Rajasthan High Court Judgments — 2013

The High Court held that both questions of law were to be answered against the assessee and in favour of the revenue. The Court noted that it had already taken a view on similar facts, particularly in the assessee's own case for the assessment year 1976-77, and in the case of Kota Co-operative Marketing Society Ltd. The Court also observed that the Allahabad High Court had followed its earlier judgment in CIT Vs. UP Co-operative Sugar Factories. Therefore, the High Court was not inclined to deviate from its previous findings. The operative direction was to answer the questions in favour of the revenue, implying that the disallowance of proportionate expenses would stand and the additions would be upheld. No issue was expressly left undecided.

The High Court held that the appeal was devoid of merit and dismissed it. The Court found that the AO's reassessment proceedings for Assessment Year 1999-2000 were initiated based on his own prior orders for Assessment Years 1996-97 and 1997-98, which were then under appeal before the Rajasthan High Court. The High Court noted that its own judgment dated 06.05.2008, which decided both the validity of reassessment proceedings and the entitlement to depreciation against the Revenue for the earlier years, squarely applied to the present case. The Court found the CIT(A) justified in quashing the reassessment and the ITAT justified in dismissing the Revenue's appeal. The distinction raised by the Revenue regarding the initial assessment being under Section 143(1) instead of Section 143(3) was not considered a valid ground to depart from the established precedent.

The Tribunal held that the appeal by the Revenue did not involve any substantial question of law. It reasoned that the statements made by persons related to the investing companies could not be utilized against the assessee without providing an opportunity for confrontation and cross-examination, which was not afforded by the AO. The Tribunal found no basis in the AO's findings from the statements of persons related to the assessee company. It further observed that the issues raised by the Revenue were matters of appreciation of evidence, which had been considered by the appellate authorities. The Tribunal noted that the share capital contributors were existing assessees with PAN numbers and were regularly assessed to tax. Citing the Supreme Court's decision in CIT v. Orissa Corporation (P) Ltd. and the Rajasthan High Court's decision in CIT v. Shree Barkha Synthetics Ltd., the Tribunal held that the question of whether the source of investment or credit has been satisfactorily explained is a finding of fact. The appellate authorities had returned findings of fact in favor of the assessee after due appreciation of evidence and sound reasoning. The Tribunal affirmed the deletion of additions of Rs. 79,80,000/- on account of share capital and premium, and Rs. 19,950/- on account of commission. The Revenue was free to proceed against the individual investors. The appeal was dismissed.

The High Court held that the Tribunal was not justified in quashing the assessment solely on the ground that the Assessing Officer did not have jurisdiction over the premises where the search was conducted. It noted that the authorized officer had passed on the information to the Assessing Officer who had jurisdiction over the assessee, and therefore, the initiation of proceedings under Section 158BD appeared prima facie in order. However, regarding the addition of Rs. 36,21,692/-, the Court concurred with the concurrent findings of fact by the CIT(A) and the Tribunal. It observed that the project report was prepared for availing loans and was not acted upon by the assessee, as no loan was availed based on it. Furthermore, the Assessing Officer made the addition by comparing project report figures with the balance sheet as of March 31, 1997, when the project was under construction, rather than March 31, 1998, when it was fully implemented. The Court emphasized that an addition must be based on proper evidence, not merely on an estimated project report, and the revenue failed to discharge its burden under Section 69. The Court found no substantial question of law arising from the impugned order as it was entirely based on findings of fact, and thus dismissed the appeal.

The Tribunal held that the Income Tax Officer (ITO), Suratgarh, did not have the necessary jurisdiction over the assessee prior to August 21, 2007. The reasoning was that the assessee was regularly filing his returns of income with the ITO-VII(2), Chennai. The proposal for transfer of jurisdiction from Chennai to Suratgarh was made only on July 24, 2007, and materialized on August 21, 2007. Therefore, the proceedings initiated by the ITO, Suratgarh, by issuing a notice under Section 148 on April 3, 2006, were not authorized and competent. The Tribunal found no error in the concurrent findings of the CIT(A) and the ITAT that the ITO, Suratgarh, acquired jurisdiction only on August 21, 2007. The facts regarding the assessee's place of business or residence were considered to have little relevance in light of the indisputable fact that the assessee was filing returns at Chennai and the jurisdiction was being exercised there at the time the proceedings were sought to be adopted by the ITO at Suratgarh. The appeal filed by the Revenue was dismissed.

The High Court held that the appellate authorities had returned findings of fact in favour of the assessee after due appreciation of the evidence on record and on sound reasoning. The Court referred to its own decisions in CIT vs. Chandra Prakash Rana and CIT vs. Shree Barkha Synthetics Ltd., which established that when the CIT(A) and Tribunal accept the explanation of the assessee based on evidence, and such findings are not perverse or absurd, no substantial question of law arises under Section 260A. The Court found that the appellate authorities had examined the explanation offered by the assessee in detail and accepted it by relying on the documents filed. Therefore, the additions made by the AO were deleted based on these factual findings, and no interference was warranted. The appeal was consequently dismissed.

