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121 orders · Page 3 of 3
The High Court held that the ITAT was correct in its findings. The Court referred to its own prior decision in ITR No.65 of 1997, which dealt with identical substantial questions of law for the same assessee. In that decision, the Court had observed that Section 67(2) of the Cooperative Societies Act allows the reserve fund to be used in the business of the society. Therefore, there was no diversion of income by overriding title, nor was there an outgoing of funds from the assessee's domain. The profits set apart were available for the society's use in its business. Consequently, these profits could not be kept out of the purview of taxation. The Tribunal was thus right in holding that the amount transferred to the reserve fund was not a diversion of income at source by overriding title, nor could it be treated as a business expenditure deductible under Section 28 or Section 37 of the Act. The substantial questions of law were answered in favour of the revenue and against the assessee.
The High Court held that the substantial questions of law raised by the Revenue did not survive. The Court observed that the impugned judgment of the ITAT did not state that a dissolution clause is unnecessary. Instead, the ITAT had allowed the appeal relying on a coordinate bench decision, which was confirmed by a Division Bench of the High Court. Furthermore, the High Court noted that the trust deed of the respondent trust contained a clause for closure, which stipulated that upon closure, the trust property would be handed over to another institution or trust with similar objects, requiring a resolution by a minimum 2/3rd majority of members and a unanimous decision of the working trustees. The Court found no error in the ITAT's direction to grant registration under Section 12(aa) given this provision. The Court also added that any decision to close the trust would require appropriate permission from the Charity Commissioner under the Bombay Public Trust Act. Consequently, the substantial questions of law were not answered, and the appeal was dismissed.
The High Court held that no substantial question of law arises from the ITAT's order. The Court noted that the sundry creditors shown in the balance sheet for Assessment Year 2007-08 were already reflected as sundry creditors in the prior Assessment Year 2006-07. Therefore, there was no remission or cessation of liability during the year under appeal. Relying on its own decision in Commissioner of Income Tax Vs. Bhogilal Ramjibhai Atara (2014), the Court found no error in the ITAT's deletion of the addition of Rs. 31,82,258/- under Section 41(1). The appeal was dismissed.
The High Court held that the Tribunal committed no error in appreciating the evidence and holding the driver of the offending car solely negligent. The evidence, particularly the claimant not being cross-examined by the car driver and the driver's admission that his statement was disclosed for the first time before the Tribunal, supported this finding. The Tribunal also considered the chargesheet, the panchnama showing front-side damage to the motorcycle, and the fact that the car driver fled the scene. Consequently, the contention of contributory negligence by the Insurance Company was not sustainable. Regarding quantum, the Tribunal considered the claimant's newspaper agency income and ITRs for AY 2016-17, which were statutory documents and not subject to manipulation. The Supreme Court's decision in Malarvizhi & Ors. v. United India Insurance Company Limited & Anr. was cited, holding that income-tax returns are statutory and income should be considered as per ITRs. The assessment of Rs. 2,15,400/- per annum based on ITR for AY 2016-17 was deemed just and proper. The body disablement and multiplier were also not disturbed as parties agreed. The Court affirmed that compensation can exceed the claimed amount as per the benevolent object of the Motor Vehicles Act, referencing Nagappa Vs Gurudayal Singh and others. Therefore, the compensation of Rs. 7,86,788/- was rightly awarded.
The High Court reassessed the appellant's annual income to Rs. 4,41,380/- based on his income tax returns for the financial year 2021-22. The Tribunal's consideration of a 50% disability and a multiplier of 15, as per Sarla Verma (Smt) & Ors. Vs. Delhi Transport Corporation & Anr., was deemed just and proper. However, the Court found that the Tribunal had considered the multiplier of 15 without adequately accounting for future prospects, awarding Rs. 3,88,053/- under future loss of income. The Court enhanced this by 40%, leading to a total of Rs. 6,17,932/- per annum for future loss of income. The total compensation under future loss of income was recalculated to Rs. 46,34,490/-, an increase of Rs. 17,24,100/- from the Tribunal's award of Rs. 29,10,390/-. Compensation for pain, shock, and suffering was enhanced from Rs. 25,000/- to Rs. 50,000/-. Actual loss of income for six months was reassessed to Rs. 2,15,690/-, entitling the appellant to an additional Rs. 21,664/-. The total compensation was revised to Rs. 62,70,669/- from Rs. 44,99,905/-. The Court also noted that the Tribunal had awarded Rs. 25,00,000/- despite the calculated entitlement, and following Nagappa Vs Gurudayal Singh and others, held that just compensation should be awarded even if the claimant prayed for a lesser amount. The appeal was partly allowed, with the respondent directed to deposit the additional amount of Rs. 37,70,669/-.
