Gujarat High Court Judgments — 2018

The High Court dismissed the appeal, holding that no question of law arises. Regarding the addition of Rs. 1.59 crores (rounded off) due to stock discrepancy, the Court noted that the Assessing Officer made the addition based on the difference between the assessee's books of account and the stock statement filed with the bank. The CIT(A) had granted substantial relief, retaining only Rs. 19.46 lakhs. The Tribunal deleted the remaining amount, observing that there was no difference in physical stock and the stock shown in the assessee's accounts on the date of the survey. The stock statements filed with the bank pertained to April to August, while the survey occurred in September. The Court acknowledged the tendency to show higher stock values to obtain higher cash credit limits. The Court found that the entire issue was based on facts duly appreciated by the CIT(A) and the Tribunal. Therefore, no question of law arose from this issue. The Court also noted that another question raised was merely an element of the first question and required no separate discussion.

The High Court dismissed the Revenue's appeal, finding it similar to a previously decided Tax Appeal No. 1192 of 2018. In that prior case, the Revenue was in appeal against an ITAT order remanding proceedings to the CIT(A) because the appeal order was ex-parte. While the Court acknowledged the appellant's grievance that the Tribunal did not impose restrictions or costs on the assessee to ensure seriousness, it held that solely for this reason, it was not inclined to entertain the appeal, as it did not find any question of law arising. The Court noted that the Tribunal would bear these observations in mind for future cases. Therefore, applying the same reasoning, the present appeal was also dismissed.

The High Court dismissed the Revenue's appeal. The Court noted that the Tribunal had deleted the addition primarily on the ground of consistency, observing that the assessee had followed the same pattern for years without prior objection from the Revenue. Independently, the Court found the disallowance unjustified on merits. The Court reasoned that the expenditure was estimated based on a scientific exercise using past data of compressor failures, which is a well-established principle for allowing estimated expenditure. The Court acknowledged the principle of allowing expenditure based on estimation derived through scientific exercise, akin to actuarial practices in statistical terms. Therefore, the disallowance was not justified.

The High Court held that the Tribunal's view was correct. The liability for additional tax arose from a retrospective amendment to Section 115JB of the Act. While the Supreme Court in Rolta India Ltd. held that interest under Section 234B is payable on failure to pay tax under Section 115JA (a predecessor to 115JB), that case did not deal with a situation where the liability arose from a retrospective amendment. The Court relied on its own decision in CIT v. National Dairy Development Board ((2017) 397 ITR 543 (Guj)), which held that if an assessee's advance tax computation was in accordance with the provisions of Chapter XVII in the absence of a retrospective amendment, no liability to pay additional tax existed. Such liability arose only due to the subsequent retrospective amendment. Therefore, interest on short payment of advance tax cannot be levied in such circumstances. The appeal was dismissed.

The High Court dismissed the Revenue's appeal. The Court referred to a similar issue that had come up before it in Tax Appeal No. 1192 of 2018, which was also dismissed. In that previous case, the Tribunal had remanded the proceedings for consideration by the CIT(Appeals) on the ground that the appeal order was ex-parte. While the Court acknowledged the Revenue's grievance that the Tribunal did not impose any restrictions or costs on the assessee to ensure seriousness in proceedings, it stated that for this reason alone, it was not inclined to entertain the appeal. The Court found no question of law arising from the ITAT's order. The operative direction was the dismissal of the appeal. No issues were left undecided.

The High Court dismissed the Revenue's appeal, following its own decision in a similar case, Tax Appeal No. 1192 of 2018. In that prior case, the Court had observed that while the Tribunal's decision to remand the proceedings for consideration by the CIT(A) on the ground that the appeal order was ex-parte was permissible, the Tribunal could have imposed a fair amount of cost on the assessee to ensure seriousness in the proceedings. However, the Court held that solely for the purpose of suggesting imposition of cost, it was not inclined to entertain the appeal, as it did not find any question of law arising. The Court noted that in future, the Tribunal would bear these observations in mind. Therefore, the present appeal was also dismissed on similar grounds, without delving into the merits of the ITAT's decision regarding the assessee's non-compliance.

