TaxTMI 
TaxTMI 
2013 (11) TMI 940
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....Nirman Ltd. ('ANL' for short). However, subsequently thereto some dispute arose between the two parties, i.e., the vendor and the vendee, and the matter was referred for arbitration. Vide arbitration award dated 26/11/2005, the total consideration for the transfer was decided at Rs. 4.60 crores; the share therein of different family members being defined, as under: Sr. No. Name Amount 1 Smt. Asha Babladi Rs.1,65,00,000/- 2 Smt. Manisha Dani Rs.1,65,00,000/- 3 Sri Satish Babladi Rs.35,00,000/- 4 Smt. Jyoti Babladi Rs.30,00,000/- 5 Sri Rajesh Babladi Rs.65,00,000/- Total Rs.4,60,00,000/- The same was to be paid by 31/12/2005, failing which the delayed payment would attract interest @ 12% p.a. The full payment, however, could not be made by the prescribed date, and was finally paid only by 15/6/2006. The issue arising is the year in which the long term capital gain arising on the transfer is to be assessed. While the assessee claims it to be the year of the receipt of the full and final payment under the award, i.e., A.Y. 2007-08, for which it claims to have returned the same, as per the Revenue, the same, i.e., full payment, is not relevant as the....
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.... of the judicial view is in the favour of the validity of the assessment made on an individual pursuant to search being authorized in the name of more than one person, with the hon'ble high court in the case of Raghu Raj Pratap Singh (supra) also drawing on the decision in the case of Madhupuri Corpn. v. Dy. CIT (2002) 256 ITR 498 (Guj.). The basis of all these decisions is that there is no restriction placed by law on the issuance of a common authorization, which is of course to be based on reason/s to believe, on the strength of materials and information with regard to the concealed income or assets of persons in respect of whom search action is initiated. As explained, the search is of a premises, etc., so that the warrant of authorization is issued qua a premises, i.e., a different warrant would stand to be issued for each different place which is to be subject to search, of course in respect of the persons whose income/assets are suspected to be secreted or held at the said place. Further, as the said person/s may not be available at the said premises at the time of search, the obligation on the search party to produce and show the search warrant is to the person who is at the....
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....ned by the hon'ble court in the case of Raghu Raj Pratap Singh (supra), noting that the relevant column (for mentioning the names of the persons being subject to search) in the relevant form (Form No.45 / PB pgs. 5-6) begins with the words 'Sarvshri', indicating plurality of names. It does not in any manner indicate an AOP comprised of the said persons. It would be a different matter if the materials with the Revenue are for the undisclosed income/assets of an AOP comprising them, but the subsequent assessment/s is framed in their individual names on the strength of evidence found with regard to their individual assets in search. The assessee has no such case, which, where so, could only be on the basis of the facts and not a bald statement/s. In fact, even in such a case, there is no bar in law for framing assessments in the names of different individuals or, even for that matter, whose names are not mentioned but qua whom material as to undisclosed income stands found, though the same would be u/s.153C and not section 153A. In the instant case, there is no iota of evidence, nor is it the assessee's case of it being so, of any joint economic or commercial activity by the four name....
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....cribed above (para 2). The dispute arose in relation to the compensation for delivering vacant and peaceful possession to the transferee for the development of the area under the property Slum Rehabilitation Scheme at Saiwadi. The matter was referred to arbitration. The terms of reference therefor was that the sole arbitrator was to fix the quantum of compensation and the time when the claimants have to handover the vacant possession of the property to the respondent (Clauses 2 and 5 of the reference agreement dated 20.10.2005/PB pgs. 31-38). Vide an arbitration award dated 26.11.2005 (copy on record/PB pgs. 21-24), the compensation was awarded at Rs.4.60 crores and the claimanttransferors were directed to handover possession of the property to the respondenttransferee forwith (refer Clauses 1 to 4 of the arbitration award). A transfer can arise only with mutual consent and agreement, so that it can, in the facts and circumstances of the case, be said to have taken place on the resolution of the dispute as well as the terms and conditions of the transfer, vide the said arbitration award, which stood accepted by both the parties. That is, on 26.11.2005, or immediately thereafter. T....
