TaxTMI 
TaxTMI 
TaxTMI 
2019 (7) TMI 1758
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....peals. The grounds of ITA No. 5949/Del/2018 (AY 2013-14) read as under:- Jurisdictional Assail 1. "That order passed by Ld. AO dated 29/12/2017 and further order passed by Ld. CIT (A) dated 18/07/2018 are bad in law in as much as while passing the impugned orders material/statement found/taken from/during search at one Pradeep Kumar Jindal are applied against the assessee u/s 153A whereas admittedly from assessee's own search u/s 132 no document much less any incriminating document was found where law does not allow use of such document/statement etc. not found from assessee's search u/s 153A (refer AO order para 1.3, CIT-A order para 7 & 7.1), thereby vitiating the entire exercise being against the mandate of law. 1.1 That order passed by Ld. AO dated 29/12/2017 and further order passed by Ld. CIT(A) dated 18/07/2018 are bad in law in as much as while passing the impugned orders material/statement found/taken from/during search at one Pradeep Kumar Jindal are applied against the assessee u/s 153A (refer AO order para 13, CIT-A order para 7 & 7.1) which could have been only imported in assessee's case as per procedure prescribed u/s 153C which is not at all followed in extant....
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....which are stated to be genuine and free from any taint. Merits of the cases: assessee's version on facts glossed over like rip van winkleism 7. That order passed by Ld. AO dated 29/12/2017 and further order passed by Ld. CIT(A) dated 18/07/2018 are bad in law in as much as both the authorities have not objectively considered and appreciated copious evidence filed by assessee where reference may be made to point no. 6.2 to 6.7 at pae 3/4 of CIT(A) order ergo we pray for deletion of additions made. 7.1 That on the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in sustaining the action of Ld. AO in making addition of Rs. 155,06,771/- and Rs. 200,00,000/- without appreciating that burden to prove that transaction is bogus/sham has remained un-discharged from side of Revenue. 7.2 That on the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in sustaining the action of Ld. AO in making addition of Rs. 930,406/- and Rs. 300,000/- on a/c of alleged commission u/s 69C which is plainly perverse and invalid. 7.3 That on the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in sustaining the action of Ld. AO by rel....
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....om business and profession". The AO issued show cause notice to the assesee and his group of companies as to why their share premium / share capital / share forfeiture / Long Term Capital Gain/ Loss should not be treated as bogus as these entries were obtained through front companies which are controlled, managed and run by Sh. Pradeep Kumar Jindal. The assessee denied to have such entries and expressed his ignorance of even knowing Sh. Pradeep Kumar Jindal. In this case Sh. Pradeep Kumar Jindal had admitted in his statement dated 18.11.2015 recorded u/s 132(4) of the Act that during search at his residence that his front companies had provided accommodation entries to Sajan Kumar Jain group companies and all his family members through intermediary role of Sh. Sudhir Chaudhary, Chartered Accountant. Sh. Sudhir Chaudhary, CA is authorized representative of Sajan Kumar Jain Group companies and all his family members. Consequently, the assessee and his group companies requested for cross examination of the other party Sh. Pradeep Kumar Jindal during the course of assessment proceedings vide their letter dated 12.12.2017. On their request summons were issued to both the parties on 13.1....
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....O has reproduced at page no. 5 of the assessment order, which read as under:- "The assessee had also submitted as under:- "After that, with the order of Hon 'able Delhi High Court, the said Company M/s Instant Travels Tours (P) Ltd was amalgamated with M/S Focus Industrial Resources Ltd and 5,64,480 share of M/s Focus Industrial Resources Ltd were exchanged against the 14400 shares of M/s Instant Travels Tours (P) Ltd under the scheme of Amalgamation by the Hon'ble Delhi High Court. Copy of Demat Account showing the exchange of shares of M/S Focus Industrial Resources Ltd and the Copy of order of Hon'ble Delhi High Court showing the scheme of Amalgamation are enclosed herewith. Subsequently, the assessee company has received 11,28,960 Bonus shares of M/S Focus Industrial Resources Ltd in its demat account which can be verified from the relevant demat account enclosed herewith: The said Company MIS Focus Industrial Resources Ltd was listed at Bombay Stock exchange a recognised Stock Exchange. Even as on date, the said Company has been listed at Bombay stock exchange, the supporting evidences are enclosed. After the listing of shares at a Recognised Stock Exchange, th....
