9911796707
TMI Blog2021 (9) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... al, Allahabad Bench, Allahabad(hereinafter called " the tribunal"), reads as under: "1. BECAUSE the "CIT(A)" has erred in law and on facts in upholding the demand that had been raised against the "appellant", in terms of order dated 23.10.2015 passed by the Asstt. CIT, Central Circle, Allahabad under section 143(3) read with section 245D(4). 2. BECAUSE the demand so raised against the "appellant", which was made up of (Rs.) (a) Tax Payable 89,20,544 (b) Interest under section 234A 1,05,785 (c) Interest under section 234B 57,12,930 was erroneous at the very face of it, as the same has been arrived at without giving full credit to "taxes paid", which had a bearing on computation of interest under sections 234A & 234B also. 3. BECAUSE in any case, while giving direction to the Assessing Officer "to allow credit for taxes paid after due verification" the "CIT(A)" should have held that due and corresponding corrections in the quantum of interest levied under section 234B and 234C should also be allowed. 4. BECAUSE interest under section 234B could not have been levied in the instant case as gross demand of Rs. 1,07,09,544/- (before levy of inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... izure operations against the tax-liability determined on assessment, and hence no interest be leviable u/s 234B of the 1961 Act. The interest u/s 234B amounting to Rs. 57,12,930/- was levied by the AO vide orders dated 21.10.2015, which was later confirmed by ld. CIT(A) vide appellate order dated 29.09.2016, wherein contentions raised by assessee were rejected by ld. CIT(A) . Aggrieved, the assessee has filed an appeal with tribunal. The assessee was issued notice u/s 153A by the AO on 28.02.2013 directing assessee to file return of income for ay: 2011-12, by 15.03.2013. The assessee did not file return of income for ay: 2011-12 in pursuance to notice dated 28.02.2013 issued by the AO. Thereafter, the AO issued another notice dated 15.07.2013 u/s 153A directing assessee to file return of income for ay: 2011-12, by 22.07.2013. The assessee did not file return of income by 22.07.2013, in pursuance to notice issued by AO dated 15.07.2013 u/s 153A of the 1961 Act. The assessee, however, filed its return of income for ay: 2011-12 on 17.09.2013. The assessee has claimed that Revenue did not supplied the copies of seized material and statements recorded during the course of search despite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by assessee on 17.09.2013, the assessee sought adjustment of the cash seized during search operations, against the liability computed to be payable by assessee itself towards tax and interest computed in the return of income filed with Revenue on 17.09.2013, for the impugned ay:2011-12 as well other ay's 2006-07 to 2010-11. The assessee, thereafter, initiated proceedings before Settlement Commission by filing an application on 19/20.03.2014 . The assessee filed revised computation of income before Settlement Commission declaring income of Rs. 85,82,279/-, which included additional income declared before Settlement Commission in SOF to the tune of Rs. 26,54,601/-. The proceedings before Settlement Commission culminated into an order dated 23.09.2015 passed by Settlement Commission u/s 254D(4) of the 1961 Act, wherein the income of the assessee was settled at Rs. 3,51,45,385/- for impugned ay: 2011-12. It is pertinent to mention that the income as per return of income filed by the assessee with AO, was Rs. 59,27,677/-, while the additional income offered by assessee in the SOF filed before Settlement Commission was Rs. 26,54,601/- and further additions were made by Settlement Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed during the search operations in timely manner,despite request made by assessee, which led to delay in filing of return of income and no fault can be attributed to assessee, thus it cannot be said that the assessee delayed the filing of return of income and consequently Revenue cannot penalize assessee by charging interest u/s 234A of the 1961 Act . We have carefully gone through the entire material placed before the tribunal. It is observed from perusal of the para 8 of the said letter dated 06.04.2011 claimed to have been filed by Shri Suresh Chandra Purwar before the Director of Income-tax(inv.), Kanpur wherein it was claimed by Shri Suresh Chandra Purwar that the said cash of high denomination currency notes of Rs. 1,000/- each aggregating to Rs. 50,33,000/- found and seized belonged to him . It was claimed that the said sum was received over a period of years under various heads and on a number of occasions. It was claimed by Shri Suresh Chandra Purwar that the said amount of Rs. 50,33,000/- did not attract taxation, looking to the period of requisition as well as nature thereof. It was also claimed in para 12 of the aforesaid letter dated 06.04.2011 that the said cash seize ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... coming to letter dated 17.09.2013 which is claimed to have been filed by assessee before the AO along with the return of income filed on 17.09.2013, it is claimed that there is no warrant of authorization issued by the Revenue in the name of the assessee viz. Suresh Chandra Purwar, HUF, which it is claimed is a separate taxable entity. Thus, it is claimed that the assessee was never subjected to search and seizure operations conducted by Revenue, u/s 132(1) of the 1961 Act. Thus, legal challenge was made to notice issued by AO u/s 153A of the 1961 Act, to be not enforceable in the eyes of law. Thereafter, the assessee submitted, without prejudice, that there was a delay in providing of seized material and statements to the assessee by Revenue which material was provided in parts and the process continued till June 2013, which has led to delay in analyzing the said documents/statements to arrive at income, and hence it could not be said that return of income filed in pursuant to notice u/s 153A are delayed returns. It was also claimed that the karta of the assessee Shri Suresh Chandra Purwar is suffering from serious disease, for which he was operated upon which also led to delay i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the said cash seized was from realizations from business activities which had been discontinued after the death of father in 1996 and realizations on account of sale of agricultural land/land under cultivation of his father during his life time and sale of agricultural land as inherited by assessee's wife after death of his mother. Thirdly, the assessee did not file declaration of true income, rather the Settlement Commission rejected all the contentions of the assessee and further brought to tax, inter-alia, cash seized from residence and lockers aggregating to Rs. 2,60,49,000/- in the hands of the assessee. Our view is further strengthened wherein the assessee while filing return of income on 17.09.2013, computed interest of Rs. 3,75,496/- payable by it. However, at this stage it offered for adjustment of tax and interest liability of Rs. 38,67,145/- against cash seized during search operations. Thus, as late as on 17.09.2013, when the assessee filed its return of income on 17.09.2013, the assessee has owned up cash seized of Rs. 50,33,000/- being high denomination currency notes of Rs. 1000/- each as its additional income for ay: 2011-12, and the assessee sought adjustment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional income was brought to tax by Settlement Commission, and since this liability was fastened in September 2015, the assessee will be liable to pay interest u/s 234B till the order was passed by Settlement Commission in September 2015 bringing to tax additional income, owing to untrue declaration of income filed by assessee before Settlement Commission. Reference is drawn to provisions of Section 234B(2A)(b) of the 1961 Act. The AO is directed to compute liability of interest u/s 234B to this effect . So far as the contentions of the Revenue that there was amendment by Finance Act, 2013, w.e.f. 01.06.2013 wherein Explanation 2 to Section 132B was inserted and cash seized could not have been adjusted against advance tax liability, the said amendment is held to be prospective in nature and not applicable to cases prior to 01.06.2013. The SLP filed by Department against judgment of Hon'ble Punjab and Haryana High Court in the case of CIT v. Cosmos Builders and Promoters Limited((2016)76 taxmann.com 374(P&H)) and Hon'ble Allahabad High Court in the case of Sunil Chandra Gupta (2016) 76 taxmann.com 372(Alld), have been dismissed by Hon'ble Supreme Court ((2016) 76 taxmann.com 377(SC) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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