Shri Amit N Shah, Ahmedabad V. The DCIT, Circle- 4, Ahmedabad

MA 157/AHD/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0719 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 17-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: misc
• Appeal Filed On: 16-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P JHANGID
• Keywords: Block assessment; Revised return
• Section: 244A; 142(1); 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH AHMADABAD BEFORE SHRI MUKUL KR. SHRAWAT , JUDICIAL MEMBER AND SHRI T.R. MEENA, ACCOUNTANT MEMBER M.A. NO. 157/AHD/2013 BLOCK PERIOD :1985-86 TO 1995-96 AND UP TO 21/12/1995 (IN IT(SS)A NO. 507 AHD 2010) AMIT N. SHAH 13,MANGALAM SOCIETY, S. M. ROAD, NEHRUNAGAR, AHMEDABAD V/S . THE DCIT, CIR-4, AHMADABAD, NAVJIVAN TRUST BLDG., OFF. ASHRAM ROAD, AHMEDABAD PAN NO. AAEFA3836F (APPELLANT) .. (RESPONDENT) BY APPELLANT SHRI ANIL KSHATRIYA, A.R. /BY RESPONDENT SHRI J. P. JHANGID, SR. D.R. /DATE OF HEARING 06.09.2013 /DATE OF PRONOUNCEMENT 17.09.2013 O R D E R PER : T.R.MEENA, ACCOUNTANT MEMBER THIS M.A. IS FILED BY THE APPELLANT AGAINST THE ORD ER PASSED BY THIS BENCH, DATED 14.06.2013 IN IT(SS)A NO. 507/AHD/2010 FOR THE BLOCK PERIOD 1985-86 TO 1995-96 & UP TO 21.12.1995. THE DATE WI SE SEQUENCES OF PROCEEDINGS ARE AS UNDER: (I) ON 21/12/1995 SEARCH & SEIZURE PROCEEDINGS U/S 132 OF THE ACT WERE CARRIED OUT IN THE CASE OF ATLANTIC CREDIT & CAPITA L LTD. & ASIATIC INFRASTRUCTURE & SHELTER LTD. AT THE BUSINESS PREMISES OWNED BY INDO AMERICAN OPTICS LTD. HAVING ITS ADDRESS AT IOL HOUSE, OPP. CENTRAL BANK AMBAVADI, AHMADABAD: 380009. M.A. NO. 157 AHD 2013 [IT(SS)A NO. 507/AHD/10], BLOCK PERIOD: 1985-86 TO 1995-96 & UP TO 21/12/1995 PAGE 2 (II) ON 14/11/1996 NOTICE U/S 158 BC R.W.S. 158BD I SSUED. (III) ON 21/11/1996 INTIMATED THE A.O. FOR THE RETU RN OF INCOME FILED IN FORM NO. 2B WHEREIN UNDISCLOSED INCOME WAS DISCL OSED AT RS.5,21,86,400/-. (IV) ON 28/11/1997 ASSESSMENT ORDER U/S 158BC R.W.S . 158BD WAS PASSED BY THE DCIT SPECIAL RANGE, AHMADABAD DETERMINING TOTAL UNDISCLOSED INCOME AT RS.22,74,46 ,700/- (ON SUBSTANTIVE BASIS RS.13,24,19,642/- + ON PROTECTIVE BASIS RS.9,50,27,058/-). (V) ON 25/8/2004 THE DIRECT APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ABOVE ORDER BEARING IT(SS)A NO. 229/AHD /1997 WAS DISPOSED OFF BY THE ITAT, AHMADABAD BENCH (A) A LLOWING THE APPEAL OF THE ASSESSEE BY SETTING ASIDE THE ORD ER DATED 21/11/1997 PASSED BY THE A.O. (VI) ON 6/1/2006 FIRST NOTICE