The High Court addressed two questions of law. Regarding the first issue concerning the disallowance of Rs. 2,58,61,384 for warranty expenses, the Court noted that the CIT(A) believed the expenditure was based on the actual cost of rendering past sale services. The Tribunal upheld this decision. The second issue involved an ad-hoc 10% disallowance of Rs. 2,12,24,500 for expenditures lacking bills and vouchers. The CIT(A) permitted additional evidence, obtained a remand report, and found that the expenditures were reflected. The Court observed that for this second issue, 'No question of law arises.' The judgment does not explicitly detail the reasoning for upholding the deletion of the warranty expenses, but it implies agreement with the lower authorities' findings. The operative direction was to dismiss the appeal.

The High Court held that while the assessee's contention regarding the correctness of taxing income in the hands of the correct assessee might not be accepted, the imposition of penalty was unwarranted. The Court found that the relevant facts indicated no attempt on the part of the assessee to evade tax payment, especially since the family members had also been assessed separately. Therefore, the imposition of penalty was reversed. The question of law was answered in favour of the assessee, and the Tax Appeal was disposed of.

The High Court held that it did not find any error in the view taken by the CIT(A) and the Tribunal concerning the two confirmed additions. Regarding the first issue, the court implicitly agreed with the lower authorities' assessment of the Annual Letting Value (ALV) for the property, finding no material basis to challenge it as unrealistically high. Concerning the second issue of clubbing the income of family members, the court found no error in the concurrent findings of the CIT(A) and the Tribunal that such income belonged to the assessee. The court reasoned that the assessee had failed to produce cogent evidence to prove the property value was lower than determined or to disprove the clubbing of income. Consequently, the court concluded that no question of law arose from the Tribunal's order. The Tax Appeal was dismissed.

The High Court held that the sole surviving question related to the assessee's disclosure of unaccounted receipts during a survey operation, which the Assessing Officer had taxed under Section 68. The assessee argued that this income should be eligible for deduction under Section 80IB(10) as it pertained to housing project development. The CIT(A) and the Tribunal had accepted this argument. The Revenue's appeal was based on this point. The Court noted that there was nothing on record to suggest the assessee had other businesses or that the undisclosed receipts were profits from any activity other than housing project development. The Tribunal had specifically concluded that the unrecorded consideration was part of the assessee’s sale transaction of completed residential units and therefore eligible for deduction under Section 80IB(10). The High Court found no error in this view. Consequently, the Tax Appeal was dismissed. The Court did not explicitly leave any issues undecided.

The High Court dismissed the Revenue's appeal. Regarding issues [A] and [B], the Court noted that similar questions for earlier assessment years in Tax Appeals No. 1154 and 1155 of 2018 were dismissed on September 17, 2018. In those dismissed appeals, the Court had relied on its Division Bench judgment in Commissioner of Income Tax vs. Radhe Developers (341 ITR 403). That judgment held that an assessee undertaking housing development at their own risk and cost, where the landowner receives the full price and is not concerned with the project's success or failure, qualifies for deduction under Section 80IB(10), even if the land was held by the original owner during execution. The Court found no error in the ITAT's view that the undisclosed receipts were part of the assessee's sale transactions of completed residential units and thus eligible for deduction under Section 80IB(10). The Court found no reason to deviate from its earlier findings and dismissed the appeal.

The High Court held that the Tribunal was justified in its conclusion. The Court reasoned that cancellation of registration under section 12AA(3) requires satisfaction that the trust's activities are not genuine or not carried out in accordance with its objects. Mere breach of sections 11(1)(d) or 13(1)(c) does not automatically satisfy these grounds, as supported by the Welham Boy's School Society case. The Director's conclusion that the trust diverted funds for non-charitable objects and operated on commercial lines was found incorrect. The Tribunal correctly noted that the intention was to acquire land for educational expansion, and the agreement to purchase agricultural land was a procedural aspect. Receiving donations does not per se imply commercial operations; collecting fees for self-financed educational institutions is normal. A reasonable surplus is permissible if utilized for trust objects, as per Queen's Educational Society and Visvesvaraya Technological University cases. The Court clarified that the proviso to section 2(15) applies to 'advancement of any other object of general public utility' and not to education itself, thus the revenue's reliance on the amended section 2(15) was misplaced. The appeal was dismissed.

