×Latest Case Laws on Income Tax by various Income Tax Appellate Tribunals in India
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03-04-2019, Rakesh Sarin & Sons HUF, Section 250(6), 158BC, Tribunal Chennai
This appeal by the assessee is directed against the order passed by the learned Commissioner of Income Tax (A)(C)-II, Chennai, dated 30.09.2014 in ITA No.452/06-07 for the block period 01.04.1996 to 27.03.2003 passed U/s.250(6) r.w.s. 143(3) r.w.s. 158BC & 158BD of the Act.
2. The assessee has raised several grounds in its appeal however the cruxes of the issues are that:-
i. The Ld.CIT(A) has erred in upholding the Order of the Ld.AO that the assessee had not filed its return of income for the assessment years falling within the block period before the date of search and thereby made addition of Rs.14,28,240/-.
ii. The Ld.CIT(A) has erred in sustaining the addition made by the Ld.AO amounting to Rs.10,00,000/- being the money advanced to M/s. Vicky Films and Rs.4,50,000/- being the money advanced to M/s. Nadiadwala Grandson Entertainment as unexplained investment.
iii. The Ld.CIT(A) has erred in confirming the addition of Rs.4,500/ towards investment in shares, Rs.5,00,000/- towards investment made in RBI bonds, Rs.25,000/- with respect to investment made in various UTI/IDBI and HDFC Relief bonds, Rs.20,000/- being the investment made in Kisan Vikas Patras, Rs.3,50,000/- and Rs.41,50,000/- towards investment in RBI relief bonds which was assigned to Standard Chartered Bank as the undisclosed investments / income of the assessee.
iv. The Ld.CIT(A) has erred in confirming the addition made by the Ld.AO amounting to Rs.13,41,800/- as unaccounted investment being the cash deposits in the bank account and Rs.14,106/- towards deposit in RD account. v. The Ld.CIT(A) has erred in sustaining the addition made by the Ld.AO amounting to Rs.4,72,112/ towards negative cash balance.
vi. The Ld.CIT(A) has erred in sustaining the addition made by the Ld.AO amounting to Rs.25,50,000/- as the undisclosed investment of the assessee being the unaccounted pro-notes found during the course of search.
vii. The Ld.CIT(A) has erred in sustaining the addition made by the Ld.AO amounting to Rs.5,84,529/- towards purchase of fixtures and amenities as unexplained investment.
3. The brief facts of the case are that the assessee is a HUF whose Karta Shri Rakesh Sarin was searched on 27.03.2003 and concluded on 28.08.2003. Thereafter a notice U/s.158BC r.w.s. 158BD was served to the assessee on 23.02.2005 requesting the assessee to file its return of income. Subsequently the assessee filed its return of income for the block assessment period on 18.03.2005. Thereafter assessment was completed U/s.143(3) r.w.s. 158BC & 158BD of the Act vide order dated 28.02.2007 wherein the Ld.AO made several additions which was further sustained by the Ld.CIT(A).
4. Ground No.2(i) : Non filing of Income Tax returns:- During the course of investigation, it was observed that the assessee had made substantial investments in recurring deposit, RBI Relief bonds, shares, KVP, HDFC Relief bonds etc., and also had advanced huge loans to various parties. It was explained by the assessee that they had disclosed the same in its return of income or all the assessment years and also produced the acknowledgements for having filed the return of income. However on verifying the acknowledgements submitted by the assessee, it was observed that the acknowledgement number did not pertain to the assessee but to different persons. Therefore the Ld.AO opined that the returns filed by the assessee are bogus towards which the