TaxTMI 
TaxTMI 
2018 (5) TMI 1378
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....g the present cross objections challenged the impugned order dated 11.06.2012 passed by the Assessing Officer qua the assessment year 2008-09 on the grounds inter alia that :- "1. That having regard to the facts and circumstances of the case, Ld. CIT (A) has erred in law and on facts in confirming the action of Ld. AO in framing the impugned assessment order without assuming jurisdiction as per law and without issuing and serving the mandatory notices u/s 143 (2) of the Income Tax Act, 1961. 2. That in any case and in any view of the matter, action of Ld. CIT (A) in not quashing the impugned assessment order framed by Ld. AO being void ab initio, being beyond jurisdiction and is contrary to law and facts." 4. Briefly stated the facts necessary for adjudication of the controversy at hand are : during assessment proceedings, Assessing Officer noticed that the assessee is a shareholder and Director of M/s. Alpex Exports Pvt. Ltd. & M/s. Karishma Machine Tools to the tune of 24.81% and 39.2% shares respectively. AO noticed from the books of account of M/s. Alpex Exports Pvt. Ltd. that an amount of Rs. 97,52,217/- was shown as receivable amount outstanding as on 31.....
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....with M/s. Alpex Exports Pvt. Ltd. during the year under assessment. It is also not in dispute that reserve of Rs. 3,42,23,672.26/- was available with M/s. Karishma Machine Tools during the year under assessment. It is also not in dispute that the assessee has invested an amount of Rs. 115.5 lakhs with RRB Master Securities Limited after taking advances from time to time from M/s. Alpex Exports Pvt. Ltd. & M/s. Karishma Machine Tools, the details of which are extracted as under :- Date of deposit with stock broking firm Amount Remarks 20.12.2007 Rs.31 lacs Advance from M/s. Karishma Machine Tools 20.12.2007 Rs.19 lacs Advance from M/s. Alpex Exports 31.12.2007 Rs.5.5 lacs Advance from M/s. Alpex Exports 14.01.2008 Rs.21 lacs Advance from M/s. Alpex Exports 21.01.2008 Rs.19 lacs Advance from M/s. Alpex Exports 24.01.2008 Rs.20 lacs Advance from M/s. Alpex Exports Total Rs.115.5 lacs Total advance received is Rs. 128 lacs 8. It is also not in dispute that assessee claimed to have taken an amount of Rs. 97,52,217/- and Rs. 31,00,000/- from M/s. Alpex Exports Pvt. Ltd. & M/s. Karishma Machine To....
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....d in the light of the fact that Agreement to Sell is dated 20.12.2007 and was stated to be cancelled somewhere in December/January 2010 as is evident from the correspondence between the assessee and M/s. Alpex Exports Pvt. Ltd. & M/s. Karishma Machine Tools, available at pages 19 to 39 of the paper book, whereas the said demolition and ceiling drive was initiated by the Government in 2005-06 for which Expert Committee under the Chairman of Shri Tejinder Khanna was constituted on 19.05.2006, as has been highlighted by the AO, which fact has not been controverted by the assessee. 13. When the factum of demolition and ceiling drive objecting use of basement at residential premises for office purposes was very much in the notice of the assessee, it makes the entire transaction by virtue of the Agreement to Sell dated 20.12.2007 between assessee and M/s. Alpex Exports Pvt. Ltd. & M/s. Karishma Machine Tools by making payment of 75% of the sale proceeds for sale of the property in question become sham. Because it is admitted case of the assessee being shareholder and Director of M/s. Alpex Exports Pvt. Ltd. & M/s. Karishma Machine Tools that the property in question was required for o....
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....lments at will under the garb of Agreement to Sell which has been rightly treated as sham and collusive transaction between the assessee and both the companies by the AO. 18. The ld. CIT (A) for the reason best known to him has relied upon the ledger account of M/s. Alpex Exports Pvt. Ltd. showing the advance of Rs. 97,25,000/- as advance against property no.B-79 whereas no such narration is there in the balance sheet wherein the said amount is shown under the head "debtor". 19. The contention of the assessee that the property in question was being sold to the companies by the assessee as the bank was insisting upon that the same be transferred in the name of the company as it was given as a collateral security at the time of taking loan for running the business of the companies is prima facie not sustainable because when the property in question was already pledged with the bank as collateral security by the Director in her individual capacity, there is no legal ground with the bank to insist upon for transferring the property in the name of the companies. Rather collateral security given by the Director of the company in individual capacity is a potent security with the ban....
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....- 145) (xvii) ALF Faheem Meatex Pvt. Ltd. vs. ACIT - ITA No.6122 & 6123/Del/2015 order dated 09.06.2017 of the Tribunal (xviii) Shri Yogesh Yadav vs.ITO - ITA No.1757/Del/2016 order dated 09.10.2017 of the Tribunal 22. However, on the other hand, to repel the arguments addressed by the ld. AR for the assessee, the ld. Senior DR contended inter alia that the statutory notice u/s 143 (2) dated 12.08.2009 was issued well within the stipulated period through speed post; that the assessee has not disputed the service of notice during the assessment proceedings rather has duly cooperated with the AO and relied upon the case of Hon'ble Delhi High Court in case of Pr. CIT-06 vs. Mega Corporation Ltd. in ITA 128/2016 order dated 213.02.2017. 23. Undisputedly, first statutory notice u/s 143 (2) was issued by the ACIT, Circle 46 (1), New Delhi whereas the assessee has filed its return dated 29.09.2008 before ACIT, Circle 1 (1), New Delhi. It is also not in dispute that the assessment record was transferred to the AO/ACIT, Circle 1 (1) on 04.08.2010 being the jurisdictional AO. It is also not in dispute that the second notice was issued on 06.08.2010. It is also not in ....
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....sued held that the question of jurisdiction of the assessing authority cannot be disputed after completion of the assessment proceedings which can only be addressed by the Commissioner or the Board, as the case may be, as per provisions contained under section 124 (4) which excludes the jurisdiction of first appellate authority or the court. 28. Hon'ble Allahabad High Court referred to a case decided by Hon'ble Apex Court cited as Kiran Singh vs. Chaman Paswan - (1954) AIR 1954 SC 340 wherein jurisdictional issue has been decided by the Hon'ble Apex Court as under :- "wherein a distinction has been drawn between a jurisdiction with regard to the subject-matter of the suit and that of territorial and pecuniary jurisdiction. It has been held that a decree or judgment passed by a court having no territorial or pecuniary jurisdiction is not a nullity but at the most it is an irregularity and such a judgment and decree cannot be set aside by higher court while exercising appellate or revisional jurisdiction unless a prejudice which has been caused to the appellant is established. Prejudice can be a ground for relief only when it is due to the action of another party and not ....