2014 (7) TMI 48

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....e under Section 260A of the Income Tax Act, 1961 (in short, "the Act") against the order dated 29.4.2010, Annexure 3, passed by the Income Tax Appellate Tribunal, Chandigarh Bench 'A' Chandigarh in ITA No.1088/CHD/2008, for the assessment year 2003-04, proposing to raise following substantial questions of law:- "i) Whether on the facts and in the circumstances of the case, the Hon'ble ITAT is right in upholding the order of CIT(A) dated 29.9.2008, thereby deleting the addition by applying rate of 0.5% as against 1% applied by the Assessing Officer? ii) Whether on the facts and in the circumstances of the case, the Hon'ble ITAT is right in upholding the order of CIT(A) dated 29.9.2008 thereby deleting the addition of Rs. 64....

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....ained investment?" 5. In view of the above, question No.(ii) arises for consideration in ITA No.37 of 2011. 6. In ITA No.38 of 2011, similarly, identical question No.(I) was held to be covered by decision in ITA No.36 of 2011 and it was admitted on 31.1.2012 for determining the following questions of law:- (I)Whether on the facts and in the circumstances of the case, the Hon'ble ITAT is right in upholding the order of CIT(A) dated 29.9.2008, thereby deleting the addition of Rs. 74,04,000/- made by the Assessing Officer on account of unexplained investment? (II)Whether on the facts and in the circumstances of the case, the Hon'ble ITAT is right in deleting the addition of Rs. 15,00,000/- made on account of surrender made by the as....

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.... year 2005-06. The income surrendered by the assessee was disclosed in the return of income furnished for the assessment years 2004-05 and 2005-06. The assessee had not furnished any return of income since after assessment year 1996-97 till the date of survey on 25.6.2004. In view of the information gathered during the survey, the Assessing Officer found that the assessee's income relevant to the assessment year 2003-04 had escaped assessment within the meaning of Section 147 of the Act and hence proceedings under Section 148 of the Act were initiated, in response to which the assessee furnished return of income declaring income of Rs. 48,000/- relating to the assessment year 2003-04 on 30.3.2005. Assessment for the assessment year 2003....

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....the scope of telescoping does not arise. Reliance was placed on judgments in Anantharam Veerasinghaiah & Co. v. CIT, (1980) 123 ITR 457 (SC), CIT v. K.N.Satyapalan, (2001) 247 ITR 105 (Ker) and Grover Fabrics (India) (P) Limited v. CIT, (2011) 332 ITR 312 (P&H). 10. On the other hand, counsel for the assessee supported the order passed by the Tribunal. 11. After hearing learned counsel for the parties and perusing the record, we find that the issue arising under Question No.1 in both the appeals as per order of the Tribunal stands remitted to the Assessing Officer. It is, however, clarified that telescoping can only be done to the extent there is direct nexus of receipt of amount on account of sale of shares which has been invested in the....