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.... account, in this regard respectfully submitted that the Assessee has not paid any commission in cash to any person against the sale of aforesaid shares. Since all these shares have been sold at Bombay Stock Exchange through Recognised Stock broker and the payments have been remitted through Stock Exchange after deduction of Brokerage, STT etc. as per the applicable terms of the Stock Exchange from the bank account of the assessee your goodself can verify whether any cash has been withdrawn to pay the commission in cash." 2.3 The AO has examined the reply filed by the assessee with reference to the search / seized documents and statements recorded of various persons under oath and held that assessee was informed that Sh. Pradeep Kumar Jindal in his statement recorded u/s. 132(4) of the I.T. Act had admitted that he was engaged in the business of providing accommodation entries and for this purpose he had been managing and controlling a web of 33 paper companies, therefore, which accommodation entries were provided in the form of capital gain / short term capital gain. The AO has reproduced the relevant portion of the statement at page no. 6-13 of the assessment order. In view of....
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....d paid tax on account of accommodation entries taken by them from Sh. Pradeep Kumar Jindal. The list of these companies is mentioned at page no. 22 & 23 of the assessment order. Keeping in view of the aforesaid facts and circumstances, explained by the AO, the AO has rejected the claim regarding exempt long term capital gain (LTCG) from Sh. Pradeep Kumar Jindal and made the addition of Rs. 1,55,06,771/- as bogus long term capital gain claimed u/s. 10(38) of the I.T. Act and disallowed the same by adding back to the total income of the assessee vide order dated 29.12.2017 and also added the commission amounting to Rs. 9,30,406/- on account of unexplained expenditure u/s. 69C of the Act, on bogus LTCG received through accommodation entries at the income of the assessee and also added Rs. 2,00,00,000/- and Rs. 3,00,000/- on account of Commission, details of which AO has mentioned in the assessment order. The AO had discussed the additions at page no. 15-19 of the assessment order and completed the assessment at Rs. 6,13,28,387/- u/s. 153A r.w.s. 143(3) of the Act vide order dated 29.12.2017. Aggrieved by the assessment order dated 29.12.2017 passed u/s. 153A/143(3) of the Act, the ass....
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....rt of India decision in the case of Andaman Timber Industries vs. Commissioner of Central Excise, Kolkata-II-281 CTR 241. Finally, Ld. Counsel for the assessee stated that in support of his his legal arguments as well as merits which he has not arguing now and is ready to argue after the decision of the legal issue, he has attached all the evidences in the shape of Paper Book. He also draw our attention towards the statement on oath of Sh. Pradeep Kumar Jindal on 17.8.2013 which enclosed at page no. 5-29 of the Paper Book and statement of Sh. Pradeep Kumar Jindal dated 18.11.2013. Ld. Counsel for the assessee relied upon the following case laws on the legal issues:- i) ITAT, Delhi 'C' Bench order dated 19.3.2019 in ITA No. 5585/De;/2015 (AY 2006-06) DCIT vs. Smt. Shivali Mahajan & Cross Objection No. 447/Del/2015 Smt. Shivali Mahajan vs. DCIT and 05 Other Revenue's Appeals and Assessee's cross objections. ii) Hon'ble Delhi High Court decision dated 25.7.2017 in the case of Pr. CIT vs. Subhash Khattar passed in ITA No. 60/2017. iii) ITAT, 'E' Bench Mumbai decision in the case of Sh. Surendera L. Hiranandani vs. Pr. CIT in ITA Nos. 3226- 3232/M/2017 (AyRs. 2008-09 to 2014-15) v....
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....se. He further stated that AO has made the addition after examining the seized materials found during the search and statement recorded of various persons under oath under Section 132(4) of the I.T. Act, in which they have admitted that the assessee was engaged in the business of providing accommodation entries for the purpose of managing and controlling a web of 33 paper companies for the purpose of providing accommodation entries in lieu of cash receipt and the companies were not in business. All the Directors of these paper companies are dummy who also in their statements recorded u/s. 132(4) of the Act vehemently deposed that they were only signing the documents and that they were not aware of the business activities of these companies. He further submitted that AO has held that assessee has taken accommodation entries of LTCG from the companies of Sh. Pradeep Kumar Jinal amounting to Rs. 1,55,06,771/- which is bogus, therefore, the exempt LTCG was disallowed by the AO and upheld by the Ld. CIT(A) is valid under the law, after giving adequate opportunity to the assessee. Hence, the appeal of the assessee may be dismissed. In support of his contention, he cited various decisions....
