Feedback   New User   Login      
Tax Management India. Com TMI - Tax Management India. Com
Acts / Rules Notifications Circulars Tariff/ ITC HSN Forms Case Laws Manuals Short Notes Articles SMS News Highlights
        Home        
Extracts
Home List
← Previous Next →

Sh. Ganpati Synthetics (Pvt.) Ltd. Versus ACIT, Circle-V, Amritsar

2018 (1) TMI 584 - ITAT AMRITSAR

Proceedings under 153A - G.P. determination - enhancement of GP rate - Settlement Commission empowered to reopen the completed proceedings- Held that:- No doubt that the assessment proceeding relevant to the Ass. Year 2004 related to the assessee was completed and not specifically reopened by the Settlement Commission by giving any reason, however, according to Sec.245E, before 1st Day of June, 2007, the Settlement Commission was fully empowered to reopen the completed proceedings, as in the ins .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

dated 07.03.2014 covering the assessment order under appeal qua A.Y. 2004-05 and while giving effect to the said order passed by the Settlement Commission, the Ld. DCIT has already passed an order u/s 153A r.w.Sec.245D (iv) of the I.T. Act 1961, therefore, we are of the considered opinion, keeping in view of the mandates of the Sec.245-C, 245E and 245-I and in order to end the litigation, impugned order under challenge passed by the Ld. CIT(A) is liable to be set aside . - I.T.A No.04(Asr)/2015 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rcumstances of the case, grossly erred in law and on fact in:- i.) upholding the rejection of the trading results, ii) upholding the Addition made by the Ld. A.O. by applying G. P. Rate of 8% and iii) making further enhancement of ₹ 10,90,350/- by applying G. P. Rate of 9%. 2. That the accounts made by the Appellant were correct and complete and the method of accounting was regularly followed and the accounts were wrongly rejected without any specific finding for applying the provisions 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

he assessment year under appeal also i.e. A.Y.2004-05. The order of the Settlement Commission was final and no further addition can lawfully be made. 5. That in any case, all the additions made by the Ld. A.O. and the Ld. CIT(A) are unjust, unlawful and the same are not supported or justified by any material on record. 6. That all the replies filed and the details furnished on record were not properly considered and judicially interpreted and the additions have been wrongly made and the same are .....

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 G.P rates of 6.43% in A.Y.2003-04, 7.01% in A.Y. 2002-03 and 8.35% in A.Y. 2001-02. The assessee filed its return of income on 31.10.2004 declaring total income of ₹ 11,31,540/- and the return was accompanied by Audit Report u/s 44AB, Balance Sheet, Trading and Profit & Loss Account etc. The case was processed u/s 143(1) of the I.T. Act. During the course of hearing on 08.12.2006, the assessee was asked to explain as to why the trading results declared in the return of income should .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he assessee has also drawn the attention of the AO to the appellate order passed by the CIT(A) CIT(A), for A.Y. 2003-04 in which the rejection of books of account was held as improper. After considering the submissions of the assessee, trading result was rejected and finally the Assessing Officer estimated the G.P rate @ 8% (on the basis of earlier G.P. rate) which worked out the gross profit at ₹ 87,22,800/- and was subjected to the taxation purposes. 3. Feeling aggrieved against the asse .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

u/s 132 at all the premises of the assessed group i.e. business premises of the above company and the business premises of the sister concerns and the residential premises of its directors/partners and family members wherein some loose documents, unaccounted purchase bills, unaccounted stocks and jewellery etc. were found. 3. The assessee group has gone into settlement before the Settlement Commissioner and ultimately, the undeclared income was settled for all the cases of the group including ab .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of the facts and circumstances of the case and the order passed by the settlement commission, it is respectfully submitted that the addition called for A.Y.2004-05, if any, is already made and covered by the orders passed by the Hon ble Settlement Commission and, therefore, no separate addition is called for. It is, therefore, humble requested that the total addition made by the Asst. CIT by assessment order dated 18.12.2006 for A.Y. 2004-05, may kindly be deleted. The Ld. CIT(A) while going th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ncome at ₹ 24,62,898/- against the declared income of ₹ 11,31,540/- and thereafter search u/s 132 was taken place at all the premises of Aassessee s group i.e., business premises of Assessee and its sister concerns and the residential premises of its directors/partners and family members, wherein some loose documents, unaccounted purchase bills, unaccounted stocks and jewellery etc. were found. Thereafter, the assessee group had gone into settlement before the Settlement Commission a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rcle, Amritsar vide his order dated 28th Jan. 2014 and the Asst. Order u/s 153A supersedes the original assessment order for which the appeal was pending before the ld. CIT(A) . During the search, some unaccounted purchase bills were seized and the Hon ble Settlement Commission had worked out the addition @ 9% on the value of such bills for the Asst. Year only to which the bills were related and for other assessment years, the Hon ble Settlement Commissioner had accepted the trading result but m .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