The High Court held that no substantial question of law was involved in the Revenue's appeal. The Court agreed with the findings of the CIT(A) and the ITAT that the claim for deduction under Section 80P(2) was a bona fide mistake arising from a change in law. The assessee, a co-operative bank, had previously been allowed similar deductions. The insertion of sub-section (4) to Section 80P made the deduction inapplicable. The Court noted that the assessee attempted to correct the mistake by filing a re-revised return when confronted with the legal position. Citing the Supreme Court's decision in CIT Vs. Reliance Petroproducts Pvt. Ltd., the Court held that a mere claim, even if unsustainable in law, does not by itself amount to furnishing inaccurate particulars. Therefore, the appellate authorities were justified in cancelling the penalty under Section 271(1)(c). The appeal filed by the Revenue was dismissed.

The High Court held that the orders of the CIT(A) and the Tribunal did not warrant interference. The Court noted that a finding of fact was recorded by the CIT(A) and affirmed by the Tribunal that the bills were raised by the assessee on March 1, 2005, and March 31, 2005, and the TDS was deposited before filing the return under Section 139(1) of the Act. In view of the retrospective amendment to Section 40(a)(ia) of the Act, which allows deduction if TDS is deposited on or before the due date specified in sub-section (1) of Section 139, the finding arrived at by the CIT(A) and affirmed by the Tribunal was considered correct. Since the findings were essentially findings of fact, no substantial question of law arose. Consequently, the appeal was dismissed.

The Tribunal upheld the CIT(A)'s findings on all three issues. Regarding the long-term capital loss, the Tribunal held that the AO lacked jurisdiction to re-examine a loss determined and accepted in prior assessment years. The principle is that an AO cannot revise an assessment of a prior year in the current year; if there was an error, it should have been rectified in the original assessment year. Concerning the notional interest, the Tribunal found no evidence linking the advance to borrowed funds and noted the advance was repaid, thus upholding the deletion. On the Section 40(a)(ia) disallowance, the Tribunal agreed that payments for ocean freight were covered by Circular No. 723, railway freight was excluded from Section 194C, individual payments were below the threshold, and TDS was duly made for other amounts, rendering the disallowance unsustainable. The appeal was dismissed as no substantial question of law arose.

The High Court held that both the CIT (Appeals) and the Income Tax Appellate Tribunal had considered the matter in detail. They arrived at the conclusion that the income declared by the assessee from the sale of agricultural land, disclosed in the revised return, was accepted by the Assessing Authority. Crucially, the appellate authorities found no material on record from which it could be inferred that the assessee had deliberately concealed income or provided inaccurate particulars. Therefore, the imposition of penalty under Section 271(1)(c) was not justified. The High Court found no substance in the Revenue's submissions and concluded that no substantial question of law arose for consideration under Section 260A. Consequently, the appeal was dismissed.

The High Court held that the order passed by the ITAT did not call for interference and the referred questions deserved to be answered against the revenue. The Court found that the issue of conversion of shares into stock-in-trade did not actually arise in Assessment Year 1983-84, as the conversion had been carried out in preceding assessment years, and the department had not raised any objection then. Therefore, the ITAT was justified in observing that when the conversion was accepted by the department in prior years and followed by the assessee in the current year, the assessee's claim was unexceptionable. This position was consistent with decisions concerning other assessees of the same group, even for subsequent assessment years, which had been approved by the High Court. Regarding the valuation of converted stock, the ITAT was also correct in holding that the market value on the date of conversion should be used. Consequently, questions 1 and 2 were answered against the revenue. Question 3, concerning the allowance of loss in the share business, was held to be consequential to the process adopted by the assessee and approved by the ITAT, and thus was also answered against the revenue. The reference case was disposed of accordingly.

The High Court held that there was no substantial question of law involved in the appeal. Regarding the trading addition, the Court found that the AO enhanced the GP rate to 8.5% from the assessee's declared 7.43% without a cogent basis. It noted that the assessee's GP rate in the current year was higher than in the preceding years (7.01% for AY 2004-05 and 6.98% for AY 2003-04), making the declared rate not fanciful or baseless. Since the CIT(A) deleted the addition on relevant considerations and the ITAT concurred, the Court found no substantial question of law. Concerning the addition of Rs.13,05,091/- for marriage expenditure, the Court observed that this was also an estimation by the AO, which was disapproved by the CIT(A) after considering the record. The ITAT had also examined the matter in detail and found the AO's estimate to be without basis, with the sources of expenditure being explained through withdrawals by the daughters, reflected in their bank accounts and income tax returns. The Court concluded that this issue involved appreciation of evidence, and the concurrent findings of the CIT(A) and ITAT against the revenue did not reveal any illegality or perversity leading to a substantial question of law. The appeal was accordingly dismissed.

