TaxTMI 
TaxTMI 
2016 (2) TMI 621
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....hort 'the Act'). Further, the assessee Shri Bhikan Bapurao Shelke has also filed an appeal against the order of CIT(A)-II, Aurangabad, dated 10.03.2005, relating to block assessment period 01.04.1987 to 10.07.1997 against order passed under section 158BC(c) r.w.s. 143(3) of the Income Tax Act, 1961 (in short 'the Act'). 2. This bunch of appeals relating to different assessees, who all are connected were heard together and are being disposed of by this consolidated order for the sake of convenience. However, reference is being made to the facts and issues in ITA No.588/PN/2004 to adjudicate the issues. 3. Before adjudicating the merits of the issue raised by the assessee and the appeals filed by the Revenue, we would like to refer to the order sheet entries in the present bunch of appeals, wherein the appeals were listed for hearing from 18.01.2007 and were adjourned from date to date at the request of the assessee that a Writ Petition filed by the assessee was pending before the Hon'ble High Court. Thereafter, the Counsel earlier appearing in the present bunch of appeals withdrew his Power of Attorney on 13.07.2015 and last opportunity was afforded to the assessee to seek adj....
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..... The grounds of appeal raised by the assessee are as under:- 1) The CIT(Appeals) erred in confirming the order of ACIT, Circle 2(1), Dhule in which the appellant was denied the immunity and benefits of the VDIS, 1997, particularly when the issue is pending with Aurangabad High Court Bench in writ petition No.5065 of 1999. The CIT(Appeals) erred in confirming the order of the A.O. in which the interpretation of the VDIS, 1997 is made against the appellant. The appellant craves leave to add/alter/amend/delete any of the grounds of appeal. 8. Further, an additional ground of appeal has been raised by the assessee, which reads as under:- Without prejudice to original Grounds of appeal Nos.1 & 2 and by way of an alternate submission, the appellant submits that if it is held that the appellant was not entitled to file declaration under V.D.I.S. 1997 and if it is held that the aforesaid declaration filed by the appellant was nonest and void ab initio then the learned Assessing Officer may please be directed to give credit of taxes paid under V.D.I.S. 1997 scheme against the demand raised under the impugned Block Assessment. 9. The facts in brief ....
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....ring the course of search action, the income declared for the remaining assessment years have been declared under VDIS, 1997. Further, a request was made to allow the due credit for the income disclosed and taxes paid under VDIS, 1997 and it was also requested that the same should not be taken for taxation under the Income-tax Act. The Assessing Officer rejected the contention of the assessee as the declaration in VDIS, 1997 was made only after search action, hence, the disclosure of total income was treated as undisclosed income under section 158BB of the Act and was taxed for the block period under section 113 of the Act. The contention of the assessee in respect of income of Rs. 1 lakh declared for the current year was accepted and the same was not treated as undisclosed income because the return of income for the current year was due to be filed on or before 31.08.1998 i.e. after the search action under section 132 of the Act. The Assessing Officer computed the total income including the undisclosed income for the block period at Rs. 6,65,000/- and after giving benefit of regular income declared by the assessee at Rs. 1 lakh, assessed the total undisclosed income under section ....
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....rious documents, books of account and other incriminating material was seized and impounded. The assessee was confronted with the entries in the documents seized and in the statement recorded during the course of search, the assessee admitted to the undisclosed income of Rs. 6,65,000/-, out of which Rs. 1 lakh related to assessment year 1998-99, i.e. the year of search and the return of income for which was still not due. Before the assessment proceedings could be taken up, the assessee made a disclosure under the VDIS, 1997 of income totaling Rs. 5,65,000/- relating to the block period, except to the income of Rs. 1 lakh, which related to the year of search. The claim of the assessee before the Assessing Officer was that since it had declared the additional income under VDIS, 1997, there was an immunity provided to the assessee and consequently, no undisclosed income could be assessed in the hands of assessee for the block period. However, the assessee furnished regular return of income relating to assessment year 1998-99 and declared income of Rs. 1 lakh. 13. The issue arising before us is that where the search under section 132 of the Act was carried out at the premises of th....
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....ment to contend that if the assessee was not entitled for the benefit of scheme, then the Revenue authorities should refund or adjust the amount paid by the assessee under the VDIS, 1997. The said contention of the petitioners was objected to by the learned Counsel for the Respondents that the petitioners were not entitled for the refund of amount and also no interest was to be awarded while refunding the amount. However, the Hon'ble High Court in the said Writ Petition held as under:- "11. It is held that, the petitioners would not be entitled for the benefit of the said scheme, in effect the said scheme would not be applicable to the petitioners. It is submitted that, a search U/Sec. 132 of the Income Tax Act was made and because of the same, the scheme of V.D.I.S. is not applicable. 12. The Apex Court in a case of Hemlatha Gargya Vs. Commissioner of Income Tax, A.P. and another referred supra has observed that, having held that, assessee are not entitled to the benefit of the scheme since the payments made by them are not in terms of the scheme, the revenue authorities are to be directed to refund or adjust the amount already deposited by the assessee in the pu....
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....s. 143(3) of the Act for the block period i.e. from 01.04.1987 to 10.07.1997. The assessee has raised identical grounds of appeal as in ITA No.588/PN/2004 i.e. it was entitled to the benefit of VDIS, 1997 and the total undisclosed income should be assessed at Rs.Nil during the block period, by way of ground of appeal No.1. The issue vide ground of appeal No.2 is in respect of allowance of credit for taxes paid under VDIS, 1997. The facts and issue arising in the present appeal are identical to the facts and issue in ITA No.588/PN/2004 and our decision in ITA No.588/PN/2004 shall apply mutatis mutandis. Accordingly, ground of appeal No.1 is dismissed and the ground of appeal No.2 raised by the assessee is allowed as the issue is same as raised by way of additional ground of appeal in ITA No.588/PN/2004 . 16. Now, coming to the ground of appeal No.3, which is against the order of CIT(A) in holding that the assessee was not a member of so-called AOP i.e. Mahendra Auto Services. The CIT(A) vide para 8.1 had observed that certain diaries No.A-37, A-39 and A-40 were found during the course of search at the premises of Shri G.M. Wadi, wherein it was noted that the assessee along with f....
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....the assessee is allowed and the ground of appeal No.3 raised by the assessee is dismissed. The appeal of the assessee is thus, partly allowed. 19. Now, coming to the cross appeal filed by the Revenue in ITA No.1235/PN/2005. The issue raised in the present appeal is identical to the issue in ITA No.1233/PN/2005 and the tax effect in the present appeal is below Rs. 10 lakhs. In view of the admission of the learned Departmental Representative for the Revenue, we dismiss the present appeal filed by the Revenue as not maintainable in line with instructions issued by the CBDT Circular No.21/2015, dated 10.12.2015. ITA Nos.1292/PN/2005 & 1237/PN/2005 20. The assessee in ITA No.1292/PN/2005 has raised identical grounds of appeal as in ITA No. 1304/PN/2005 and since the facts and issues are similar, the ground of appeal No.1 raised by the assessee is dismissed, ground of appeal No.2 raised by the assessee is allowed and the ground of appeal No.3 raised by the assessee is dismissed. The appeal of the assessee is thus, partly allowed. 21. Now, coming to the cross appeal filed by the Revenue in ITA No.1237/PN/2005. The issue raised in the present appeal is identical to the issue in....