CIT V. MADHUSUDAN AGARWAL

ITA/181/2010

AI Insights

The case involves multiple appeals by the Commissioner of Income Tax-Central against Shri Madhusudan Agarwal concerning the assessment of income following a search and seizure operation under section 132 of the Income Tax Act, 1961. The operation, conducted on 23.11.2005, led to the discovery of cash and jewelry at the assessee's premises. Subsequently, the assessee declared an income of Rs.1,40,06,463/- on 3.10.2006. The department challenged the Tribunal's decision, which had favored the assessee, in the High Court of Rajasthan. The primary legal question was whether the Tribunal was correct in assessing the assessee's income below what he had voluntarily declared.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 720198 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 07-02-2017
• Assessment Year: misc
• Other Referred Cases: M/s Kalindee Rail Nirman (Engineers) Limited vs. The Commissioner of Income Tax
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: NARESH GU PTA
• Assessee Lawyers: ANUROOP SINGHI; ADITYA VIJAY
• Keywords: Assessment; Income Declaration; Income tax appeal; Search and seizure
• Section: 142(1); 143(2); 127; 132910

Judgement Text

"HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 181 / 2010 Commissioner of Income Tax-Central, New Central Revenue Building, Statue Circle, Jaipur (Raj.). ----Appellant Versus Shri Madhusudan Agarwal, Agrasan Market, Johari Bazar, Jaipur. ----Respondent Connected With D.B.INCOME TAX APPEAL No. 199 / 2011 Commissioner of Income Tax-Central, New Central Revenue Building, Statue Circle, Jaipur (Raj.). ----Appellant Versus Shri Madhusudan Agarwal, Agrasan Market, Johari Bazar, Jaipur. ----Respondent D.B.INCOME TAX APPEAL No. 499 / 2011 Commissioner of Income Tax-Central, New Central Revenue Building, Statue Circle, Jaipur (Raj.). ----Appellant Versus Shri Madhusudan Agarwal, Agrasan Market, Johari Bazar, Jaipur. ----Respondent D.B.INCOME TAX APPEAL No. 500 / 2011 Commissioner of Income Tax-Central, New Central Revenue Building, Statue Circle, Jaipur (Raj.). ----Appellant Versus Shri Madhusudan Agarwal, Agrasan Market, Johari Bazar, Jaipur. ----Respondent (2 of 4) [ITA-181/2010] _____________________________________________________ For Appellant(s) : Mr. Anuroop Singhi with Mr. Aditya Vijay For Respondent(s) : Mr. Naresh Gupta _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE VINIT KUMAR MATHUR Judgment Per Hon’ble Jhaveri J. 07/02/2017 1. Since controversy involved in all these appeal is identical, therefore, these appeals are decided by this common order. 2. By way of these appeals, the appellant has challenged the judgment and order of the Tribunal whereby the Tribunal has allowed the cross-objection of the assessee and dismissed the appeal of the department. 3. This Court while admitting the appeals framed the following substantial question of law: “Whether on the facts and circumstances of the case, the learned Tribunal was right and justified in determining the total income of the assessee below the income voluntarily declared by the assessee?” 4. The brief facts of this case are that the assessee is an individual and received business, rental and interest income. The assessee is running its proprietary business in the name of M/s Shree Ganpati Fashion. A search and seizure operation under section 132910 of the Income Tax Act,1961 was carried out on 23.11.2005 at the residential premises. During the course of (3 of 4) [ITA-181/2010] search & seizure operation at 2681, Ghee Walon Ka Rasta, Johari Bazar, Jaipur cash and jewellery was found. The Commissioner of Income Tax-I Jaipur has centralized the case with Central Circle-1, Jaipur vide order No.1580 U/s 127 on 18.01.2006. The assessee filed return declaring an income of Rs.1,40,06,463/- on 3.10.2006 with Central Circle-I, Jaipur. A notice u/s 142 (1) & 143(2) were issued on 5.2.2007 fixing the case for hearing on 26.02.2007 which was duly served upon the assessee on 08.02.2007. Subsequently, notice under Section 143(2) was issued on time to time. Thereafter a detailed questionnaire in terms of provisions of Section u/s 142(1) of the Income Tax Act, 1961 also issued on 30.07.2007 and duly served on the assessee. Thereafter, due to change of incumbency notice under section 143(2) was again issued to the assessee on 06.11.2007 and the same was duly served on the assessee. In compliance to the above notice Shri Vijay Goyal, CA and AR of the assessee appeared, and, filed the necessary details and produced the books of accounts comprising of computerized cash book, ledger and journal, which were examined on test check basis. 5. Counsel for the appellant has contended that the view taken by the Tribunal is not just and proper and requires to be reversed. 6. Counsel for the respondent has contended that the issue is now squarely covered by the decision of this Court in DB Income Tax Appeal No.128/2006 in the case of M/s Kalindee Rail Nirman (Engineers) Limited. vs. The Commissioner of Income Tax decided on 24.01.2017 and more particularly in para (4 of 4) [ITA-181/2010] 6 which reads as under: “6. Taking into consideration the view taken by the Gujarat High Court, Allahabad High Court, Madras High Court and Andhra Pradesh High Court, we are of the opinion that the contention raised by the appellant that on acceptance of the scrutiny, if he is entitled for other benefits which he has not claimed, the same be refunded to him i.e. after the proceedings if it is found that assessee is entitled for refund, the same should be refunded as the State cannot recover the tax more than what is due to it.” 6.1. In that view of the matter, the issue is answered in favour of the assessee and against the department. 7. The appeals stand dismissed. 8. A copy of this judgment be placed in each file. (VINIT KUMAR MATHUR)J. (K.S. JHAVERI)J. Asheesh Kr. Yadav/141-144 "