TaxTMI 
TaxTMI 
2023 (12) TMI 1285
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....nts of the affidavit, carefully perused, cites reasons personal in nature. The same have not been disputed by the Revenue. Under the circumstances, we, accepting the assessee's application for condonation of delay, admit the instant appeals. Hearing was accordingly proceeded with. 3. The assessee is a private trust formed on 01.01.2007 (02/11/2004, as per the impugned order) with the object of construction of a herbal city, apartments/villas, etc. for the promotion of herbal treatment, herbal tourism, farms, etc. by Dr. V.N. Radhakrishnan (VNR) and his wife, Smt. Ramani Radhakrishnan (RR), and their three children. A search u/s. 132 of the Act was conducted by the Revenue on 17.9.2008 at the business premises of the assessee and the residence of VNR. Various land documents were found and seized. Assessments were framed u/s. 153A (VNR, the person searched) and section 153C (assessee) upon analysis of more than 750 land documents seized and bank account statements of the members of this group, including the assessee and VNR. This is the second round before the Tribunal. In the first round, it, vide order dated 10.7.2013 (ITA Nos. 223-227/Coch/2013/copy on ....
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....asset, over the various assessees of the group and years were eliminated. This exercise was carried out over several days of sitting spread over five months. Also, credits in the bank accounts analyzed. Based on this analysis, a category-wise statement of investment was prepared and sent to the assessee seeking the sources thereof vide letter dated 16/01/2014. The AR appeared with books of accounts maintained and on detailed verification of these accounts the assessment is concluded as under:" (emphasis, ours) Assessments, which though in view of the non-furnishing of the returns of income, continued to be u/s. 153C r/w s. 144, were accordingly framed, making additions. The principal addition sustained for both the years is u/s. 69 for unexplained investments in land. The assessee failing to improve it's case in any manner at the first appellate stage, the same were confirmed. This explains the instant appeals. 4. We have heard the parties, and perused the material on record. 4.1 Before us, the assessee's case was two-fold: (i) that, while the AO had made the addition u/s. 69, the ld. CIT(A) had found it to be u/s. 68, i.e., qua a credit/s recorded in it'....
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....otherwise, a special jurisdiction, is restricted to the person searched. Reference, apart from the clear and unambiguous language of the statute, may in this context be made to the decision in CIT v. Calcutta Knitwears [2014] 362 ITR 673 (SC).This aspect, understandable in view of the materials seized, and even as the matter travelled up to the Tribunal, was not challenged in the first round and, which, rather, would be the first thing that an assessee, had that been the case, done, i.e., in the normal course of conduct. The decision in Abhishar Buildwell (supra) impacts only the assessment of the person/s searched, with the controversy prior thereto, and which therefore stands resolved since, was qua the assessment pursuant to a search/requisition in case of such person. While one view, as by the Hon'ble jurisdictional High Court (E.N. Gopakumar v. CIT [2017] 390 ITR 131 (Ker)), was that the same would by itself, without anything more, trigger the jurisdiction to assess, abating all pending assessments, the second, which found favour with the Hon'ble Apex Court, is that it would only be on the strength of materials found during search, and not otherwise. As such, if no incriminati....
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....or Rs. 17.08 lakh for AY 2008- 2009. It was the assessee's case that the same stands financed by VNR, which was found false, with VNR being unable to explain even the source of the properties purchased in his name. For AY 2009-2010, it was the assessee's claim that the source of funds for the purchase of properties is not the credits appearing in the name of VNR. And which led the ld.CIT(A) to direct the AO to verify the availability of cash with the assessee, stated to arise on the sale of properties, so that, where available, no addition would hold (para 5.26 of the impugned order). The fact of the addition being maintained implies a failure on the assessee's part to prove the source of investments, i.e., the very reason for which the addition was made in the first place. For AY 2008-2009 also, the ld.CIT(A) endorsed the AO's finding of the assessee being unable to explain the source of investment made (para 5.21). His statement of the assessee having not proved the credit and the genuineness of the liability is only upon giving the credence to the assessee's claim of the investment being financed by VNR, a claim found to be without any basis. The additions u/s.69 and se....
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....uch as, as against material seized in 2008, the books of account produced in 2013, i.e., in the second round, or much later in time, upon collecting the entire data gathered, cannot by any stretch of imagination be regarded as the books of account being maintained in the regular course of its business by the assessee. In this context, it may be clarified, that an addition u/s.68, i.e., even assuming for the sake of argument of it being the correct provision, is misplaced, and for which reference be made to the decisions in Hukumchand Mills Ltd. (supra); Isha Beevi (supra). 5.1 The only other ground raised per the instant appeals is the date up to which the interest u/s. 234A for non-furnishing the returns of income is in law to be charged. While the Revenue has, as claimed, charged it up to 31.07.2014, i.e., the date of the impugned assessment/s, the assessee claims it to be up to 28.12.2010, i.e., the time of first assessment/s. Both have placed reliance on the decision in Mahesh Investments v. Asst. CIT [2021] 123 taxmann.com 6 (Kar) [227 Taxman 161]. 5.2 Section 234A reads as follows: Interest for defaults in furnishing return of income. 234A. (1) Where t....
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....e the return of income for any assessment year, required by a notice under section 148 or section 153A issued after the determination of income under subsection (1) of section 143 or after the completion of an assessment under sub-section (3) of section 143 or section 144 or section 147, is furnished after the expiry of the time allowed under such notice, or is not furnished, the assessee shall be liable to pay simple interest at the rate of one per cent for every month or part of a month comprised in the period commencing on the day immediately following the expiry of the time allowed as aforesaid, and,- (a) where the return is furnished after the expiry of the time aforesaid, ending on the date of furnishing the return; or (b) where no return has been furnished, ending on the date of completion of the reassessment or recomputation under section 147 or reassessment under section 153A, on the amount by which the tax on the total income determined on the basis of such reassessment or recomputation exceeds the tax on the total income determined under sub-section (1) of section 143 or on the basis of the earlier assessment aforesaid. Explanation.-[* * *] ....
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....sponsible by its conduct for the same, or the Revenue, is immaterial for the purpose of levy of interest u/s. 234A, which is only towards the delayed filing of the return. And which default, and with enough justification, receives closure by law on the completion of the assessment in the first instance. The only thing therefore relevant from the stand point of charge of this interest with reference to the subsequent proceedings is the revision in the assessed tax and, accordingly, the concomitant interest liability. Sec. 234A(4) only contemplates revision in the amount charged or chargeable, even if nil, as where the first assessment yields a nil assessed tax. We accordingly, for the reasons stated, find no merit in the Revenue's case. As regards the decision in Mahesh Investments (supra), the relevant part of which is reproduced at para 5.12 of the impugned order, the same infact supports the assessee's case. In sum 6. The assessee stating that no incriminating material was found during search is without basis on facts. Notice u/s. 153A r/w s. 153C in case of a person other than the persons searched, as the assessee in the instant case, can only be on the basis of a satisfac....