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572 orders · Page 11 of 12
The High Court held that the issuance of a notice under Section 148 of the Income Tax Act, 1961, is not rendered otiose by the existence of seized material that relates to or belongs to a person other than the one on whom the search is conducted or requisition is made. Section 148 continues to apply to regular proceedings and cases where no incriminating material is seized. The Tribunal clarified that under Sections 153A and 153C, the 'total income' is assessed, which includes returned income, unearthed undisclosed income, and information from other sources. However, the Court found that in the specific facts before it, the notices issued under Section 148 were quashed. The reasoning was based on the reliance placed on the decisions of Sri Dinakara Suvarna and M/s. Aditi Constructions, which suggested that Section 153C would prevail over Section 147/148 in cases where the jurisdictional conditions for Section 147/148 were not satisfied or where Section 153C was the more appropriate provision. The Court explicitly stated that the first ground of challenge to the initiation of proceedings under Section 148 was accepted, and there was no need to consider other grounds. The respondents were granted liberty to proceed against the petitioners in accordance with law.
The High Court allowed the writ petitions and quashed the notices issued under Section 148 and the impugned orders. The Court held that when incriminating material found during a search on a third party relates to the assessee, the revenue must proceed under the specific provisions of Section 153C of the Income Tax Act, 1961. The Court found the invocation of Section 148 to be inappropriate in such circumstances, as the conditions for invoking Section 147/148 were not satisfied, and Section 153C, being a specific provision, would prevail over the general provisions of Section 147. The Court distinguished the reliance placed by the revenue on M/s. M.R. Shah Logistics Pvt. Limited and Abhisar Buildwell P. Ltd., stating that those cases did not address the specific interplay between Section 147/148 and Section 153C in the context of third-party searches. The Court found merit in the assessees' reliance on Sri Dinakara Suvarna and M/s. Aditi Constructions. The operative direction was to quash the notices and orders, with liberty to the respondents to proceed against the petitioners in accordance with law.
The High Court held that the notices issued under Section 148 and the impugned orders are quashed. The Court reasoned that when incriminating material seized or requisitioned belongs to or is relatable to a person other than the one on whom the search was conducted, Section 153C is to be resorted to. The Court found the revenue's reliance on M/s. M.R. Shah Logistics Pvt. Limited to be misplaced as the issue of interplay between Section 147/148 and Section 153C in the context of third-party seized material was not before the Supreme Court. While acknowledging the Supreme Court's decision in Abhisar Buildwell P. Ltd. regarding Section 148 in the absence of incriminating material, the Court distinguished it from the present case where Section 153C was arguably applicable. The Court found merit in the petitioners' reliance on Sri Dinakara Suvarna and M/s. Aditi Constructions, which supported the principle that specific provisions (like Section 153C) should prevail over general provisions (like Section 147/148) when the conditions are met. The Court accepted the first ground of challenge, which was the initiation of proceedings under Section 148, and therefore did not delve into other grounds. The respondents were granted liberty to proceed against the petitioners in accordance with law. The writ petitions were allowed.
The High Court held that the authorities had acted dehors the Act and the provisions contained under Section 148 of the Income Tax Act, 1961. The proceedings were initiated on a wrong footing, with an inquiry conducted regarding the sale of land when, in fact, it was a purchase. The court found that the notice under Section 148A(b) was issued without verifying the factum of sale or purchase. Despite the petitioner submitting a reply clarifying that they had purchased the property and were not liable for capital gains tax, the authorities, ignoring this reply, concluded that the matter required reassessment and that income chargeable to tax to the tune of Rs. 2.84 crores had escaped assessment. The court determined that the impugned order and notice, being based on wrong facts, could not be sustained and that the assessee had been harassed. Therefore, the civil writ petition was allowed, and the impugned order and notice were set aside and quashed.
