McDowell & Co. Ltd. v. CTO

Creation Publicity Pvt. Ltd., Mumbai vs. ITO Ward - 2(1)(2), Mumbai

In the result, all the three appeals of the assessee are dismissed

Bench: Shri D.T. Garasia

…is exempt. 16. The self imposed clause in the Articles of Association of Assessee company is nothing but a colourable device used for tax avoidance. It is pertinent to bring on record the observations of the apex court in McDowell and Co. Ltd.’s case [1985] 154 ITR 148. The same will apply in full vigour to the present case which read thus (pages 160 and 161): M/s. Creation Publicity Pvt. Ltd. "In our view, the proper way to construe a taxing statute, while considering a device to avoid tax, is not to ask whether the provisions should be construed literally or liberally, nor whether the transaction is not unrea…

Creation Publicity Pvt. Ltd., Mumbai vs. ITO Ward - 2(1)(2), Mumbai

In the result, all the three appeals of the assessee are dismissed

Bench: Shri D.T. Garasia

…is exempt. 16. The self imposed clause in the Articles of Association of Assessee company is nothing but a colourable device used for tax avoidance. It is pertinent to bring on record the observations of the apex court in McDowell and Co. Ltd.’s case [1985] 154 ITR 148. The same will apply in full vigour to the present case which read thus (pages 160 and 161): M/s. Creation Publicity Pvt. Ltd. "In our view, the proper way to construe a taxing statute, while considering a device to avoid tax, is not to ask whether the provisions should be construed literally or liberally, nor whether the transaction is not unrea…

ITO 19(2)(4), Mumbai vs. Naitik Gems, Mumbai

In the result, appeal of the Revenue is dismissed

Bench: Shri P.K. Bansal, Vice- & Shri Pawan Singhito -19(2)(4), M/S Naitik Gems Room No. 217, Matru Mandir, 1304, Prasad Chambers, Vs. Mumbai-400007. Opera House, Mumbai-400004. Pan: Aaafn5200F (Appellant) (Respondent)

…IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH “E”, MUMBAI BEFORE SHRI P.K. BANSAL, VICE-PRESIDENT AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITO -19(2)(4), M/s Naitik Gems Room No. 217, Matru Mandir, 1304, Prasad Chambers, Vs. Mumbai-400007. Opera House, Mumbai-400004. PAN: AAAFN5200F (Appellant) (Respondent) Assessee by : Shri V. Justin (Sr. DR) Revenue by : Shri Ashok J. Patil (AR) Date of hearing : 31.10.2017 Date of Pronouncement : 29.11.2017 Order Under Section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by Revenue u/s 253 of the Income-Tax Act (“The Act”) is directed against…

Samkit Diamonds Exporters, Mumbai vs. ACIT 19(3), Mumbai

In the result both the appeals of the assessee as well of the revenue are allowed for statistical purposes

Bench: Shri Saktijit Dey & Shri Ramit Kocharआयकर अपीऱ सं./I.T.A. No.4133/Mum/2016 (नििाारण वर्ा / Assessment Year: 2012-13) बिाम/ Samkit Diamonds Exporters Acit 19(3) 111 Prasad Chambers, Tata Mumbai Road No.2, Opera House, V. Mumbai 400004 स्थायी ऱेखा सं./ Pan : Aakfs5302F (अपीऱाथी /Appellant) (प्रत्यथी / Respondent) ..

…on the judgement of Hon'ble supreme Court in the case of Sri Meenakshi Mills Ltd 63 ITR 609 where it was held that the I.T. Authorities are entitled to pierce the veil of Corporate Entity and to look into reality of transaction. In the case of McDowell & Co. 154 ITR 148(SC) it was stated that implications of tax avoidance are manifold. First, there is substantial loss of much needed public revenue. Next, there is serious disturbance caused to the economy of the country due to piling of mountains of black money, causing inflation. Thus, there is "the large hidden loss" to the community, by some of the' members in…

Chandra N Hingorani, Mumbai vs. ITO 23(1)(3), Mumbai

In the result, the appeal of assessee is allowed

Bench: Sri Mahavir Singh, Jm & Sri N.K. Pradhan, Am Smt Chandra N. Hingorani The Income Tax Officer 10-A, Jeevan Jagruti, Dr. 23(1)(3), Vs. 1St Ambedkar Road, Bandra(W), Floor, Matru Mandir, Mumbai-400 050 Tadreo, Mumbai-400 007 Appellant .. Respondent Pan No. Aapph8893K

