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TMI Blog2008 (9) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... red in holding that the contracts with the sister concerns were sham transactions? (3) Whether the Tribunal erred in holding that the appellant had diverted its income to sister concerns? (4) Whether the Tribunal erred in applying section 6 of the Indian Evidence Act when the assessee had filed its return in a statutory form as required? (5) Whether the Tribunal erred in confirming the Commissioner's order for one charge when the penalty order was for another charge and the show-cause notice was for still another charge? (6) Whether the Tribunal erred in holding that Explanation 1 to section 271(1)(c) was applicable in this case? (6A) Whether the Tribunal erred in holding that the appellant's transactions with sister concerns were sham ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner (Appeals) and the Tribunal but did not succeed. The Tribunal's order in quantum proceedings was brought before this court by way of Income-tax Reference No. 220 of 1989 wherein the following question of law was raised. "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in finding that tax was avoided without ascertaining whether there is any revenue loss on account of non-inclusion of the income in question in the assessee's assessment and its inclusion in the assessment of the sister concerns?" 6. The High Court, vide its judgment rendered on July 14, 2003, answered the question in the affirmative, i.e., in favour of the Revenue and against the assessee. 7. The quantum proceedings have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on the concept of double taxation suffers from an inherent infirmity inasmuch as it proceeds on the erroneous presumption that the Revenue is debarred from assessing the income belonging to the assessee in the hands of the assessee on the ground that the said income has been declared by another person and the same has been assessed by the Assessing Officer. It is well established by various judicial pronouncements of the hon'ble Supreme Court as well as the other High Courts that when an assessee shows certain income in his return, the Revenue does not act inconsistently if it accepts the return of that assessee on its face value and at the same time tax that income in the hands in which it ought really to be taxed. Reference in this cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess of whether the same income has been declared and taxed in the hands of a different person. In so far as assessment proceedings are concerned, there can be no dispute with the aforesaid proposition. 11. However, when the issue is raised in penalty proceedings the factum of the very same income having been offered for tax by different entity and having been taxed substantially in the hands of other entity becomes a relevant factor for determining whether the assessee has concealed the said income or furnished inaccurate particulars regarding the said income which has already been taxed after being shown in the hands of different entity, namely, other than the assessee. The court does not intend to convey that in each and every case, in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various submissions were made by both the sides. But the court finds that for recording a correct and complete finding, the appeal is required to be restored to the file of the Tribunal instead of sending only one issue to be decided by the Tribunal. Therefore, all respective contentions available to both the sides on facts and in law are left open without recording any opinion in this regard so as to enable the parties to raise all the contentions of facts and law before the Tribunal when the appeal is heard by the Tribunal. This is necessary as the issues are interlinked and any segregation, or partial decision may result in prejudice to one or the other side. 14. In the circumstances, in the light of the view that the court has ad ..... X X X X Extracts X X X X X X X X Extracts X X X X
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