The Tribunal held that the assessee had discharged its primary onus by providing sufficient proof regarding the share application money. The investors, M/s. General Capital and Holding Co. Pvt. Ltd., had confirmed the transactions. The amounts were received through banking channels and were reflected in the annual accounts of the investing company. Bank statements filed before the appellate authorities showed no cash deposits as alleged by the AO. The director of the investing company had also appeared before the AO and confirmed the transactions. The Tribunal noted that both the assessee company and the share applicant were managed by the same group of persons. It further relied on the consistent view of the Gujarat High Court that if an assessee provides sufficient proof for share applications, no addition can be made in the assessee's hands; any doubt about the share applicant's source should be investigated in the applicant's hands, not the assessee's. Consequently, the Tribunal confirmed the deletion of the addition.

The High Court acknowledged that the issue was squarely covered by its own prior judgment in CIT vs. Gujarat State Road Transport Corporation Limited. However, considering that an SLP was pending before the Supreme Court and the disputed amount was small, the Court opted for an arrangement to allow the assessee to benefit from a potential Supreme Court reversal without immediate further appeal. The Court dismissed the appeal at that stage but provided that if the Supreme Court reverses the judgment in CIT vs. GSRTC, the assessee would be permitted to revive the appeal by filing an application within three months from the date of the Supreme Court's judgment. The operative direction is to dismiss the appeal with a liberty to revive.

The High Court acknowledged the Revenue's grievance that the ITAT should have imposed some conditions or costs on the assessee when remanding the proceedings to ensure seriousness. The Court was of the prima facie view that imposing a fair amount of cost could have been considered to instill a required level of seriousness. However, the Court stated that solely for this reason, they were not inclined to entertain the appeal, as they did not find any other substantial question of law arising from the ITAT's order. The Court expressed hope that the Tribunal would bear these observations in mind in future proceedings. The appeal was disposed of accordingly, with the operative direction being the disposal of the tax appeal.

The Gujarat High Court dismissed the appeal filed by the assessee. The Court acknowledged that the issue was covered by its own prior judgment in CIT vs. GSRTC. While the assessee sought the benefit of a potentially favorable Supreme Court decision on the pending SLP, the Court opted for a pragmatic approach due to the small disputed amount. The appeal was dismissed at that stage, but with a specific liberty granted to the assessee. The assessee was permitted to revive the appeal by filing an application within three months from the date of the Supreme Court's judgment, should the Supreme Court reverse the decision in CIT vs. GSRTC. This conditional dismissal aimed to provide the assessee with the benefit of the Supreme Court's ruling without requiring them to file a fresh appeal if the precedent was overturned.

The High Court acknowledged that the issue was covered by its own prior judgment in CIT vs. Gujarat State Road Transport Corporation Limited. However, it noted the pendency of an SLP before the Supreme Court against this judgment. Considering the smallness of the disputed amount and the potential expense for the assessee to appeal to the Supreme Court, the Court opted for a pragmatic approach. The appeal was dismissed at that stage. However, the Court provided a mechanism for the assessee to revive the appeal if the Supreme Court reverses the judgment in the CIT vs. GSRTC case. The assessee would be permitted to file an application for revival within three months from the date of the Supreme Court's judgment. The ratio is that procedural flexibility can be exercised to grant relief in cases where a higher court is considering a precedent-setting matter, especially when the amount in dispute is small and the assessee faces significant costs.

The High Court acknowledged the Revenue's grievance that the ITAT, while remanding the proceedings to the CIT(Appeals) due to an ex-parte order, did not impose any conditions or restrictions on the assessee to ensure seriousness. The Court opined that imposing a fair amount of cost could have instilled the required seriousness. However, the Court stated that solely for this reason, it was not inclined to entertain the appeal as it did not find any substantial question of law arising from the ITAT's order. The Court expressed hope that the ITAT would bear these observations in mind in future proceedings. The appeal was disposed of accordingly.

