PARVINDER JIT SINGH BINDRA vs. COMMISSIONER OF INCOME TAX LUDHIANA

ITA/168/2014HC Punjab & HaryanaPHHC01109295201416 September 2014Author: MR. JUSTICE DR. RAVI RANJAN,MR. JUSTICE SURINDER GUPTA8 pages
AI SummaryDismissed

What were the facts?

The assessee, Parvinder Jit Singh Bindra, filed an appeal before the High Court of Punjab and Haryana against an order of the Income Tax Appellate Tribunal (ITAT) for the assessment year 2001-02. The ITAT had partly allowed the assessee's appeal against the order of the Commissioner of Income Tax (Appeals), which had upheld the Assessing Officer's order. The Assessing Officer had made additions to the assessee's income, including Rs. 12,30,000 declared in a block assessment, Rs. 16,00,000 received as advance for property sale, and an estimated Rs. 10,00,000 as commission income. The ITAT's order was dated December 19, 2013. The appeal before the High Court was filed under Section 260A of the Income Tax Act, 1961.

What did the High Court hold?

The High Court held that the appeal lacked merit and no substantial question of law arose. Regarding the jurisdiction for regular assessment under Section 143(3), the Court agreed with the Tribunal that the warrant of authorization under Section 132A was never executed as the cash was not handed over to the Income Tax Department. The Court noted that Section 158BC is a special provision requiring specific conditions to be met, and the assessee had not even paid taxes due for the block period. The Court found no bar to framing a regular assessment under Section 143(3) and no prejudice caused to the assessee. Concerning the addition of Rs. 16 lacs, the Tribunal found the transaction unaccounted for in the assessee's hands. The Court upheld the Tribunal's reasoning that the affidavit of Mr. Banerjee alone was insufficient to prove his creditworthiness and capacity to pay without supporting material. The Tribunal noted discrepancies in documents, names, and the absence of witnesses, and relied on the decision in Dr. Prem Chand Sharma vs. CIT. The addition of Rs. 10 lacs for commission was also confirmed as part of the overall assessment. The Court found no perversity in the Tribunal's order.

What were the issues?

The High Court had to decide the following substantial questions of law: 1. Whether the ACIT had valid jurisdiction to make a regular assessment under Section 143(3) when jurisdiction was transferred for block assessment under Section 158BC, which was dropped due to unexecuted warrants of authorization because cash seized by FEMA was not handed over (Section 158BC, Section 132A). 2. Whether the Tribunal was correct in confirming the regular assessment under Section 143(3) without first deciding if the ACIT had competent jurisdiction, given the block assessment was dropped (Section 143(3), Section 158BC). 3. Whether the ITAT correctly held that the warrant under Section 132A remained unexecuted solely because cash was not handed over, despite other documents being received, contrary to Explanation 2(b) to Section 158BE (Section 132A, Section 158BE). 4. Whether the ITAT legally confirmed the addition of Rs. 16 lacs without considering documentary evidence, including an affidavit from Mr. Banerjee confirming the transaction and repayment (Section 143(3)). 5. Whether the Tribunal was right in confirming the estimated addition of Rs. 10 lacs for commission income by relying on FEMA-seized documents, while simultaneously ignoring them to hold the Section 132A authorization unexecuted, and without independent IT authority statements (Section 143(3)). 6. Whether the Tribunal's order was perverse and illegal. Assessee's contentions: The assessee argued that assessment should have been under Section 158BC as the warrant under Section 132A was executed. They also contended that the addition of Rs. 16 lacs was against documentary evidence, including Mr. Banerjee's affidavit. The revenue did not record specific arguments in the judgment.

Which sections of the Income-tax Act were involved?

Section 260A,Section 143(3),Section 158BC,Section 132A,Section 158BE,Section 113,Section 139

AI-generated summary — verify with the full judgment below

-1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of Decision: 16.9.2014 Parvinder Jit Singh Bindra ....Appellant Versus Commissioner of Income Tax, Central Circle, Ludhiana ...Respondent. CORAM:- HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. HON'BLE MR. JUSTICE FATEH DEEP SINGH. PRESENT: Mr. Jorawar Singh Bhasin, Advocate for the appellant. AJAY KUMAR MITTAL, J.

1.

This appeal has been filed by the assessee under Section 260A of the Income Tax Act, 1961 (in short “the Act”) against the order dated 19.12.2013 (Annexure A-3) passed by the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (hereinafter referred to as “the Tribunal”) in ITA No. 270(ASR)/2010 for the assessment year 2001-02, claiming the following substantial questions of law:- “A) Whether in the facts and circumstances of the case, the ACIT Central Circle-I, Jalandhar, was vested with valid juri iction to make regular assessment under section 143(3), when the juri iction was transferred to him to make block assessment under section 158 BC, which was dropped for non-execution of warrants of GURBACHAN SINGH 2014.10.17 14:50 I attest to the accuracy and

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