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Showing 281 to 300 of 467 Records
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2025 (1) TMI 187
Classification of services - restaurant services or not - supply of Cakes, bakery items, ice creams, chocolates, drinks and other eatable products prepared at the premises of the Petitioner and supplied to the customers from the counter with the facility to consume the same in the air-conditioned premises itself - composite supply or not - supply of items such as birthday stickers, candles, birthday caps, snow sprays etc. related items which are essentially used in birthday celebration - sale of handmade chocolates which are manufactured in the workshop of the Petitioner and are utilised for the purpose of providing other services such as shakes, brownies - nature and rate of tax.
Classification of services - restaurant services or not - supply of Cakes, bakery items, ice creams, chocolates, drinks and other eatable products prepared at the premises of the Petitioner and supplied to the customers from the counter with the facility to consume the same in the air-conditioned premises itself - HELD THAT:- On examining the records of the instant case, it was found that the Petitioner is supplying Cake, Ice Cream and other items of food which are made to order along with certain services. Hence the Petitioner is supplying both goods and services. In order to examine as to whether the said supply satisfies the conditions of a composite supply', it is pertinent to us to discuss the provisions of Section 2 (30) of the CGST Act - Since the supplies made by the Petitioner in its outlets involve both supplies of goods and services, with one of them as principal supply i.e. supply of goods which are naturally bundled and supplied in conjunction with each other, therefore, the same has to be considered as a composite supply. Further, Restaurant Services have been defined under the purview of composite supply (in clause (b) of para 6 of Schedule-II), the relevant extract is as under.
It is seen that the Petitioner is supplying items of food as a part of service and since the provision of eating in the premises is provided or the customers may take the same away from the place, the transactions under question are covered under the amended provision of Entry 7 (i) of Notification No. 11/2017-Central Tax (Rate), dated 28-6-2017 as amended by Notification No. 46/2017-Central Tax (Rate), dated 14-11-2017 and attracts a tax of 2.5% without any input tax credit.
Supply of items such as birthday stickers, candles, birthday caps, Balloon, Carry Bags, snow sprays etc - HELD THAT:- The said related items are being purchased and sold as such without any further processing in the restaurant. Sale of such bought out goods as such, is not a service but sale of goods. Entry No. 7(i) of Notification No. 11/2017-Central Tax (Rate), dated 28-6-2017 relating to the supply of services reads as under: “Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or drink, where such supply or service is for cash, deferred payment or other valuable consideration, provided by a restaurant, eating Joint including mess, canteen.” - Since this notification is applicable only to supply of services and not supply of goods, only Notification No. 1/2017-Central Tax (Rate) is applicable and hence all the supply of bought out goods as such which are enlisted by the Petitioner is taxable as 'supply of goods and at rates applicable as per Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017 as amended from time to time.
Input tax credit - HELD THAT:- Since the goods as specified above are supplied and output tax is payable on the same, the Petitioner is eligible to take applicable input tax credit which is admissible as per the GST laws.
Conclusions - i) The petitioner's operations qualify as 'Restaurant Services', taxed at 5% GST. ii) Items like birthday caps and decorative items are taxed as goods per Notification No. 1/2017-Central Tax (Rate). iii) The petitioner is ineligible for the Composition Scheme due to ice cream manufacturing.
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2025 (1) TMI 186
Grant of registration u/s 12AA - charitable activity - as per CIT (E) that the activities of the trust is in the nature of trade, commerce or business and covered by proviso to Section 2 (15) - HELD THAT:- Principal Commissioner or the Commissioner has to satisfy himself about the objects of the trust or institution and the genuineness of its activities as required under sub-clause (i) of clause (a) and compliance of the requirements under sub-clause (ii) of the said clause, and has to pass an order in writing registering the trust or institution and a copy of the order so passed will be sent to the applicant.
Reverting to the facts of the present case in light of the order passed by this Court in Chhattisgarh Urology Society’s case [2018 (2) TMI 1156 - CHHATTISGARH HIGH COURT] and in view of the finding of the learned ITAT, it is quite vivid that the activities of the assessee Society are for charitable purpose for public at large and in that view of the matter, the learned ITAT is absolutely justified in directing the CIT(E) to grant registration under Section 12AA of the IT Act by setting aside the order of the CIT(E), as such, the order impugned passed by the ITAT is in accordance with law.
