AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2011 (4) TMI 841
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.... 143(1) of the Act, however, the case of the assessee was selected for scrutiny assessment and a notice under section 143(2) of the Act was issued on 26-10-2006, which was served upon the assessee. According to the Assessing Officer, in response to the notice of hearing, Mr. Mukesh Mittal, CA & authorized representative from M/s. B. Goyal and Company appeared before him, from time to time, on behalf of the assessee and submitted necessary details. The Assessing Officer has passed an assessment order under section 143(3) on 17-12-2007. Shri Gian Gupta is also running a proprietorship concern namely "Ford Service Centre". It is an authorized dealer of IBO Co. Ltd. He is director of various companies. Smt. Usha Gupta is also running a proprietorship in the name and style of M/s. Shri Oil Company, an authorized dealer of IBOL Ltd. According to the assessee, it has constructed a building at village Smalka in Haryana, during this year which was rented out in the next year. On scrutiny of the accounts, it revealed to the Assessing Officer that investment in the said property is claimed to be share application money amounting to Rs. 1,34,75,980 from Shri Gian Gupta. The Assessing Officer f....
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....been taken into consideration at page 9 by the ld. First Appellate Authority. The ld. First Appellate Authority has deleted the penalty by referring to the decision of Hon'ble Madras High Court rendered in the case of CIT v. Rugmani Ram Raghav Spinners (P.) Ltd. [2008] 304 ITR 417, as well as the orders of the ld. ITAT in the case of Shrepak Enterprises v. Dy. CIT [1998] 64 ITD 300 (Ahd.). He also refereed to the decision of Hon'ble Madras High Court in the case of CIT v. Idhayam Publications Ltd. [2006] 285 ITR 221/[2007] 163 Taxman 265 (Mad.) and the order of ld. ITAT Hyderabad Bench in the case of Dillu Cine Enterprises (P.) Ltd. v. Addl. CIT [2002] 80 ITD 484. 6. Ld. DR while impugning the order of ld. CIT(A) contended that possibility of receiving share application money is totally missing in the present case because authorized share capital of the assessee is only of Rs. 1 lakh. It has already received a sum of Rs. 8,05,000 in earlier years. It has never applied for increase of the authorized share capital. From the conduct of the director as well as of the assessee it transpires that they have no respect for the provisions of 269SS. It continued to accept cash, use it in th....
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....ia (HUF) [2003] 133 Taxman 426. Ld. Counsel for the assessee further apprised us the intention of Legislature which has been explained by the board and the Tribunal has construed the circular issued by the board on section 269SS in the judgment rendered in the case of Industrial Enterprises v. Dy. CIT [2000] 73 ITD 252 (Hyd.). The ld. Counsel for the assessee thereafter took us through the head note of Chapter XXB, whereby it is stated , "Requirement as to mode of acceptance payment or repayment in certain cases to counteract evasion of tax", On the strength of this head note, he pointed out that this section is applicable in certain cases only. According to the ld. Counsel for the assessee, the object of the provision is to unearth unaccounted money. This section is not applicable to every transaction which is shown in an open manner, which is genuine and in which no unaccounted money is involved. For butteracing his contention, he relied upon the order of ITAT in the case Dillu Cine Enterprises (P.) Ltd. (supra). It was also the contention of assessee that the directors and the company are one and the same. Therefore, there cannot be any loan from the Director. He relied upon the....
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....tent it is relevant for the purpose reads: "No person shall, after the 30th day of June, 1984, take or accept from any other person (hereafter in this section referred to as 'the depositor'), any loan or deposit otherwise than by an account payee cheque or an account payee bank draft if. (a) the amount of such loan or deposit or the aggregate amount of such loan and deposit.... Is twenty thousand rupees or more." We are not concerned with clauses (b) and (c) of this section or the proviso to the section. The only other relevant limb of the section is Explanation (iii). That part of the Explanation reads: "Explanation.-For the purposes of this section.... (iii) 'loan or deposit' means loans or deposit of money." Section 269T provides for the mode of repayment of certain deposits and in Explanation (ii) to that section, it is provided: 'deposit' means any deposit of money which is repayable after notice or repayable after a period and, in the case of a person other than a company, includes deposit of any nature." 9. A plain reading of the provision would make it clear that any loan or deposit made in contravention to section 269SS of the Income-tax Act, 1961 shall be liable ....
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....r the material supplied to the assessee, the payment was made through banking channel. Assessee was required to make more payment or incur more expenses through banking channel, it would have made the payment through the banking channel out of the alleged share application money. Conducting of the business in this way simply suggest that it continued to incur expenses which was procured from the directors and then tried to give it a colour of share capital, otherwise there was no material on the record which can give inference that assessee has invited share capital. 10. Let us consider the other fold of submissions raised by the assessee. The first contention raised by the assessee is that intention of the Legislature for introducing this section is to curb introduction of black money. Thus, unless there is a black money, this section will not be applicable. He referred to the decision of Hon'ble Supreme Court in the case of Kum. AB Shanti (supra). In that decision the Hon'ble Supreme Court has just upheld the constitutional validity of the provision. The next argument of the ld. Counsel for the assessee was that this chapter is applicable in respect of certain cases as discernib....