97,472/- of cash credits merely on the basis confirmation filed by the appellant, evidence, namely affidavits PAN number payment through cheques and I.T. File numbers were available of the creditors such conclusion is proper? 3. The facts of the case are that the assessee is a Transporter. The return has been filed on 30.8.1997 disclosing total income at ₹ 1,21,925/- which was processed u/s 143(1) of IT Act showing loss from transport work o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , second show cause notice issued on the same subject is without any authority of law. 6. Counsel for the appellant has relied upon the following decisions:- 6.1 In Aditya Medisales Ltd. vs. Deputy Commissioner of Income Tax, Circle 1(1) reported in (2016) 73 taxmann.com 197 (Gujarat), it has been held as under:- 9. As noted, for the assessment year 2005-2006, the Assessing Officer had issued first notice of reopening on 11.1.2011, which was based on the premise that the assessee having transferred its shares from stock-intrade to investment, was liable to pay tax on the difference between cost price of such shares and the market value on the date of transfer. In the present case, the notice for reopening is founded on the allegations that the assessee had shown to have held only 20,10,198 shares of Sun Pharmaceuticals on 31.3.2004. However, on 1.4.2004, the assessee had shown to have converted 40,20,396 shares of the said company from stock-in-trade to investment. Further, the list of shares and securities that the assessee claimed to have converted into investment on 1.4.2004 submitted during the course of assessment did not include these 40,20,396 shares. These shares ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of such provision. 12. Thus while claiming long term capital gain on sale of 40,20,396 shares of Sun Pharma, the assessee related to the date of investment of 2.11.2002 and the date of sale of 2.7.2004 completely withholding the fact that shares were transferred from stock-in-trade to investment only on 1.4.2004. On the ground of true and full disclosures therefore, notice cannot be quashed, nor can it be concluded that no income chargeable to tax had escaped assessment. This later issue of escapement of income must be left to be decided in the assessment proceedings if the notice is otherwise valid. 6.2 In Commissioner of Income Tax vs. Jaideo Jain and Co. (1997) 227 ITR 302 (Rajasthan), it has been held as under:- The Income Tax Appellate Tribunal, Jaipur Bench, Jaipur, before which the application under Section 256(1) of the Act was made by the Revenue for referring the above two questions of law for the opinion of the High Court, dismissed the application on the ground that the answer to both these questions are self-evident and, therefore, it is not necessary to refer these questions for the opinion of the High Court. The judgment passed by the Tribunal is af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rescribed along with an application for refund under Section 237 of the Act is a valid return. There is no stopping the Income-tax Officer to complete the assessment on the basis of return so filed. It may be that the Income-tax Officer may limit the scope of examination of the return to satisfy himself regarding the correctness of the amount claimed as refund. For that purpose, he will examine if the tax paid by the assessee exceeds the amount of tax for which he is chargeable. If it is found that the income was nil , he will direct refund be granted to the assessee for any amount of tax paid. That will certainly be assessment. Filing of return In the form prescribed under Section 39 of the Act along with the application for refund is not an empty formality. It assumes importance if such return had not been filed earlier. We have reproduced the note/order dated November 10, 1965 on the file pertaining to assessment year 1963- 64. In the file for assessment year 1963-64 there is another note which is as under: Please see my note in 1963-64 file. Refund to be considered in the hands of the beneficiaries. 18. The mere glance at this note would show that it could not be s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eting the assessment, the Assessing Officer held that the assessee has reduced ₹ 2,00,000/- on account of old stocks, but there was no justification to it and, therefore, he made addition accordingly. On appeal, the Commissioner (A) deleted the said addition. During the pendency of revenue s appeal before the tribunal, a notice was issued to be assessee u/s 148. The assessee filed instant petition challenging the said notice. It was contended that when the proceedings filed by the Department were pending and when the order impugned in the appeal before the tribunal was in favour of the assessee, surely, the notice u/s 148 could not be issued. 6.6 In Deputy Commissioner of Income Tax vs. Rohini Builders reported in (2002) 256 ITR 360 (Gujarat), it has been held as under:- 8. Further, we may point out that section 68 under which the addition has been made by the Assessing Officer reads as under : 68. Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rakash Gupta and Shri Gauri Shanker Singhal, about the purpose for which the gold ornaments were delivered for making new ornaments and that the ornaments were belonging to their family was found to be not acceptable, could not have provided any nexus for drawing inference therefrom that the primary gold and gold ornaments belonged to the assessee. 6.8 In Commissioner of Income Tax vs. Lovely Exports (P) Ltd. reported in (2010) 14 SCC 761, it has been held as under:- Income from undisclosed sources - Addition under Section 68 Share application money--SLP was filed before Supreme Court and question before court was; can the amount of share money be regarded as undisclosed income under Section 68 of IT Act, 1961. Held: No merit is found in SLP for the simple reason that if the share application money is received by the assessee-company from alleged bogus shareholders, whose names are given to the AO, then the department is free to proceed to reopen their individual assessments in accordance with law. Hence, no infirmity is found with the impugned judgment. Special Leave Petition is dismissed. It cannot be regarded as undisclosed income of assesseecompany. 7. Counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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