TaxTMI 
TaxTMI 
2016 (10) TMI 971
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....ssee to file appeal. Even he did not inform the assessee. He retired from the firm w.e.f. 30.4.2013, but he was not attending office in the month of April, as he has to start his independent practice. Due to retirement of Shri Sapnesh Sheth communication between the assessee and tax consultant firm had not taken place, and the assessee was not aware about outcome of appellate proceedings before the ld.CIT(A). Shri S.B. Vaidya has admitted as a partner in the firm, and thereafter, it came to the notice that no appeal was filed in this case. He advised the assessee to file appeal, and accordingly present appeal was filed. In this way, the assessee has prayed that delay in filing the appeal be condoned. 3. The ld.DR, on the other hand, contended that except affidavit by the assessee, there is no other supporting evidence in support of the alleged pleading. The assessee should be vigilant in prosecuting its income tax proceedings. He should be aware that the ld.CIT(A) decided the appeal and it has decided against the assessee, and the assessee should have filed the appeal well in time. 4. We have duly considered rival contentions and gone through the record carefully. Sub-section....
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....nt of Hon'ble Supreme Court in the case of N.Balakrishnan Vs. M. Krishnamurthy, (1998) 7 SCC 123. It reads as under: "Rule of limitation are not meant to destroy the right of parties. They are meant to see that parties do not resort to dilatory tactics, but seek their remedy promptly. The object of providing a legal remedy is to repair the damage caused by reason of legal injury. Law of limitation fixes a life-span for such legal remedy for the redress of the legal injury so suffered. Time is precious and the wasted time would never revisit. During efflux of time newer causes would sprout up necessitating newer persons to seek legal remedy by approaching the courts. So a life span must be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublicae up sit finis litium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The id....
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....bhai Dahyabhai Kakadia HUF had purchased agriculture land comprised at Block no.42 and 559B by way of sale deed executed on 15.3.2004. The land at block no.42 was purchased for Rs. 1,45,725/-. The assessee has shown value of this land in the balance sheet of his HUF at Rs. 2,08,805/- which included stamp duty, registration charges and other expenses. Similarly, land at Block No.559/B was purchased for a consideration of Rs. 4,78,035/- which has been shown in the balance sheet of the HUF at Rs. 6,697,010/- which included registration charges and stamp duty and other expenses. These pieces of land were purchased from one Smt.Hetalben. It appears that DDIT(Investment) had received a tax evasion petition and he conducted an inquiry. Statement of the assessee was recorded under section 131 by DDIT (Investigation) on 2.11.2007. During this statement, the assessee has admitted an investment of Rs. 50 lakhs over and above amounts stated in the sale deed. The assessee agreed that he has paid on-money of Rs. 38 lakhs on the land at block no.559/B and also paid a brokerage of Rs. 3 lakhs. The assessee also admitted that the land was sold in the year ending 31.3.2006 and received on-money of R....
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....6 Shri Chandubhai Parbhatbhai Dabaria AAUPD7631E 13.875 06-07 7 Shri Dhirubhai @ Dhirajlal Arjunbhai Patel ADGPP3559G 27.75 06-07 Total 161.00 As per the report the assessee individual Shri. Karsanbhai D. Kakadia had made unaccounted investment of Rs. 38 lakhs in cash for the purchase of land (on 15-04-2004) at Survey No.51, Block 559B admeasuring 31,869 sq.mtr. and Survey No.51, Block 42, admeasuring 9915 sq.m. Block 559B admeasuring 31,869 sq.mtr . The assessee has admitted that he had paid Rs. 38,00,000/- in cash to the seller Mrs. Hetalben R Desai/The assessment for A.Y.2004-05 is being reopened separately on this issue. The assessee has later sold these lands : (a) at Survey No.51, Block 559/B admeasuring 31,869 sq. m. to S/Shri.Dhirubhai Arjanbhai Patel, Chandubhai Parbatbhai Dabaria and Shaileshbhai Parbatbhai Dabaria. The transaction led to payment and receipt of a cash at Rs. 55.5 lakhs which has been admitted by both the seller and the purchasers. The assessments of three purchasers is being reopened u/s 147 separately. Thus the assessee sold the land @ Rs. 214 per sq mtr.....
