TaxTMI 
TaxTMI 
TaxTMI 
2018 (6) TMI 64
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.... The Grievances raised by the Revenue are as follows: "1) That the CIT(A) erred in law as well as facts and circumstances of the case in holding that the cash seized during the course of search should be adjusted against the tax liability from 'date of application' i.e. on 10.04.2012 considering that income tax does not provide for adjustment of seized cash before determination tax liability and cannot be adjusted against advance tax as per explanation 2 to section 132B. 2) The appellant craves the leave to make any addition, alteration and modification etc of ground or grounds on or before the date of hearing of the appeal." 3. The brief facts qua the issue are that a search and seizure operation was conducted under the provisions of ....
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....iled by assessee on 23/09/2014 requesting the AO to provide balance credit of Rs. 8,45,000/- and reduce Interest. The assessing officer again passed the rectification order U/s 154 of the Act, on dated 23/09/2014 and denied the balance tax Credit of Rs. 8,45,000/-. 4. Aggrieved by the stand of the Assessing Officer,( against Rectification order dated 23/09/2014),assessee carried the matter in appeal before the CIT(A), who allowed the balance tax Credit of Rs. 8,45,000/-. The Revenue is not satisfied with the order of ld CIT(A) and is in further appeal before this Tribunal. 5. The ld. DR for the Revenue hassubmitted before us that ld. CIT(A) erred in holding that the cash seized during the course of search & seizure, should be adjusted aga....
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....d in the said letter that the total cash seized should be adjusted towards his advance tax liability to avoid unnecessary demand and interest due thereon. The ld. Counsel further submitted that it was clear from the letter submitted by the assessee to the Income Tax Authority regarding adjustment of the entire seized cash amounting to Rs. 1,83,45,000/- and therefore, it should have been adjusted against the tax dues with effect from the 'date of application'. 7. We have given a careful consideration to the rival submissions and perused the materials available on record, we note that the cash was seized during the course of search andthe return of income was filed by the assessee taking credit of seized cash, so the liability to deposit the....
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....8,45,000/- (Rs.1,83,45,000/- - Rs. 1,75,00,000/-) has not been adjusted. We note that Rs. 1,75,00,000/- was seized from the resident of the assessee and Rs. 8,45,000/- seized from the office premises of the assessee. It is abundantly clear that the letter was written by the assessee to the Income Tax Authorities dated 10.04.2012, requesting for adjustment of the entire seized amount of Rs. 1,83,45,000/-, towards advance tax liability of the assessee, therefore, the assessing officer should have been adjusted the entire seized cash against tax due with effect from the date of said application. As per the provisions of Clause (i) of Section 132B of the I.T. Act, 1961, which clearly provides for the adjustment of seized cash with the existing....
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....n payment of advance tax is also not leviable under Section-234B for the reason that assessee had already made a request for adjustment of the amount against the advance tax which was already in the custody of the department. Similarly,Section-234Cis not attracted as there was no deferment.It may be mentioned that Hon'ble Punjab & Haryana High Court, in the case of IT vs. Ashok Kumar 334 ITR 355 (P.&H.) observed that the assessee was entitled to adjustment of seized cash against the advance tax liability and therefore, no interest could be charged under Section-234A,B,C especially when the department had not responded to the assessee's request for the adjustment of the cash seized against the advance tax liability." 8. We note th....