9911796707
TMI Blog2024 (3) TMI 1419X X X X Extracts X X X X X X X X Extracts X X X X ..... 0,86,330/-. The case of the petitioner was selected for limited scrutiny under E-assessment scheme for verification of expenses incurred for earning exempt income and Share capital/other capital. Assessment was finalized and the assessment order u/s. 143(3) of the Income Tax Act,1961 (for short 'the Act') was passed on 23.03.2021 accepting the returned income as assessed income. 4.2 On 21.03.2022, respondent has issued notice u/s 148A(b) of the Act for re-assessment of income for A.Y. 2018-19. The main contention for re-opening of the case was that objections were raised by the Comptroller and Auditor General of India that it was observed from the Balance sheet as on 31.03.2018 that assessee was engaged in share trading business and hence the same should be shown as business income and not capital gains. Further, it was also observed that assessee has received huge dividends from Concord Biotech Limited which is unlisted company. For claiming the benefit of exemption w/s 10(38) of the Act, STT must be paid at the time of sale of shares. As no details were available regarding details of shares sold, name of shares, STT paid, etc. the claim of Long Term Capital Gains of Rs. 20,27,41 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as failed to consider that the petitioner has not offered any Long-Term Capital Gain by claiming exemption under section 10(38) of the Act amounting to Rs. 20,27,41,312/- earned by the petitioner by selling the bonus shares of Hindustan Petroleum Corporation Ltd. and the petitioner has already paid as the shares sold were bonus share and the cost of acquisition was considered as only, moreover, the petitioner also paid the STT of Rs. 2,03,306/- on the sale of those shares duly reflected in the contract note issued by the share broker of the petitioner. 5.1 It was further submitted that the reopening of the case of the petitioner is based upon the audit objection raised by the Comptroller and Auditor General of India on the basis of dividend received statement and therefore the impugned notice is issued on the borrowed satisfaction without application of mind. 5.2 It was submitted that the contention of the respondent-Assessing Officer that the petitioner cannot claim exemption under section 10(38) of the Act is without any basis on the ground that the petitioner was engaged in the business of share trading and therefore, such income earned by the petitioner ought to have been con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on-1(ii) of section 148 of the Act. 5.6 It was submitted that the respondent Assessing Officer without considering the reply of the Assessee has passed the impugned order dated 07.04.2022 under section 148A(d) of the Act. 5.7 It was also submitted that notice under section 148A(b) was issued on 21.03.2022 asking the petitioner to file reply on or before 28.03.2022 giving only six days' time to respond which is contrary to the provision of section 148A (b) of the Act which requires the Assessing Officer to issue notice to show cause providing minimum seven days' time and accordingly the notice under section 148A(b) is invalid. Reliance was placed on the decision of CIT vs. Amit K. Jain in Tax Appeal No. 243/2007 in support of his submissions. 6. On the other hand, learned advocate Mr. Nikunt Raval for the respondent submitted that information was placed on the inside portal under the category "High Risk CRIU/ VRU cases" for the financial year 2017- 2018 in accordance with the risk management strategy formulated by the Board which falls under the definition of information as per clause (i) of Explanation-1 to section 148 of the Act. 6.1 It was submitted that information was also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... details of the information and enquiry, if conducted, are enclosed with this notice in Annexure A. 2. You are required to show-cause as to why, in view of the details contained in Annexure A, a notice section 148 of the income tax Act, 1961 should not be issued. 3 You may, to the extent technologically feasible, submit your response with supporting documents (if any) on the above mentioned issues electronically in 'e-proceeding' facility through your account in e filing portal at your convenience on or before 28/03/2022............" 9. On perusal of the above notice, it is clear that the Assessing Officer has provided less than seven days time to file reply and to show cause as to why in view of the details contained in Annexure A, notice under section 148 of the Act should not be issued. 10. This Court in case of CIT vs. Amit K. Jain (supra) while considering the words not less than 15 days in section 158B(c) of the Act, held that 15 days means clear 15 days which is the requirement to the law and therefore, the Assessing Officer issuing notice under section 158BC of the Act requiring the assessee to file return within fifteen days of the service of the notice, the notice wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This question therefore is not of any practical significance at this stage. 2. The High Court has taken the view that there was a modification of the agreement by the subsequent correspondence between the parties as a result of which the loan fell put of the purview of the aforesaid proviso to Rule 1(v). The finding of the High Court is as under (at page 205): "Therefore, if the spread over of the repayment has been provided in the terms of the agreement in such a manner that the repayment is completed by a date beyond seven years from the first advance made under the agreement under which the moneys are borrowed, the loan in question will qualify for inclusion in the capital of the company computed for the purposes of surtax. However, once we find that the moneys were advanced as of a particular date and under the terms of agreement under which those moneys were advanced, the final date for the repayment of the entire amount falls beyond the period of seven years counting from the date of the first advance under the agreement, the loan would qualify for inclusion in the capital. In the instant case, the first advance of Rs. 10 lakhs under the agreement was paid in the month ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