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....at Block 559B admeasuring 31,869 sq.mtr. Therefore the Rate of land sold = (Rs. 12,75,000+55.5 lakhs /31869=68,25,000/31869 = Rs.l84 per sq. mtr - In view of the above, I am of the opinion that the assessee's unaccounted investment is much more than what he has admitted for A.Y. 2006-07. Hence, the case needs re- ; opening u/s. 147 of the I.T. Act, 1961. Sd/- Place: Surat (Sanjay V. Deshmukh) Date : 12.10.2010 Dy. Commissioner of Income-Tax Circle-9, Surat" "REASONS FOR REOPENING THE CASE OF Shri.Karsanbhai O. Kakadia (PAN:- AMXPK2145H ) for A.Y.2004-05 The ADIT(Inv.) Unit-II Surat has forwarded his report on the enquiry of TEP conducted in the case of Hetalben R. Desai and Others vide letter dated 31- 8-2010. The TEP was regarding an allegation that two pieces of land (at Survey No.51, Block 559B admeasuring 31,869 sq.mtr. and Survey No.51, Block 42, admeasuring 9915 sq.m.) together worth Rs. 7 crores sold was sold at very low * prices by one Mrs. Hetalben R Desai to some individuals .The report states that the sale of the said land by Hetalben and subsequent holders resulted in transfer of unaccounted money which was ac....
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....e matter before the ld.CIT(A). But appeals to the ld.CIT(A) did not bring any relief to the assessee in both the years. 10. The ld.counsel for the assessee, while imputing orders of the Revenue authorities contended that there was no material with the AO in the case of the assessee (individual) to harbor a belief that income chargeable to tax has escaped. He pointed out that return in the case of HUF was filed on 29.3.2006 for the Asstt.Year 2004-05. The assessee has shown both pieces of the land in the balance sheet. The DDIT has conducted an inquiry on 22.3.2007. The assessee agreed on unaccounted investment in this land. The assessee has filed revised computation in HUF and also paid taxes of Rs. 4.70 lakhs in four instalments. This tax was paid in HUF. All these things have been happened prior to recording of reasons for reopening of the assessment. The ld.counsel for the assessee took us through copies of reasons available on page no.41 to 45 of the paper book. He contended that in the Asstt.Year 2006-07, the ld.AO has worked out unaccounted monies upto Rs. 1.61 crore. This is totally an erroneous conclusion. Unexplained investment did not cross Rs. 55 lakhs. Since four tra....
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.... 285 (Del) iii) Signature Hotels P.Ltd. Vs. ITO, & Another (20111) 338 ITR 51 (Del) iv) Sarthak Securities Co.Ltd. Vs. ITO (2010) 329 ITR 110 (Del) v) ITO Vs. On Exim Pvt.Ltd. - ITA No.1116/del/2011 12. In his next proposition, he contended that assessment was sought to be reopened on the premises that unexplained investment of more than Rs. 7 crores was made by the assessee. But ultimately, the AO has not made any addition on account of this premise. He did not make any addition on the basis of DVO's report, which has been suggested by the DDIT. He made addition only on the basis of alleged disclosure of the assessee before the DDIT in the statement recorded under section 131 of the Act. Therefore, according to the ld.counsel for the assessee, the AO was not justified in making the addition, if no addition has been made on the basis of his reasons. In support of his conclusions, he relied upon the decision of the Bombay High Court I the case of CIT Vs. Jet Airways (I) Ltd., 331 ITR 236 (Bom) and CIT Vs. Mohmed Juned Dadani, 214 taxmann 0038 (Guj). On the strength of these decisions, it was contended that expression "and also" has been employed i....
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....imitation. If the assessee files objections against reopening of assessment on last date of expiry of limitation, the AO cannot be expected to dispose of the objections, because, he has already set the assessment machinery in motion, and he was at the verge of completion of the assessment order. In this case, we do not see any irregularity for not disposing of that objection filed by the assessee against the reopening of the assessment. On this reason, the proceeding cannot be quashed. 16. A bare perusal of section 147 would indicate that this section contemplates that if the AO has reasons to believe any income chargeable to tax has escaped assessment for any assessment year ... Meaning of the above would be that there should be reason to believe that any income chargeable to tax has escaped assessment. Now, the question is how the reasons to be formulated. What will help the AO to believe about the escapement of income from taxation. This belief cannot be made in air. There should be some deductive or inductive material for persuading the AO to form the opinion that, income has escaped assessment. Such material should have a direct nexus between escapement of income and format....