The High Court held that the ITAT was justified in deleting the additions. The Court found that the submissions made by the Revenue did not raise any substantial question of law, as they primarily related to the appreciation of evidence and factual inquiries. The Court noted that the seized paper was from a third party (Shri D.L. Purohit), and the assessee was not given an opportunity to cross-examine Shri D.L. Purohit or Shri Mahendra Choudhary. The ITAT rightly observed that no presumption could be drawn against the assessee under Section 132(4A) for a paper not recovered from him, and additions could not be made solely based on entries in a document seized from a third party without corroborative evidence. The Court found no perversity or wrong application of principles in the ITAT's order. Therefore, the appeal filed by the Revenue was dismissed.

The Tribunal held that the ITAT rightly allowed the rectification application under Section 254(2) of the Act. The Supreme Court's decision in ACIT Vs. Hotel Blue Moon, which declared the issuance of notice under Section 143(2) within the prescribed time as mandatory for block assessments under Section 158BC where the return is repudiated, has retrospective effect. This decision clarifies the correct legal position, and judicial decisions discover the correct law, which must be applied retrospectively. The principle that a judicial decision acts retrospectively, as explained in ACIT Vs. Saurashtra Kutch Stock Exchange Ltd., means that even if an earlier decision operated for some time, a later decision clarifying the legal position has retrospective effect, except for matters that are res judicatae or accounts settled. The ITAT's earlier order dated 28.04.2006, which deemed the notice requirement non-mandatory, was contrary to the law declared by the Supreme Court. Therefore, the ITAT's order dated 12.10.2010, recalling its earlier order and quashing the assessment for want of a valid Section 143(2) notice, was just and proper. The consequential order dated 10.03.2011 was also upheld. The ratio is that a mandatory procedural requirement, if omitted, renders the assessment void ab initio, and subsequent binding judicial pronouncements on such requirements must be applied retrospectively, even through rectification, to secure justice. The appeals were dismissed.

The High Court held that the matter essentially relates to questions of fact and does not involve any substantial question of law, thus not meriting admission of the appeal. The ITAT had adjudicated the issues in a proper and justified manner. The Court noted that the ITAT accepted the assessee's explanation regarding duplication, deleting an addition of Rs. 16,20,840/-. Regarding wrong measurement, the ITAT found weight in the assessee's explanation that suitings come in specific lengths and that the survey party might have wrongly noted the lengths. The ITAT deleted an addition of Rs. 45,58,689/- after acknowledging a calculation mistake by the assessee to the extent of Rs. 2,61,500/-. Additions for incapacity of godown and excess quantity of cloth were also deleted as unjustified. The ITAT upheld the addition concerning 'OCM-SD'. For rate differences, the ITAT found that stock should be valued at cost price or market price, whichever is lower, and that the cost price was lower. The ITAT deleted the addition of Rs. 21,38,113/-. The Court found no perversity or illegality in the ITAT's order, emphasizing that mere preparation of inventory or not raising objections at that time does not preclude the assessee from presenting correct measurements and calculations later. The ITAT's acceptance of correct measurements and calculations after thorough analysis was deemed justified.

The High Court held that the ITAT acted just and proper in allowing the rectification application and modifying its earlier order. The Court reasoned that the Supreme Court's decision in ACIT & Anr. Vs. Hotel Blue Moon clearly established that the issuance of notice under Section 143(2) within the prescribed time is mandatory for block assessments under Section 158BC when the AO repudiates the return. The Court emphasized that failure to issue such a notice is not a curable procedural irregularity but goes to the root of the jurisdiction, rendering the assessment void ab initio. The Court relied on the principle that judicial decisions act retrospectively, as explained in Saurashtra Kutch Stock Exchange Ltd., meaning the correct legal principle discovered by the Supreme Court in Hotel Blue Moon should be applied. The Court also noted that the proceedings had not attained finality due to the pendency of appeals. Therefore, the ITAT's order dated 12.10.2010, quashing the assessment, was upheld. Consequently, the subsequent order of the ITAT dated 10.03.2011, dismissing the pending appeals, was also affirmed. The ratio decidendi is that a mandatory statutory notice, the omission of which renders an assessment void ab initio, can be the subject of rectification under Section 254(2) if a subsequent binding judicial pronouncement clarifies this position, even if the original order was passed before such pronouncement.

The High Court held that no substantial questions of law were involved in the appeals, making them not maintainable under Section 260A of the Income Tax Act. The Court found that the issue of whether service tax was to be paid separately or not was a question of fact. Based on the terms of the agreements, the service tax was payable separately and not included in the fees for professional or technical services. Therefore, the orders passed by the Appellate Authority and the ITAT, which held that TDS was not deductible on service tax in such circumstances, were in accordance with the provisions of Section 194J of the Income Tax Act. Even if the Circular dated 28.04.2008 was not directly applicable, the findings of the lower authorities were justified by the facts and circumstances and the provisions of Section 194J. Consequently, all appeals filed by the Revenue were dismissed for want of substantial questions of law.

