TaxTMI 
TaxTMI 
2023 (3) TMI 905
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....: Ms. Sarita Kumari, CIT-DR Shri Jeetender Chand, Sr.DR ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER:- The above captioned 24 appeals are filed by 8 different appellants, preferred against 3 set of orders each pertaining to Assessment Year 2017-18. Since all these appeals were heard together and common issues are involved, therefore, these are being disposed of by this common order for the sake of convenience brevity. 2. The representatives of both the sides agreed that the facts in the case of Shri Sourabh Aggarwal, Legal Heir of Smt. Kamala Agarwal may be considered as the facts in all other appeals are identical and on such concession, we are considering the facts in ITA No. 962/DEL/2022 alongwith ITA No. 677/DEL/2022 and ITA No. 919/DEL/2022 for disposal of the captioned appeals. 3. We will first address to the issues raised in ITA No. 962/DEL/2022. 4. The impugned assessment order is dated 17.12.2019 framed u/s 143(3) of the Income-tax Act, 1961 [hereinafter referred to as 'The Act'] and the order of the first appellate authority is that of CIT(A)-3, Gurgaon dated 31.03.2022. 5. The sum and substance of the quarrel is that the ld. CIT(A) erred in uph....
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....eing issued separately. " 9. The chronological events resulting into the aforementioned findings of the Assessing Officer are as under: (i) Return of income was filed on 24.07.2017 declaring an income of Rs. 17,40,150/-; (ii) Return was selected for scrutiny assessment and detailed questionnaire was issued on 09.09.2019 alongwith notice u/s 142(1) of the Act; (iii) The assessee was asked to furnish requisite details as under: "Please refer to your return of income filed on 24.07.2017. You are aware that your case is selected in scrutiny and notice u/s 143 (2) has already been issued. In order to complete the assessment proceedings, you are requested to furnish the following details/information alongwith supporting documentary evidences on or before 24.09.2019 through e-filing. There is large value of cash deposits by you during demonetization period as compared to returned income as cash deposits are significantly large as compared to returned income. Furnish details of all cash deposits along with source of investment thereof. Also furnish the details of total exempt income and agricultural income earned by you during the year under ....
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.... details of source of income of the cash deposit in your saving bank accounts during the period 08.11.2016 to 16.12.2016 and also produce documentary evidence in support of your claim." (vii) Statement of the assessee was recorded by the ADIT, Investigation, Ambala as under: "Statement of Smt. Kamla Aggarwal D/o, Sh. Harbans Lal Aggarwal R/o, E-49, Industrial Area, Yamuna Nagar Recorded u/s 13(1) of the Income Tax Act, 1961 on 28.12.2016 at the time of attendance in this office in compliance to the summons issued u/s 131 (1) of the Income Tax Act, 1961 dt. 23.12.2016 I swear in the name of God that I will speak the truth, only and nothing else but only truth. Q. Please identify yourself. Ans. Myself Kamla Aggarwal D/o, Sh. Harbans Lal Aggarwal R/o E- 49, Industrial Area, Yamuna Nagar. As a proof of my identity I am furnishing a copy of my Adhaar Card. Q. Information has been received by this office that you have deposited Rs.4.50 cr in your saving bank account No. 02101000050007 with HDFC Bank Ltd. Yamuna Nagar on 13.11.2016, 15.11.2016 & 21.11.2016 post 08.11.2016. In this regard, please explain the nature of ....
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....per tax rates prevailing in the month of November, 2016 as per Income Tax Act, 1961. In compliance to summons issued u/s 131(1) of the Income Tax Act, 1961 dated 23-12-2016, we had disclosed on 28-12-2016 the income of Rs. 32.75 crores as well as already tax deposited of Rs.11,13,50,000/- under the scheme of Pradhan Mantri Garib Kalyan Yojana, 2016 notified by the Central Govt. to buy peace of mind and to avoid any litigation under the provisions of Income Tax Act, 1961 before the ld. Assistant Director-of Income Tax (Inv.), Aayakar Bhawan, B.C. Bazar, Ambala Cantt. and the balance tax of Rs.5,20,72,500/- was deposited from 16-02-2017 to 17-03- 2017. In view of above, we have discharged our total tax liability @49.9% i.e. Rs. 16,34,22,500/- on the declared income of Rs.32.75 crores and also amount deposited @25% i.e. Rs.8,18,75,000/- on the declared income of Rs.32.75 crores in PMGKDS, 2016. It is further submitted that we had also filed the declaration Form 1 with Hon'ble CIT (Central Circle), Gurgaon under PMGKY scheme 2016 for processing the same as reported to Id. Assistant Director of Income Tax (Inv.), Aayakar Bhawan, B.C. Bazar, Ambala Cantt. The detail....