The High Court dismissed the petition, holding that at the stage of reopening, it was not inclined to interfere. The Court noted that the petitioner's return was accepted without scrutiny under Section 143(1), which grants the Assessing Officer wider latitude to reopen and negates the principle of change of opinion. The Court explicitly stated that it was not inclined to delve into the prima facie evidence of the transfer of the capital asset or the petitioner's contention of a fraudulent transaction. These issues, the Court held, were for the Assessing Officer to examine and decide during the reassessment proceedings. The Court also highlighted the risk of the assessment becoming time-barred if the Assessing Officer was prevented from proceeding. The Court clarified that it had expressed no opinion on the taxability of the amount and kept all contentions of the petitioner open to be raised before the Assessing Officer. The operative direction was to dismiss the petition.

The High Court held that the petitioner could not maintain the litigation. The court reasoned that the Karta of the HUF had already initiated litigation and pursued remedies to protect the HUF's interest. The cause of action arose in 2001, and the petitioner filed the petition in 2018, solely on the ground of attaining majority. The court emphasized that the law does not recognize multiple actions by different members of an HUF long after the cause of action has arisen. A crucial element for maintaining a writ petition under Article 226 is timely action. The petitioner, filing 17 years later, was essentially taking up the cause for the HUF and not in his individual capacity. The Karta was managing the affairs at the relevant time, and the petitioner did not possess an independent right to raise these grievances. Therefore, the petition was dismissed. No issue was expressly left undecided.

The High Court held that the Tribunal erred in refusing to condone the delay. The Court found that the Tribunal overlooked the crucial aspect of the starting point of limitation, which commences upon the communication of the order under challenge. The assessee's assertion that the order was not served earlier was not contested by the Revenue. Therefore, the High Court reversed the Tribunal's order, allowing the appeal. The Tax Appeal was restored to the file of the Tribunal for disposal on merits. The principle established is that the period of limitation for filing an appeal runs from the date of communication of the order, and if the assessee demonstrates non-receipt and the revenue does not contest it, delay should be condoned.

The High Court dismissed the Revenue's appeal, following its earlier decision in a similar case involving the same assessee. Regarding the opening stock (Question A), the Court noted that the CIT(A) and the Tribunal had concurrently held on facts that the assessee's declaration was genuine. Evidence included a certificate from the Superintendent of Central Excise, Surat, confirming the stock position as of March 31, 2003, and declarations made to both Income Tax and Central Excise authorities. The stock was subsequently sold with proper declarations and CENVAT credit claims. The Court found no question of law arose as the issue was based on appreciation of record. For bogus creditors (Questions B and C), the Tribunal confirmed the CIT(A)'s view, finding sufficient evidence of genuineness and noting that adding these purchases would distort the gross profit rate. The Court again found the issues to be based on appreciation of record with no question of law arising. For disallowance of expenses (Question D), the Court deemed the question factual, involving a small amount. Therefore, all issues were decided in favour of the assessee based on concurrent findings of fact by the lower appellate authorities.

The High Court held that no question of law arises from the order of the Income Tax Appellate Tribunal. The Tribunal had placed the matter back before the Commissioner of Income Tax (Appeals) for fresh disposal in accordance with law, drawing a conclusion that the non-appearance of the assessee before the CIT(A) was neither intentional nor deliberate. The High Court did not delve into the merits of the assessee's compliance or non-compliance, nor did it re-examine the ITAT's finding on the intent behind the non-appearance. The operative direction was to dismiss the Tax Appeal. The ratio decidendi is that if the Tribunal, in its appellate jurisdiction, finds that an assessee's non-appearance was not intentional or deliberate, and remands the matter for fresh adjudication, such an order may not give rise to a substantial question of law for further appeal to the High Court, especially if the ITAT's order is based on its factual appreciation of the circumstances.

