TaxTMI 
TaxTMI 
TaxTMI 
2024 (10) TMI 590
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....e relevant Assessment Years 2008-09 to 2012-13 in the Income Tax Return Forms when there was no specific column in the ITR to that effect? 3. The question proposed by the Ld. Judicial Member are as under:- "1. Whether, the finding in Income Tax Appeal (in ITA Nos. 6720 to 6723/Mum/2018 vide order dated 03.01.2022 relating to A. Ys. 2008-09 to 2011-12) could have a bearing on the finding in BMA proceeding, when both being two different statutes? 2. Whether in the absence of any documentary evidence produced by the assessee can it be held that the alleged oral trust be valid and even otherwise can the assessee contend that he is not the beneficial owner of the said trust? 3. Whether the undisclosed income/asset which is disposed off before the enactment of the BMA would be a bar on the Id. A.O. to assume jurisdiction u/s. 10 of the BMA? 4. In the absence of any documentary evidence could it be held that the assessee has discharged his onus even when he has not explained the source of money deposited in the account of the Trust vehicle, in which he is the sole authorized signatory and the trustee of the said trust ? 5. Whether the applicability of case laws relied upon by t....
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....s made the sole authorized signatory for the alleged bank account no. 8044349 for unlimited amount. Another Board Resolution of ERSL dated 09/03/2006, which was submitted to Deutsche Bank, Singapore, has assessee's name as sole authorized signatory. His specimen signature has also appeared in the document and authenticated by ERSL. Moreover, this resolution has been duly entered in the Minute book and signed by the Chairman. 6.1. On the above facts, the authorities below took a stand that the assessee is treated as owner of the assets of the said bank account in Deutsche Bank, Singapore and income arising from there. According to the lower authorities, the onus is on the assessee to demonstrate the extent of such assets which can be explained as having been acquired through funds which have been disclosed to the Department. In absence of such evidence, the entire value of such assets is liable to be treated as income of the owner of the assets under BMA. 7. The Ld. AM was of the firm belief that the additions made under the Income Tax Act and BMA, are almost the same and since the Co-ordinate Bench in Income Tax proceedings passed an order dated 03/01/2022, wherein the Bench cons....
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....staking a claim for being substituted as a secured creditor under the SARFAESI Act consequent to the assignment of debt to it by the IFCI. That the claim was not simply with regard to assignment of an actionable claim under Section 130 of the T.P. Act is evident from its own pleadings and the pursis filed by the IFCI before the Debt Recovery Tribunal. No material has been placed before us with regard to the orders that may have been passed by the Tribunal on such application. After the claim of the appellant of being a secured creditor was rejected by the Company Judge, and the appellant realised the unsustainability of its claim in the law, it made a complete volte face from its earlier stand and surprisingly, contrary to its own pleadings, now contended that it had never sought the status of a secured creditor under the SARFAESI Act. 11. The contention of the appellant that it had never sought substitution as a secured creditor under the SARFAESI Act is additionally belied from the recitals contained in the order dated 07.09.2015. Time and again this court has held that the recitals in the order sheet with regard to what transpired before the High Court are sacrosanct. The lear....
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....the Ld. AM has not touched upon those issues and, therefore, as mentioned elsewhere, there is no question of any dissent between the Ld. Members. 10. Before me, the ld. Representatives relying upon the respective orders in favour of each, have fairly conceded that the core issue that needs adjudication is whether the decision of the Co-ordinate Bench in Income Tax proceedings is binding upon the Division Bench in BMA proceedings. 11. While enacting the BMA the introduction to the Act reads as under:- "An act to make provisions to deal with the problem of Black money that is undisclosed foreign income and assets, the procedure for dealing with such income and assets and to provide for imposition of tax on any undisclosed foreign income and asset held outside India and for matters connected therewith or incidental thereto." 11.1. In the Statement of Objects and Reasons, it has been provided that:- "4. The new legislation will apply to all persons resident in India and holding undisclosed foreign income and assets. A limited window is proposed to persons who have any undisclosed foreign assets. Such persons may file a declaration before the specified tax authority within a spec....