U/S 142(1) & 143(2) O F THE ACT (AFTER SETTING ASIDE OF THE ORIGINAL ASSESSMENT ORDE BY AB OVE ORDER) WAS ISSUED BY ACIT CIRCLE-4, AHMADABAD CALLING UPON THE ASSESSEE TO PREPARE A TRUE AND CORRECT RETURN OF IN COME. SIMILAR NOTICES WERE ALSO ISSUED LATER ON. (VII). ON 14/03/2006 REVISED RETURN OF INCOME FILED BY THE ASSESSEE DECLARING TOTAL UNDISCLOSED INCOME OF RS.1,72,11,00 0/-. (VIII) ON 23/3/2006 THE ASSESSING OFFICER FRAMED TH E ORDER U/S 158BD R.W.S. 254 OF THE I.T. ACT DETERMINING TOTAL UNDISCLOSED INCOME AT RS.24,17,31,739/- (ON SUBSTANTIVE BASIS RS.14,67,04,681/- + ON PROTECTIVE BASIS RS. 9,50,27 ,058/-) (IX) ON 10/07/2009 DIRECT APPEAL PREFERRED AGAINST THE ABOVE ORDER WAS DISPOSED OFF ASSESSEES APPEAL BEARING IT (SS)A NO.87/AHD/2006 BY THE ITAT, AHMADABAD BENCH (A) ALL OWING THE APPEAL OF THE ASSESSEE BY GIVING THE FOLLOWING FINDINGS:- M.A. NO. 157 AHD 2013 [IT(SS)A NO. 507/AHD/10], BLOCK PERIOD: 1985-86 TO 1995-96 & UP TO 21/12/1995 PAGE 3 I. FINDING AS PER PARAGRAPH 12 OF THE ORDER. THEREFORE, IN OUR OPINION, SINCE THE LAW IS NOW WELL SETTLED IN VIEW OF THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF MANISH MAHESHWARI V. ACIT 289 ITR 341 (SC), THAT FOR INVOKING JURISDICTION UNDER SECTION 158BD AGAINST THE PERSON IN WHOSE CASE THE SEARCH HAS NOT TAKEN PLACE, RECORDING OF THE SATISFACTION ABOUT THE UNEARTHING OF THE UNDISCLOSED INCOME OF THE PERSON NOT SEARCH IS ESSENTIAL, THEREFORE ASSESSMENT FRAMED WITHOUT COMPLYING WITH THIS CONDITION IS INVALID AND VOID. WE ACCORDINGLY QUASH THE ASSESSMENT FRAMED BY THE ASSESSING OFFICER IN THIS CASE UNDER SECTION 158BC(C) R.W. SECTION 158BD.' ( KINDLY REFER TO P. B. P. NO.69) II. FINDING AS PER PARAGRAPH 20 OF THE ORDER THUS, OUT OF AN ADDITION OF RS.2,27,86,000/-, THE ADDITION TO THE EXTENT OF RS.24,76,000/- IS SUSTAINED. (KINDLY REFER TO P.B.P.NO.83) (X) ON 16/07/2009 THE ASSESSEE FILED A LETTER DATED 10/07/2009 WITH DCIT CIRCLE-4, AHMEDABAD CLARIFYING THE LEGA LITY AND IMPLICATION OF THE ABOVE ORDER OF HON'BLE TRIBUNAL DATED 10/07/2009 ON THE NON-TAXABILITY, REFUND OF TAX & D ATES FROM WHERE TO WHERE INTEREST U/S 244A OF THE ACT SHOULD BE GRANTED ON REFUND OF TAX. (XI) ON 18/08/2009 ORDER GIVING EFFECT TO THE ABOVE ORDER OF HON'BLE ITAT BENCH 'D' , AHMEDABAD WAS PASSED BY DCIT CIRCLE-4, AHMEDABAD AFTER CONSIDERING & DISPOSING T HE M.A. NO. 157 AHD 2013 [IT(SS)A NO. 507/AHD/10], BLOCK PERIOD: 1985-86 TO 1995-96 & UP TO 21/12/1995 PAGE 4 CONTENTION OF THE ASSESSEE AS