Accordingly, the finding recorded by the CIT(E) that the activities of the respondent assessee Society is in the nature of trade, commerce or business and covered by proviso to Section 2 (15) of the IT Act was not the correct finding. Decided in favour of assessee.
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2025 (1) TMI 185
Stay application rejected - petitioner directed to deposit 20% of the demand - HELD THAT:- The respondent authorities has passed the assessment order dated 31.03.2024 passed u/s 143 (3) along with copy of demand notice issued under Section 156 against the petitioner. Thereafter the petitioner has filed an application u/s 220 (6) of the Income Tax Act, 1961 filed on 29.04.2024 before respondent No. 3. The respondent-No. 3 has not decided the case on the basis of prima facie case, balance of convenience, irreparable loss caused to the petitioner, Genuine hardship, CBDT instruction and hi-pitched assessment.
The respondent No. 3 rejected the application without reasoned and speaking order on 14.06.2024. Subsequently, aggrieved of the same, the petitioner has filed review application before the respondent No. 2/PCIT (Central) Bhopal. The respondent No. 2 has also not decided the review application on merits and passed the order to pay 20% of the tax liability by way of installments in 5 months on. 18.10.2024. Thus, the impugned orders dated 14.06.2024 and 18.10.2024 are non-speaking orders.
AO has not adopted the correct procedure in deciding the stay application and review application of the petitioner and has not followed the guidelines as stated by Bombay High court in KEC International Ltd. [2001 (3) TMI 32 - BOMBAY HIGH COURT] and in UTI Mutual Fund [2012 (3) TMI 333 - BOMBAY HIGH COURT] and also the decision rendered by this Court in M/s Aarti Sponge & Power Ltd. [2018 (4) TMI 1284 - CHHATTISGARH HIGH COURT].
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2025 (1) TMI 184
Disallowance u/s 36(1)(iii) - interest free advances given by assessee - HELD THAT:- CIT(A) has given finding that the prudent business man will never give such interest free advances, the fact remains that these are for a purchase of material and it was for conducting the business of the assessee and therefore, the same cannot be stated as certain interest free loan / advances was not rightly disallowed by the AO u/s 36(1)(iii).
In fact, the opening balance of these advances was submitted by the assessee in the details and therefore, the contention of the A.R. that such funds were not diverted towards interest free advances appears to be justifiable from the records i.e. Tax Audit Report, Financial Statements and the evidence in support of these advances given to the related parties.
Thus, the disallowance made by the AO as well as confirmed by the CIT(A) is not justifiable in light of the decision of CARGILL GLOBAL TRADING (P.) LTD. [2011 (2) TMI 209 - DELHI HIGH COURT] and SA BUILDERS LTD. VERSUS COMMISSIONER OF INCOME-TAX [2006 (12) TMI 82 - SUPREME COURT]. Thus, the appeal of the assessee is allowed.
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2025 (1) TMI 183
Assessment u/s 153C - incriminating material which was seized had to pertain to the Assessment Years in question - mandation of recording of satisfaction - HELD THAT:- Satisfaction note recorded by the AO of the searched person u/s 153C of the Act when read along with the satisfaction note recorded by the AO of the appellant u/s 153C he two are similar in content. The narration of facts of search and seizure operation, details of documents allegedly pertaining to the assessee are mirror images except for the fact that in the satisfaction note recorded by the AO of searched person, the said AO uses the words that the allegedly the seized documents ‘pertain’ to a person other than the person searched and the AO of the assessee before us record the satisfaction that the documents pertain to an information contained in the said documents ‘related’ to Shri Rajiv Agarwal, i.e., a person other than the person searched u/s 132 of the Income-tax Act, 1961.
It is very apparent from the two satisfaction notes before us that none of the alleged incriminating documents has been examined or the contents of these documents analysed in a manner to show that how these alleged documents have any bearing on the determination of total income of the assessee for a particular year for which the reassessment was initiated by issuance of notice u/s 153C r.w.s. 153A of the Act.
In the case of Canyon Financial Services Ltd. Vs. ITO [2017 (7) TMI 539 - DELHI HIGH COURT] has held that where satisfaction notes recorded by Assessing Officer of assessee and Assessing Officer of searched person were identically verdict carbon copy proceeding could not be initiated against assessee u/s 153C.
