TMI Blog2023 (9) TMI 391X X X X Extracts X X X X X X X X Extracts X X X X ..... tanding Counsel with Ms Pratishtha Choudhary and Mr Aditya Gupta, Advs. For the Respondent Through: Mr Ved Jain and Mr Nischay Kantoor, Advs. GIRISH KATHPALIA, J.: 1. These three appeals filed under Section 260A of the Income Tax Act by the revenue, having arisen out of common factual and legal matrix are taken up together for disposal. 2. We heard learned counsel for both sides and examined the written submissions. 3. Briefly stated, circumstances relevant for present purposes are as follows. 3.1 The respondents/assessees are companies forming a part of M/s Priya Gold Group of Companies. On 16.12.2014, search and seizure proceedings under Section 132 of the Income Tax Act were conducted in the case of Priya Gold Group of Companies, during which statement of Shri Shekhar Aggarwal, Director of Surya Food Agro Limited (the flagship company of the group) was recorded under Section 132(4) of the Act. In his said statement, Shri Aggarwal admitted that the said group of companies had earned unaccounted income which was routed as bogus share capital during the Financial Years pertaining to the Assessment Years 2013-14 and 2014- 15. 3.2 As assured in his sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal after recording submissions from both sides, deleted the addition related to the 2.5% commission thus : 22. With regard to ground No. 2, both the parties admitted that this ground would be consequential to the decision in ground No. 1. The Assessing Officer, apart from the addition on share capital, has also made further addition of alleged expenditure being commission for acquiring the accommodation entries in the form of share capital. Both the parties have agreed that if it is accepted that the investment in the share capital was out of the undisclosed income of M/s Surya Food Agro Limited, which is disclosed before the Settlement Commission, the same finding would be squarely applicable with regard to commission for arranging such accommodation entries. In view of the finding with regard to ground No. 1, we hold that the addition for alleged expenditure on arranging the accommodation entries in the form of share capital is also made from the undisclosed income offered and settled by M/s Surya Food Agro Limited before the Settlement Commission . 7. Hence, the present appeals. 8. The appeals are admitted on the following question of law, which arises f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompanies and the admitted position being that the proceedings before the Settlement Commission subjected the said unaccounted income to tax, which proceedings having not been challenged by either side, attained finality, subjecting the said income to tax in the hands of the respondents/assessees would be tantamount to double taxation, which is not permissible in law. 12. We have examined the judicial precedents cited on behalf of the appellant/revenue and it is found that the same are of no help to the appellant/revenue as the same stand on distinguishable footing. Unlike the present case, circumstances in the judicial precedents (except in one case) cited on behalf of appellant/revenue did not pertain to the issue of double taxation possibility. 12.1 The judicial precedent in the case Dharamdas Agarwal (supra) cited by learned counsel for appellant/revenue supports the case set up by the respondents/assessees. In the said case, placing reliance on the judgment of the Hon ble Supreme Court in the case of Anantharam Veerasinghaiah Co. vs CIT, 1980 SCR (3) 618 , it was held that when cash credits were treated as income from undisclosed sources, the assessee can take an alt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ai N. Padsala in his settlement application. Such application has been granted by the Settlement Commission by passing order of settlement. By very statutory scheme of provisions, acceptance of such income in the hands of Bhikhubhai N. Padsala would have to be preceded by payment to tax. We have therefore proceeded on the basis that the Settlement Commission accepted the said sum as income of Bhikhubhai N. Padsala and the department has already received the tax and interest on such income. That being the position, it would not be possible for the department to tax the same income once again in the hands of the present assessee. This would be for multiple reasons. Firstly, there is nothing on record to suggest that before the Settlement Commission, the declaration of Bhikhubhai N. Padsala in this respect was opposed by the Revenue. Secondly, the Settlement Commission having accepted such settlement, with or without the opposition by the Revenue, finality of the conclusions of the Settlement Commission would attached in terms of section 245I of the Act. Thirdly, the department concedes that the order of Settlement Commission has not been challenged further. Under the circumstances, a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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