TaxTMI 
TaxTMI 
2016 (6) TMI 471
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....ulled out from the records, are as under:- 2.1. A search u/s.132 of the Act was conducted in the group cases of Shri Rameshbhai Babulal Shah of Nadiad on 03/04/2008. During the course of search, documents including laptop were seized. In the laptop, there existed books of accounts of 65 companies for different periods. During the course of search as well as post search enquiries, key person of the group Shri Rameshbhai Babulal Shah had stated that the accounts were being maintained for various business transactions which may either totally out of books or partly out of books. Shri Rameshbhai Babulal Shah also owned various entities maintained in the laptop. Assessee thereafter filed Settlement Petition before Hon'ble Settlement Commissio....
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....by AO. Aggrieved by the order of the AO, assessee carried the matter before ld.CWT(A), who by a consolidated order for all the four assessment years, decided the issue in favour of assessee by holding as under:- 5.2 I have considered the submissions furnished by the appellant and have gone through the assessment orders. 5.3 The contention of the appellant appears to be reasonable. There is no dispute that these cash balances reflect the pool of cash balances of various concerns, individuals of the appellant group. The very presence of these figures in the data seized from the laptop of the appellant proves that such cash was being used by the appellant for the business purpose of various concerns. These are circulating rec....
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.... of appeal for all the years is allowed. 2.3. Aggrieved by the order of the CWT(A), Revenue is now in appeal before us and has raised following grounds: Grounds of Appeal - AYs 2004-05 to 2007-08 1. On the facts of the case and on the circumstances of the law, the CWT(A)-IV, Ahmedabad has erred in holding that the assets that are used for commercial purposes are productive assets and the cash balances as on 31.03.2004 for 2004-05 of Rs. 2,86,05,682/- as on 31.03.2005 for AY 2005-05 of Rs. 3,17,87,493/-, as on 31.03.2006 of 2006-07 of Rs. 3,43,57,850/-, and as on 31.03.2007 of 2007-08 of Rs. 1,86,78,867/- were not an asset within the meaning as defined under the provisions of section 2(ea) of WT Act? 2. On the f....
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....Learned CIT(A) ought to have appreciated that since the case of the appellant falls within the exception provided in the third proviso to sub section (2) of section 17 and application made by appellant was pending before Hon'ble Settlement Commission, reassessment proceedings initiated by Assessing Officer is bad in law. 3. On the facts and in the circumstances of the case, cash balance of Rs. 2,85,55,672 reflected in Exhibit - 34 of Settlement Application filed by appellant and considered for the purpose determining wealth tax liability is beyond the scope of section 2(ea) of Wealth Tax as such balance represents balance arrived at on the basis of movement of funds of capital and loan accounts amount various partnership firm, ....
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....f the assessee group and the balance found in the laptop was in the nature of circulating receipts and payments. He also pointed out to the relevant finding of the CWT(A). He therefore submitted that no addition was therefore called for. As an alternate submission, ld.AR submitted that the cash only in excess of Rs. 50,000/- which belonged to the assessee could be taxed in assessee's hands and since the cash balance is the combined cash balance of more than 65 entities, the entire addition of the cash balance of all the 65 entities could not be made in the hands of the assessee. He further submitted that since in the orders of authorities below, there is no finding of individual cash balance of various concerns/individuals, the matter may b....
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....ted as wealth of the assessee. On the other hand, apart from other submissions, it is assessee's submission that the cash which is owned up by assessee as reflected in the Settlement Commission order, represents the cash of various entities (i.e. 65 entities) and is not the cash of assessee alone. We find that there is no finding of any of the lower authorities as to the amount of cash of the various entities. In such a situation, we are of the view, that the issue needs to be re-examined at the end of AO. AO is directed to consider the cash as wealth of the assessee in accordance with law and only to the extent of the cash as at the close of year that belongs to the assessee. We therefore remit the issue to the file of AO to decide the tax....