The High Court held that the writ petition had become infructuous. The reasoning was based on the petitioner's submission that their application under the Vivad Se Vishwas Scheme had been accepted. Consequently, the Court found no surviving cause of action for pursuing the writ petition. The ratio decidendi is that a taxpayer's successful resolution of a tax dispute through a scheme like Vivad Se Vishwas renders any pending litigation on the same matter infructuous. The operative direction was to dismiss the petition as infructuous. No issues were left undecided.
The High Court held that the writ petition was rendered infructuous. This decision was based solely on the submission made by the learned counsel for the petitioner, who stated that in view of subsequent developments during the pendency of the writ petition, no cause of action survived for pursuing it. Consequently, the Tribunal dismissed the writ petition as infructuous. No other issues were decided, and no reasoning beyond the petitioner's submission was provided. The ratio decidendi is that a writ petition can be dismissed as infructuous if the petitioner concedes that no cause of action remains.
The High Court perused the Assessment Order dated 16.05.2023. It observed that the Assessing Authority had accepted the plea of the assessee and also accepted the return income as filed by the assessee. Consequently, the Court found that nothing survived in the present civil writ petition. The petition was accordingly dismissed. The Court did not explicitly decide on the validity of the notices or the instruction, as the matter became infructuous due to the acceptance of the assessee's return income by the Assessing Authority. The ratio decidendi is that if the Assessing Authority accepts the assessee's return income, any challenge to the reassessment proceedings initiated prior to such acceptance becomes infructuous.
The High Court held that the impugned orders rejecting the petitioner's objections were liable to be set aside. The Court noted that it was an undisputed fact that substantial additions made for Assessment Year 2001-2002 were deleted in appeal. While rejecting the objections, the respondent authorities failed to deal with the specific objection raised by the petitioner that the appeal for AY 2001-02 had been accepted. Consequently, the Court set aside the impugned orders and remitted the matter back to the respondent (Income Tax Officer) for deciding the objections afresh in accordance with law. The respondent was directed to provide an opportunity of hearing to the petitioner. The Court also directed the petitioner to appear on 15.04.2024 at 11:00 am and continued the stay proceedings during the pendency of the fresh decision on objections.
The High Court granted the petitioners' request to withdraw the writ petition. The court's reasoning was based solely on the petitioners' expressed desire to withdraw the case. There was no adjudication on the merits of any underlying tax dispute or legal question. The operative direction was to dismiss the petition as withdrawn. No issues were left undecided, as the petition itself was disposed of based on the withdrawal request.
The High Court, without commenting on the merits of the case, allowed the Revenue to revive its appeal in exercise of the liberty granted by the ITAT. The Court noted that the ITAT's order explicitly stated that the Revenue would be at liberty to approach the Tribunal for re-institution of the appeal if requisite material was brought to show that the appeal was protected by the exceptions in paragraph 10 of the circular dated July 11, 2018. The Court acknowledged the Revenue's submission that the ITAT had made observations on merits and that the issue of the amendment's applicability was not considered. The appeal was accordingly dismissed as withdrawn with the liberty granted to the Revenue to revive it. The Revenue was also granted liberty to seek exclusion of the period of pendency of this appeal for limitation purposes.
The High Court noted that the prayer for cancellation of the existing PAN of the private respondent (respondent No. 3) was satisfied as the private respondent had surrendered the disputed PAN (AAQPV3256P) and obtained a new PAN (COXPV9465B). Regarding the refund of excess TDS, the Court directed that the petitioner would be required to file an online grievance to the CPC, Bengaluru. The Income Tax Department agreed to consider this grievance and decide it expeditiously within three months from the date of submission. The respondents were also permitted to assess the refund for the financial years 2020-21, 2021-22, and 2022-23 in accordance with law. The writ petition was disposed of with these directions.