The High Court dismissed the Tax Appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court found that the Excise show-cause notices were at a preliminary stage and no final adjudication orders had been passed. The material collected by the Excise Department, including witness statements, had not been independently established or verified by the Assessing Officer. The AO had merely confronted the assessee with the show-cause notice and accompanying material, shifting the burden of proof to the assessee. The Court noted that the statements and their veracity were not automatically established by merely producing copies. Therefore, the AO lacked sufficient independent material to justify the additions. The question of the percentage of sales at which additions should be made became redundant in the absence of a valid basis for making additions.

The High Court dismissed the appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court held that the Excise Department's show-cause notices were at a stage where no final adjudication had occurred, and the material collected by the Excise Department was yet to be verified. The Assessing Officer had not brought any independent material on record beyond what was collected by the Excise Department. The Court found that the AO had merely cosmetically given the assessee an opportunity to respond to allegations, effectively shifting the burden of proof. The Court noted that the veracity of the statements collected by the Excise Department was not established. Therefore, the AO lacked sufficient basis for making additions, rendering the question of the percentage of sales for additions redundant. The question was decided against the Revenue.

The Tribunal held that the assessee HUF was eligible for deduction under Section 54F of the Income Tax Act, 1961. The reasoning was that while the sale deed for the new residential house was executed in the names of two members of the HUF, the Tribunal found that the new residential house was acquired out of the resources of the HUF and was also declared in the books of accounts of the HUF as property belonging to the HUF. Therefore, the investment in the names of the members was, in substance and effect, owned by the HUF. The Tribunal considered this as substantial compliance with the requirements of Section 54F, as neither the source of acquisition nor the accounting of the new asset in the HUF's books was disputed by the Revenue. The Tribunal distinguished the cited High Court judgments, noting that in those cases, the new asset was purchased in the name of persons other than the assessee, and the title was vested in those purchasers, unlike the present case where the HUF was the beneficial owner as reflected in its accounts. The appeal was dismissed.

The High Court dismissed the appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court held that the Excise Department's show-cause notices were at a stage where no final adjudication had occurred, and the material collected by the Excise Department was yet to be verified. The Assessing Officer had not brought any independent material on record beyond what was collected by the Excise Department. The Court found that the AO had merely cosmetically given the assessee an opportunity to respond to allegations, effectively shifting the burden of proof. The Court noted that the veracity of the statements collected by the Excise Department was not established. Therefore, the AO lacked sufficient basis for making additions, rendering the question of the percentage of sales for additions redundant. The question was decided against the Revenue.

The High Court dismissed the appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court held that the Excise Department's show-cause notices were at a stage where no final adjudication had occurred, and the material collected by the Excise Department was yet to be verified. The Assessing Officer had not brought any independent material on record beyond what was collected by the Excise Department. The Court found that the AO had merely cosmetically given the assessee an opportunity to respond to allegations, effectively shifting the burden of proof. The Court noted that the veracity of the statements collected by the Excise Department was not established. Therefore, the AO lacked sufficient basis for making additions, rendering the question of the percentage of sales for additions redundant. The question was decided against the Revenue.

The High Court dismissed the appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court held that the Excise Department's show-cause notices were at a stage where no final adjudication had occurred, and the material collected by the Excise Department was yet to be verified. The Assessing Officer had not brought any independent material on record beyond what was collected by the Excise Department. The Court found that the AO had merely cosmetically given the assessee an opportunity to respond to allegations, effectively shifting the burden of proof. The Court noted that the veracity of the statements collected by the Excise Department was not established. Therefore, the AO lacked sufficient basis for making additions, rendering the question of the percentage of sales for additions redundant. The question was decided against the Revenue.

The High Court dismissed the appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court held that the Excise Department's show-cause notices were at a stage where no final adjudication had occurred, and the material collected by the Excise Department was yet to be verified. The Assessing Officer had not brought any independent material on record beyond what was collected by the Excise Department. The Court found that the AO had merely cosmetically given the assessee an opportunity to respond to allegations, effectively shifting the burden of proof. The Court noted that the veracity of the statements collected by the Excise Department was not established. Therefore, the AO lacked sufficient basis for making additions, rendering the question of the percentage of sales for additions redundant. The question was decided against the Revenue.

