TaxTMI 
TaxTMI 
TaxTMI 
2017 (11) TMI 130
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the credit worthiness as required u/s 68 of the Act while sustain the addition of Rs. 11,97,472/- of cash credits merely on the basis confirmation filed by the appellant, evidence, namely affidavits PAN number payment through cheques and I.T. File numbers were available of the creditors such conclusion is proper?" 3. The facts of the case are that the assessee is a Transporter. The return has been filed on 30.8.1997 disclosing total income at Rs. 1,21,925/- which was processed u/s 143(1) of IT Act showing loss from transport work & on account of capital loss. The notice u/s 148 is issued on 21.1.04 after obtaining prior approval of the Addl. CIT, range-III, Gwalior vide letter F.No. Addl. CTR/R- 3/approval/147/Gwl/2003-04/828 dt. 12.1.04, the notice u/s 148 is served on the assessee as per confirmation received through dak on 25.2.04. 3.1 In this case the return of income was filed on 30.8.97 & was processed on 24.3.99. The assessment proceedings were reopened u/s 147 of the IT Act by issuance of notices u/s 148 on 25.10.99 for the following reasons:- 3.2 The notices was served as per order dt. 30.10.99 by notice server Sh. H.K. Pathak on 29.10.99. Subsequently notices were is....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sent case, the notice for reopening is founded on the allegations that the assessee had shown to have held only 20,10,198 shares of Sun Pharmaceuticals on 31.3.2004. However, on 1.4.2004, the assessee had shown to have converted 40,20,396 shares of the said company from stock-in-trade to investment. Further, the list of shares and securities that the assessee claimed to have converted into investment on 1.4.2004 submitted during the course of assessment did not include these 40,20,396 shares. These shares were redeemed during the year under consideration and instead of showing receipt as business income or short term capital gain, it was shown as long term capital gain. The assessee had thus paid tax at a lower rate and avoided tax on business income. Thus according to the Assessing Officer, the assessee had supplied wrong information and paid tax on the sale of shares claiming as long term capital gain which at best could have been short term capital gain. 10. With the petitioner's contention of the issues having been scrutinised during the original assessment and true and full disclosure, we are not impressed. Though vehemently argued before us, we do not notice any direct....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ajasthan), it has been held as under:- The Income Tax Appellate Tribunal, Jaipur Bench, Jaipur, before which the application under Section 256(1) of the Act was made by the Revenue for referring the above two questions of law for the opinion of the High Court, dismissed the application on the ground that the answer to both these questions are self-evident and, therefore, it is not necessary to refer these questions for the opinion of the High Court. The judgment passed by the Tribunal is after discussion of all the facts and circumstances of the case. While deciding the case, the Tribunal has relied upon the judgment of the Supreme Court. The Tribunal also held that since the original assessment proceedings have got barred by time for both the assessment years, the fresh assessment proceedings initiated for the same assessment years, were invalid because they were completed on the basis of the fresh notice issued under Section 148 of the Act and the notices were issued on March 31, 1980, and March 17, 1981, i.e., at the time when the original proceedings initiated under Section 148 were still pending. After perusal of the order passed by the Tribunal, we are of the opinion that n....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion for refund is not an empty formality. It assumes importance if such return had not been filed earlier. We have reproduced the note/order dated November 10, 1965 on the file pertaining to assessment year 1963- 64. In the file for assessment year 1963-64 there is another note which is as under: Please see my note in 1963-64 file. Refund to be considered in the hands of the beneficiaries. 18. The mere glance at this note would show that it could not be said that the Income-tax Officer gave finality to the refund fence no refund is granted either in the hands of the trust or in the hands of the beneficiaries. It is an inconclusive note where the Incometax Officer left the matter at the stage of consideration even with regard to refund in the hands of the beneficiaries. This note was also not communicated to the trustees. When we examine the note dated November 10, 1965 on the file of 1963-64 nothing flows from that as well. In any Case if it is an order, it would be appealable under Section 249 of the Act. Since period of limitation starts from the date of intimation of such an order, it is imperative that such an order be communicated to the assessee. Had the Income-tax Offi....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 360 (Gujarat), it has been held as under:- 8. Further, we may point out that section 68 under which the addition has been made by the Assessing Officer reads as under : "68. Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to Income Tax as the income of the assessee of that previous year." 9. The phraseology of section 68 is clear. The Legislature has laid down that in the absence of a satisfactory explanation, the unexplained cash credit may be charged to Income Tax as the income of the assessee of that previous year. In this, case the legislative mandate is not in terms of the words "shall be charged to Income Tax as the income of the assessee of that previous year". The Supreme Court while interpreting similar phraseology used in section 69 has held that in creating the legal fiction the phraseology employs the word "may" and not "shall". Thus the unsatisfactoriness of the explanation does not and need not automatically re....
X X X X Extracts X X X X
X X X X Extracts X X X X
....reason that if the share application money is received by the assessee-company from alleged bogus shareholders, whose names are given to the AO, then the department is free to proceed to reopen their individual assessments in accordance with law. Hence, no infirmity is found with the impugned judgment. Special Leave Petition is dismissed. It cannot be regarded as undisclosed income of assesseecompany. 7. Counsel for the respondent has contended that the Tribunal while considering the matter has rightly decided in favour of the department and therefore no interference is called for in the reasoning adopted by the tribunal. 8. We have heard counsel for the parties. 9. Taking into consideration the provisions of Section 148 of the Income Tax Act which reads as under:- 148. Issue of notice where income has escaped assessment.- (1) Before making the assessment, reassessment or recomputation under section 147, the Assessing Officer shall serve on the assessee a notice requiring him to furnish within such period, as may be specified in the notice, a return of his income or the income of any other person in respect of which he is assessable under this Act during the previous year ....