The High Court held that the impugned order dated 26.11.2013, rejecting the petitioner's application for exemption under Section 10(23C)(vi) of the Income Tax Act, 1961, was not sustainable. The Court observed that the respondent-Chief Commissioner had rejected the application based on the finding that the petitioner was run for profitable purposes and regularly earned a surplus. However, the Court noted that the judgment relied upon by the respondent (CIT Vs Queen‘s Educational Society (Uttarakhand)) was overruled by the Hon’ble Apex Court in Queen’s Educational Society Vs Commissioner of Income Tax (2015) SCC 47. Furthermore, the Court referred to Circular No. 14/2015 dated 17.08.2015, which clarified that the mere generation of surplus cannot be a basis for rejection of an application under Section 10(23C)(vi) if the surplus is used for educational purposes. The Court found that the petitioner's case needed reconsideration in light of these developments. Consequently, the petition was partly allowed, the impugned order was quashed, and the matter was remanded back to the respondents to re-consider the application strictly in accordance with law and the cited precedents and circular.
The Tribunal held that the petitioner received the notice on 17.03.2022 itself, as a notice was sent via email on that date to the petitioner's declared email address, 'aakhr8286f@mailinator.com', which was the same address provided by the petitioner in his income tax return. The court noted that computer-generated details of the email dispatch were annexed by the respondent, confirming the email was sent to the correct address. Consequently, the Tribunal found that the petitioner had received the notice on 17.03.2022, meaning the seven-day clear notice period was not violated. Therefore, the petitioner's case, based on the alleged statutory violation, was dismissed. No issue was left undecided.
The High Court held that the impugned order of the ITAT was justified. Regarding the addition under Section 68, the Court observed that the assessee had furnished all requisite documents to prove the identity, creditworthiness, and genuineness of the share applicants. The assessment order was based on suspicion and doubt, which is not permissible. The CIT and ITAT had rightly deleted the addition, holding that it could not be considered an unexplained credit. Concerning the disallowance of Rs. 1,50,000/- out of expenses, the Court noted that the CIT had restricted the disallowance to Rs. 75,000/-, which was considered justified. For the ESI contribution disallowance, the Court observed that the CIT directed verification of the assessee's claim that contributions were deposited before the due date, and this was upheld by the ITAT. The Court found concurrent findings by the CIT and ITAT, which were well-reasoned and based on the available material, and therefore, did not find it a fit case to grant any relief to the appellant. The appeal was dismissed.
The Tribunal noted that the learned counsel for the petitioner sought to withdraw the writ petition. This request was made in view of an objection raised by the respondents. The petitioner specifically requested liberty to file a fresh writ petition at the Principal Seat of the Court at Jodhpur. The Court considered this request and granted the liberty as prayed for. Therefore, the writ petition was dismissed as withdrawn. No decision was made on the merits of the case.
The High Court held that while proceedings under the liability created against the legal representatives of a deceased assessee can be initiated, this can only be done after strict compliance with the mandatory provisions of Section 148A(b) of the Income Tax Act, 1961. The Court noted that it was evident from the record that the provision of Section 148A(b) had not been complied with against the legal representatives of the deceased Smt. Sneh Lata Bhandari. Consequently, the impugned notice dated April 21, 2023, under Section 148A and the order dated April 21, 2023, passed under Section 148A(d) were quashed and set aside. However, the respondents were granted liberty to reinitiate proceedings against the legal representatives, strictly adhering to the provisions of Section 148A(b) and Section 159 of the Act. The limitation period between the filing of the writ petition and its disposal was excluded for computing the limitation for initiating such proceedings.
The Tribunal held that the period of limitation for exercising powers under Section 263 of the Income Tax Act, 1961, must be reckoned from the date of the original assessment order, not from the date of the reassessment order. This decision was based on the authoritative pronouncement of the Supreme Court in Commissioner of Income Tax Vs. Industrial Development Bank of India Ltd. The Supreme Court, in turn, relied on its earlier decision in Commissioner of Income Tax, Chennai vs. Alagendran Finance Ltd. The reasoning is that if the issues before the Commissioner under Section 263 relate to the subject matter of reassessment, the limitation would start from the reassessment order. However, if the subject matter of reassessment is distinct and different from the issues before the Commissioner, the relevant date for limitation is the original assessment order. In this case, the notice impugned was found to be without jurisdiction and barred by limitation. The petition was allowed, and the notice was set aside.