The High Court held that no substantial questions of law were involved in the appeals. While the Revenue argued that Circular dated 28.04.2008 was not applicable as it related to Section 194-I and not Section 194J, the Court examined Section 194J in light of both Circulars dated 28.04.2008 and 30.06.2008. The Court found that the terms 'any sum paid' in Section 194J relate to fees for professional or technical services. Crucially, as per the terms of the agreements, the service tax was to be paid separately and was not included in the fees for professional or technical services. The Court noted that whether service tax was to be paid separately was a question of fact, and both the Appellate Authority and the ITAT had recorded findings of fact to this effect. Therefore, even if the Circular dated 28.04.2008 was considered not applicable, the orders passed by both the authorities below were found to be in accordance with the provisions of Section 194J of the Income Tax Act, considering the facts and circumstances. Since no substantial questions of law were involved, the appeals were dismissed.

The High Court held that no substantial questions of law were involved in the appeals, making them not maintainable under Section 260A of the Income Tax Act. The Court found that the issue of whether service tax was to be paid separately or not was a question of fact. Based on the terms of the agreements, the service tax was payable separately and not included in the fees for professional or technical services. Therefore, the orders passed by the Appellate Authority and the ITAT, which held that TDS was not deductible on service tax in such circumstances, were in accordance with the provisions of Section 194J of the Income Tax Act. Even if the Circular dated 28.04.2008 was not directly applicable, the findings of the lower authorities were justified by the facts and circumstances and the provisions of Section 194J. Consequently, all appeals filed by the Revenue were dismissed for want of substantial questions of law.

The High Court reframed the substantial question of law to: 'Whether respondent/assessee is entitled to get benefit of depreciation under Section 32(1) of the Income Tax Act, 1961 or not?'. The Court noted that the assessee is a leasing company and the vehicles were leased out. The Revenue argued that the assessee was neither the owner nor the user of the vehicles. The Court, relying on the Supreme Court's decision in Industrial Credit And Development Syndicate Limited, held that the assessee, as a lessor, is considered the owner of the vehicles for the purpose of claiming depreciation. The Court reasoned that Section 32 requires the asset to be used for the 'purposes of business', which is satisfied even if the assessee does not physically use the asset itself, as long as it is utilized for the assessee's business. The Court agreed with the Supreme Court's finding that the lessor is the owner and satisfies both requirements of Section 32, thus being entitled to depreciation. The appeal was dismissed.

The High Court held that no substantial questions of law were involved in the appeals, making them not maintainable under Section 260A of the Income Tax Act. The Court found that the issue of whether service tax was to be paid separately or not was a question of fact. Based on the terms of the agreements, the service tax was payable separately and not included in the fees for professional or technical services. Therefore, the orders passed by the Appellate Authority and the ITAT, which held that TDS was not deductible on service tax in such circumstances, were in accordance with the provisions of Section 194J of the Income Tax Act. Even if the Circular dated 28.04.2008 was not directly applicable, the findings of the lower authorities were justified by the facts and circumstances and the provisions of Section 194J. Consequently, all appeals filed by the Revenue were dismissed for want of substantial questions of law.

The High Court held that it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original assessment, which has already been completed, merely because an assessment under Section 153A is required to be made following a search. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as an opportunity for the AO or the assessee to reopen completed assessments beyond the scope of incriminating material found. The Court emphasized that Section 153A cannot be used to circumvent the provisions for filing revised returns (Section 139(5)) or for income escaping assessment (Section 147). The Court also referred to the Allahabad High Court's decision in CIT (Central, Kanpur) v. Smt. Shaila Agarwal, which dealt with the abatement of proceedings, to support its conclusion. The interpretation that Section 153A allows an AO to undo conclusions reached up to the High Court in completed assessments was repelled as absurd. Therefore, the substantial question of law (iv) was answered in the affirmative, against the assessee, and the other questions were rendered infructuous. The appeal was dismissed.

The High Court held that the assessment proceedings under Section 153A are essentially in the context of search and/or requisition and cannot be interpreted as a further opportunity for the AO or the assessee beyond the provisions of Sections 139, 139(5), 147, and 263 of the Act. The Court reasoned that the scheme of Section 153A, particularly the first proviso which allows assessment or reassessment of total income for each assessment year falling within the six preceding years, must be read in conjunction with the entire section. The words 'assess' and 'reassess' are used in the context of abated and completed assessment proceedings, respectively. For completed assessments, the AO can only make adjustments based on incriminating material found during the search or requisition. The Court rejected the argument that Section 153A allows the AO to disturb income, expenditure, or deductions de hors the incriminating material. The High Court also referred to the Allahabad High Court's decision in CIT (Central, Kanpur) v. Smt. Shaila Agarwal, which dealt with the abatement of proceedings, and the Supreme Court's decision in K.P. Varghese v. Income Tax Officer (1981) 131 ITR 597, emphasizing the avoidance of absurdity. Consequently, it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original completed assessment, simply because an assessment under Section 153A is being made. The Court answered substantial question of law (iv) in the affirmative, holding against the assessee, and found that the other three questions did not arise. The appeal was dismissed.