…IN THE INCOME TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI BEFORE SRI MAHAVIR SINGH, JM AND SRI N.K. PRADHAN, AM Smt Chandra N. Hingorani The Income Tax Officer 10-A, Jeevan Jagruti, Dr. 23(1)(3), Vs. 1st Ambedkar Road, bandra(W), Floor, Matru Mandir, Mumbai-400 050 Tadreo, Mumbai-400 007 Appellant .. Respondent PAN No. AAPPH8893K Assessee by : Hari S Reheja, AR Revenue by : Aarju Garodia, DR Date of hearing: 09-11-2017 Date of pronouncement : 16-11-2017 O R D E R PER MAHAVIR SINGH, JM: This appeal by the Assessee is arising out of the order of Commissioner of Income Tax (Appeals)-32, Mumbai, [in short CIT(A)] i…

Gigaplex Estate P.Ltd, Mumbai vs. DCIT OSD II Cen RG 7, Mumbai

In the result, the appeals of the assessee are partly allowed

Bench: Shri C.N. Prasad, Jm & Shri Rajesh Kumar, Am

…आयकर अपीऱीय अधिकरण, म ुंबई न्यायपीठ “जे” म ुंबई IN THE INCOME TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI श्री सी. एन.प्रसाद, न्याययक सदस्य एवं श्री राजेश कुमार, ऱेखा सदस्य के समक्ष BEFORE SHRI C.N. PRASAD, JM AND SHRI RAJESH KUMAR, AM ITA NO.1132, 1133/Mum/2016 And ITA No.1137/Mum/2016 (ननधधायण वषा / Assessment Year: 2007-08, 2008-09 and 2006-07) Gigaplex Estate Pvt Ltd., Dy.Commissioner of Income (Formerly known as B Raheja Tax, OSD-II, Central Range -7, Builders Pvt Ltd), Aayakar Bhavan, फनधभ/ Plot No.C-30, G Block, M K Road, Opp SIDBI Bank, Mumbai-400020 Vs. Bandra Kurla Complex, Bandra (Est), Mumbai-400051 (अऩी…

Gigaplex Estate P.Ltd, Mumbai vs. DCIT OSD II Cen RG 7, Mumbai

In the result, the appeals of the assessee are partly allowed

Bench: Shri C.N. Prasad, Jm & Shri Rajesh Kumar, Am

…आयकर अपीऱीय अधिकरण, म ुंबई न्यायपीठ “जे” म ुंबई IN THE INCOME TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI श्री सी. एन.प्रसाद, न्याययक सदस्य एवं श्री राजेश कुमार, ऱेखा सदस्य के समक्ष BEFORE SHRI C.N. PRASAD, JM AND SHRI RAJESH KUMAR, AM ITA NO.1132, 1133/Mum/2016 And ITA No.1137/Mum/2016 (ननधधायण वषा / Assessment Year: 2007-08, 2008-09 and 2006-07) Gigaplex Estate Pvt Ltd., Dy.Commissioner of Income (Formerly known as B Raheja Tax, OSD-II, Central Range -7, Builders Pvt Ltd), Aayakar Bhavan, फनधभ/ Plot No.C-30, G Block, M K Road, Opp SIDBI Bank, Mumbai-400020 Vs. Bandra Kurla Complex, Bandra (Est), Mumbai-400051 (अऩी…

Gigaplex Estate P.Ltd, Mumbai vs. DCIT OSD II Cen RG 7, Mumbai

In the result, the appeals of the assessee are partly allowed

Bench: Shri C.N. Prasad, Jm & Shri Rajesh Kumar, Am

…आयकर अपीऱीय अधिकरण, म ुंबई न्यायपीठ “जे” म ुंबई IN THE INCOME TAX APPELLATE TRIBUNAL “J” BENCH, MUMBAI श्री सी. एन.प्रसाद, न्याययक सदस्य एवं श्री राजेश कुमार, ऱेखा सदस्य के समक्ष BEFORE SHRI C.N. PRASAD, JM AND SHRI RAJESH KUMAR, AM ITA NO.1132, 1133/Mum/2016 And ITA No.1137/Mum/2016 (ननधधायण वषा / Assessment Year: 2007-08, 2008-09 and 2006-07) Gigaplex Estate Pvt Ltd., Dy.Commissioner of Income (Formerly known as B Raheja Tax, OSD-II, Central Range -7, Builders Pvt Ltd), Aayakar Bhavan, फनधभ/ Plot No.C-30, G Block, M K Road, Opp SIDBI Bank, Mumbai-400020 Vs. Bandra Kurla Complex, Bandra (Est), Mumbai-400051 (अऩी…