The tribunal held that the APL, through its nominees, can exercise voting rights in the tier-one companies and influence decisions in lower-tier companies as shareholders. However, the APL cannot directly interfere with the internal affairs of companies or lift the corporate veil.
The High Court disposed of the appeals. The Court noted that the appeals were filed aggrieved by the dismissal of the appeals by the Tribunal on low tax effect and the subsequent dismissal of rectification applications. The Revenue's grievance was against the rejection of the rectification applications. The Court observed that the dismissal of the appeal on tax effect was consequential to the applicability of the circular dated 06.09.2019. The Court found that no substantial question of law arose from the Tribunal's order in the appeal itself. However, liberty was granted to the appellants (Revenue) to avail remedies in accordance with law to challenge the order passed in the rectification application and to make a prayer for consequential reliefs. The specific question of maintainability of appeal against an order in M.A. and the applicability of the circular were not definitively decided on merits, but the parties were permitted to pursue their remedies.
The High Court disposed of the appeals. The Court noted the respondents' preliminary objection regarding the maintainability of an appeal against an order passed in a rectification application, citing relevant case law. The appellant sought liberty to avail remedies to challenge the order passed in the M.A. The Court observed that the Tribunal had dismissed the original appeal without going into merits due to low tax effect, and the subsequent M.A. was also dismissed. The grievance of the department was against the rejection of the M.A., and the dismissal of the appeal on tax effect was consequential to the applicability of the circular dated 06.09.2019. The Court found that no substantial question of law arose from the Tribunal's order in the appeal. Consequently, the appeals were disposed of with liberty to the appellants to pursue remedies in accordance with law to challenge the order passed in the M.A. and seek consequential reliefs.
The High Court dismissed the petition as not pressed. The court granted liberty to the appellant to approach the Tribunal by way of a miscellaneous rectification application in case the Income Tax Return of Smt. Kanika Kothawala or an affidavit regarding her status as an Income Tax assessee and her source of income is obtained. The reasoning for the dismissal is that the appellant, through their counsel, indicated they were not pressing the appeal in its current form and sought alternative recourse. The court did not decide on the merits of any substantive issue related to the income tax assessment. The operative direction is the dismissal of the petition with the liberty granted.
The High Court dismissed the writ petition as not pressed. The petitioner was granted liberty to raise all the pleas raised in the writ petition, including the plea germane to Section 151A and the scheme framed thereunder, in the proceedings under Section 147/148 of the Income Tax Act at an appropriate stage. The Court did not decide the merits of the pleas raised by the petitioner. The operative direction was to dismiss the petition with liberty as prayed for.
The High Court acknowledged the delay in releasing the attached properties, which have been under attachment since 2021, and that the reference was decided in favor of the petitioners. While not deciding the merits of the release applications, the Court disposed of the petition by directing the official respondents of the Income Tax Department to consider and decide the applications (Annexures 4, 5, and 6) within two weeks from the date of the order. The petitioners are directed to appear before the respondents on February 26, 2024, at 11 A.M. The respondents are to decide the matter in accordance with law and expeditiously. No specific finding was given on the legal question of release, as the matter was disposed of with a direction to decide the pending applications.
The High Court held that no substantial questions of law arose from the ITAT's order. The Tribunal had allowed the respondent's appeal by deleting the additions made by the AO. The ITAT considered that the respondent purchased 12,500 shares in FY 2012-2013 for Rs. 1,87,500/- and sold them after more than a year, resulting in a capital gain of Rs. 29,75,725/-. The purchase payment was by account payee cheque, and both purchase and sale were through a Demat Account managed by an independent agency, with sale executed through a registered share broker via online transaction at prevailing market prices. The ITAT found that the AO failed to contradict the evidence produced by the respondent. Furthermore, the Tribunal held that statements recorded without affording an opportunity for cross-examination were not evidence in the eyes of law and did not specifically state that the respondent's transactions were accommodation entries. The second addition on account of commission was consequential to the capital gain addition. The Tribunal's decision was based on the appreciation of evidence adduced by the respondent and the absence of contrary material from the department, without any plea of perversity. Therefore, no case was made out for interference.