The High Court held that it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original assessment, which has already been completed, solely because an assessment under Section 153A of the Act is being made pursuant to a search or requisition. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as a further opportunity for the AO or the assessee beyond the provisions of Sections 139, 139(5), 147, and 263 of the Act. The Court emphasized that allowing such claims would lead to absurdity, where AO could undo conclusions reached up to the High Court level. Therefore, the substantial question of law (iv) was answered in the affirmative, against the assessee. Consequently, the other three questions were held not to arise. The appeal was dismissed.

The High Court held that it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original assessment, which has already been completed, solely because an assessment under Section 153A of the Act is being made pursuant to a search or requisition. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as a further opportunity for the AO or the assessee beyond the provisions of Sections 139, 139(5), 147, and 263 of the Act. The Court emphasized that allowing such claims would lead to absurdity, where AO could undo conclusions reached up to the High Court level. Therefore, the substantial question of law (iv) was answered in the affirmative, against the assessee. Consequently, the other three questions were held not to arise. The appeal was dismissed.

The High Court held that it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original assessment, which has already been completed, solely because an assessment under Section 153A of the Act is being made pursuant to a search or requisition. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as a further opportunity for the AO or the assessee beyond the provisions of Sections 139, 139(5), 147, and 263 of the Act. The Court emphasized that allowing such claims would lead to absurdity, where AO could undo conclusions reached up to the High Court level. Therefore, the substantial question of law (iv) was answered in the affirmative, against the assessee. Consequently, the other three questions were held not to arise. The appeal was dismissed.

The High Court held that it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original assessment, which has already been completed, solely because an assessment under Section 153A of the Act is being made pursuant to a search or requisition. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as a further opportunity for the AO or the assessee beyond the provisions of Sections 139, 139(5), 147, and 263 of the Act. The Court emphasized that allowing such claims would lead to absurdity, where AO could undo conclusions reached up to the High Court level. Therefore, the substantial question of law (iv) was answered in the affirmative, against the assessee. Consequently, the other three questions were held not to arise. The appeal was dismissed.

The High Court held that it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original assessment, which has already been completed, merely because an assessment under Section 153A is required to be made following a search. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as an opportunity for the AO or the assessee to reopen completed assessments beyond the scope of incriminating material found. The Court emphasized that Section 153A cannot be used to circumvent the provisions for filing revised returns (Section 139(5)) or for income escaping assessment (Section 147). The Court also referred to the Allahabad High Court's decision in CIT (Central, Kanpur) v. Smt. Shaila Agarwal, which dealt with the abatement of proceedings, to support its conclusion. The interpretation that Section 153A allows an AO to undo conclusions reached up to the High Court in completed assessments was repelled as absurd. Therefore, the substantial question of law (iv) was answered in the affirmative, against the assessee, and the other questions were rendered infructuous. The appeal was dismissed.

The High Court held that the present appeal is fully covered by its earlier decision in D.B. Income Tax Appeal No.29/2008 and other connected matters, which included the Revenue's appeal (D.B. Income Tax Appeal No.39/2008) relating to the present assessee for AY 2003-04. In that earlier judgment, the High Court had dismissed the Revenue's appeals, affirming the ITAT's finding that the assessee was eligible for deduction under Section 80HHC for the export of cut and polished marble blocks. The Court noted that the facts and the question of law were identical in both cases. The High Court found no useful purpose in remitting the matter to the Assessing Officer. Consequently, the appeal was allowed, the impugned order of the ITAT was set aside, and it was held that the assessee is entitled to deduction under Section 80HHC. The substantial question of law was answered in favor of the assessee.

The High Court held that it is not open for the assessee to seek a deduction or claim an expenditure that was not claimed in the original assessment, which has already been completed, merely because an assessment under Section 153A is required to be made following a search. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as an opportunity for the AO or the assessee to reopen completed assessments beyond the scope of incriminating material found. The Court emphasized that Section 153A cannot be used to circumvent the provisions for filing revised returns (Section 139(5)) or for income escaping assessment (Section 147). The Court also referred to the Allahabad High Court's decision in CIT (Central, Kanpur) v. Smt. Shaila Agarwal, which dealt with the abatement of proceedings, to support its conclusion. The interpretation that Section 153A allows an AO to undo conclusions reached up to the High Court in completed assessments was repelled as absurd. Therefore, the substantial question of law (iv) was answered in the affirmative, against the assessee, and the other questions were rendered infructuous. The appeal was dismissed.