RAISED IN THE ABOVE M ENTIONED LETTER DATED 10/07/2009 WHICH WAS FILED ON 16/07/20 09 BY DETERMINING THE INCOME AT RS.24,76,000/-, CALCULATI NG THE TAX THEREON AT RS. 14,85,600/-, & AFTER DEDUCTING SUCH TAX FROM TAX PAID OF RS.3,12,82,424/-, CALCULATED INTEREST PAYAB LE U/S 244A OF THE ACT OF RS. 3,23,55,219/- ON THE NET REFUN DABLE PRINCIPLE AMOUNT OF RS. 2,97,96,824/-. IN THE SAID ORDER THE A.O. HAS MENTIONED THE FOLLOW ING TWO TABLES:- (I) THE ASSESSEE HAS MADE THE FOLLOWING PAYMENTS AS PER TABLE 'B' S.NO. DATE AMOUNT 1 24-3-1996 10,00,000 2 26-3-96 2,42,20,000 3 27 - 3 - 96 20,00,000 4 23-01-1998 4,050 5 05-02-1998 3,714 6 31-03-2000 40,51,660 7 22 - 11 - 2002 3,000 TOTAL 3,12,82,424 (II) DETAILS OF INTEREST WORKING TABLE C SR. NO. DETAILS OF INTEREST WORKING AMOUNT 1 ON RS.2,57,34,400 ( AS PER SR.NO.L TO 3 ABOVE RS.2,72,20,000 - 14,85,600) FROM 01-05-1996 TO 31-01-1998; 21 MONTHS @ 1% 54,04,224 2 ON RS.2,57,38,450 ( AS PER SR.NO.L TO 4 ABOVE) FROM 01-02-1998 TO 28-02- 1998; 01 MONTHS @ 1% 2,57,385 3 ON RS,2,57,42,164 ( AS PER SR.NO.L TO 5 ABOVE) FROM 01-03-1998 TO 31-03-2000; 25 MONTHS @ 1% 64,35,541 4 ON RS.2,97,93,824 ( AS PER SR.NO.L TO 6 ABOVE) FROM 01-04-2000 TO 31-05-2002; 14 MONTHS @ 1% 41,71,135 M.A. NO. 157 AHD 2013 [IT(SS)A NO. 507/AHD/10], BLOCK PERIOD: 1985-86 TO 1995-96 & UP TO 21/12/1995 PAGE 5 5 ON RS.2,97,93,824 ( AS PER SR.NO.L TO 6 ABOVE) FROM 01-06-2001 TO 31-05-2002; 12 MONTHS @ 0.75% 26,81,444 6 ON RS.2,97,93,824 ( AS PER SR.NO.L TO 6 ABOVE) FROM 01-06-2002 TO 30-10-2002; 5 MONTHS @ 0.666% 9,92,134 7 ON RS.2,97,96,824 ( AS PER SR.NO.L TO 7 ABOVE) FROM 01-11-2002 TO 31-08- 2003; 10 MONTHS Q.666% 19,84,468 8 ON RS.2,97,96,824 ( AS PER SR.NO.L TO 7 ABOVE) FROM 01-09-2003 TO 30-06- 2009; 70 MONTHS @ 0.5% 1,04,28,888 TOTAL INTEREST 3,23,55,219 2. THE GRIEVANCE OF THE APPELLANT IS THAT THE LD. A .O. HAD REDUCED THE TAX OF RS.14,85,600/- FROM TAX PAID OF RS.3,12,82,424/- AN D CALCULATED INTEREST ON THE REDUCING THE REFUNDABLE AMOUNT OF RS.2,97,96,82 4/-. THE ORIGINAL ASSESSMENT MADE BY THE A.O. DATED 20.11.1997, WAS S ET ASIDE BY THE ITAT VIDE ORDER DATED 25.08.2004 AND DIRECTING ASSESSING OFFICER TO PASS THE ASSESSMENT AFRESH AFTER ALLOWING ADEQUATE OPPORTUNI TY TO THE ASSESSEE. THE LD. A.O. PASSED ORDER U/S. 158BD R.W.S. 254 OF THE IT ACT, 1961 ON 23.03.2006 AND DETERMINED THE BLOCK INCOME AT RS. 24,17,31,739 /- ON 23.03.2006 AND DEMAND WAS PAYABLE BY THE ASSESSEE U/S. 156 WITHIN 30 DAYS OF THE SERVICE OF THIS NOTICE. AS PER ASSESSEES SUBMISSION, THE DEMAND BECAME DUE ON 28.04.2006. THE APPELLANT AGAIN FILED APPEAL BEFOR E THE ITAT. THE CO- ORDINATE D BENCH, AHMADABAD, VIDE ORDER DATED 10. 