AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (6) TMI 1302
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....pugned order is in violation to natural justice since; it relied upon the remand report dated 24/05/2018 and no opportunity of hearing or clarification of doubts was granted during remand proceedings. Earlier, the original Assessment Order dated 31/12/2016 was also passed within 4 days of issuing notice without giving any opportunity of hearing. 2. Because, the appeal against the previous assessment order dated 26/2/2015 by ITO ward-10(4), Kolkata, towards addition of Rs. 114.03 lakhs, was subjudice before CITAppeals, Kolkata-4 in appeal no. 809/2015-16. Hence, Ld. CIT-Appeals-2, Bhubaneswar should not have allowed the addition of same amount over and above the income as per return during pendency of appeal before CIT- Appeals, Kolkata-4. 3. Because, several contents of impugned order are contrary to the documents on records. As per Assessment order, the Company has given loan to other persons/concern up to Rs. 300.04 lakhs for non-business purpose and hence; there was no rational for disallowing entire interest expenditures incurred on loan of Rs. 940.0 lakhs. Because, the proceedings and assessment order u/s 153 (c) are not valid since; the preconditions for inv....
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....ion which will be submitted before the scheduled date of hearing. 1. Because, the impugned order is in violation to natural justice since; it relied upon the remand report dated 24/05/2018 and no opportunity of hearing or clarification of doubts was granted during remand proceedings. Earlier, the original Assessment Order dated 31/12/2016 was also passed within 4 days of issuing notice without giving any opportunity of hearing. 2. Because, several contents of impugned order are contrary to the documents on records. The remand report is also contrary to documents on record. The Company has not availed any loan of Rs. 300.04 lakhs from IFCI during the year and no loan of Rs. 304.0 lakhs was given by Company, as observed in order. As a result, the adverse conclusion is drawn on presumption and not upon evidence. More examples will be cited in detail petition. 3. Because, the interest free loan given to promoters of Shiva Cement in the previous year was Rs. 304 lakhs and hence; the presumptive loss of interest is Rs.41.80 lakhs out of total interest expenditures of Rs. 98.52 lakhs, as observed. Hence, disallowance of Rs. 93.14 lakhs is unjust. 4. Bec....
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....0.2019, the assessee has filed additional grounds for A.Y.2012-2013, which read as under :- 1. In the facts and circumstance of the case & in law, the Pr. Commissioner of Income Tax - 4, Kolkata erred in passing order for transfer of jurisdiction from Kolkata to Sambalpur without giving an opportunity to the Appellant before transfer. Which is a clear violation of section 127 of the Income Tax Act. 2. In the facts and circumstance of the case & in law, the Satisfaction Note must be prepared before transfer of jurisdiction, since it affects the third party rights, in the present case the transfer order was placed on record on December 26,2016, whereas satisfaction note u/s 153C of the third party was recorded on December 27,2016, (Supplementary Paper Book page 23) is without jurisdiction & bad in law & also Void ab initio 3. In the facts and circumstance of the case & in law, the entire assessment was completed within 4 days in great haste from the transfer of jurisdiction and hence the entire order in bad in law and without jurisdiction. 4. In the facts and circumstance of the case & in law, there is no nexus, linkage, connection or corroboration....
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....er grounds with facts of the case. 2. The above mentioned grounds are purely legal issues which goes to the root of the matter and make the assessment order bad in law and void ab initio. The Additional Grounds which are purely based on legal issues be admitted and deliberated by the Hon'ble Tribunal as laid down in various Judicial decisions as duly mentioned herein below: (i) The Pr. Commissioner of Income Tax Central - 3 vis Mls Dreamcity Buildwell Pvt. Ltd. ITA 1152/2017 Delhi High Court; (ii) Noorul Islam Education Trust vis CIT & Ors. Supreme Court; (iii) Vijayasanthi Investment Pvt. Ltd. vis CIT - 1991 187 ITR 405 Andhra High Court; (iv) CIT v/s Calcutta Kintwears (2014) Supreme Court followed and digested in The DY CIT vis Salasar Dewellers Pvt. Ltd. ITA No 5707/MUM/2015 AY 2008-09; (v) Jute Corporation Of India Ltd vis Commissioner of Income Tax & Anr. 1991 AIR 241, 1990 SCR Supl. (1) 340; (vi) National Thermal Power Co. Ltd. vis Commissioner Of Income Tax on 1998 (99) ELT 200 SC, 1998229 ITR 383 SC, (1997) 7 SCC 489; (vii) Commissioner of Income Tax - Ill, Pune v/s Sinhgad Technical Education Soci....