The High Court dismissed the appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court held that the Excise Department's show-cause notices were at a stage where no final adjudication had occurred, and the material collected by the Excise Department was yet to be verified. The Assessing Officer had not brought any independent material on record beyond what was collected by the Excise Department. The Court found that the AO had merely cosmetically given the assessee an opportunity to respond to allegations, effectively shifting the burden of proof. The Court noted that the veracity of the statements collected by the Excise Department was not established. Therefore, the AO lacked sufficient basis for making additions, rendering the question of the percentage of sales for additions redundant. The question was decided against the Revenue.

The High Court dismissed the appeals, following its earlier decision in the case of The Principal Commissioner of Income Tax Rajkot-3 vs. Vrundavan Ceramics Pvt. Ltd. The Court held that the Excise Department's show-cause notices were at a stage where no final adjudication had occurred, and the material collected by the Excise Department was yet to be verified. The Assessing Officer had not brought any independent material on record beyond what was collected by the Excise Department. The Court found that the AO had merely cosmetically given the assessee an opportunity to respond to allegations, effectively shifting the burden of proof. The Court noted that the veracity of the statements collected by the Excise Department was not established. Therefore, the AO lacked sufficient basis for making additions, rendering the question of the percentage of sales for additions redundant. The question was decided against the Revenue.

The High Court held that the notice for reassessment for AY 2010-11 was invalid. The Court found that the Assessing Officer had conducted a detailed scrutiny of the petitioner's claim for deduction under Section 10A in the original assessment proceedings for AY 2010-11, raising multiple queries which were duly replied to by the petitioner. The AO had also provided brief reasons for accepting the claim in the assessment order. Therefore, it was not open for the AO to reopen the assessment on the principal claim based on a change of opinion, which is impermissible even after the amendment to Section 147 of the Act, as per the Supreme Court's decision in CIT vs. Kelvinator of India Ltd. The Court also referred to its previous judgment in a similar case for AY 2007-08, where a reassessment was quashed on similar grounds. Consequently, the consequential order of assessment and the revision order passed by the Principal Commissioner were set aside. The petition was allowed.

The High Court dismissed the Tax Appeals filed by the Revenue. The Court observed that the Assessing Officer (AO) had not independently gathered material to support the additions made on account of suppressed sales. Instead, the AO relied solely on the show-cause notices issued by the Excise Department and the statements of witnesses recorded during the excise search. The Court found that these materials were yet to be adjudicated by the Excise authorities and thus remained in the realm of the department's stand, not yet established. The AO had merely confronted the assessee with these materials and obtained a brief reply denying the allegations, without bringing any independent material on record. The Court held that merely producing copies of statements does not automatically establish their veracity. The AO's action was considered to be cosmetically giving the assessee an opportunity to respond, virtually shifting the burden of proof to the assessee. Therefore, the AO lacked sufficient material to make the additions, rendering the question of the percentage of sales for additions redundant. The Court relied on its previous order in similar cases dismissing the Revenue's appeals.

The High Court dismissed the Tax Appeals filed by the Revenue. The Court observed that the Assessing Officer (AO) had not independently gathered material to support the additions made on account of suppressed sales. Instead, the AO relied solely on the show-cause notices issued by the Excise Department and the statements of witnesses recorded during the excise search. The Court found that these materials were yet to be adjudicated by the Excise authorities and thus remained in the realm of the department's stand, not yet established. The AO had merely confronted the assessee with these materials and obtained a brief reply denying the allegations, without bringing any independent material on record. The Court held that merely producing copies of statements does not automatically establish their veracity. The AO's action was considered to be cosmetically giving the assessee an opportunity to respond, virtually shifting the burden of proof to the assessee. Therefore, the AO lacked sufficient material to make the additions, rendering the question of the percentage of sales for additions redundant. The Court relied on its previous order in similar cases dismissing the Revenue's appeals.

