9911796707
TMI Blog2016 (12) TMI 1200X X X X Extracts X X X X X X X X Extracts X X X X ..... and loan given by the assessee to Mr. N. Chhabra in UK is perverse, contradictory and based upon surmises and conjectures?" 2. The original assessee died even before the proceedings commenced. 3. The brief facts are that the assessee, Late Sh. K.M. Bijli [hereafter "Sh. Bijli"] was a tax payer. On the basis of an information received from the UK tax authority through letter dated 12.05.1989, in terms of the Indo- UK Double Taxation Avoidance Agreement [hereafter "DTAA"], the appellant/Revenue reopened the completed assessment for AY 1982-83 by reassessment notice dated 08.12.1992. Sh. Bijli died on 11.01.1992. The basis for the reopening of the completed assessment was a statement made by Bijli on 06.06.1983 to the UK revenue officials, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Kingdom? Ans. -Only money deposits in Banks. Q. No.14 - How of ten have you been to the U.K. in the last ten years. Ans. -Probably 25 in ten years - 1981 - 2 or 3 times, book at passport. A reading to the above answers makes clear that the assessee is having transport business in India, and money deposits in Banks in U.K. He visited U.K. frequently, about 2-3 times in a year. It was gathered from the investigation by the U.K. Tax Authority in the case of Kumar Bros., under their company name of Rajan Trading Co. Ltd. and during the interrogation, the deceased assessee deposed before the U.K. Tax Authority that he had bank deposits to the tune of GBP 2 Million in U.K. The U.K. Revenue authority stated that Mr. Bijli, the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition, based on the assumption that the UK GBP2 million in fact and in reality belonged to the assessee, it was urged that in the absence of any objective or cogent material, or even bank statements, the statement attributed to Sh. Bijli and his brother-in-law Sh. Kumar were ipso facto insufficient. 6. The Revenue, on the other hand, contended that these statements were made in the course of proceedings that should be treated as regular having regard to the nature of revenue loss in UK. The ITAT considered the letters written by the UK authorities dated 10.07.1989 and 11.09.1989, shared under the Indo-UK DTAA. It also took note of the letter written by the UK revenue department in reply to the letter of Joint Secretary of the Govt. of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax in the UK. The ITAT, based its conclusions on the following observations: "16. We may refer to another important aspect having a bearing on the evidentiary value of the interview notes communicated by the British Tax Authorities. Interviews with the assessee were conducted by the tax officials of Inland revenue UK at the office of Rothburn Burton & Partners, who were Tax Advisors of Shri K.K. Kumar. The interviews with the assessee were obviously informal, oral and outside the pale of tax laws of the UK. No statement has been recorded and no oath has been administered to the assessee by the Enquiry Officials. A mere informal conversation with the assessee at the office premises of his brother in law Shri K.L. Kumar's Tax advisors could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to assessment year 1982-83 under reference. With regard to loan to Shri P.N. Chhabra even the so called bank entries do not support any such addition for assessment year 1982-83. The loan has been given on 1981. There is nothing on record as to whether the advancement of the loan falls in the accounting year 1982-83. Moreover, we find from the extract of the interview containing questions and answers No.34 to 37, as reproduced above, that the assessee has transactions with Mr. Chhabra right since the year 1970 and even has received loans from him in the year 1980 or 1983. Thus, the date of the loan in question as falling during the year under reference or being out of undisclosed funds generated during the year under question is not estab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment proceedings carried out after the death of the original assessee could not have resulted in these adverse consequences. 10. This Court has considered the submissions and materials on record. No doubt, the letters received from the UK authorities were sufficient to trigger a reassessment proceedings but exactly that is where the Revenue, in our opinion, faltered. Having received information, it could well have proceeded through a reassessment proceeding at the earliest opportunity, i.e. in October 1989 or latest by December of that year, the revenue chose to wait for three years and sought to reopen at least a decade-late completed assessment. By then the assessee had died. There are certainly pointers to interesting omissions and i ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