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....both the parties, as aforesaid. We find that Ld. Counsel for the assessee has draw our attention towards the relevant portion of the judgement / decision of the Hon'ble Supreme Court of India, Hon'ble High Courts and various Benches of the Tribunal on the legal issue on which he argued. Ld. Counsel for the assessee further submitted that admittedly from assessee's own premises during search u/s. 132 of the Act no incriminating material was found and no adverse statement is there on record of the assessee u/s. 132(4) of the I.T. Act and it is an admitted fact before us that mere basis of un-confronted statement of Sh. Pradeep Kumar Jindal recorded u/s. 132(4) of the Act in his own separate search action and on the basis of unconfronted material for the said search u/s. 132(4), which in our considered opinion, cannot be made as a sole basis for making the additions u/s. 153A of the I.T. Act without recourse of mandatory and exclusive provisions under the Act like u/s 153C of the Act which specifically covered the extant situation. On this legal issue, we had gone through the decision relied upon by the Ld. Counsel for the assessee. In our opinion, the decision of the Hon'ble Supreme ....
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....e list as maintained at the depot to determine the price for the purpose of levy of excise duty. Whether the goods were, in fact, sold to the said dealers/witnesses at the price which is mentioned in the price list itself could be the subject matter of crossexamination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the cross-examination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17.03.2005 was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. In view the above, we are of the opinion that if the testimony of these two witnesses is discredited, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the Show Cause. We, thus, set aside the impugned order as passed by the Tribunal and allow this appeal." (B) ITAT, Delhi 'C' Bench order dated 19.3.2019 in ITA No. 5585/De....
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....disclosed and the undisclosed income would be brought to tax". iv. Although Section 153A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment "can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material." v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessment....
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....Tax (Central- III) v. Kabul Chawla (supra) had also discussed and concurred with the decision of the Rajasthan High Court in Jai Steel (India), Jodhpur v. ACIT (2013) 36 Taxman 523 (Raj) which had held that the assessment in respect of each of the six assessment years, preceding the year of search "is a separate and distinct assessment." It was further held in the said decision that "If in relation to any assessment year, no incriminating material is found, no addition or disallowance can be made in relation to that assessment year in exercise of powers under section 153A of the Act and the earlier assessment shall have to be reiterated." 14. From a reading of the above decisions of Hon'ble Jurisdictional High Court, it is evident that completed assessment can be interfered with by the Assessing Officer on the basis of any incriminating material unearthed during the course of search. If in relation to any assessment year no incriminating material is found, no addition or disallowance can be made in relation to that year in exercise of power under Section 153 of the Act. Obviously, the reference to the incriminating material in the above decisions of Hon'ble Jurisdictiona....
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....ional High Court, hold that during the course of assessment under Section 153A, the incriminating material, if any, found during the course of search of the assessee only can be utilized and not the material found in the search of any other person. 16. Now, coming to question No.2, we find that this issue is also covered by the decision of Hon'ble Jurisdictional High Court in the case of Harjeev Aggarwal (supra) and Best Infrastructure (India) (P.) Ltd. (supra). In the case of Harjeev Aggarwal (supra), Hon'ble Jurisdictional High Court considered the evidentiary value of the statement recorded during the course of search. The relevant portion is paragraph 19, 20 & 24, which are reproduced below for ready reference :- "19. In view of the settled legal position, the first and foremost issue to be addressed is whether a statement recorded under Section 132(4) of the Act would by itself be sufficient to assess the income, as disclosed by the assessee in its statement, under the Provisions of Chapter XIV-B of the Act. 20. In our view, a plain reading of Section 158BB(1) of the Act does not contemplate computing of undisclosed income solely on the basis of a statement reco....
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....cable while considering the evidentiary value of the statement while making the assessment u/s 153A. 18. In the case of Best Infrastructure (India) (P.) Ltd. (supra), Hon'ble Jurisdictional High Court reiterated in paragraph 38 "Fifthly, statements recorded under Section 132(4) of the Act do not by themselves constitute incriminating material as has been explained by this Court in Harjeev Aggarwal". 19. Learned DR has relied upon several decisions so as to buttress her case that the statement recorded under Section 132(4) has an evidentiary value and the addition can be made under Section 153A on the basis of such statement without there being any incriminating material. The first case relied upon by her is of Hon'ble Madras High Court in the case of B. Kishore Kumar Vs. CIT - 52 taxmann.com 449. She has also stated that the SLP against this decision is dismissed by the Hon'ble Apex Court which is reported in 62 taxmann.com 215. We have gone through the decision of Hon'ble Madras High Court and from the brief facts as noted in paragraph 2.1 of the judgment, it is clear that during the course of search, loose sheets and noting on the telephone diaries were found and seized b....