The High Court dismissed the Tax Appeals filed by the Revenue. The Court observed that the Assessing Officer (AO) had not independently gathered material to support the additions made on account of suppressed sales. Instead, the AO relied solely on the show-cause notices issued by the Excise Department and the statements of witnesses recorded during the excise search. The Court found that these materials were yet to be adjudicated by the Excise authorities and thus remained in the realm of the department's stand, not yet established. The AO had merely confronted the assessee with these materials and obtained a brief reply denying the allegations, without bringing any independent material on record. The Court held that merely producing copies of statements does not automatically establish their veracity. The AO's action was considered to be cosmetically giving the assessee an opportunity to respond, virtually shifting the burden of proof to the assessee. Therefore, the AO lacked sufficient material to make the additions, rendering the question of the percentage of sales for additions redundant. The Court relied on its previous order in similar cases dismissing the Revenue's appeals.

The High Court dismissed the Tax Appeals filed by the Revenue. The Court observed that the Assessing Officer (AO) had not independently gathered material to support the additions made on account of suppressed sales. Instead, the AO relied solely on the show-cause notices issued by the Excise Department and the statements of witnesses recorded during the excise search. The Court found that these materials were yet to be adjudicated by the Excise authorities and thus remained in the realm of the department's stand, not yet established. The AO had merely confronted the assessee with these materials and obtained a brief reply denying the allegations, without bringing any independent material on record. The Court held that merely producing copies of statements does not automatically establish their veracity. The AO's action was considered to be cosmetically giving the assessee an opportunity to respond, virtually shifting the burden of proof to the assessee. Therefore, the AO lacked sufficient material to make the additions, rendering the question of the percentage of sales for additions redundant. The Court relied on its previous order in similar cases dismissing the Revenue's appeals.

The High Court held that the second question raised by the Revenue, concerning the carry forward and set-off of unabsorbed depreciation, was squarely covered by the Court's previous judgment in the case of General Motors India Pvt. Ltd. vs. Deputy Commissioner of Income-Tax reported in 354 ITR 244. Consequently, the validity of the reopening of the assessment (the first issue) became academic. The Court did not provide any separate reasoning or finding on the reopening issue itself, as it was rendered moot by the decision on the second issue. The operative direction was to dismiss the Tax Appeal.

The High Court granted the Revenue's request to withdraw the appeals. The reasoning provided is that the Revenue sought permission to withdraw the appeals because the tax effect in each of them was below the minimum threshold limit stipulated by the CBDT circular dated 11.07.2018. This circular permits the department to withdraw appeals under such circumstances. Consequently, the High Court disposed of all the Tax Appeals as withdrawn. No specific issue regarding the merits of the original tax disputes was decided.

The High Court granted the permission sought by the Revenue to withdraw the Tax Appeals. The Court reasoned that the Revenue's decision to withdraw was based on the CBDT circular dated 11.07.2018, which sets a minimum threshold for tax effect for preferring and maintaining appeals before the High Court. Since the tax effect in these appeals fell below this prescribed limit, the Revenue was entitled to withdraw them. The Court did not delve into the merits of the underlying ITAT orders. The operative direction was to dispose of the Tax Appeals accordingly, meaning they were withdrawn. No issues were left undecided as the appeals were disposed of on a procedural ground.

The High Court granted permission to the Revenue to withdraw the tax appeals. The reasoning provided is that the learned advocate for the appellant, acting under instructions from the department, sought permission to withdraw the appeals. This request was based on the fact that the tax effect involved in these appeals was below the minimum threshold limit specified in the CBDT Circular dated 11.07.2018. This circular enables the department to prefer and maintain appeals before the High Court. Consequently, the appeals were disposed of as withdrawn. No specific issue was decided on merits.

The High Court granted permission to the Income Tax Officer to withdraw the appeals. The reasoning provided was that the tax effect in these appeals fell below the minimum threshold limit stipulated by the CBDT in its circular dated 11.07.2018. This circular empowers the department to withdraw or not pursue appeals where the tax effect is below a certain monetary limit. Consequently, the appeals were disposed of as withdrawn. No specific findings were made on the merits of any tax-related issues, as the appeals were withdrawn on procedural grounds related to the tax effect threshold.

