TaxTMI 
TaxTMI 
2011 (8) TMI 702
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....ax Act are not established or fulfilled ? I. Whether the Income-tax Appellate Tribunal, the Commissioner of Income-tax (Appeals)-I and the Assessing Officer could have passed orders dated August 25, 2004, and March 28, 2003, relying on Shri Kuldeep Mehra's statement which was given during the assessment proceedings of Sri P. K.Mitra and not during the assessment proceedings of the appellant-firm ?. K. Whether both the appellant-firm and Sri P. K. Mitra can be substantively assessed for the consideration paid to Sri P. K. Mitra for the sale of flats in the assessment year 1995-96 ?" 3. The brief facts of the case are that the assessee-appellant is a partnership firm, engaged in the business of construction, development and sale of buildings. The partners of the appellant-firm are Sri Mool Raj and Smt.Asha who have equal share in the profit or loss of the firm. The firm has its office at Madan Mohan Malviya Marg, 13, Jopling Road, Lucknow. Originally, the assessee-firm has filed the return of income for the assessment year under consideration on October 31, 1995, by showing the income of Rs. 2,670 after completing the building known as Asha Apartment I a....
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....e-tax (Appeals) but also by the Income-tax Appellate Tribunal. Being aggrieved, the assessee has filed the present appeal. 6. With this backdrop, Sri Mudit Agarwal, learned counsel for the assessee, submits that the notice under section 148 of the Act was wrongly issued. It was time barred and actual income was less than rupees one lakh so notice could not have been issued within a period of four years. On a special query by the Bench, he accepted that if the income is more than one lakh then the notice could have been issued as per the then law. For this purpose, he has drawn the attention of the court to section 149(1), which is reproduced hereunder : "149.(1) No notice under section 148 shall be issued for the relevant assessment year,- (a) if four years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b) ; (b) if four years, but not more than six years, have elapsed from the end of the relevant assessment year unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to one lakh rupees or more for that year ;" 7. He further submits that the se....
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.... consideration of the flats sold by the assessee at Asha Apartment II. Admittedly, during the financial year 1995-96 the assessee had paid a sum of Rs. 3,03,435 to Sri Mitra, therefore, 33.85 per cent. of this was Rs. 1,02,712 had escaped the assessment. It is pertinent to mention that the assessee has shown its sale consideration of Rs. 38,63,055 which implied that Rs. 12,87,685 had been diverted toSriMitra. It also appears that the assessee-firm on the basis of the development agreement, had made several payments aggregating toRs.26,48,899 in different financial years up to 2001-02 which included an amount of Rs. 3,03,435 paid by the assessee to Sri Mitra during the assessment year 1994-95.This amount has been taken as the basis for determining the escapement of income considering the share of Sri Mitra, therefore, prima facie there was escapement of more than Rs. 1 lakh during the assessment year under consideration and hence the reassessment proceedings were not hit by the provisions of section 149(1)(a) and (b) of the Income-tax Act. The order of the Tribunal in this regard needs no interference. 11. Thus, the answer to question No. 1 is in favour of the Department a....
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....Revenue has been able to establish the requirements of benami transaction or not. 16. As per section 2(a) of the Benami Transactions (Prohibition) Act, 1988, a "benami transaction" means any transaction in which property is transferred to one person for a consideration paid or provided by another person. By applying the test of weighing the probabilities and by finding out the source of money and also the nature and possession of the property after the purchase, a conclusion as to whether a transaction is benami or not can be arrived. In the case of Bhim Singh v. Kan Singh, AIR 1980 SC 727, it was held that where a person buys a property with his own money but in the name of another person without any intention to benefit such other person, the transaction is called benami. In that case, the transferee holds the property for the benefit of the real owner. A benami transaction is different from a sham transaction wherein the owner of the property executes a conveyance in favour of another without the intention of transferring the title to the property thereunder. In the case of benami transaction, there is an operative transfer from the transferor to the transferee though ....