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.... their views whether after the decision of Hon'ble Delhi High Court in the case of M.S. Aggarwal (supra), the earlier decision of Harjeev Aggarwal (supra) still remains as a binding precedent. Learned DR stated that when Hon'ble Delhi High Court itself have expressed the view that the decision in the case of Harjeev Aggarwal (supra) needs to be reconsidered and reappraised, it cannot be considered as a binding precedent so long as this issue is not settled by the Larger Bench. The learned counsel for the assessee stated that the decision of Hon'ble Delhi High Court in the case of Harjeev Aggarwal (supra) continues to be binding precedent until it is reversed by the Hon'ble Supreme Court or a contrary view is given by the Larger Bench. In support of his contention, he relied upon the order of the ITAT, Delhi Bench 'I-1' in the case of Cairn India Ltd. Vs. DCIT in ITA No.1459/Del/2016, wherein similar situation arose and ITAT held as under :- "46. The ld.DR relied on the judgment in the case of Dynamic Orthopedics P.Ltd. vs. CIT (2010) 321 ITR 300 (SC) to contend that the provisions of section 205 of the Companies Act stand incorporated into section 115J of the Act.....
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....axmann.com 67. (iii) PCIT Vs. Avinash Kumar Setia - [2017] 81 taxmann.com 476 (Delhi). 26. As the above decisions were relating to survey proceedings, the same will have no application for interpreting the scope of assessment under Section 153A. 27. The next decision relied upon by the learned DR is of Hon'ble Gauhati High Court in the case of Greenview Restaurant (supra). We find that the facts in this case are altogether different as assessment was completed under Section 143(3) and not under Section 153A. Therefore, the above decision would not be applicable so far as the scope of assessment under Section 153A is concerned. 28. In view of the above, we, respectfully following the decision of Hon'ble Jurisdictional High Court in the case of Harjeev Aggarwal (supra) and Best Infrastructure (India) (P.) Ltd. (supra), hold that the statement recorded during the course of search on standalone basis without reference to any other material discovered during the search and seizure operation would not empower the Assessing Officer to make the addition merely because any admission was made by the assessee during the search operation. Admittedly, in this case, during the course....
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....eration. In the year under consideration, i.e., 2006-07, if any cash payment is made by the assessee during the financial year 2005-06, that can only be considered and not the payments made in the subsequent years. The learned DR stated that since the space was booked during the financial year under consideration, the entire cash payment is to be considered in this year. We are unable to agree with this contention of the learned DR. The addition for unexplained investment can be made only in the year when the investment is made and not in any other year. In view of the above, even as per the statement of Shri Lalit Mahajan, no addition can be made in this year. In view of the above, we do not find any justification to interfere with the order of the learned CIT(A). The same is upheld. 31. In the result, the appeals of the Revenue are dismissed and the cross-objections of the assessees are allowed. (C) Hon'ble Delhi High Court decision dated 25.7.2017 in the case of Pr. CIT vs. Subhash Khattar passed in ITA No. 60/2017. "2. While admitting the appeal on 7'h February, 2017, this Court framed the following question of law: "Did the Income Tax Appellate Tribunal (ITAT) fal....
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....y incriminating material found during the search on the premise of the Assessee was not sustainable in law. Reliance was placed on the decision of this Court 111 Commissioner of Income Tax v. Kabul Chawla, [2016J 380 ITR 573. 7. A question was posed to the learned counsel for the Revenue whether in the present case anything incriminating has been found when the premises of the Assessee was searched. The answer was in the negative. The entire case against the Assessee was based on what was found during the search of the premises of the AEZ Group. It is thus apparent on the face of it, that the notice to the Assessee under Section 153A of the Act was misconceived since the so-called incriminating material was not found during the search of the Assessee's premises. The Revenue could have proceeded against the Assessee on the basis of the documents discovered under any other provision of law, but certainly, not under Section 153A. This goes to the root of the matter. 8. Consequently, the impugned order of the ITAT calls for no interference of this Court. The question framed by this Court on 7th February, 2017 is answered in negative, that is, in favour of the Assessee and again....