The High Court of Gujarat at Ahmedabad granted the Revenue's request to withdraw the Tax Appeals. The Court held that the Revenue, acting under instructions from the department, was permitted to withdraw these appeals. The rationale for the withdrawal, as presented by the Revenue and accepted by the Court, was that the tax effect in each of these appeals fell below the minimum threshold limit specified in the CBDT circular dated July 11, 2018. This circular provides guidelines for the department regarding the preference and maintenance of appeals before the High Court. Since the condition of the minimum tax effect was not met, the Court allowed the withdrawal. Consequently, the Tax Appeals were disposed of as withdrawn. No specific issue regarding the merits of the original assessment or the orders under challenge was decided.

The High Court granted permission to the Revenue to withdraw the tax appeals. The Court acknowledged the Revenue's submission that the tax effect in these appeals was below the minimum threshold limit stipulated by the CBDT in its circular dated July 11, 2018. This circular provides the departmental guidelines for preferring and maintaining appeals before the High Court. Consequently, the Court disposed of all the listed Tax Appeals accordingly. No specific findings were made on the merits of the individual appeals, as the withdrawal was based on administrative policy and monetary limits set by the CBDT.

The High Court granted permission to the Income Tax Officer to withdraw the appeals. The reasoning provided was that the tax effect in these appeals fell below the minimum threshold limit stipulated by the CBDT in its circular dated 11.07.2018. This circular empowers the department to withdraw or not pursue appeals where the tax effect is below a certain monetary limit. Consequently, the appeals were disposed of as withdrawn. No specific findings were made on the merits of any tax-related issues, as the appeals were withdrawn on procedural grounds related to the tax effect threshold.

The High Court granted permission to the Income Tax Officer to withdraw the appeals. The reasoning provided was that the tax effect in these appeals fell below the minimum threshold limit stipulated by the CBDT in its circular dated 11.07.2018. This circular empowers the department to withdraw or not pursue appeals where the tax effect is below a certain monetary limit. Consequently, the appeals were disposed of as withdrawn. No specific findings were made on the merits of any tax-related issues, as the appeals were withdrawn on procedural grounds related to the tax effect threshold.

The High Court granted permission to the Income Tax Officer to withdraw the appeals. The reasoning was based on the revenue's submission that the tax effect in these appeals was below the minimum threshold limit prescribed by the CBDT's circular dated 11.07.2018. This circular provides guidelines for the department regarding the monetary limits for filing and pursuing appeals. Since the condition stipulated in the circular was not met, the department was permitted to withdraw the appeals. The appeals were disposed of accordingly. No specific finding was made on the merits of any tax dispute, as the appeals were withdrawn before any substantive adjudication.

The High Court granted permission to the Income Tax Officer to withdraw the appeals. The reasoning provided was that the tax effect in these appeals fell below the minimum threshold limit stipulated by the CBDT in its circular dated 11.07.2018. This circular empowers the department to withdraw or not pursue appeals where the tax effect is below a certain monetary limit. Consequently, the appeals were disposed of as withdrawn. No specific findings were made on the merits of any tax-related issues, as the appeals were withdrawn on procedural grounds related to the tax effect threshold.

The High Court granted permission to the Revenue to withdraw the appeals. The reasoning provided is that the tax effect involved in these appeals is below the minimum threshold limit stipulated by the CBDT in its circular dated 11.07.2018. This circular provides the basis for the department to prefer and maintain appeals before the High Court. Since the condition for maintaining the appeal, as per the circular, was not met due to the low tax effect, the court allowed the withdrawal. The appeals were disposed of accordingly. No specific issue was decided on merits, and no operative directions for remand or deletion were issued.

The High Court granted permission to the Income Tax Officer to withdraw the appeals. The reasoning provided was that the tax effect in these appeals fell below the minimum threshold limit stipulated by the CBDT in its circular dated 11.07.2018. This circular empowers the department to withdraw or not pursue appeals where the tax effect is below a certain monetary limit. Consequently, the appeals were disposed of as withdrawn. No specific findings were made on the merits of any tax-related issues, as the appeals were withdrawn on procedural grounds related to the tax effect threshold.