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.... attendance, production of evidence, impounding of books of account and documents. (v) The Central Government has been empowered to enter into agreements with other countries, specified territories and associations outside India inter alia for exchange of information, recovery of tax and avoidance of double taxation. (vi) Safeguards to prevent misuse have been embedded in the Bill. It will be mandatory to issue notices and grant of opportunity of being heard, record reasons for various actions and pass written orders. Appeal to the Income-tax Appellate Tribunal, and to the jurisdictional High Court and the Supreme Court on substantial questions of law have been provided for. (vii) Persons holding foreign accounts with minor balances which may not have been reported out of oversight or ignorance have been protected from criminal consequences. (viii) The Bill also proposes to amend Prevention of Money Laundering Act (PMLA), 2002 to include offence of tax evasion under the proposed legislation as a scheduled offence under PMLA. 6. The enactment of the proposed new Bill will enable the Central Government to tax undisclosed foreign income assets acquired from such undisclosed ....
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....ome under the Income-tax Act. This clause deals with the scope of total undisclosed foreign income and asset. It provides that the total undisclosed foreign income and asset of any previous year of an assessee shall be,- (a) the income from a source located outside India, which has not been disclosed in the return of income furnished under sub-section (1) or sub-section (4) or subsection (5) of section 139 of the Income-tax Act; (b) the income, from a source located outside India in respect of which a return is required to be furnished under section 139 of the Income-tax Act but no return of income has been furnished under sub-section (1) or sub-section (4) or subsection (5) of section 139 of the Income-tax Act; (c) the value of any undisclosed asset located outside India. It further provides that any variation made in the income from a source outside India in the assessment or reassessment of the total income of any previous year, of the assessee under the Income-tax Act in accordance with the provisions of section 29 to section 43-C or section 57 to section 59 or section 92-C of the said Act shall not be included in the total undisclosed foreign income. It also provid....
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....n the total undisclosed foreign income and asset under this Act shall not form part of the total income under the Income-tax Act." 14.1. Thus, any addition made as undisclosed foreign income and asset under the BMA, shall not be repeated under the Income Tax Act but there is no corresponding provision under the Income tax Act, which means that addition/s made under the Income tax Act have no bearing under the BMA. 15. The second most important feature in respect of the scope of total income is that under both the Acts, the provisions start with "Subject to the provisions of this Act....." and there is no non-obstante clause. Therefore, the scope of total income under the Income tax Act is only for the purpose of that Act. 16. Section 2(11) of the BMA, defines Undisclosed assets located outside India and Section 2(12) of the BMA defines Undisclosed foreign income and asset and the same read as under:- (11) "undisclosed asset located outside India" means an asset (including financial interest in any entity) located outside India, held by the assessee in his name or in respect of which he is a beneficial owner, and he has no explanation about the source of investment in such asse....
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....ordance with Section 59 of the Act shall not be included in the total income of the declarant for any assessment year under the Income Tax Act, if the declarant makes the payment of taxes. 17.2.1. It has been specifically provided u/s 65 of the BMA that, the declarant shall not be entitled, in respect of undisclosed asset located outside India declared or any amount of tax paid thereon, to reopen any assessment or reassessment made under the Income-tax Act or the Wealth-tax Act or claim any set-off or relief in any appeal, reference or other proceeding in relation to any such assessment or reassessment. 18. Thus, it is only under the BMA that such provisions have been provided whereas no such corresponding provisions are provided under the Income tax Act. This also goes to show that the proceedings under both the Act are clearly distinguishable and moreover, the proceedings under the Income tax Act, have no binding effect on the proceedings under the BMA inasmuch as the scope of income is totally different under both the Acts. 19. Section 70 of the BMA is produced as under:- 70. Applicability of certain provisions of Income-tax Act and of Chapter V of Wealth-tax Act.- The prov....
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....in section 5.", and it can be seen that none of the above is a deeming provisions and have different implications than Section 68 & 69 of the Act. Therefore, I am of the considered view that Ld. AM should have decided the quarrel within the four walls of BMA. 20.2. As mentioned elsewhere, since the Ld. AM has not given any finding in respect of the other issues, decided by the Ld. JM, there is no question of any dissent and, therefore, the decision of the Ld. JM shall prevail. 21. The second question which needs to be addressed raised by the Ld. AM is whether the assessee is obliged to make any disclosure of his assets/income held overseas in any capacity whatsoever during the relevant Assessment years 2008-09 to 2012-13 in the Income Tax Return Forms where there was no specific column in the ITR to that effect. The answer lies in Section 59 of the BMA, which is reproduced below at the cost of repetition:- "59. Declaration of undisclosed foreign asset.- Subject to the provisions of this Chapter, any person may make, on or after the date of commencement of this Act but on or before a date to be notified by the Central Government in the Official Gazette, a declaration in respec....