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....aterials. Justification 1. The Appellant vide its letter dated December 29, 2016 (Paper Book page 35 to 36) had challenged the proceedings initiated u/s 153C of the Income Tax Act 1961 and also challenged the order passed u/s 127 of the Income Tax Act 19161, before the ACIT, Central Circle, Sambalpur. The Appellant stated in the said letter that transfer of jurisdiction to DCIT, Central Circle, Sambalpur without issuing any show cause and without any opportunity of hearing is Ipso Facto illegal and without jurisdiction. The Appellant also stated in the said letter that" Apparently there is no satisfaction recorded by the Assessing Officer while initiating the proceeding u/s 153C of the Income Tax Act 1961 and further since the transfer of the case by the Principal Commissioner of Income Tax - 4, Kolkata has passed the order without issuing any show cause notice and without affording any opportunity of hearing. The initiation of the proceeding by DCIT, Central Circle, Sambalpur is void ab initio." The Appellant applied to the Authorities on dated June 21, 2019 for certified copies of seized documents. These documents are supplied after the appeal filed, in....
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....or Bank and money received by the appellant from Shivom Minerals Ltd. 5. The AO grossly erred in framing the assessment disregarding the fact that the original assessment u/s 143(3) were already completed and therefore the assessment does not "abate" and additions could only have been made based on seized materials. Justification 1. The Appellant applied to the Authorities on dated June 21, 2019 for certified copies of seized documents. These documents are supplied after the appeal filed, in the meantime the Appellant submitted Appeal Memo cum Paper Book before this Hon'ble Tribunal with addition I alteration of earlier grounds with facts of the case. 2. The above mentioned grounds are purely legal issues which goes to the root of the matter and make the assessment order bad in law and void ab initio. The Additional Grounds which are purely based on legal issues be admitted and deliberated by the Hon'ble Tribunal as laid down in-various Judicial decisions as duly mentioned herein below: (i) National Thermal Power Co. Ltd. v/s Commissioner Of Income Tax on 1998 (99) ELT 200 SC, 1998 229 ITR 383 SC, (1997) 7 SCC 489; (ii) ....
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....e Tax & Anr. 1991 AIR 241,1990 SCR Sup!. (1) 340; (ii) National Thermal Power Co. Ltd. vis Commissioner Of Income Tax on 1998 (99) ELT 200 SC, 1998229 ITR 383 SC, (1997) 7 SCC 489; (iii) Commissioner of Income Tax - Ill, Pune v/s Sinhgad Technical Education Society (2018) 11 SCC 490. 8. Further on 04.12.2020, the assessee has filed additional grounds in the appeal for A.Y.2012-2013, which read as under :- 1. In the facts and circumstance of the case & in law, there is no nexus, linkage, connection or corroboration between the seized Materials / documents and the subject additions in the impugned order are not based on the seized materials and hence impugned order is not maintainable in law. 2. In the facts and circumstance of the case & in law, the seized documents as per Satisfaction Note as referred therein are page 67-93 and 94-97 of SMLO-05 don't belong to and no way related to Appellant. 3. In the facts and circumstance of the case & in law, no additions are made in the Assessment Order based upon the seized materials as referred in SMLO - 5 & 52. 4. In the facts and circumstance of the case & in law, under any event....
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....e SMLO - 5 & 52. 4. In the facts and circumstance of the case & in law, under any event and circumstances, the documents mentioned in Satisfaction Note & its annexure are not incriminating material, since it is only Sanction Letter of IFCI Factor Bank and money received by the appellant from Shivom Minerals Ltd. 5. The AO grossly erred in framing the assessment disregarding the fact that the original assessment u/s 143(3) were already completed and therefore the assessment does not "abate" and additions could only have been made based on seized materials. Justification 1. The Appellant applied to the Authorities on dated June. 21, 2019 for certified copies of seized documents. These documents are supplied after the appeal filed, in the meantime the Appellant submitted Appeal Memo cum Paper Book before this Hon'ble Tribunal with addition I alteration of earlier grounds with facts of the case. 2. The above mentioned grounds are purely legal issues which goes to the root of the matter and make the assessment order bad in law and void ab initio. The Additional Grounds which are purely based on legal issues be admitted and deliberated by ....