8%. The assessee company was engaged in the business and printing in which grey cloths were purchased and sold after dying and printing process. All sales and purchases are duly vouched and stock tallies are maintained and same were furnished before the Assessing Officer. No defect was found either in purchases or sales or in the stock tallies and the addition was made on the basis of guess work that the declared G.P. Rate of 6.73 was low. The books were wrongly rejected and the addition as well .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

books of account while giving reasoning to the effect that (a) There is variety of clothes (rate-wise) and there is huge variation in their rates buy there is no record. (b) There is no day-to-day record about the quality/quantity of cloth and the chemicals used for their purpose. (c) There is no record co-relating the purchase with the sales And finally the Assessing Officer determined that it is impossible to co-relate sales with stock register regarding valuation and correct income cannot be .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rejection of books of accounts. It was further argued by the ld. D.R. that while coming to the instant case, the Assessing Officer rightly held that correct income cannot be computed in the absence of proper books of account and day to day stock particulars as the assessee has not maintained quality/quantity wise records of manufacturing, purchases, sales and all the production. In view of the aforesaid judgment the Ld. AO was right in rejection of books of account. Further the Ld. DR argued th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

g to the said judgment, the settlement commission has no power to reopen the completed proceedings at the instance of the assessee, and settlement commission can reopen the assessment only in those cases where it is found that it is necessary and expedient for the purpose of disposal of the case pending before it, however, this too can be done only if it is in the interest of Revenue and in such case concurrence of the assessee is required. It was further submitted by the ld. D.R. that in the in .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

even the same was challenged before the Ld. CIT(A), therefore, it cannot be construed that the assessment proceeding was not completed. The Ld. DR further drawn our attention to the clause 65.3, 65.4 & 65.5 of Circular No.7/2003 dated 05.09.2003 which are reproduced herein below and submitted that appeal, revision or rectification proceedings pending on the date of initiation of search u/s 132 or requisition shall not abate and it is also clarified that the assessment or reassessment made u .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Assessing Officer shall issue notice to such person requiring him to furnish, within such period as may be specified in the notice, return of income in respect of six assessment years immediately preceding the assessment year relevant to the previous year in which the search was conducted under section 132 or requisition was made under section 132A. 65.3.C The Assessing Officer shall assess or reassess the total income of each of these six assessment years. Assessment or reassessment, if any, re .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

shall apply to the assessment or reassessment made under section 153A. It is also clarified that assessment or reassessment made under section 153A shall be subject to interest, penalty and prosecution, if applicable. In the assessment or reassessment made in respect of an assessment year under this section, the tax shall be chargeable at the rate or rates as applicable to such assessment year. 65.3.D The new section 153B provides for the time limit for completion of search assessments. It prov .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e case as it is not in controversy that the assessment relevant to the Asst. Year: 2004-05 was made on 18.12.2006 by the Assessing Officer and thereafter, the same was challenged before the Ld. CIT(A) on dated 12th Jan, 2007 and thereafter during the pendency of appeal itself, the search was conducted at the business and residential premises of the assessee and its sister concerns on 16.03.2007 and an application for settlement was filed before Settlement Commission only on 27.05.2007. Before go .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sclosure of his income which has not been disclosed before the Assessing Officer, the manner in which such income has been derived, the additional amount of income-tax payable on such income and such other particulars as may be prescribed, to the Settlement Commission to have the case settled and any such application shall be disposed of in the manner hereinafter provided Section 245(D) prescribed the procedure to be followed on receipt of an application under section 245C:- 245D. (1) On receipt .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

245E prescribes the powers of Settlement Commission to reopen the completed proceedings:- 245E. If the Settlement Commission is of the opinion (the reasons for such opinion to be recorded by it in writing) that, for the proper disposal of the case pending before it, it is necessary or expedient to reopen any proceeding connected with the case but which has been completed under this Act by any income-tax authority before the application under section 245C was made, it may, with the concurrence 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

vided further that no proceeding shall be reopened by the Settlement Commission under this section in a case where an application under section 245C is made on or after the 1st day of June, 2007. Further, Section 245-I enumerated the order of settlement to be conclusive. 245-I. Every order of settlement passed under sub-section (4) of section 245D shall be conclusive as to the matters stated therein and no matter covered by such order shall, save as otherwise provided in this Chapter, be reopene .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ng Officer shall issue notice to such person requiring him to furnish, within such period as may be specified in the notice, return of income in respect of six assessment years immediately preceding the assessment year relevant to the previous year in which the search was conducted under section 132 or requisition was made under section 132A. The Assessing Officer shall assess or reassess the total income of each of these six assessment years. Assessment or reassessment, if any, relating to any .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the assessment or reassessment made under section 153A. It is also clarified that assessment or reassessment made under section 153A shall be subject to interest, penalty and prosecution, if applicable. In the assessment or reassessment made in respect of an assessment year under this section, the tax shall be chargeable at the rate or rates as applicable to such assessment year. The new section 153B provides for the time limit for completion of search assessments. It provides that the Assessin .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

2001-02 to 2007-08 without mentioning the fact that the assessment of the A.Y. 2004-05 has already been completed. The Settlement Commissioner while computing the income u/s 245D(4) of the Act of the assessee for the Asst. Year 2004-05, determined at ₹ 12,57,540/- instead of ₹ 11,31,540/- which was shown by the Assessee in its return of income and the DCIT, Central Circle, Amritsar while giving effect to the order of the Hon ble Settlement Commission, New Delhi assessed the income a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

proached at any stage of case by an assessee and further Sec. 245A prescribes that every order of Settlement Commission passed by the Settlement Commission under sub-section 4 of Sec.245D shall be conclusive as to the matter stated therein and no matter covered by such order shall save as otherwise provided in this chapter be reopened in any proceeding under this Act or under any law for the time being in force, which goes to show that order of settlement to be considered as conclusive and in or .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ay, with the concurrence of the applicant, reopen such proceeding and pass such order thereon as it thinks fit. Further provided certain limitation of nine years in reopening of proceeding and no proceeding shall be reopened by the Settlement Commission under this Section in a case wherein application u/s 245C is made on or after 1st Day of June, 2007. While coming to the instant case, no doubt that the assessment proceeding relevant to the Ass. Year 2004 related to the assessee was completed an .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Discussion Forum
what is new what is new
 


Share:            

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members ||

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

Go to Mobile Version