The High Court held that in cases where assessees are subjected to reassessment under Section 153A (i.e., they were the searched persons), the AO cannot switch to or invoke Sections 147/148 based on incriminating material found during the search under Sections 132 or 132A. The statute prohibits this unless there is material gathered from an independent source. However, the Revenue is not barred from invoking Sections 147/148 if the conditions therein are met and there is material from an independent source, not connected to the search, from which the AO has reason to believe income has escaped assessment. For 'other persons' (Section 153C), the AO of the searched person must record satisfaction on incriminating material and communicate it to the jurisdictional AO of the 'other person'. Without this satisfaction note, the jurisdictional AO of the 'other person' cannot assume jurisdiction under Section 153C based solely on forwarded material. The Court answered the issues by stating that satisfaction recording is mandatory for the AO of a 'searched person' and communication to the 'other person's' AO. The 'other person' cannot be subjected to Section 153C without a satisfaction note. The jurisdictional AO of the 'other/searched person' can invoke Sections 147/148 only on material from other sources. If a satisfaction note is recorded and transmitted, the only recourse is Section 153C. The writ petitions of Group-A were dismissed, while those of Groups B, C, and D were allowed, quashing the reopening notices.
The High Court held that for assessees subjected to reassessment under Section 153A (i.e., the searched persons themselves), the AO cannot switch to or invoke Sections 147/148 based on incriminating material found during the search. However, the Revenue is not barred from invoking Sections 147/148 if conditions are met and based on material from an independent source discovered post-search. For 'other persons' (under Section 153C), it is mandatory for the AO of the 'searched person' to record satisfaction on incriminating material and communicate it to the jurisdictional AO of the 'other person'. In the absence of such a satisfaction note, the jurisdictional AO of the 'other person' cannot assume jurisdiction under Section 153C based solely on forwarded material; such action is illegal and without jurisdiction. The jurisdictional AO of the 'other person' can invoke Sections 147/148 only on the basis of material from sources other than that forwarded under Section 153C. If a satisfaction note is recorded and transmitted, the only recourse for the jurisdictional AO is to proceed under Section 153C. Consequently, certain petitions were dismissed, while others were allowed, quashing the reopening notices.
The High Court held that the question raised was no longer a substantial question of law, as it was covered by the principles of the doctrine of merger and well-settled decisions of the Apex Court and the High Court itself. The Court noted that the Tribunal's view in M/s.Saurashtra Chemical Ltd. was in consonance with the High Court's own view and the Apex Court's decisions. The Court found no reason to further examine the matter based on consistency principles, as the Tribunal's later view was supported by higher judicial pronouncements. The Court concluded that no substantial question of law arose and therefore, found no case for interference with the impugned orders passed by the Tribunal. The appeals were dismissed. The Civil Applications were disposed of as they would not survive.
The High Court held that the question raised no longer constituted a substantial question of law. It found that the Tribunal's view, allowing interest on refunds arising from appellate orders, was in consonance with the principles of the doctrine of merger and well-settled legal principles. The Court referred to its own earlier decisions and Supreme Court judgments, including the interpretation of the Sandvik case, which clarified that while compensation for inordinate delay in refund might be payable, 'interest on interest' was not approved. The Court found that the Tribunal's later view, supported by the High Court's and Supreme Court's pronouncements, should not be deprecated. Therefore, the appeals were dismissed as meritless, finding no substantial question of law requiring interference with the Tribunal's impugned orders.
The High Court held that the question raised no longer constituted a substantial question of law. It found that the Tribunal's view, allowing interest on refunds arising from appellate orders, was in consonance with the principles of the doctrine of merger and well-settled legal principles. The Court referred to its own earlier decisions and Supreme Court judgments, including the interpretation of the Sandvik case, which clarified that while compensation for inordinate delay in refund might be payable, 'interest on interest' was not approved. The Court found that the Tribunal's later view, supported by the High Court's and Supreme Court's pronouncements, should not be deprecated. Therefore, the appeals were dismissed as meritless, finding no substantial question of law requiring interference with the Tribunal's impugned orders.
The High Court held that the question raised was no longer a substantial question of law as it was covered by well-settled principles, including the doctrine of merger and previous decisions of the Supreme Court and the High Court itself. The Court noted that the Tribunal's view in M/s. Saurashtra Chemical Ltd. was in consonance with their own view and the Apex Court's decisions. The Court found no reason to further examine the matter based on consistency principles. The Court also addressed the Revenue's reliance on the Sandvik case, clarifying that while the Supreme Court in Sandvik did not approve of 'interest on interest' in that specific context, it did not disapprove of general principles for awarding compensation for delay in receiving monies due. However, the primary reasoning for dismissing the appeals was that the issue was already settled law, making it not a substantial question of law. The appeals were dismissed.