When the satisfaction notes are compared with the notice u/s 142(1) of the Act along with the annexure having analysis of the seized material, it appears that at the time of assumption of jurisdiction by way of recording the satisfaction, the AO of the assessee before us had not applied his mind while issuing the notic.
CIT(A) has erred in law by not appreciating that the impugned assessment orders in both the years were based on illegal assumption of jurisdiction on the basis of satisfaction note which was recorded without application of mind and quite in a mechanical manner. The reasons do not demonstrate how the nature of seized material has bearing on the total income of the assessee and to which assessment year particularly. The satisfaction note does not reflect any rational connection with or relevant bearing on the alleged seized material and the alleged undisclosed income of the assessee for a particular year sought to be assessed. Decided in favour of assessee.
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2025 (1) TMI 182
Reopening of assessment u/s 147 - ‘reason to believe’ or 'reason to suspect' - addition u/s 68 - HELD THAT:- AO solely relied on some unspecified and unintelligible information in the category of ‘high risk transactions’ of unsecured loans. Allegations towards escapement without giving specific particulars of the lenders is apparently in the realm of bald allegations devoid of any specific details. To reiterate, the name of the lendor(s) who are alleged to be susceptible to section 68 of the Act do not feature in the reasons recorded at all. No definitive link is present.
At the time of formation of belief, the AO is not shown to be in possession of any document of adverse nature which may led to allegations of escapement. Clearly, the AO has harboured belief on vague and non-descript hypothesis emerging from so-called analysis of any specified information collected.
No tangible material has been referred in the reasons recorded which is capable in igniting the belief towards alleged escapement. Mere identification of transactions fueling in ‘high risk transaction’ category ipso facto would not provide cause of action to invoke the drastic power of reopening of a concluded assessment. Requirement of main provision of section 147 is thus apparently not met.
AO must have reason to believe that chargeable income has escaped assessment. The expression ‘reason to believe’ is the most valuable safeguard available to prevent arbitrary exercise of jurisdiction. It is trite that the ‘reason to suspect’ cannot be equated with expression ‘reason to believe’.
The reasons recorded in the instant case, gives an infallible impression that it is a case of ‘reason to suspect’ on so-called risk transactions categorised by the automated system of the Department. rather than ‘reason to believe’.
It is well-settled that notice of re-opening can be supported by the Revenue within the confines of the reasons recorded by the AO alone.
AO cannot supplement the reasons at a later stage. Other principle which is equally well-settled and which applies in the present case is that re-opening of assessment would not be permitted for a fishing or a roving inquiry as a part of requirement of main provision of section 147 of the Act.
The purported ‘belief’ in the instant case is premised on some vague and undisclosed grounds and thus, a mere pretence. Such action does not pass the test of ‘reason to believe’. We thus, see no semblance in the action of the AO on the touchstone of main provision of section 147 of the Act. Assessee appeal allowed.
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2025 (1) TMI 181
Validity of Reopening of assessment u/s 147 - Borrowed satisfaction - AR argued that the AO had mechanically recorded the reason for reopening the case and the AO had not verified the veracity of the information received from the Investigation Wing of the Income Tax Department - AR further contended that the reassessment proceedings were based on change of opinion - HELD THAT:- This case is squarely covered by the decision of ATS Infrastructure Ltd. [2024 (7) TMI 1441 - DELHI HIGH COURT] wherein the case of Manjinder Singh Kang [2012 (6) TMI 616 - PUNJAB AND HARYANA HIGH COURT] and N. Govind Raju [2015 (8) TMI 271 - KARNATAKA HIGH COURT] were discussed and distinguished.
The case of Mehak Finvest P. Ltd. [2014 (11) TMI 56 - PUNJAB & HARYANA HIGH COURT] are also held distinguishable on the facts of the case. The decision of the Hon’ble Delhi High Court in the case of ATS Infrastructure Ltd. [2024 (7) TMI 1441 - DELHI HIGH COURT] are binding in nature as the AO was situated within the territorial and subjective jurisdiction of the Hon’ble Delhi High Court.
Thus, hold that there were no infirmities in the impugned orders and we thus, decline to interfere with. We hold that reassessment orders in these cases were bad in the eyes of the law and therefore, these are hereby quashed. Decided in favour of assessee.
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2025 (1) TMI 180
Denial of deduction u/s 10AA - inadvertent mistake in e-filing of return of income - technical error/glitch in the software used by the assessee for preparing.xml file format wherein inadvertently the deduction u/s 10AA could not be captured in appropriate column of the computation of income - fourth year of claiming of deduction.