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.... Delhi High Court in the case of PCIT vs. Meeta Gutgutia, (2017) 82 taxmann.com 287affirmed by the Hon'ble Supreme Court by dismissal of the Special Leave petition in the case of PCIT vs. Meeta Gutputia, (2018) 96 taxmann.com 468. There is a long line of authorities in support of the proposition of law that in the absence of incriminating material found as a result of search no addition can be made in the assessment made pursuant to notice u/s.153A of the Act. Please refer to the decision of Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla (2016) 380 ITR 573 and Hon'ble Gujarat High Court in the case of PCIT vs. Sunrise Finlease (P) Ltd, (2018) 89 taxmann.com 1 and Hon'ble Bombay High Court in the case of CIT vs. Continental Warehousing Corporation (Nhava Sheva) Ltd, (2015) 374 ITR 645. Thus, we find that the Assessing Officer lack jurisdiction to make addition on account of alleged bogus purchases in the absence of any incriminating material found." (E) ITAT, 'C' Bench, Bangalore decision dated 28.6.2019 in the case of M/s VSL Mining Company Pvt. Ltd. Vs. DCIT in ITA No. 1854/Bang/2013 (AY 2008-09) and ACIT vs. M/s VSL Mining Company Pvt. Ltd. In ITA No. 204/Bang/20....
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....risdiction over such other person and that Assessing Officer shall proceed against each such other person and issue notice and assess or reassess the income of the other person in accordance with the provisions of section 153A, if, that Assessing Officer is satisfied that the books of account or documents or assets seized or requisitioned have a bearing on the determination of the total income of such other person 17[for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made and] for the relevant assessment year or years referred to in sub-section (1) of section 153A : Provided that in case of such other person, the reference to the date of initiation of the search under section 132 or making of requisition under section 132A in the second proviso to sub-section (1) of section 153A shall be construed as reference to the date of receiving the books of account or documents or assets seized or requisitioned by the Assessing Officer having jurisdiction over such other person." 7.6.3 From the above, it is seen that the jurisdictional conditions and circumstances prescribed by the legislature ....
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....nizance of the material found / seized in the case of Shri Manoj Kumar Jain and making an assessment with reference to those materials in the case on hand. 7.6.5 The Kolkata Bench of ITAT in the case of Krishna Kumar Singhania (168 ITD 217) has considered the provisions of sections 153A and 153C of the Act and after examining the different scope of these two sections, at para 10 of its order, has held as under:- "We have heard the rival submissions. We find that it is not in dispute that there were no documents that were seized from the premises of the assessee except loose sheets vide seized document reference KKS / 1 comprising of 8 pages , for which satisfactory explanation has been given by the assessee and no addition was made by the Id AO on this seized document. The seized document used by the Id AO for making the addition in section 153A assessment is CG/1 to 11 and CG/HD/1 which were seized only from the office premises of Cygnus group of companies in which assessee is a director. In this regard, it would be pertinent to note that as per section 292C of the Act, there is a presumption that the documents , assets, books of accounts etc found at the time of search in the....
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.... of a regular assessment and the scope of assessment under section 158BD of the Act are different as they stand on different footings and has gone on to uphold the action of the Tribunal in holding that the provisions of section 158BD of the Act ought to have been invoked to make any disallowance of depreciation based on material found in the course of search conducted by the Department in the case of some other person. This judgment also supports the contention of the assessee that no addition could be made in the assessments framed under section 153A of the Act, based on materials found and seized from some other person, unless provisions of section 153C are invoked. 7.6.7 Taking into account the aforesaid factual and legal matrix, we are of the considered view that the AO could not have taken cognizance of the seized documents and other material found and seized in the course of search conducted in the premises / case of Shri. Manoj Kumar Jain, while framing the order of assessment under section 143(3) of the Act in the case on hand. As a matter of fact, the ongoing assessment proceedings under section 143(3) of the Act would abate on receipt of these seized materials as per t....
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.... Provided that no order under sub-clause (ii) shall be passed unless the applicant has been given a reasonable opportunity of being heard. [(1A) All applications, pending before the [Principal Chief Commissioner or] Chief Commissioner on which no order has been passed under clause (b) of sub-section (1) before the 1st day of June, 1999, shall stand transferred on that day to the [Principal Commissioner or] Commissioner and the [Principal Commissioner or] Commissioner may proceed with such applications under that sub-section from the stage at which they were on that day.] (2) Every order granting or refusing registration under clause (b) of sub-section (1) shall be passed before the expiry of six months from the end of the month in which the application was received under clause (a) [or clause (aa) [or clause (ab)] of sub-section (1)] of section 12A.] [(3) Where a trust or an institution has been granted registration under clause (b) of subsection (1) [or has obtained registration at any time under section 12A [as it stood before its amendment by the Finance (No.2) Act, 1996 (33 of 1996)]] and subsequently the [Principal Commissioner or] Commissioner is satisfied that the acti....