The High Court held that for assessees subjected to reassessment under Section 153A (i.e., the searched persons), the Assessing Officer cannot switch to or invoke Sections 147/148 based on incriminating material found during the search. However, the Revenue is not barred from invoking Sections 147/148 if conditions are met and based on material from an independent source other than the search material. For persons other than the searched person, it is mandatory for the Assessing Officer of the searched person to record satisfaction on incriminating material and communicate it to the jurisdictional Assessing Officer of the other person. In the absence of such a satisfaction note, the jurisdictional Assessing Officer cannot assume jurisdiction under Section 153C. The other person cannot be subjected to assessment under Section 153C without a satisfaction note, making such an approach illegal. The jurisdictional Assessing Officer of the other person can invoke Sections 147/148 only on material from sources other than the incriminating material sent to them. If a satisfaction note is recorded and transmitted, the only recourse is Section 153C, not Sections 147/148.
The High Court held that for assessees subjected to reassessment under Section 153A (i.e., the searched persons), the Assessing Officer cannot switch to or invoke Sections 147/148 based on incriminating material found during the search. However, the Revenue is not barred from invoking Sections 147/148 if conditions are met and based on material from an independent source other than the search material. For persons other than the searched person, it is mandatory for the Assessing Officer of the searched person to record satisfaction on incriminating material and communicate it to the jurisdictional Assessing Officer of the other person. In the absence of such a satisfaction note, the jurisdictional Assessing Officer cannot assume jurisdiction under Section 153C. The other person cannot be subjected to assessment under Section 153C without a satisfaction note, making such an approach illegal. The jurisdictional Assessing Officer of the other person can invoke Sections 147/148 only on material from sources other than the incriminating material sent to them. If a satisfaction note is recorded and transmitted, the only recourse is Section 153C, not Sections 147/148.
The High Court held that the assessment proceedings could not be maintained. The Court answered Question (A) in favour of the assessee and against the revenue. The reasoning was based on the mandatory requirement of issuing a notice under Section 143(2) of the Act. The Court referred to its earlier decision in Tax Appeal No. 1385 of 2007, which in turn relied on the Supreme Court's judgment in Assistant Commissioner of Income-tax vs. Hotel Blue Moon ([2010] 321 ITR 362). The Supreme Court had held that the AO must necessarily follow the provisions of Section 142 and sub-sections (2) and (3) of Section 143, and that the requirement of notice under Section 143(2) cannot be dispensed with as a mere procedural irregularity. Since Question (A) was answered in favour of the assessee, Question (B) regarding the assessment being under Section 144 did not survive and was not required to be answered. The impugned judgment and order of the ITAT were modified to the extent that the assessment was not sustainable. The appeal was allowed to this extent.
The High Court held that the appeals did not involve any substantial question of law. The Court found that the entire issue was based on factual aspects. The Tribunal had given elaborate reasoning to delete the addition, concluding that the addition of 'on money' in the assessee's case was unjustified. The Court noted that the Tribunal found no material evidence to establish that the assessee made an investment over and above what was recorded in the return of income. The Revenue's attempt to argue perversity in the Tribunal's findings was considered a futile attempt to have the High Court re-appreciate evidence, which is not permissible under Section 260A of the Act. The Court affirmed that the Tribunal's findings were based on a proper appreciation of facts and that no substantial question of law arose. Consequently, the addition of Rs. 5,22,500/- made under Section 69 was deleted.
The High Court held that the appeals do not involve any substantial question of law, as required by Section 260A of the Income Tax Act, 1961. The Court found that the ITAT had provided elaborate reasoning for deleting the addition of 'on money'. The entire issue was based on factual aspects, and the Tribunal, after considering the evidence and submissions, concluded that the addition was unjustified. The Revenue's attempt to demonstrate perversity in the ITAT's findings was deemed a futile effort to have the High Court re-appreciate facts. The Court reiterated that under Section 260A, it cannot undertake an exercise of re-examining evidence or factual background to determine the reliability of evidence or the correctness of findings of fact. The ITAT's finding that the Revenue failed to prove the assessee made an undisclosed investment, and the finding regarding non-payment of 'on money' by the assessee, were considered questions of fact. Therefore, the ITAT's order deleting the addition under Section 69 was upheld.