07.2009 IN IT(SS)A NO. 87/AHD/2006, HAS DELETED THE ADDITION EXCEPT RS.24, 76,000/-. LD. A.O. GAVE THE APPEAL EFFECT OF THE ORDER OF THE ITAT, ORDER D ATED 10.07.2009 ON 18.08.2009 AND ISSUED REFUNDABLE AMOUNT INCLUDING I NTEREST U/S. 244A M.A. NO. 157 AHD 2013 [IT(SS)A NO. 507/AHD/10], BLOCK PERIOD: 1985-86 TO 1995-96 & UP TO 21/12/1995 PAGE 6 RS.6,21,52,043/-. THE ASSESSEE CHALLENGED THIS CAL CULATION OF INTEREST BEFORE THE CIT(A) WHO HAS ACCEPTED THE ASSESSEES REQUEST AND HELD THAT INCOME OF RS.24,76,000/- WAS NOT PART OF ADMITTED INCOME. AC CORDINGLY, HE DIRECTED TO THE A.O. TO EXCLUDE RS.24,76,000/- FROM THE CALCULA TION MADE IN THE ORDER BY THE A.O. HE FURTHER DIRECTED TO THE A.O. TO GRANT REFUND ON WHOLE TAX PAID OF RS.3,12,82,424/- ON VARIOUS DATES AND TO RECOMPUTE INTEREST U/S. 244A UP TO THE DATE OF ORDER AND ALSO ALLOW INTEREST ON THE AM OUNT TILL THE DATE OF ISSUE OF THE FRESH REFUND OF THE SAID AMOUNT SUBJECT TO ADJU STMENT OF THE AMOUNT ALREADY REFUNDED. THE REFUND OF RS.6,21,52,043/- D ETERMINED ON 18.08.2009 AND GRANTED ON 28.08.2009 WILL BE REVISED AFTER COM PUTING OF INTEREST U/S. 244A. THE SAID INTEREST AMOUNT IS TO BE ALSO REDUC ED AND INTEREST ON THE SAID AMOUNT IS TO BE ALLOWED TILL THE DATE OF ISSUE OF F RESH REFUND. THE REVENUE WAS IN APPEAL AGAINST THE ORDER OF CIT(A), DATED 23 .02.2010, WHEREIN, IT WAS CLAIMED BY THE REVENUE THAT THE A.O. WAS RIGHT IN D EDUCTING THE TDS ON INCOME OF RS.24,76,000/-. ONCE, THE ADDITION IS PAR T OF BLOCK INCOME, THE LIABILITY TO PAY TAX ARISE AT THE TIME OF FILING TH E RETURN OF INCOME. THEREFORE, THE A.O. RIGHTLY DEDUCTED THE TAX ON SAID AMOUNT FR OM THE PRE-PAID TAX WHILE PASSING THE ORDER. THIS BENCH HAS ALLOWED THE APPE AL OF THE REVENUE VIDE ORDER DATED 14.06.2013 IN IT(SS)A NO. 507/AHD/2010 BY OBSERVING AS UNDER: 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. THE ADMISSION OF INCOME BY THE APPELLAN T IS NOT REQUIRED FOR CALCULATING THE TAX ON UNDISCLOSED INCOME UNDER THE BLOCK ASSESSMENT CHAPTER. THE A.O. HAS TO ASSESS THE UND ISCLOSED INCOME UNDER THIS CHAPTER AND CALCULATE THE TAX. T HE DEMAND EVEN M.A. NO. 157 AHD 2013 [IT(SS)A NO. 507/AHD/10], BLOCK PERIOD: 1985-86 TO 1995-96 & UP TO 21/12/1995 PAGE 7 ON REMAINING ADDITION IS EFFECTIVE FROM THE DATE OF ORIGINAL ORDER OF THE