HELD THAT:- The assessee made his elaborate submissions before the Ld. Addl./JCIT(Appeals) with evidences stating that while e-filing the return there corrupt an error due to which the deduction claimed u/s 10AA was denied even though the assessee has duly furnished Form 56F in the prescribed Form by Chartered Accountant.
Disallowance of the deduction claimed u/s 10AA of the Act arose due to a technical glitch/inadvertently the deduction could not be filled in the appropriate column of computation of Income. But the total income has been computing by allowing claimed deduction only. Upon reviewing the submissions made by the appellant and examining the data available on the system, the prima facie of the appellant's case is found to be acceptable as per the order of the Ld. Addl./JCIT(Appeals).
No valid reason to interfere with the findings given for allowing the claim of deduction u/s 10AA of the Act to the assessee which was otherwise denied due to technical glitch in e-filing the return. Decided against revenue.
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2025 (1) TMI 179
Addition u/s 69A - unexplained money - cash deposited by assessee in his bank account during the year - HELD THAT:- Assessee claims to have deposited Rs. 47,53,965/- from the various amounts kept by his wife as gifts received during the 11 years on account of marriage, marriage anniversary, celebrations on account of birthday of two children, cash received from uncle, sister, mother and brother. It is a fact that the appellant/assessee has failed to furnish the details of business activities carried by him.
As per e-filing portal, assessee filed Income-tax Returns for the years 2010-11, 2011-12 & 2015-16 only. The bank statements show that assessee conducted activities beyond assessment year 2015-16 but had not filed any ITR. The assessee has not offered income arising out of his activities for taxation. Be that as it may, in view of facts and circumstances of the case, to balance equity and to meet the ends of justice, we hold that source of cash deposits to the extent of Rs. 10,00,000/- as unexplained and remaining cash deposits to be out of explained source.
Assessee had transferred Rs. 10,00,000/- each vide entries dated 11.05.2013 & 14.05.2013 to Harbans Lal Gulati who had returned Rs. 20,00,000/- vide bank entry dated 19.01.2017 in South Indian Bank, Janakpuri stand fully explained. The deposits in bank thus represents repayment of earlier payment to Gulati. Appellant/assessee has claimed that his family members vide various bank credit entries had transferred Rs. 2,63,600/- (i.e. Rs. 2,09,600/- from his mother, Rs. 27,000/- from his wife, Rs. 17,000/- from his brother and Rs. 10,000/- from his father). As such, the additions of Rs. 23,26,003/- under section 69A is unsustainable and is deleted.
Appeal filed by assessee is partly allowed.
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2025 (1) TMI 178
Unaccounted/unexplained income - Unexplained Cash Credit u/s 69A - assessee was selected for scrutiny under CASS for the reason that there was an abnormal increase in the cash deposits during the demonetization period - HELD THAT:- AO was of the view that the assessee had inflated cash sales even prior to the declaration of the demonetization and had introduced bogus sales and had deposited cash so generated in the books of account to account for his unaccounted money, which was otherwise lying outside the books of account. While arriving at this conclusion, the AO has heavily relied on preponderance of probability and, thus, has worked on the assumption/presumption that the assessee had resorted to this kind of exercise for the purpose of depositing his unaccounted money in the Bank account through the cash book.
While doing so, as rightly pointed out by the A.R., the AO has not brought on record any single piece of evidence, which would suggest that the assessee has inflated sales so as to create cash balance in the books of account. Moreover, no deficiency has been pointed out by the AO in the books of account nor has the availability of stock been doubted. Thus, the AO has, on the one hand, accepted the sales and purchases declared by the assessee and, on the other hand, has made addition on account of bogus sales made out of books of account and deposited in the Bank account during the period of demonetization.
Undoubtedly, there has been a substantial jump in the turnover during the period of demonetization, but without there being any evidence to justify the claim of the AO that such jump in turnover was due to bogus sales having been created in the books, such claim remains a mere presumption. Although the principle of preponderance of probability is an accepted principle, but such probability has to be backed by some cogent evidence and the onus is squarely on the Department to establish that what is being said to be probable has proper evidence to support such claim. The Ld. First Appellate Authority, while dismissing the appeal of the assessee has also not considered this aspect.
