2009 (7) TMI 23

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....SH KUMAR GOEL, J. - The revenue has preferred this appeal under Section 260A of the Income Tax Act, 1961 (for short, "the Act) against the order of the Income Tax Appellate Tribunal, Chandigarh Bench 'B', Chandigarh dated 30.9.2008 passed in ITA No. 111/Chd/2008 for the assessment year 1996- 97, proposing to raise following substantial question of law:- "Whether on the facts and in the circumstan....

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....disallowed on the ground that the transactions entered into by the assessee were sham transactions. The CIT (A) dismissed the appeal but the Tribunal upheld the plea of the assessee. The relevant observations are as under:- "It cannot be said that any and every attempt of tax planning is illegal/illegitimate or that every transaction or arrangement which is perfectly permissible under the law, h....

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....nning of the assessee is not within the permissible limit or any colourable device has been adopted by the assessee. In such a situation, the decision of the Hon'ble Gauhati High Court in the case of CIT Vs. George Williamsons (Assam) Ltd. (265 ITR 626) clear supports the case of the assessee wherein various judicial pronouncements has been considered including the case of Mc Dowells (supra). In ....

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....Reiterating the view that the assessee was entitlted to arrange his affiars to reduce tax liability, without violating the law, it was observed in Azadi Bachao Andolan, supra that the principle laid down in IRC Vs. Duke of West Minister, (1936) ACI was still valid. 4. It was further observed that the above principle had been approved in India in judgment of the Hon'ble Supreme Court in CIT Vs. A.....