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....344 as also the decision of the Hon'ble Delhi High Court in the case of Nahid Finlease Pvt. Ltd., in ITA No.1483/2018, order dated 13.05.2019, cancelled the assessment order passed u/s.153C of the Act. It was the submission that the addition in the assessment was in respect of disallowance of interest claimed on the ground that interest bearing loans taken from IFCI Factor Ltd. had been advanced as interest free loans to Shri Rajendra Prasad Gupta and his family members for an amount of Rs.3.40 crores. It was the submission that the seized documents which is the ledger account and which has been referred to by the AO of the searched person without issuing the satisfaction note, did not have any relation whatsoever to the computation of the interest disallowance. It was the further submission that regular books of accounts are not incriminating materials and for this proposition, ld. Sr. Counsel placed reliance on the decision of the Hon'ble Delhi High Court in the case of Param Dairy Ltd., passed in ITA No.37/2021, dated 15.02.2021. It was the further submission that the disallowance of claim u/s.36(1)(iii) of the Act being the deduction of an expenditure cannot be part of an asses....
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....e ledger account has been found and it showed that loans have been taken from IFCI Factors Ltd. It was also the submission that consequently the AO had handed over the evidence after recording the satisfaction note to the AO of the assessee. It was the submission that the said ledger did have bearing on the determination of the total income required under the provisions of Section 153C of the Act. It was the submission that the concept of total income included both "disclosed" and "undisclosed" income. He further drew our attention to page 15 of the paper book, which were the extracts of SMLO-05 & SMLO-52 and the explanation of the assessee in respect of the documents. It was the submission that the fact that a specific transaction in respect of the assessee has been found, there is no question as to whether it is incriminating or not. The AO of the person searched transferred the evidence which was found in the course of search as belonging to the assessee to the AO of the assessee along with the satisfaction note and it was then the duty of the AO of the assessee to scrutinise the same and draw the conclusion thereon. 16. The ld. CIT-DR further drew our attention to the decision ....
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....and the material which was disclosed therein was culled out and it showed that the same belongs to Assessment Year 2004-05 or thereafter. After taking note of the material in para 9 of the order, the position that emerges therefrom is discussed in para 10. It was specifically recorded that the counsel for the Department could not point out to the contrary. It is for this reason the High Court has also given its imprimatur to the aforesaid approach of the Tribunal. That apart, learned senior counsel appearing for the respondent, argued that notice in respect of Assessment Years 2000-01 and 2001-02 was even time barred. 18. It was submitted that the decision in the case of SSP Aviation Ltd. (supra) had been distinguished in respect of the issue as to whether seized materials can be relied on when the same does not pertain to the assessment year in question. It was the submission that in the present case, the seized material was not incriminating material and these were transactions which were recorded in the regular books and consequently no assessment u/s.153C of the Act is liable to be made. 19. We have considered rival submissions. 20. A perusal of the Annexure-A annexed ....
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....rch conducted in the premises of M/s Shivom Minerals Ltd. and its group, that such evidence having been provided to the AO of the assessee to whom such evidences were related to, the proceedings initiated u/s.153C of the Act are valid insofar as such evidence relates to the assessment years to which the evidences were found. Once the proceedings u/s.153C of the Act are initiated rightly, the consequential assessment is a forlorn conclusion. In these circumstances, we find no error in the order of the AO and that of the ld.CIT(A) on this issue. In view of the above, the additional grounds filed by the assessee stand rejected. As no other grounds have been argued, therefore, the same are treated as not argued/pressed and are being dismissed as such. 21. One of the argument of the ld. Sr. Advocate is that the issue is squarely covered by the decision of the coordinate bench of the Tribunal in the assessee's own case for the immediately preceding assessment years, however, a perusal of the said order does not show any of the facts being considered and in the absence of the facts being brought out, in view of the decision of the Hon'ble Madras High Court in the case of M/s Hi Tech Ar....
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.... of money by the assessee form Shivom Minerals. Office premises of Shivom Minerals Ltd., P-25, Civil Township, Rourkela 25.09.2014 SMLO-05, SMLO-52 Page no.: 67-73 & 94-97 of SMLO-05 Business Relationship As per Annexure 'A' attached 2009-10,2010-11,2011-12,2012-13,2013-14,2014-15 Name and Designation of the AO सहायक आयà¥à¤•à¥à¤¤ क रà¥à¤¯à¤¾à¤²à¤¯, ACT (C) SAMBALPUR ACT CENTRAL 40 THE [Sishir Kumar Dash] Assist. Commissioner of Income Tax Central Circle, Sambalpur (SISHIR KUMAR DASH) Asst. Commissioner of Curtibi Income Tax (Central) Certified, The Tele/0205:19 (Anup Tete) Inspector of Income-Tax Olo The Dy. CIT, Central Circle Sambalpur Document 2 Annexure-A company referred in S. No. 4(M/s Unicon Merchants Pvt. Ltd.) has business relationship with th company referred in S.No. 2(Shivom Minerals Ltd). During the course of post-search investigation, o the basis of the seized document, individual statement of affairs/balance sheet of family members ( the Group and copy of bank account statement obtained fro....