TaxTMI 
TaxTMI 
2014 (3) TMI 217
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....dgment assessment under Section 144 of the Income Tax Act 1961? iii. The unit of assessment under the Income Tax Act being previous year to assessment year, can be suppression of Income during any other year be a basis for estimation of income in any other year? iv. Whether the authorities below had gone wrong in relying on the proceedings of the Commercial Tax Department that too before the same had attained finality for the purpose of coming to the conclusion that the assessee had been issuing estimate slips instead of sale bills? 2. The undisputed facts that led to filing of the above appeals are as under: There were six jewellery business concerns of the appellants which are admittedly sister concerns. There were two shops at Thiruvananthapuram, two shops at Kottayam, one at Kollam and another at Kottarakkara. All the six business concerns pertain to Sunny Jacob & family. So far as assessment for income tax and Commercial Tax, all the six are different entities, though the partners of all the six business concerns belong to one and the same family. In this background, one has to appreciate the challenge made by the appellant assessee so far as order of the Tri....
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....the assessment made for assessment year 2008-09. Aggrieved by the same, revenue preferred appeals before the Appellate Tribunal. So far as 2008-09 assessment year, assessee also approached the Appellate Tribunal. All the appeals were heard and disposed of by a common order dated 16.11.2012. 5. The Tribunal by above said order categorized the order into three portions. One portion was with reference to six previous years assessments prior to the assessment year in which search was made. Second portion was with reference to assessment year 2008-09 during which a search was made and the last portion was with reference to assessment year 2001-2 in ITA No.692 of 2010 pertaining to alleged gift of Rs.3,47,580/- received from Sri.George Joseph through banking channel. 6. The Tribunal, so far as previous six years assessment from 2002-03 to 2007-08, opined that the statements of cashier and other persons, so also other material collected from the Commercial Tax department needs to be examined after giving an opportunity to the tax payer, since the tax payer had no occasion to explain the material collected by Sales Tax Department during their inspection on 22.04.2006. It also opined ....
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....re-enquiry information as well as information from Commercial tax department cannot become basis for reopening the previous six year's assessments from 2002-03 to 2007-08 as none of the material pinpoint any transactions of like nature in the previous years. Therefore, in the absence of any material with reference to any particular year in the previous six years, there was no justification for remitting back the matter to the assessing officer. Hence this opinion of the tribunal deserves to be set aside and orders of the CIT(Appeals) deserves to be confirmed. 10. During the course of arguments, he also contended that, though all the six shops are sister concerns, information collected from one of the shops cannot be the information for other sister concerns. Therefore, there is no justification in placing reliance on the information collected during pre-search enquiry for all the six business concerns of the tax payers. According to him, wherever the information was collected such information has to be considered with reference to that particular assessee and not other assesses. This is in addition to the argument that whatever information collected during the course o....
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....cording to the department, they conducted search in all the six business concerns and also residential places of the partners concerned. During the course of search, statement of Mr.Sunny Jacob was recorded by the Assistant Director of the Income Tax. The estimate slips collected from shops of Kottayam, Kollam and Thiruvananthapuram were shown to him. This was with reference to question No.5 during the statement of Mr.Sunny Jacob recorded as stated above. According to Mr.Sunny Jacob, the estimate slips were issued for showing the customer, but they issue bills on finalization of the sales. This statement of Mr.Sunny Jacob was considered with reference to other information collected. Daily summary sheet pertaining to business transactions a day prior to the search, that is 20.08.2007, was recovered and seized during the search operations. There were 37 sales as per the daily summary sheet. The actual sales recorded in the day book were much less than the details recorded in the summary sheet. In other words only 30.84% of the real sales were recorded. Mr.Bijimon, Manager of the Kottarakkara showroom was not able to give any explanation for the above discrepancy as per the observatio....
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....rs of one family, but with different combination of partners in all the six business concerns. Two of the partners are common in all the business concerns. 19. In this background whether the material recovered on 21.08.2007 and also other information during the course of search could be the material for previous six years to initiate proceedings under Section 153A of the Act has to be seen. It is clear that in the pre-search enquiry and course of search proceedings the information collected was mostly with reference to assessment year 2008-09. However, the information gathered during the search proceedings with reference to Commercial Tax department pertains to 2006. Inspection by Commercial Tax department was on 24.02.2006. Commercial Tax department also found similar deficits in the maintenance of accounts and the records by the appellant assessee. Commercial Tax Department also opined, sales bills were not issued for the entire sales made by them though estimate slips was prepared for the actual sales. 20. In other words, though the estimate slip reflects the actual purchase and sale of gold made in the business concerns of appellant assessees, the sale bill was always for....