The High Court held that since an assessment order had been passed during the pendency of the writ petition, the petitioner's counsel submitted that no cause of action survived. Consequently, the Court dismissed the writ petition as withdrawn. The judgment does not delve into the merits of any assessment or challenge to it, nor does it provide any reasoning beyond the petitioner's submission regarding the survival of the cause of action. No specific issues regarding the Income Tax Act were decided on merits.
The Tribunal decided the issues as follows: Questions 1 and 3 were answered against the appellant (Revenue) in light of this Court's judgment in CIT Central Jaipur Vs. Unique Builders and Developers and connected matters, which was upheld by the Supreme Court via dismissal of SLP. This implies the ITAT's decision to delete the addition under the percentage of completion method and its direction regarding the project completion method for suppressed sales were upheld. Question of Law No. 2 was answered in favour of the appellant (Revenue) and against the assessee, relying on the Supreme Court's decision in Shree Choudahry Transport Company Vs.Income Tax Officer. This means the disallowance made by the AO under Section 40(a)(ia) was upheld. The appeal was partly allowed.
The High Court granted permission to the appellant (revenue) to withdraw the appeal. This decision was based on Circular No. 17/2019 issued by the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes, which sets a monetary threshold of Rs. 1 crore for filing appeals. The Court noted that the tax effect in the present appeal was below this threshold. Consequently, the appeal was dismissed as withdrawn. No substantive issues of income tax law were decided, and therefore, no ratio decidendi for future cases on merits was established. The operative direction was to dismiss the appeal as withdrawn.
The High Court noted the petitioner's counsel's emphatic statement that no proceedings are pending and assessments have been made long back. The respondents' counsel agreed to a disposal based on this submission. Consequently, the Court directed the respondents to forthwith release the impounded documents, provided no proceedings are pending as of the date of the order. The Court did not delve into the merits of the original impounding action but disposed of the petition based on the changed circumstances and the parties' submissions. The specific date of impounding or the nature of the documents was not detailed.
The High Court disposed of the writ petition with a specific direction to the respondents. The court ordered that the refund amount found due by the order dated 27.03.2023 should be credited to the petitioner's account within eight weeks from the date of the order. The court also stipulated that if there were any impediments to this action, the respondents should communicate them to the petitioner. The petitioner was also granted liberty to pursue further legal remedies if any grievance remained unaddressed. The core of the decision is the enforcement of the previously determined refund order within a stipulated timeframe.
The High Court, exercising its discretionary jurisdiction, decided not to keep the writ petition pending. Instead, it disposed of the petition with a specific direction to the respondent Income Tax Office. The respondent was directed to decide the pending appeals concerning the petitioner's assessments within an outer limit of three months from the date of receiving a copy of the order. The Court's reasoning was based on the peculiar circumstances of the case, specifically the prolonged pendency of the appeals (since 2016 and 2019) and the fact that recoveries had already been made. The principle derived is that in cases of inordinate delay in the disposal of appeals, even where alternative remedies exist, a writ court may intervene to direct expeditious disposal, especially when recoveries have already been effected.
The Tribunal held that the writ petition had become infructuous due to subsequent developments during its pendency. The reasoning was based on the submission made by the learned counsel for the petitioner that no cause of action survived. Consequently, the writ petition was dismissed as rendered infructuous. The ratio decidendi is that if a party to a legal proceeding acknowledges that the matter has become infructuous due to subsequent events, the proceeding should be dismissed on that ground. No specific relief was granted or denied on the merits of the original grievance, as the petition was disposed of on a procedural basis. No issues were left undecided, as the petition was dismissed in its entirety.
The High Court disposed of the writ petition without commenting on the merits of the case. The matter was remitted back to the respondent No.1 - Income Tax Officer, Ward 2(1), Kota, to proceed in pursuance to the impugned notices in accordance with law. The petitioner was granted liberty to raise all available legal grounds. The first prayer regarding the certificate under Section 197 for assessment year 2005-06 was rendered infructuous due to the efflux of time.