Tata Industries Ltd, Mumbai vs. Asst CIT RG 2(3), Mumbai

The appeal of the assessee stands partly allowed

…आयकर आयकर अपीलीय आयकर आयकर अपीलीय अपीलीय अिधकरण अपीलीय अिधकरण अिधकरण, मुंबई अिधकरण मुंबई मुंबई “ एल मुंबई एल एल” खंडपीठ एल खंडपीठ खंडपीठ खंडपीठ Income-tax Appellate Tribunal -“L”Bench Mumbai सव"ी सव"ी सव"ी राजे"" सव"ी राजे"" राजे"",लेखा राजे"" लेखा लेखा सद"य लेखा सद"य सद"य एवं सद"य एवं एवं, राम एवं राम रामलाल राम लाल लाल नेगी लाल नेगी नेगी, "याियक नेगी "याियक "याियक सद"य "याियक सद"य सद"य सद"य Before S/Shri Rajendra,Accountant Member and Ram Lal Negi,Judicial Member आयकर अपील अपील संसंसंसं./I.T.A./6750/Mum/2014,िनधा"रण िनधा"रण वष" वष" /Assessment Year: 2007-08 आयकर आयकर आयकर अपील अपील िनधा"रण िनधा"रण वष" वष" Ta…

Mrunal Shamsunder Naik, Mumbai vs. ACIT 15(2), Mumbai

Bench: Sh. R. C. Sharma, Am & Sh. Sandeep Gosain, Jm आयकरअपीलसं./ I.T.A. No. 911/Mum/2017, (निर्धारणवर्ा / Assessment Year: 2010-11)

…claimed transactions. However, it is not enough if there are documents evidencing an apparent situation, if such documents do not record a real transaction, but are made to cover up what could be inferred reasonably as unreal. In McDowell and Co. vs CTO( 1985)154 ITR 148(SC) the position of law is that if substance attracts tax, the form can be ignored by the tax collector. Further, In the case of Assistant Commissioner of Income-tax v. Tribhovandas Bhimji Zaveri [2000] 74 lTD 92(MUM.), Hon'ble Mumbai Bench of ITAT white dealing with the issue of bogus purchases where similar arguments were advanced to buttress t…

Muffazal Hakim Penwala, Mumbai vs. ITO 17(2)(4), Mumbai

In the result, this appeal filed by the assessee stands dismissed

Bench: Shri Shamim Yahya, Am & Shri Sandeep Gosain, Jm आयकर अपील सं./I.T.A. No. 3740/Mum/2017 ("नधा"रण वष" / Assessment Year: 2010-11) Shri Muffazal Hakim Penawala Cit(A)-28, India House, Ground Floor, Earnest House, Ncpa Marg, बनाम/ Shop No. 1-2, 246, A. R. Street, Nairman Point, Mumbai-400 021 Vs. Mumbai-400 003 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aabpp 1934 H (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Ms. Ruchi M. Rathod ""यथ" क" ओर से/Respondent By : Shri M. V. Rajguru

…a Prasad 82 ITR 540 (SC) and in the case of Sumati Dayal Vs. CtT (1995) 214 ITR 801 (SC). (iv) The purchases from hawala operators fall within the ambit of the term 'Colourable device' and the Hon'ble Supreme Court in the case of McDowell and Co, Ltd, Vs. CTO 154 ITR 148 has observed that "Tax planning may be legitimate provided it is within the framework of low. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the payment of tax by resorting to dubious method. It is obligation of every citizen to pay the taxes honestly without r…