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..../2016, 15/11/2016 & 21/11/2016 after 8/11/2016 when the old 500/1000 currency notes were demonetized. The tax of Rs.1,53,00,000/- was paid by using the advance tax challan No.280 by me on, 16/11/2016 and 22/11/2016. The advance tax was paid for the cash deposits made in the bank accounts. The detail of the assessee who submitted the Form No.1 in PMGKY Scheme 2016 are as under:- S.No. (1) Name of the Assessee (2) PAN (3) Amount declared in PMGRY Scheme 2016 (4) Advance Tax Paid in challan No. 280 (5) Tax Paid in Challan No. 287 (6) Total Tax paid (49.9%) (7) Amount deposited in PMGKY Deposit Scheme 2016 (25%) (8) 1. Kamla Aggarwal AAGPA4655K 4,50,00,000 1,53,00,000 71,55,000 2,24,55,000 1,12,50,000 2. Summon dtd. 23/12/2016 was received from Asst. Director of Income Tax (Inv), Ambala in my name for cash deposited in demonetized currency after 8/11/2016 in the bank account. In response to the summon myself attended and appeared before the ADIT (Inv.), Ambala on 28/12/2016. As per the advise of ADIT (Inv.), Ambala, the amount of cash deposited in the bank account after 8/11/2016 in old currency notes were agreed to be declared u....
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....gaon and again requested to process the forms and to issue the certificate because the tax required to be paid under the scheme has been duly paid within the due dates and also the amount of deposit made within time. Only the difference was of challan number and he requested again to the Pr. CIT to adjust the tax paid in challan No.280 on 16/11/2016and 22/11/2016 under the PMGKY Scheme. The Pr.CIT (Central), Gurgaon stated that 1.10 the system is not accepting the request and therefore the form is not being processed. 5. In view of this I have no other alternative but to approach the Hon'ble CBDT to issue suitable instructions in this regard to the concerned official of Systems of the Department so that the amount paid in challan No.280 on 16/11/2016 and 22/11/2016 by me can be transferred to the' payment under PMGKY scheme so that the undue hardship can be avoided in the matter. The details of Advance Tax paid on 16/11/2016 and 22/11/2016 by me are enclosed in the statement. 6. It is further submitted that I have not claimed the payment made in challan No.280 on 16/11/2016 and 22/11/2016 aggregating to Rs. 1,53,00,000/- in the return of income filed by me....
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....,000 iii) 21.11.2016 HDFC Bank Ltd. Yamuna Nagar 0210100050007 1,50,00,000 Total 4,50,00,000 Period from 01.11.2016 to 30.12.2016 i) 13.11.2016 HDFC Bank Ltd. Yamuna Nagar 0210100050007 1,00,00,000 ii) 15.11.2016 HDFC Bank Ltd. Yamuna Nagar 0210100050007 2,00,00,000 iii) 21.11.2016 HDFC Bank Ltd.Yamuna Nagar 0210100050007 1,50,00,000 Total 4,50,00,000 A copy of the bank statement has already been placed as part of reply dated 18.10.2019. 2.2 That on 16.11.2016, the assessee voluntarily suo-moto in a communication had stated as under: "Most respectfully, the assessee would like to submit that out of an income of Rs. 4,50,00,000/-, the assessee has deposited Rs. 3,00,00,000/- in the saving bank account with HDFC Bank Ltd., Yamuna Nagar during the year and I have deposited the advance tax of Rs: 1,02,00,000/- on the income of Rs.3,00,00,000/- vide challan no.00180 dated 16/11/2016 BSR 0510308 for the A.Y. 2017-18. This is for your kind information please." 2.3 That on 16.12.2016, PMGKY scheme was announced w....
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....ffice of learned Pr.CIT (Central), Gurgaon. The copies of all the relevant documents i.e., Form No.1 of PMGKY Scheme 2016.copies of advance tax paid challans, copies of tax paid challans under PMGKY scheme in challan No.287 and receipt for deposit made under the said scheme were submitted on the record of learned Pr. CIT (Central) Gurgaon. A copy of Form No. 1 is already placed on record. 2.8 That on 31.3.2017 subsequent to the deposit of Form No.1 in the office of learned Pr. CIT (Central) Gurgaon, my representative Mr. Rajiv Gupta, Advocate had written a letter to learned Pr. CIT (Central) Gurgaon wherein he stated that the department's software is not accepting the tax deposited in challan No.280between 14/11/2016 to 24/11/2016 under the PMGKY scheme 2016 and therefore the system is not processing the declaration in the case of assessee. -A copy of letter dated 31.3.2017 to learned Pr. CIT (Central). Gurgaon is already placed on record. It was requested in the said letter that the declaration filed in Form No.1 under PMGKY scheme may be processed manually and certificate may be issued accordingly. 2.9 In the meantime, my representative again appeared before....