AO was legally not entitled to calculate sales on a hypothetical basis completely ignoring various evidences submitted during the course of assessment proceedings in the form of VAT returns, Purchase Bills and quantitative details, etc. Once the amount has been declared in the VAT return as well and the same has also been accepted by the AO, such sales cannot be considered as concealed income. Appeal of assessee allowed.
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2025 (1) TMI 177
TP Adjustment - determination of transfer price for supply of electricity from thermal unit to washeries division of the assessee during the year - reference u/s 92CA(1) - TPO applied an average of the rate published by CSEB (as adjusted by transmission and distribution cost but not adjusted for transmission and distribution losses) and the rate of trade as per IEX (without adjusting for any transmission / distribution loss or charges) and arrived at the rate of Rs 2.868 per unit to be the ALP - fair market value for the transfer rate of power or the selling rate of power in the industry by CSEB is Rs 4.05 per unit - HELD THAT:- Whether the said rate of Rs 4.05 per unit being the prevailing market rate could be used for transfer of electricity between two units of the same Assessee for captive consumption was subject matter of consideration by the Hon’ble Supreme Court in the case of CIT vs Jindal Steel & Power Ltd [2023 (12) TMI 417 - SUPREME COURT] as held market value of the power supplied by the State Electricity Board to the industrial consumers should be construed to be the market value of electricity. It should not be compared with the rate of power sold to or supplied to the State Electricity Board since the rate of power to a supplier cannot be the market rate of power sold to a consumer in the open market. The State Electricity Board's rate when it supplies power to the consumers have to be taken as the market value for computing the deduction under section 80-IA of the Act.
Thus, Tribunal had rightly computed the market value of electricity supplied by the captive power plants of the assessee to its industrial units after comparing it with the rate of power available in the open market i.e., the price charged by the State Electricity Board while supplying electricity to the industrial consumers.
In the present case before us, the market value is Rs 4.05 per unit being the rate charged by CSEB on the industrial consumers, whereas the transfer price between two units of the assessee was Rs 4 per unit. The same is well within the market rate of Rs 4.05 per unit and hence the price of Rs 4 per unit is to be construed to be at ALP. Accordingly, no transfer pricing adjustment is warranted.
Addition towards Employees contribution to PF and towards disallowance of depreciation on the ground that the said figures does not even pertain to the assessee before us - AR was very fair in stating that the said issue may be restored to the file of Learned AO for denovo adjudication for adopting the correct figures in accordance with law after considering the facts and figures pertaining to the assessee and make an addition if warranted.
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2025 (1) TMI 176
Validity of reopening of assessment as barred by limitation - period of six years expired - HELD THAT:- The notice u/s.148 issued on 27/07/2022 is clearly barred by limitation. The reason being the test for checking the time limit and the validity of notices issued u/s.148 under new regime applicable from A.Y. 2021-22 and prior regime is, whether period of six years had expired at the time of issue of such notice or not. In the case of assessee, the period of six years had expired on 31/03/2022 and consequently, the notice dated 27/07/2022 is clearly barred by limitation and on this ground, the assessment proceedings u/s.147 is hereby quashed.
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2025 (1) TMI 175
Assessment u/s 153A - Invalid approval granted u/s 153D - as argued approval granted by the superior authority u/s 153D is non-est approval being a mechanical and a perfunctory approval and suffers from the vice of non-application of mind - HELD THAT:- On a perusal of the approval addressed by the Ld. Addl. CIT to the AO, it emerges that the Ld. Addl.CIT has not uttered a word on the subject matter of additions. The approval is in the nature of Performa approval; the approval granted smacks of mechanical or perfunctory approval in a symbolic exercise of powers vested u/s 153D of the Act.
Approval memo is totally silent on the issues involved and has granted omnibus approval without any thoughtful process being discernible. The Order Sheet has not docketed any interaction or directions of the Ld. Addl. CIT in the course of assessment either. There is no other material to show involvement of the superior authority in the course of assessment.
In the first para of the approval memo, it is mentioned that draft assessment order has been received for approval and in the second para of the approval memo, it was stated that the draft assessment order has been approved. Nothing else is discernible. Such mechanical approval cannot be countenanced - the assessment order based on ritualistic approval stands vitiated and thus quashed. Assessee appeal allowed.