A.O. I.E. 23.03.2006 IN WHICH UNDISCLOSED INCOM E WAS CALCULATED AT RS.24,17,31,739/-. THE ITEM NO.1 WAS ADDITION O F RS.2,27,86,000/- ON ACCOUNT OF PURCHASE OF SHARE AS PER PARA 5 OF THE ASSESSMENT ORDER. OUT OF THIS, THE REMAINING A DDITION OF RS.24,76,000/- WAS CONFIRMED BY THE ITAT. THUS, TH E A.O. WAS RIGHT IN ADJUSTING THE TAX FROM THE TAX PAID BY THE ASSES SEE AT RS.3,12,82,424/-. AFTER ADJUSTING THE TAX ON RS.24 ,76,000/- AT RS.14,85,600/-, HE CALCULATED RIGHTLY NET REFUND IN CLUDING INTEREST AT RS.6,21,52,043/-. THUS, WE HAVE CONSIDERED VIEW TH AT CIT(A) WAS NOT RIGHT IN ALLOWING THE APPEAL OF THE ASSESSEE. ACCORDINGLY, WE REVERSE THE ORDER OF THE CIT(A). 3. NOW THE ASSESSEE FILED M.A. AND ARGUED THAT THE HONBLE BENCH HAD NOT DECIDED THE ISSUE AS PER LAW. THE DETAILED FIN DINGS GIVEN ARE CONTRADICTORY IN VIEW OF THE PROVISIONS RELATING TO THE REFUND AS WELL AS INTEREST ON REFUND U/S. 214(1), 214(1A) AND 240(1A) OF THE I T ACT. LD. SR. D.R. VEHEMENTLY ARGUED THAT HONBLE ITATS ORDER WAS RIG HT AND DECIDED THE ISSUE AGAINST THE ORDER OF THE CIT(A). 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. IN LIGHT OF THE ABOVE DISCUSSION ON MERIT THE FINDINGS IN THE BEGINNING OF PARA 5 OF THE ORDER DATED 14.06.2013 IS NOT MATC HING WITH THE FINDINGS GIVEN IN CONCLUDING LINES OF THIS PARA, HENCE AN APPARENT MISTAKE WAS COMMITTED INADVERTENTLY IN CONCLUSION. THE WORDS RIGHT/RIGH TLY AS WELL AS THE WORD NOT WAS INCORRECTLY USED. AFTER NOTICING AN APPA RENT ERROR, WE HEREBY RECTIFY THE MISTAKE AND REPLACE THE CONCLUDING LINES; WHICH SHALL HEREAFTER BE READ AS UNDER: M.A. NO. 157 AHD 2013 [IT(SS)A NO. 507/AHD/10], BLOCK PERIOD: 1985-86 TO 1995-96 & UP TO 21/12/1995 PAGE 8 THUS, THE A.O. WAS WRONG IN ADJUSTING THE TAX FROM THE TAX PAID BY THE ASSESSEE AT RS.3,12,82,424/-. AFTER ADJUSTING THE TAX ON RS.24,76,000/- AT RS.14,85,600/-, HE CALCULATED WRO NGLY NET REFUND INCLUDING INTEREST AT RS.6,21,52,043/-. THUS, WE H AVE CONSIDERED VIEW THAT CIT(A) WAS RIGHT IN ALLOWING THE APPEAL O F THE ASSESSEE. ACCORDINGLY, WE CONFIRM THE ORDER OF THE CIT(A). 5. IN THE RESULT, M.A. IS ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 17.09.2013 SD/- SD/- ( MUKUL KR. SHRAWAT ) (T.R. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA ! ! ! ! '! '! '! '! / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. '(' ) * / CONCERNED CIT 4. *- / CIT (A) 5. !./ ), ) , 12( / DR, ITAT, AHMEDABAD 6. /45 67 / GUARD FILE. BY ORDER/ , 8/ 1 ': ) , 12( ;