TaxTMI 
TaxTMI 
2020 (6) TMI 407
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....stand duly perused. 2. We find at the outset that both assessees have raised their identical twin substantive grounds inter alia challenging correctness of both the lower authorities action initiating sec. 148 r.w.s. 147 proceedings culminating in undisclosed income from bank accounts addition(s) of Rs.2,30,71,880/- each, on various legal and factual aspects, respectively. 3. Mr. Tulsiyan submits that these two assessees have also raised their two additional substantive grounds as follows:- "1. That on the face of the assessee's denial, since the Revenue failed to discharge its onus to prove that he was one of the beneficiaries of M/s Ambrunova Trust or that he made any investment in LGT Bank, the Ld. AO /CIT(A) erred in adding his alleged "proportionate share of benefit" in the Bank balance as on 31.12.2001 as his income from other source apparently u/s 69 of the I.T. Act. 2. That without prejudice to the assessee's denial of any connection with Ambrunova Trust or LGT Bank since the Department has not proved that the sum of USD 24.06.604 was invested in LGT Bank during the FY 2001-02, the Ld. AO/ CIT(A) erred in holding that a sum of Rs. 2,30,71,881 is asse....
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....r A.Y 202-03 within the meaning of section 147 of Income Tax Act. 1961. Issue notice u/s. 148 of the I.T. Act. prior sanction of CIT Kol-XII, Kolkata has already been obtained vide No.CIT-XII/Kol/Tech./147/08-09/1490 dated 30/03/2009." The factual position is very much identical in latter appeal as well. 6. Mr. Roy once again sought our permission to highlight a very significant aspect that this tribunal's co-ordinate bench's order(s) in assessee's other three family members case namely Shri Mohan, Ambrush, & Ms. Bhavya Manoj Dhupelia vs. DCIT, Mumbai (2014) 54 taxmann.com 146 (Mum-Trib) have already upheld departmental action initiating re-opening proceedings qua the very twin trusts set up in LIECHTENSTFIN The department's case therefore is that the instant appeal(s) must also follow the suit since involving identical questions of law and facts. 7. Learned authorized representative clarified at this stage that although it is correct that all these five family members have been held as the alleged beneficiaries of the twin trusts i.e. M/s Ambrunova Trust having maintained an account with the LGT Bank in Liechtenstein and another trust namely Marline Management S.....
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....ss in motion on different set(s) of reasons. And that the other three assessees / family members had also filed sec. 254(2) rectification before the tribunal's co-ordinate bench which stood rejected on 22.06.2015. They then filed civil writ petition Nos. 2601 to 2603 of 2015 before the hon'ble Bombay high court which stood accepted vide order dated 03.03.2016 as under:- "1. These Petitions challenge a common order dated 22nd June 2015 passed by the Income Tax Appellate Tribunal (Tribunal) under section 254(2) of the Income Tax Act 1961 (the Act).By the impugned order dated 22nd June 2015, the Petitioners' Rectification Applications, seeking to rectify the order dated 31st October 2014 passed under section 254(1) of the Income Tax Act 1961 (the Act) was rejected. 2. We heard the Petitions for some time and we find that the Petitioners have made out an arguable case that the impugned order has failed to deal with the Petitioners' submissions with regard to the rectification of the order dated 31st October 2014. To illustrate the order date 31st October 2014 passed by the Tribunal while rejecting the Petitioners' grievance of breach of natural justice inter alia ....
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....taxable income having remained unassessable by reasons of an assessee's failure in disclosing all material facts fully and truly must not be based on mere suspicious but on relevant information / material only. Their lordships next judgment Income Tax Officer vs. Lakmani Mewal Das, (1976) 103 ITR 437 (SC) also concluded that their must be some direct nexus or live link between the relevant material coming to an Assessing Officer's notice whilst forming belief of escapement of taxable income from being assessed. Their lordships were further of the view that although it is correct that a court could not go into sufficiency or adequacy of the material and substitute its own opinion for that of the Assessing Officer on the point as to whether re-opening action ought to be initiated or not, it has to be kept in mind that it is not any or every material; however vague and indefinite or distant, remote and forfetched, which would warrant the formation of belief relating to taxable income having gone unassessed. 9. Their lordship in Sheo Nath Singh vs. ACIT 972 SCR (1) 175 (SC) and S. Naarayanappa and Others Vs. Commissioner of Income Tax, Bangalore, (1967) 63 ITR 219 (SC) also hold tha....
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....le income in the nature of balance amount of US $ 246604.09 as on 31.12.2001 had remained unassessed to the extent of 1/5th share each. The Revenue's vehement stand throughout is that the Assessing Officer had proceeded on the basis of the corresponding trust deed(s) pertaining to the foregoing two trusts as well as other relevant documents whilst setting into motion u/s. 148 / 147 mechanism. These two assessees had filed a common representation before the Assessing Officer on 23.07.2009 denying not only any such undeclared bank account(s) but also categorically stated that they are not beneficiaries of any such family or charitable trust. Learned departmental representative fails to dispute that in spite of the Assessing Officer having recorded his re-opening reasons based on assessees' alleged shares in trusts assets going by the trust deeds claims, the department itself sought for the very trusts deeds from these assessees / beneficiaries only. Copy of the relevant clinching corresponding coming from the department to this effect is dated 23.09.2009. 13. Coupled with this, the case file(s) suggests that this tribunal had also directed the department to produce the assessment ....
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....ncome had escaped assessment on account of their failure in disclosing the material facts "fully & truly" as stipulated in sec. 147 1st proviso of the Act. The Revenue has strongly contended that these assessees are beneficial owners of the trusts' assets to the extent of 1/5th share each which represented their taxable income remaining unassessed. Section 147 2nd proviso r.w.s u/s 149(1) (c) is also quoted that since the instant appeals pertain to undisclosed overseas assets, the assessees are not entitled to draw any benefit u/s 147 1st proviso. Learned departmental representative fails to dispute that both the foregoing statutory provisions stood inserted by the Finance Act 2012 w.e.f. 01.07.2012 having prospective effect whereas we are dealing with sec. 148 proceedings involving re-opening reasons recorded in the year 2009 pertaining to assessment year 2002-03 i.e. much earlier than insertion of the amended provision. We also make it clear in view of our observation in preceding paragraphs that there is no material evidence coming from the departmental side that the corresponding twin trusts deeds have formed part of records which could even remotely indicate that these asse....