The High Court held that the appeals do not involve any substantial question of law, as required by Section 260A of the Income Tax Act, 1961. The Court found that the ITAT had provided elaborate reasoning for deleting the addition of 'on money'. The entire issue was based on factual aspects, and the Tribunal, after considering the evidence and submissions, concluded that the addition was unjustified. The Revenue's attempt to demonstrate perversity in the ITAT's findings was deemed a futile effort to have the High Court re-appreciate facts. The Court reiterated that under Section 260A, it cannot undertake an exercise of re-examining evidence or factual background to determine the reliability of evidence or the correctness of findings of fact. The ITAT's finding that the Revenue failed to prove the assessee made an undisclosed investment, and the finding regarding non-payment of 'on money' by the assessee, were considered questions of fact. Therefore, the ITAT's order deleting the addition under Section 69 was upheld.
The High Court partly allowed the appeal. Regarding contributory negligence, the Tribunal's finding of 40% contributory negligence on the part of the deceased was upheld. The Court found that the FIR, panchnama of the accident site indicating a wide road, and the fact that the claimant's witness lacked personal knowledge supported the Tribunal's conclusion that both drivers were not cautious enough, leading to a head-on collision. The appeal's claim that the deceased was not negligent at all was not accepted. Concerning the quantum of compensation, the Court reassessed the compensation. It found the deceased's income to be Rs. 4,42,465/- per annum, applying a multiplier of 18 for future loss of dependency, resulting in Rs. 79,64,370/-. Under loss of consortium, Rs. 1,45,200/- was awarded (Rs. 48,400 x 3), and Rs. 18,150/- each for loss of estate and funeral expenses. The total reassessed compensation, after deducting 40% for contributory negligence, came to Rs. 48,87,522/-. The Court directed the insurance company to deposit this enhanced amount. The 'pay and recover' order was upheld, citing Supreme Court decisions, to ensure victims are compensated while allowing insurers to recover from the owner who breaches policy conditions.
The High Court held that the Tribunal committed a serious error in interjecting and terminating the departmental proceedings prematurely. The department was merely in the process of reconsidering the evidence, as permitted by the Tribunal's earlier judgment dated 09.07.2009, and had issued show-cause notices for the delinquent's representation. The Tribunal ought not to have intervened at this stage, as the question of whether the evidence was sufficient to prove the charges should have been decided by the department. The Court noted that the employee had since been convicted in a bribery case. Therefore, the Tribunal's judgment dated 27.03.2013, which quashed the departmental OMs and terminated the proceedings, was set aside. The judgment of the Tribunal dated 14.03.2013, which was based on the employee's exoneration, was also set aside. The department was directed to proceed further from the stage of considering the respondent's representation to the second OM dated 19.03.2010, and to pass a fresh order. The department was also directed to carry out fresh pay fixation.
The High Court held that while the Tribunal did not commit an error in appreciating the evidence regarding the alleged income from the school teacher position, it found merit in reassessing the deceased's income. Considering the deceased's engineering degree, his future prospects as a promising young man, and his potential to earn more in the future, in light of Narender Dev Poonia (supra), the Court deemed it fit to consider the income of the deceased at ₹15,000/- per month to award just compensation. The Court reiterated that compensation should be just, fair, and reasonable, not a windfall or a pittance. The Tribunal's consideration of future prospective income at 40%, deduction of 1/2 for personal expenditure, and a multiplier of 18 were found to be just and proper. The loss of future dependency was reassessed to Rs.22,68,000/-. Conventional heads were also reassessed, leading to a total compensation of Rs.23,52,700/-. The appellant is entitled to an additional Rs.10,59,100/-. The appeal was partly allowed, modifying the Tribunal's award.
The High Court held that the action for reopening the assessment under Section 147 of the Income Tax Act, 1961, was barred by the first proviso. The Court noted that the respondent admitted that all relevant facts pertaining to the claim of depreciation were disclosed and produced at the time of the earlier assessment. Since there was no ground for non-disclosure of true and correct material facts, the four-year bar under the first proviso to Section 147 would apply, rendering the action under Section 147 without jurisdiction. Furthermore, the Court found considerable force in the petitioner's contention that the reassessment order was liable to be quashed because the AO proceeded to pass the order without considering and disposing of the petitioner's objections. Citing its own decision in General Motors India (P) Ltd. V/s. Deputy Commissioner of Income Tax, the Court stated that failure to follow the mandatory procedure of disposing of objections before proceeding with reassessment would require quashing the initiation of action and the subsequent order. Therefore, the Court quashed and set aside the action for reopening of assessment and the reassessment order.