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....investment u/s. 54EC is only with reference to this date. In other words, the date of transfer gets crystallized as falling during f.y. 2005-06. Finally, in view of our having decided thus, we find little merit in the assessee's also staking a claim for the transfer date as falling in f.y. 2006-07 on the basis of delivery of possession in that year, being made with reference to a letter of possession dated 20.06.2006 (PB pg. 54). The said letter is of no consequence. Firstly, for the reason that the same does not mention the date on which possession was handed over. Secondly, we have already explained that this makes the assessee's claim self-contradictory. In fact, this aspect stands also discussed by the ld. CIT(A) vide para 1.17 and 1.18 of his order, and whose findings, including with regard the non-admissibility of the said letter in evidence, has not been rebutted by the assessee before us, so that the same cannot be considered in evidence. 5.3 The only issue, therefore, that arises and calls for our adjudication is the eligibility of the assessee's entitlement to deduction u/s.54F; the investment in specified bonds u/s.54EC having been found to be within the prescribed tim....
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....e ld. DR, on the other hand, would rely on the decision by the Hon'ble Delhi High Court in the case of CIT vs. Anil Kumar Bhatia [2012] 24 taxmann.com 98 (Delhi), placing a copy of the same on record. Its stands abundantly clarified by the hon'ble high court, he would continue, that the A.O. is bound to issue notices u/s.153A for each of the six years immediately preceding the assessment year relevant to the previous year in which the search or requisition is made and, two, is empowered to assess or reassess the total income of the assessee for each of those six years as well as for the assessment year relevant to the year of search or requisition. That is, there are no fetters placed by law, and the A.O. is obliged to frame the assessment for those years assessing the total income without any restriction. In other words, there is no conditionality of discovery of any 'incriminating' material, which qualification could itself be a subject matter of dispute. 9. We have heard the parties, and perused the material on record. 9.1 In our view, the plea being canvassed by the assessee cannot be accepted in view of the decision by the hon'ble high court in the case of Anil Kumar Bhatia ....
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.... regarding the transfer of rights and delivery of possession in a property of the assessee, including the compensation therefor, came to be resolved through arbitration during the relevant previous year, came to light only during the course of the search proceedings dated 10.08.2006. These facts are conspicuous by their absence in the return of income for the relevant year, i.e., A.Y. 2006-07, filed on 31.07.2006, i.e., prior to the date of search. As such, even considering, for the sake of argument, some merit in the assessee's contention that section 153A could not be invoked in the absence of any incriminating material, the same would not be applicable in the facts of the instant case. This is in view of the material found in the assessee's case impacting his assessment for A.Y. 2006-07. It is not necessary that the said material is to be independently found for all the assessment years under reference, as once the A.O. validly assumes jurisdiction u/s.153A, he is duty bound to issue notices and frame the assessment for each of the six years immediately preceding the assessment year relevant to the year in which the requisite search is made as well as the year of such search. Th....
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....ved at objectively, based on materials and explanations, are principally matters of fact. Toward this, we find that the Revenue has found the assessee's explanation unsatisfactory on count of capacity (of the creditor) and genuineness (of the credit); the assessee being obliged to prove the credit in its books of account on the parameters of identity (of the creditor); creditworthiness and genuineness. This is for the reason as the income of the donor, Shri Vikas Bafna, for the two years for which the documents have been filed, being financial year ending 31.03.2002 and 31.03.2004, reveal it to be at Rs.1,76,741/- and Rs.1,55,068/- respectively, with the withdrawals for the two years being at Rs.83,218/- and Rs.62,064/- respectively, leading to the inference of him being a man of little means, leading a frugal life. With regard to the genuineness of the gift, the findings are even more indicting. The donor has no relationship with the donee, and is claimed to be a friend. No special need or occasion attends the gift, which has been utilized by the assessee - donee for investing in ICICI Prudential Mutual Fund, so that the apparent need for receiving the gift is the said investment,....
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....The impugned transaction is against all tenets of friendship and of human conduct. Here, at this stage, we may also clarify that we do observe loans and advances in the donor's balance-sheets at a healthy sum of Rs.92.78 lakhs. However, going just beneath the surface, again raises genuine doubts in the matter. Firstly, the balance-sheets are unsigned, and the portfolio is the same, at Rs.92.78 lakhs for both the years for which the balance-sheets stand submitted. Surprisingly, of the same, no interest arises from two parties to whom Rs.90 lakhs, or the bulk of the capital, stands advanced. Neither does the donor earn interest nor recalls the said advances, which, even at 12% p.a., would yield him an income which is a multiple of his combined income from all other sources. That the assessee is unable to produce the bank statement of the creditor for the full year, but does so only for a part of the year, i.e., up to the date of the gift, is again quizzical, if not highly unusual, and no convincing explanation for this unusual state of affairs is furnished. 12.5 The assessee has placed reliance on some decisions. However, as afore-stated, the matter is purely factual, i.e., based on....