Meru Impex, Mumbai vs. Asst CIT Cir 17(2), Mumbai

In the result, this appeal filed by the assessee stands partly allowed

Bench: Shri Shamim Yahya, Am & Shri Sandeep Gosain, Jm आयकर अपील सं./I.T.A. No. 2660/Mum/2017 ("नधा"रण वष" / Assessment Year: 2007-08) M/S. Meru Impex Acit-Circle 17(2), बनाम/ 15, 1St Floor, Agiary Lane, Aayakar Bhavan, Osman Manzil, 2Nd Floor, M. K. Road, Mumbai-400 020 Vs. Mumbai-400 003 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaafm 6289 K (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : None ""यथ" क" ओर से/Respondent By : Shri T. A. Khan सुनवाई क" तार"ख / : 17.10.2017 Date Of Hearing घोषणा क" तार"ख / : 01.11.2017 Date Of Pronouncement आदेश / O R D E R Per Shamim Yahya, A. M.: This Appeal By The Assessee Is Directed Against The Order By The Commissioner Of Income Tax (Appeals)-28, Mumbai (‘Cit(A)’ For Short) Dated 19.01.2017 & Pertains To The Assessment Year (A.Y.) 2007-08. 2. The Issue Raised Is That The Ld. Cit(A) Erred In Sustaining Disallowance Of 10% Of Bogus Purchase Amounting To Rs.4,99,55,341/-.

…urga Prasad 82 ITR 540 (SC) and Sumati Dayal Vs. CIT (1995) 214 ITR 801 (SC). (iii) The purchases from hawala operators falls within the ambit of the term 'colourable devices' and the Hon'ble Supreme Court observed in the case of McDowell and Co. Ltd. Vs. CTO 154 ITR 148 that "Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that it is honourable to avoid the 4 M/s. Meru Impex vs. ACIT payment of tax by resorting to dubious method. It is obligation of every citizen to pay the taxes hone…

Mandakini Hospitality P.Ltd, Mumbai vs. Asst CIT Cir 4(2), Mumbai

In the result, the appeal filed by the assessee is allowed

Bench: Shri P K Bansal & Shri Pawan Singh

…red Bank. The AO was, therefore, of the opinion that the assessee has circumvent the provisions of Section 10(38) by entering into off market transaction and therefore he relying on the decision of the Hon'ble Supreme Court in the case of Mc Dowell & Co. Ltd. 154 ITR 148 held that the entire transaction is colourable device to circumvent the provisions of Section 10(38) and therefore he disallowed the carry forward of long term capital loss amounting to `1,55,97,911/-. When the matter went before the CIT(A), the CIT(A) confirmed the order of the CIT(A). 4. We heard the rival submissions and gone through the orde…

Dwarka Prasad Agarwal, Mumbai vs. ITO 21(1)(3), Mumbai

In the result, appeal of the Revenue is dismissed

Bench: Shri D.T.Garasia, Jm & Shri Rajesh Kumar, Am

…M u m / 2 0 1 6 a n d o t h e r t w o a p p e a l s the present case, the trust is resident of Bahamas and the beneficiaries are residents of India. The ld. DR in defense of his arguments relied upon the series of decisions as under : i) McDowell and Co Ltd -154 ITR 148 (SC); ii) Twinstar Holdings Ltd V/s DCIT – 260 ITR 0006 (Bom); iii) Nayantara G Agarwal V/s CIT -207 ITR 639 (Bom); iv) Onam Agarbathi Co V/s DCIT-310 ITR 56 (Kar); v) Pravinbhai M Kheni V/s ACIT -28 taxmann.com 111(Guj); vi) CIT V/s Rothman Cycle Ind. Pvt.Ltd (2011) 203 taxman 302; vii) CIT V/s Bharti Devi Sarabhi -231 ITR 526 (SC); viii) Moti…

Dwarka Prasad Agarwal, Mumbai vs. ITO 21(1)(3), Mumbai

In the result, appeal of the Revenue is dismissed

Bench: Shri D.T.Garasia, Jm & Shri Rajesh Kumar, Am

…M u m / 2 0 1 6 a n d o t h e r t w o a p p e a l s the present case, the trust is resident of Bahamas and the beneficiaries are residents of India. The ld. DR in defense of his arguments relied upon the series of decisions as under : i) McDowell and Co Ltd -154 ITR 148 (SC); ii) Twinstar Holdings Ltd V/s DCIT – 260 ITR 0006 (Bom); iii) Nayantara G Agarwal V/s CIT -207 ITR 639 (Bom); iv) Onam Agarbathi Co V/s DCIT-310 ITR 56 (Kar); v) Pravinbhai M Kheni V/s ACIT -28 taxmann.com 111(Guj); vi) CIT V/s Rothman Cycle Ind. Pvt.Ltd (2011) 203 taxman 302; vii) CIT V/s Bharti Devi Sarabhi -231 ITR 526 (SC); viii) Moti…