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2025 (1) TMI 174
Income deemed to accrue or arise in India - taxability of administrative support service charges as fees for technical services (FTS) in terms of Article 13 of Double Taxation Avoidance Agreement (DTAA) between India – United Kingdom (UK) - HELD THAT:- As decided in assessee’s own case in A.Y. 2012- 13. [2023 (3) TMI 1485 - ITAT MUMBAI] the services provided by the group entities or holding company to its subsidiaries as support services to run their business effectively will not be considered as FTS or FIS under the treaty and these services does not amount to make available technical or skill or expertise while providing these services.
Thus the services provided by the assessee to its subsidiaries are only to support to function the administration and day to day management of JIPL considering the fact that JIPL does not have any infrastructure to carry out any administration and day to day management. These facts are confirmed by the lower authorities and also facts on record. Therefore, these services are outside the ambit of FIS and FTS. Hence we are incline to allow the grounds raised by the assessee.
Taxability of reimbursement of expenses as FTS under Article 13(4) of India-UK treaty - As decided in assessee’s own case in A.Y. 2012- 13 [2023 (3) TMI 1485 - ITAT MUMBAI] we hold that reimbursement of expenses cannot be treated as FTS. Accordingly, we uphold the decision of learned first appellate authority by dismissing the grounds raised.
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2025 (1) TMI 173
Revision u/s 263 - TDS u/s 194I or 194C - Payment in nature of external/infrastructure development charges to HUDA - liability u/s 201/201(1A) - HELD THAT:- The issue under consideration is already pending before ld. CIT(A) and the issue under consideration is not settled considering the fact that Hon’ble Supreme Court has stayed the operation of Hon’ble Delhi High Court decision in the case of Puri Construction (P.) Ltd. [2024 (2) TMI 756 - DELHI HIGH COURT]
The issue under consideration is payment of EDC to HUDA which is pending before first appellate authority where the provisions of section 194I or 194C can also be the point of adjudication. PCIT found that it is against the law and also observed that it is against the interest of Revenue.
After careful consideration, we are of the view that the slab at which the AO calculated liability u/s 201/201(1A) is at 10% considering the same as rental payment. However, ld. PCIT has cancelled the relevant assessment order following the provisions of section 194C for which slab of 2% is applicable. It is not against the interest of Revenue.
We observed that the order passed by the AO is not erroneous when the same was passed and also this is a debatable issue not settled considering the fact that the issue was pending before CIT (A) and also PCIT should not have proceeded to initiate proceedings u/s 263 when the same was pending before the ld. CIT (A). Let alone the fact that there is no prejudicial to the interest of Revenue in this case. Therefore, we are inclined to set aside the order passed u/s 263. Assessee appeal allowed.
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2025 (1) TMI 172
Validity of reopening of assessment in the absence of proper service of notice u/s 148 - HELD THAT:- No notice u/s. 148 was ever served on the assessee. The AO without service of mandatory notice u/s. 148 of the Act, proceeded to complete the assessment. The proceedings u/s. 147 of the Act without mandatory notice u/s. 148 of the Act are bad and liable to be quashed.
As in the case of CIT vs. Laxman Das Khandelwal,[2019 (8) TMI 660 - SUPREME COURT] has held that provisions of section 292BB of the Act does not save complete absence of notice u/s. 148 of the Act. In the instance case since there was no service of notice u/s. 148 of the Act nor the assessee was provided the reasons for issuance of notice u/s. 148 of the Act, the assessment order passed in the instant case is held to be without jurisdiction. Appeal of the assessee is allowed.
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2025 (1) TMI 171
Addition u/s 68 - unexplained cash credit being share capital/ share premium - person/investors has not appeared before the AO - assessee company/investors did not comply with summon u/s 131 by producing the director / principal officer/ individual of the share subscribing companies - HELD THAT:- The assessee has furnished all the evidences proving identity and creditworthiness of the investors and genuineness of the transactions but AO has not commented on these evidences filed by the assessee. Besides the investors have also furnished complete details/evidences before the AO which proved the identity, creditworthiness of investors and genuineness of the transactions.
Similar ratio has been laid down in the case of CIT Vs Orchid Industries (P) Ltd [2017 (7) TMI 613 - BOMBAY HIGH COURT] by holding that provisions of section 68 of the Act cannot be invoked for the reasons that the person has not appeared before the AO where the assessee had produced on records documents to establish genuineness of the party such as PAN, financial and bank statements showing share application money.
