N B SURTI FAMILY TRUST vs. COMMISSIONER OF INCOME-TAX

ITR/146/1994HC GujaratGJHC24020223199406 October 2005Author: HONOURABLE MR. JUSTICE D.A.MEHTA,HONOURABLE MS. JUSTICE HARSHA DEVANI14 pages
AI SummaryAllowed

What were the facts?

The assessee, N B Surti Family Trust, is challenging the Income Tax Appellate Tribunal's (ITAT) decision for assessment years 1978-79 to 1982-83. The trust filed returns in 1987 under an Amnesty Scheme, claiming to be an Association of Persons (specific trust). The Assessing Officer (AO) requested details about the trust's creation, activities, and beneficiary shares. The assessee failed to provide any information or appear. Consequently, the AO passed assessment orders under Section 144, deeming the trust not genuine due to the absence of a trust deed. The CIT(Appeals) upheld the AO's decision, noting the assessee's failure to produce the trust deed and suggesting deliberate misleading. The assessee then appealed to the ITAT, where, on August 16, 1993, they first filed an affidavit seeking to admit a trust deed dated April 4, 1977. The ITAT rejected this request.

What did the High Court hold?

The Tribunal was right in rejecting the assessee's request to admit the trust deed dated April 4, 1977, as evidence. The High Court reasoned that this was not a case of additional evidence but of fresh evidence being adduced for the first time before the Tribunal, given the complete lack of documentation before the AO and CIT(Appeals). The significant delay in filing the returns (1987 for assessment years 1978-79 to 1982-83) and the subsequent failure to produce the trust deed despite multiple opportunities and adjournments, including summons under Section 131, demonstrated a lack of diligence. Furthermore, the Tribunal noted a critical discrepancy: the statement of facts filed before the CIT(Appeals) mentioned a trust created in 1976 by Narottambhai Bhagwanbhai Surti, whereas the trust deed sought to be produced was dated April 4, 1977, and settled by Shri Bhagwandas Govindji Surti. This inconsistency, observed at first sight, justified the Tribunal's refusal to admit the document. The Court found no infirmity in the Tribunal's discretionary order, holding that the assessee failed to discharge the primary onus of substantiating its claim at a belated stage. The question is answered in the affirmative, in favour of the revenue.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in rejecting the assessee's request of admitting in evidence the trust deed dated April 4, 1977, which was not filed at any earlier stage and was for the first time filed before the Tribunal on August 16, 1993? Assessee's contentions: The Tribunal erred by not recording a finding that the trust deed was irrelevant or unnecessary for deciding the appeal. The Tribunal should have remanded the matter for verification of the deed's genuineness. Reliance was placed on Pari Mangaldas Girdhardas v. CIT, R.S.S. Shanmugam Pillai & Sons v. CIT, and Anaikar Trades and Estates (P) Ltd. (No.2) v. CIT. Revenue's contentions: The Tribunal's order was correct, and the question should be answered in favour of the revenue.

Which sections of the Income-tax Act were involved?

Section 144,Section 256(1),Section 131

AI-generated summary — verify with the full judgment below

ITR/146/1994 1/14 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD INCOME TAX REFERENCE No. 146 of 1994 For Approval and Signature: HONOURABLE MR.JUSTICE D.A.MEHTA HONOURABLE MS.JUSTICE H.N.DEVANI ============================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ============================================================== N B SURTI FAMILY TRUST - Applicant(s) Versus COMMISSIONER OF INCOME-TAX - Respondent(s) ============================================================== Appearance : MR DK PUJ FOR MS NIYATI K SHAH for Applicant MR BB NAIK for Respondent ================================================================== CORAM :  HONOURABLE MR.JUSTICE D.A.MEHTA and HONOURABLE MS.JUSTICE H.N.DEVANI Date : 06/10/2005 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE D.A.MEHTA)

ITR/146/1994 2/14

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 256(1)

All 370 judgments and leading authorities on Section 256(1) →

Recent GST High Court judgments

Search GST case law →