The High Court held that it is not open for the assessee to seek deduction or claim expenditure which was not claimed in the original assessment, which had already been completed, solely because an assessment under Section 153A of the Act was required to be made pursuant to a search or requisition. The Court reasoned that Section 153A proceedings are essentially in the context of search and/or requisition and cannot be interpreted as a further opportunity for the AO or the assessee beyond the provisions of Sections 139, 139(5), 147, and 263 of the Act. The Court referred to the Allahabad High Court's decision in CIT (Central, Kanpur) v. Smt. Shaila Agarwal, which dealt with the abatement of pending proceedings under the second proviso to Section 153A, and noted that this supports the conclusion that for completed assessments, they can only be altered based on incriminating material found during the search. The Court also cited K.P. Varghese v. Income Tax Officer (1981) 131 ITR 597, emphasizing the need to avoid absurdity and mischief in statutory interpretation, and stated that allowing an assessee to make new claims in completed assessments via Section 153A would lead to such an absurd outcome. Consequently, the substantial question of law (iv) was answered in the affirmative, against the assessee, and the other questions were rendered infructuous. The appeal was dismissed.

The High Court held that the Tribunal was justified in its approach and that the appeals lacked merit. The Court analyzed the Rajasthan Agricultural Produce Markets Act, 1961, and the Rules framed thereunder. It found that both the Agriculture Marketing Board and the Krishi Upaj Mandi Samitis derive their existence from this enactment. The construction and maintenance of market yards and roads were executed by the Board, not the Samiti. The money transferred by the Samiti to the Board was a statutory contribution. The Board was statutorily charged with the duty to carry out construction works. Therefore, the contention that a contractor-contractee relationship should be assumed for the invocation of Section 194C was not tenable. Similarly, it could not be held that the Board provided professional or technical services to the Samiti within the meaning of Section 194J. The mere charging of supervision and work charges by the Board did not convert its activities into professional or technical services. These charges were merely prescriptions for meeting the Board's expenses from the total cost of construction. Consequently, the Tribunal's decision was upheld, and the appeals were dismissed.

The High Court held that the Tribunal was justified in its findings and that the appeals lacked merit. The Court analyzed the Rajasthan Agricultural Produce Markets Act, 1961, and the Rules framed thereunder, which established that the Agriculture Marketing Board and the Krishi Upaj Mandi Samitis derive their existence from the Act. The construction and maintenance of market yards and roads were executed by the Board, not the Samiti. The money transferred by the Samiti to the Board was a statutory contribution mandated by the Act and Rules. Therefore, the prerequisite for invoking Section 194C, namely a contractor-contractee relationship, could not be assumed. Similarly, the Court found that the Board was not providing professional or technical services to the Samiti in the meaning of Section 194J. The mere charging of supervision and work charges by the Board did not convert its activities into professional or technical services. The Court found no infirmity in the Tribunal's approach and dismissed the appeals.

The High Court held that the Tribunal was justified in its findings and that the appeals lacked merit. The Court analyzed the Rajasthan Agricultural Produce Markets Act, 1961, and the Rules framed thereunder, which established that the Agriculture Marketing Board and the Krishi Upaj Mandi Samitis derive their existence from the Act. The construction and maintenance of market yards and roads were executed by the Board, not the Samiti. The money transferred by the Samiti to the Board was a statutory contribution mandated by the Act and Rules. Therefore, the prerequisite for invoking Section 194C, namely a contractor-contractee relationship, could not be assumed. Similarly, the Court found that the Board was not providing professional or technical services to the Samiti in the meaning of Section 194J. The mere charging of supervision and work charges by the Board did not convert its activities into professional or technical services. The Court found no infirmity in the Tribunal's approach and dismissed the appeals.

The High Court held that the Tribunal was justified in its approach and that the appeals lacked merit. The Court analyzed the Rajasthan Agricultural Produce Markets Act, 1961, and the Rules framed thereunder. It found that both the Agriculture Marketing Board and the Krishi Upaj Mandi Samitis derive their existence from this enactment. The construction and maintenance of market yards and roads were executed by the Board, not the Samiti. The money transferred by the Samiti to the Board was a statutory contribution. The Board was statutorily charged with the duty to carry out construction works. Therefore, the contention that a contractor-contractee relationship should be assumed for the invocation of Section 194C was not tenable. Similarly, it could not be held that the Board provided professional or technical services to the Samiti within the meaning of Section 194J. The mere charging of supervision and work charges by the Board did not convert its activities into professional or technical services. These charges were merely prescriptions for meeting the Board's expenses from the total cost of construction. Consequently, the Tribunal's decision was upheld, and the appeals were dismissed.

The High Court held that all the questions formulated in the present appeals were decided in favour of the assessee and against the revenue. This decision was based on the concession made by both parties that the point involved had already been considered and decided by a Division Bench of the High Court and the Hon'ble Apex Court. The Court referred to a previous judgment of a co-ordinate Bench of the High Court in D.B. Income Tax Appeal No. 197/2008, which had dismissed the revenue's appeal on the basis of the judgment in Arihant Tiles & Marbles (P) Ltd. versus Income Tax Officer, which was affirmed by the Hon'ble Apex Court in Income Tax Officer versus Arihant Tiles & Marbles (P) Ltd. The ratio decidendi is that if a substantial question of law has been settled by a higher court or a co-ordinate bench, and parties concede to this, the appeal should be decided accordingly. Consequently, both appeals filed by the Revenue were dismissed.