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....RACE in case of assessee is again enclosed herewith for ready reference; and after the change of head of the challan the position of tax paid under PMGKAY Scheme is as under: S. No. (1) Name of the Assessee (2) PAN (3) Amount declared in PMGRY Scheme 2016 (4) Advance Tax Paid in challan No. 280 (5) Tax Paid in Challan No. 287 (6) Total Tax paid (49.9%) (7) Amount deposited in PMGKY Deposit Scheme 2016 (25%) (8) 1. Kamla Aggarwal AAGPA4655K 4,50,00,000 1,53,00,000 71,55,000 2,24,55,000 1,12,50,000 2.14 Thus, the tax paid in advance tax challan no. 280 which was not appearing on portal under PMGKY Scheme has now been transferred to the said Scheme, therefore the advance tax appearing in 26AS got removed and transferred to PMGKY Scheme after change of head/code of challan by the Department. The relevant portion of form 26AS is as under: FORM 26AS Name of Assessee : Kamla Aggarwal PAN : AAOPA4655K. Assessment Year : 2017-18 PART A - Details of Tax Deducted at Sources PART B - Details of Tax Collected at Sources PART C - Details of Tax Paid (other than TDS or TC....
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....above 1 crores, it was noticed that few of the cases having common address, belonged to same family and deposited cash of approx. 29 cr. in old currency notes. It was further investigated that these persons belong to Globe Group of Yamunanagar and total income deposited was Rs. 32.75 cr and not 29 cr. as reported (the name of one of the family members Smt. Manju Agarwal was not found in the said list). 3. During enquiries u/s 131 of the I.T. Act, 1961 on oath, the assessee members of the Globe Group have admitted Rs.32.75 crs as their undisclosed income for the relevant FY 2016-17 under Pradhan Mantri Garib Kalyan Yojna (PMGKY) and have further submitted that they shall pay taxes in accordance with provisions of Pradhan Mantri Garib Kalyan Yojna. 4. The details of the assessee members, and their respective disclosures before this Office is as under: S.No. NAME S/Sh./Smt. Cash deposit in old currency after 08.11.2016 Disclosure made before this office u/s 131 of IT Act, 1961 1 Sourabh Aggarwal E-49 Industrial Area, Yamunanagar 2 crores 2 crores 2 SatyaAggarwal E-49 Industrial Area, Yamunanagar 3.25 crores 3.25 crores 3 Shar....
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....Chandigarh, The Pr.DIT (Inv),Chandigarh has accorded his permission to close the STR proceedings in this case. Hence, a copy of this letter is being sent to you for your information." xx) The entire quarrel now crystallizes by the following letter issued by the Under Secretary, (ITA-II), CBDT disposing of all the letters and the CPGRAM grievance which reads as under: "Subject: Request for adjustment of advance tax towards PMGKY 2016 received from Sharwan Aggarwal & other seven family members and CPGRAM Grievance DORVU/E/2019/01509 dated 11.07.2019 of Smt. Kamla Aggarwal - reg. Kindly refer to your letter dated 08.01.2018 and 24.06.2018 and 24.06.2019 and CPGRAM Grievance: DORVU/E/2019/01509 dated 11.07.2019 of Smt. Kamla Aggarwal. 2. With reference to your above referred letters requesting to give credit for the advance taxes paid before the commencement of the PMGKY Scheme against the tax liability under the PMGKY Scheme on the basis of CBDT's order under section 119 of the Act dated 27.09.2017, I am directed to state that the and request cannot be considered favourably as: (iii) Board's order u/s 119 dated 27.09.2017 allowed challan co....
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....eon; (c) The assessees paid taxes @ 49.9% under the PMGKY Scheme, 2016 as against the normal maximum tax rate of 30%, thereby there has not been any loss to the Revenue; (d) The assessee will have difficulty in withdrawing his deposit @ 25% made with the bank as part of PMGKY Scheme, 2016 unless they are issued the PMGKY certificate; (e) The assessee has suffered hardship in Covid times due to lack of liquidity as his money had been locked up in the PMGKY deposit Scheme and has been assessed u/s 148 of the Act for the same amount. This issues with the approval of the DGIT -[INV], NWR Chandigarh signed by Shri Rajesh Mahajan, Addl. CIT [INV] [HQ]O/o the Director General of Income Tax, Chandigarh." 10. After understanding thoroughly the afore-stated factual matrix of the case in hand and, in particular, clause (b) and (c) above, we fail to understand how the amount declared under the PMGKY Scheme, 2016 becomes taxable u/s 69A of the Act as done by the Assessing Officer. Section 69A of the Act reads as under: "69A.Where in any financial year the assessee is found to be the owner of any money, bullion, jewellery or other valuable article ....
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.... surcharge, penalty payable under the scheme and deposit to be made in the deposit scheme shall be paid/made before filing declaration under the Scheme and declaration shall be accompanied with proof of payment made in respect of tax surcharge and penalty payable under the Scheme and proof of deposit made in the PMGKY Scheme, 2016. 16. The assessee has complied with all the mandatory conditions mentioned hereinabove. It is also provided that the declaration shall be void and deemed never to have been made where declaration has been made by misrepresentation or suppression of facts or without payment of tax and surcharge or penalty or without depositing requisite amount in the PMGKY Scheme, 2016 and in such cases, all provisions of the Act including penalty and prosecution shall apply accordingly. The facts discussed elsewhere clearly show that the assessee does not fall in the circumstances mentioned hereinabove. 17. Most importantly, it is provided that where a valid declaration as detailed above has been made, the following consequences will follow: a) Amount of undisclosed amount declared shall not be included in the total income of the declarant under the I.T. Ac....