Crystal Networks Pvt. Ltd. [2010 (7) TMI 841 - KOLKATA HIGH COURT] wherein it has held that where all the evidences were filed by the assessee proving the identity and creditworthiness of the loan transactions, the fact that summon issued were returned unserved or no body complied with them is of little significance to prove the genuineness of the transactions and identity and creditworthiness of the creditors. Assessee appeal allowed.
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2025 (1) TMI 170
Unexplained investment - Relying on the seized material the assessment u/s 153C was completed - assessment order passed by the AO for want of Certificate u/s 65B of IE Act by relying electronic evidence for completing assessment u/s 153A - HELD THAT:- In the instant case, admittedly there is no certificate under section 65B of the Indian Evidence Act, 1872. Thus, the evidence in the form of a print out taken from the phone owned by another person, if was to be relied for completion of assessment of assessee, the certificate in terms of section 65B of the Indian Evidence Act, 1872 was necessary. That not being there the alleged incriminating document when taken out of case of the ld. AO, nothing is left to draw any inference of payment of any on money amount.
In a case like this, where the alleged seized material extract as reproduced in the assessment order seems to be not quite legible and Department had to prepare a special coloured copy of the same, so that this bench can be appraised of the content, that all the more required the certificate u/s 65B of the Indian Evidence Act.
If this piece of document is considered, the same has no signatures of the assessee or even Shri Anil Narang. There is no separate piece of evidence establishing the handwriting to be of Shri Anil Narang or the assessee. As we go through the contents there are no corroborating facts to establish that any on money was paid separately. The ld. AO himself mentions that when Shri Anil Narang was confronted with this document and his statement u/s 131(1A) of the Act was recorded, Shri Anil Narang had deposed that he is unable to understand the document. As with regard to the transaction also he had shown his ignorance.
There is no independent inquiry also by the AO of the fact that the value of the property was otherwise thrice at Rs. 1,67,00,000/- than the amount paid by the assessee of Rs. 67,50,000/- by way of banking transactions. Thus being a case of no evidence, the addition is not sustainable under law. Assessee appeal allowed.
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2025 (1) TMI 169
Validity of Revision proceedings against company dissolved/insolvent - HELD THAT:- We find that provisions contained u/s 238 of “the Code” are having an overriding effect over all other Central and State statutes including Income Tax Act as held by Hon’ble Supreme Court in case of PCIT vs. Monnet Ispat and Energy Ltd. [2018 (8) TMI 1775 - SC ORDER]
Section 238 of the Code will have overriding effect over all other Central and State statutes including the Income Tax Act and all the claims including claim of the Income Tax Department under the Income Tax Act, 1961 shall be entertained by the Official Liquidator u/s. 53(1) of the Code.
Appeal filed by the assessee has become infructuous and dismissed as such. However, the assessee is at liberty to approach the Tribunal for reinstitution of the appeal and the Tribunal shall consider such application appropriately, as per law.
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2025 (1) TMI 168
Addition u/s 69A - Cash deposited into the Bank accounts during the demonetization - HELD THAT:- From the bank statements filed by the assessee, is clear that assessee had withdrawn cash from the banks which was finally deposited when demonetisation was announced.
CBDT wide instruction number 3/2017 dated 21/02/2070 announced that, any taxpayers above 70 years of age was allowed to deposit the cash upto ₹ 5 lakh per person and the source of such amount can either be household savings or savings in the past income. Thus to the extent of ₹ 5 lakh the disallowance made is not justified.
Women have a tendency of accumulating cash saved from household budgets and from whatever cash they receive from relatives and family members during festivals and occasions. Honourable Prime Minister and also CBDT considering this aspect had announced that a lady assessee is a housewife and do not have any business would not be questioned if the bank deposits during the demonetisation were found to be less than 2.5 lakhs.
In the present facts of the case considering the age of the assessee and the tendency to hold onto the cash at that age cannot be overlooked. Assessee has filed bank statements that are self-explanatory regarding the withdrawals which was held by the assessee as on the date of demonetisation being declared.
Hence assessee has duly explain the source of balance 5 Lakh cash deposited into the accounts, and therefore no addition can be made u/s 69 unless there is a cogent evidence to prove that the amount deposited in the bank account was undisclosed income that falls outside the bank statements filed by the assessee. Decided in favour of assessee.
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9911796707