The High Court held that all the substantial questions of law formulated in the present appeals were decided in favour of the assessee and against the revenue. This decision was based on the concession made by both parties that the issues involved were squarely covered by the judgment of the Division Bench of the High Court in Arihant Tiles & Marbles (P) Ltd. v. Income Tax Officer, which was affirmed by the Hon'ble Apex Court in Income Tax Officer v. Arihant Tiles & Marbles (P) Ltd. The Court noted that a co-ordinate bench had previously dismissed the Revenue's appeal for assessment year 2003-04 on identical grounds, finding no error in the Tribunal's order and no substantial question of law. Consequently, the appeals filed by the Revenue were dismissed. The ratio decidendi is that if the issue regarding the applicability of Section 80 IB to stone cutting and tile manufacturing has been decided by the Supreme Court in a specific case, subsequent appeals on the same issue for the same assessee should follow that precedent.

The High Court recalled its earlier order admitting the appeal on the substantial questions of law as framed, due to the admission by both parties that these questions did not arise from the pleadings or the ITAT's order. Upon re-examination, the High Court found that the appeal was preferred only in respect of Rs. 14,00,817/- claimed as interest received and Rs. 2,71,921/- claimed as postage and insurance charges. Regarding postage and insurance charges, the matter was remanded by the ITAT to the Assessing Officer. For the interest income of Rs. 14,00,817/-, the High Court agreed with the ITAT's conclusion that this amount could not be considered business income. Consequently, the High Court held that the ITAT's judgment was based on factual aspects and required no interference. No substantial question of law arose in the present case.

The High Court held that the question of whether the surrendered amount is income from business or other sources is essentially a question of fact. The Commissioner of Income Tax (Appeals) and the Income Tax Appellate Tribunal had recorded a concurrent finding of fact, based on cogent material, that the surrendered amount was income from business and not from other sources. The Revenue failed to point out any perversity in these concurrent findings. The Court noted that there was no dispute that if the surrendered amount was treated as income from business, the assessee would be entitled to a set-off of Rs. 54,10,054/-. Consequently, the questions of law framed by the Court were not sustainable as no perversity was demonstrated in the factual findings of the lower appellate authorities. Both questions were answered in favour of the assessee. The appeal was dismissed.

The High Court first allowed the Revenue's application for dispensing with the requirement of filing the certified copy of the ITAT's order dated 16.12.2011. Subsequently, the High Court dismissed the Revenue's appeal. The reasoning for dismissal was explicitly stated to be 'For the reasons mentioned in the judgment passed in ITA No.48/2012'. While the judgment in ITA No.48/2012 is not provided, the operative direction for the present appeal is a dismissal. No costs were awarded. The specific findings on the substantive issues of the appeal are not detailed in this judgment, as it relies on a previous decision.

The High Court dismissed the appeal filed by the Revenue. The Court noted that the ITAT's order dated 06.11.2012, which deleted the addition made under Section 36(1)(va) read with Section 2(24)(x), was based on the ITAT's earlier order dated 16.12.2011. The High Court had previously dismissed appeals (ITA Nos.48/2012 and 50/2012) arising from the ITAT's order dated 16.12.2011 on 13.05.2013. Since the present appeal was based on the same grounds, the High Court applied the same reasoning and dismissed the Revenue's appeal. The operative direction was the dismissal of the Revenue's appeal, with no costs awarded. No specific issue was left undecided.

The High Court held that the Tribunal was justified in its findings. It reiterated the principle that Chapter XIV-B of the Act provides a special procedure for assessment of undisclosed income resulting from a search, and Section 158BB read with Section 158BC assesses undisclosed income for the block period, not total income or loss of previous years as in regular assessment under Section 143(3). The Court cited its own decisions in CIT v. Rajendra Prasad Gupta and CIT v. Chandra Chemoux, emphasizing that additions in block assessment must be based on material found during search or requisition, not mere inferences. The AO cannot make estimations 'de hors' the material in possession. In this case, apart from the admitted undisclosed cash, the AO lacked evidence from the search to justify other additions. Therefore, the Tribunal's conclusion that additions were made without reference to search material was correct and did not give rise to substantial questions of law. The appeal was dismissed.

The High Court held that the ITAT's decision involved a question of fact and did not raise any substantial question of law, thus not warranting interference under Section 260A of the Income Tax Act, 1961. The Court observed that when an appellate order affirms a lower authority's decision, detailed reasons are not always required. The ITAT had noted that for prior assessment years (1992-93 to 1994-95), departmental appeals were dismissed, and an 8% profit rate was deemed reasonable. Since the present appeal concerned the same issue for assessment year 1997-98, the ITAT's affirmation of the 8% rate was considered justified based on its previous findings. The Court condoned the delay in filing the appeal and, after hearing the matter on merits, found the appeal to be devoid of merit. Consequently, the appeal was dismissed.