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.... be carried out in accordance with the objects of the society. At the same time, he further drew the inference that no genuine activities are being carried out by the assessee. The learned counsel for the assessee has stated before us that the assessee has repeatedly requested for the supply of any material in the possession of the Department on the basis of which the allegation has been made against the assessee. However, no such material was supplied to the assessee. Therefore, no adverse inference can be drawn against the assessee in this regard. Learned DR, on the other hand, stated that the exact charge against the assessee i.e., it has received a donation from HHBRF in lieu of cash has been mentioned in the show cause notice itself. We find that in the order under Section 12AA(3), the CIT(Exemptions) has reproduced the assessee's written submission from page 3 to 6 of his order. Paragraph 7 & 8 of such letter read as under :- "7. The assessee has already requested your honour vide letter dated 29/02/2016 as under: "If the Income Tax Department is in possession of any material on the basis of which impugned allegation has been made, please provide the copy of the same to ....
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....lthcare Bio-Herbal Research Foundation. It has been clearly indicated in the statement and report send by the Ld. CIT(E), Kolkata that the assessee has paid cash in addition to commission to manage this donation by cheque from M/s Herbicure Healthcare Bio-Herbal Research Foundation. The assessee is apparently running a business and is generating huge amount of cash. This cash has been used to obtain or manage the donation from M/s Herbicure Healthcare Bio-Herbal Research Foundation by way of cheque after paying cash and commission to M/s Herbicure Healthcare Bio-Herbal Research Foundation." 13. However, in the order of the CIT(Exemptions), it is nowhere mentioned whether the letter of CIT(Exemptions), Kolkata, letter of HHBRF and the copy of the statement referred in paragraph 13 was supplied to the assessee, much less the crossexamination of the person whose statement is being relied upon. It is settled law that any material collected behind the back of the assessee cannot be used against him unless he is supplied the copy of such material and is allowed an opportunity to rebut the same. Similarly, any statement recorded behind the back of the assessee cannot be used against hi....
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....price which is mentioned in the price list itself could be the subject matter of crossexamination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the cross-examination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17.03.2005 was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. In view the above, we are of the opinion that if the testimony of these two witnesses is discredited, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the Show Cause Notice. We, thus, set aside the impugned order as passed by the Tribunal and allow this appeal." 14. We find that the facts of the assessee's case are identical. In this case also, the assessee before the CIT(Exemptions) requested for supply of the material, if any, which is proposed to be utilized against the assessee.....
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....rned DR has also relied upon the decision of Hon'ble Punjab & Haryana High Court in the case of Scientific Educational Advancement Society (supra). We find that the facts in the above case were also altogether different. In the aforesaid case, a piece of land belonging to the assessee society was sold to a private builder. The builder built flats on the said land. Subsequently, the assessee society purchased two farm houses constructed by the same builder. The Chairman of the assessee society alongwith his family members used to visit farm houses on weekend and no permission from any prescribed authority had been obtained for operating any educational institution on the property purchased. The Chief Commissioner, therefore, took a view that there was nothing on record to show that the assessee society intended to carry out any educational activities on the land purchased and accordingly rejected the assessee's claim seeking exemption under Section 10(23C). Thus, clearly, the facts of the assessee's case are altogether different than the facts before the Hon'ble Punjab & Haryana High Court in the aforementioned case. 16. In view of the above, we are of the opinion that the decisio....
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....17. Learned counsel for the assessee has also relied upon the decision of Hon'ble Jurisdictional High Court in the case of Agra Development Authority (supra) to support his contention that Section 12AA(3) does not authorize the Commissioner to cancel charitable registration with retrospective effect. He pointed out that the show cause notice was given in this case by the CIT on 25th January, 2016 while the CIT cancelled the registration from 1st April, 2010, which is not permissible in view of the decision of Hon'ble Jurisdictional High Court in the case of Agra Development Authority (supra). We find the contention of the learned counsel to be justified. In the aforementioned case, Hon'ble Jurisdictional High Court in paragraph 51 & 52 held as under :- "51. Clearly, the act of cancellation of registration has serious civil consequences. In absence of any legislative intent expressed to suggest that the legislature had empowered the Commissioner to cancel the assessee's registration under Section 12-A of the Act with retrospective effect, such power could not be deemed to exist or arise or be exercised to unsettle closed/part transactions especially because in this cas....