The High Court dismissed the writ petition, holding that interference at this premature stage is not warranted. The Court noted that the Income Tax Act provides a complete machinery for assessment and reassessment, and the petitioner has adequate alternative remedies. The Court emphasized that the correctness of the order under Section 148A(d) was challenged on factual premises, and there is a distinction between a jurisdictional error and an error of law or fact within jurisdiction. The Court cited several High Court judgments and a Supreme Court order in the case of Anshul Jain, which held that challenges to reopening notices should be agitated before the Assessing Officer in reassessment proceedings. The Court explicitly stated that it had not commented on the merits of the assessment. All submissions made by the petitioner regarding the non-taxable nature of the Rs. 65,00,000/- transaction and the need for documents would be open to be raised at the appropriate stage in the reassessment proceedings. The Assessing Officer is duty-bound to deal with these submissions and supply necessary documents to the petitioner.
The Tribunal allowed the petitioner's prayer to withdraw the writ petition. The reasoning provided is that the learned counsel for the petitioner prayed for withdrawal. Consequently, the writ petition was dismissed as withdrawn. No specific legal principle or ratio decidendi is established as the matter was disposed of on the petitioner's request. No issues were decided on merits, and no operative directions beyond dismissing the petition as withdrawn were issued.
The Rajasthan High Court, Bench at Jaipur, disposed of the four writ petitions by a common order. The Court noted that the petitions had been pending for over two years. Recognizing that 'much water has flown' during this period, the Court directed Respondent No. 2 (Deputy Commissioner of Income Tax, Central Circle, Kota) to consider and decide the petitioner's representation for the release of the seized cash. This decision was to be made as expeditiously as possible, but not later than eight weeks from the date of the order (08/02/2024). To further expedite the process and avoid further delays, the Court also directed the petitioner to appear in the office of Respondent No. 2 on 15.02.2024 at 11:00 AM. The Court did not delve into the merits of releasing the cash or the validity of the seizure itself, focusing solely on ensuring the pending representation is adjudicated.
The High Court acknowledged that the writ petitions had been pending for over two years. Considering the significant time elapsed since the filing of the representation and the petitions, the Court decided to dispose of the matter by issuing a directive to the respondent No. 2 (Deputy Commissioner of Income Tax, Central Circle, Kota). The respondent No. 2 was directed to consider and decide the petitioner's representation for the release of the seized cash expeditiously. The Court set a timeline for this decision, mandating that it be completed not later than eight weeks from the date of the order. To facilitate prompt action and avoid further delays, the Court also directed the petitioner to appear in the office of respondent No. 2 on February 15, 2024, at 11:00 AM. No specific finding was made on the merits of the representation itself, as the order focused on ensuring its timely disposal.
The High Court noted that the writ petitions had been pending for over two years. Given the delay, the Court decided to dispose of the petitions by issuing a specific direction to the respondent No. 2 (Deputy Commissioner of Income Tax, Central Circle, Kota). The Court directed respondent No. 2 to consider and decide the representation of the petitioner for the release of the seized cash as expeditiously as possible, and in any event, not later than eight weeks from the date of the order. To facilitate a prompt resolution and avoid further delays, the Court also directed the petitioner to appear in the office of respondent No. 2 on February 15, 2024, at 11:00 AM. No specific finding was made on the merits of the representation itself, as the order focused on procedural direction.
The High Court held that while the impugned order noted the petitioner's objection regarding the reassessment proceedings being time-barred, it failed to consider and decide this specific objection. The Court reiterated the principle laid down in G.K.N Driveshafts (India) Ltd. that the Assessing Officer is duty-bound to pass a speaking order after considering all objections filed by the assessee. Since the impugned order did not fulfill this requirement, it was set aside. The matter was remitted back to the respondent (Assessing Officer) to proceed in accordance with the law, implying that the objections, including the one concerning the time-bar, should be properly considered and decided by a speaking order before proceeding with the assessment. No specific finding was given on the merits of the time-bar issue itself, as it was remitted for fresh consideration.