The High Court held that the observations made by the Commissioner (Appeals) and the Tribunal were based on the factual matrix of the case. The Court found no substantial question of law arising that warranted interference. Specifically, regarding the deletion of the Rs. 5 Lacs addition, the Tribunal had observed that the statement of Kripa Shanker Sharma was not confronted to the assessee, and no documentary evidence was supplied. The Tribunal also noted that confirmation letters from creditors were filed, and the existence of the companies as separate legal entities was not disputed. Therefore, the Tribunal's decision to delete the addition based on the lack of proper evidence and procedural fairness was upheld. The Court concluded that the appeals were devoid of merit.

The Tribunal held that the existence of the companies and the identity of the investors were not disputed, supported by confirmation letters from creditors and the fact that these companies were assessed to tax. It further observed that the oral statement of Kripa Shanker Sharma, recorded before the search authorities, was not sufficient evidence to assess an income of Rs. 5 Lacs in the hands of the assessee, particularly as the statement was not confronted to the assessee and no documentary evidence was supplied. Consequently, the Tribunal allowed the cross-objection filed by the assessee and dismissed the appeal preferred by the Revenue concerning the Rs. 5 Lacs addition. The High Court, in its order, found that the observations of the Commissioner (Appeals) and the Tribunal were based on the factual matrix and no substantial question of law arose, leading to the dismissal of the Revenue's appeals.

The High Court held that the observations made by the Commissioner (Appeals) and the Tribunal appeared to be based on the factual matrix of the case. The Court found no substantial question of law arising from the Tribunal's judgment that would warrant interference. Specifically, the Tribunal's decision to delete the Rs. 5 Lacs addition was based on the reasoning that the statement of Kripa Shanker Sharma was not confronted to the assessee, and no documentary evidence was supplied to support it. The Tribunal also noted that the existence of the investor companies as separate legal entities, with their own tax assessments and confirmation letters filed, could not ordinarily be doubted. The Court agreed with the Tribunal's view that an oral statement alone, without corroboration and proper procedure, was insufficient to assess income in the hands of the assessee. Consequently, the appeals filed by the Revenue were dismissed.

The High Court held that the ITAT was justified in allowing deductions under Section 80HHC for the export of cut and polished marble blocks. The court reasoned that the 12th Schedule, specifically item (x), requires 'cut and polished minerals and rocks'. The explanation to the Schedule defines 'processed' to include 'cutting and polishing'. The court found that the assessees had produced evidence of cutting and polishing, and the ITAT had concurrently held in favour of the assessees. The Act does not prescribe the degree of cutting and polishing, and any process that adds value to the marketable commodity creates eligibility for deduction. The export of marble blocks after cutting and polishing fetched higher profits, indicating high value addition. The court also noted that the Revenue had not challenged the ITAT's findings of fact as perverse, and therefore, these findings were binding. The Circular No. 693 did not adversely affect the assessees' claims. The appeals of the Revenue were dismissed.

The High Court held that the learned ITAT was justified in allowing the deduction under Section 80HHC. The Court reasoned that the assessees had produced evidence of cutting and polishing, satisfying the conditions of the 12th Schedule and Circular No. 693. The Act does not prescribe a specific degree of cutting and polishing; any process that adds value to the marketable commodity creates eligibility. The fact that the processed marble blocks fetched higher profits indicated high value addition. Furthermore, the Court noted that the ITAT's findings of fact were binding, and the Revenue had not contended that these findings were perverse. The Circular No. 693 was also held not to adversely affect the assessees' claims. The substantial question of law was answered in favour of the assessees.

The High Court held that the ITAT was justified in allowing the deduction under Section 80HHC. The Court found that the assessees had produced vouchers, invoices, and certificates demonstrating the cutting and polishing of the exported marble blocks, thereby fulfilling the conditions in the 12th Schedule and Circular No. 693. The Court noted that the Act does not prescribe the degree or extent of 'cutting and polishing', and any process that adds value to a marketable commodity creates eligibility for the deduction. The fact that the exported marble blocks fetched higher profits after processing indicated high value addition. Furthermore, the Court reiterated that findings of fact by the ITAT are binding unless perverse, and the Revenue had not contended that the ITAT's findings were perverse. The Circular No. 693 was also held not to adversely affect the assessees' claims. The substantial question of law was answered in favour of the assessees.

The High Court held that the ITAT was justified in allowing the deduction under Section 80HHC. The Court reasoned that the 12th Schedule, item (x), and its explanation, along with Circular No. 693, require 'cutting and polishing' for eligibility. The assessees had provided evidence of cutting and polishing, and the Act does not prescribe a specific degree of processing. The Court found that cutting and polishing marble blocks adds value and enhances marketability, fulfilling the conditions for deduction. Furthermore, the Court noted that the ITAT's findings of fact were binding, as the Revenue had not argued that these findings were perverse. The Court also addressed a second substantial question of law regarding the legal effect of Circular No. 693, holding that it did not adversely affect the assessees' claims. The appeals were dismissed, with the substantial question of law answered in favour of the assessees.