PRINCIPAL COMMISSIONER OF INCOME TAX-3 LUDHIANA V. HARINDER

ITA/186/2016

AI Insights

The case involves an appeal by the Principal Commissioner of Income Tax-3, Ludhiana against an order of the Income Tax Appellate Tribunal, which had deleted substantial additions made by the Assessing Officer under section 69 of the Income Tax Act, 1961. The additions pertained to unexplained investments and profits on the sale of plots for the assessment year 2008-09. The Revenue's argument was based on a statement made by the Managing Director of Basera Realtors Pvt. Ltd. during a related assessment, which implicated the respondent-assessee in similar undisclosed investments. However, the Tribunal had previously upheld a revisional order that assessed these investments solely in the hands of Basera Realtors Pvt. Ltd., which had not been challenged further. Consequently, the High Court found no grounds to reassess the same amounts against the respondent-assessee.

• Counselvise Citation: [2018] 140 COUNSELVISE.COM (IT) 728882 (HC-MISC)
• Appeal Type: Others
• Pronouncement Date: 10-05-2018
• Assessment Year: misc
• Other Referred Cases: M/s Basera Realtors Pvt. Ltd.
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Assessee Lawyers: RAJESH KATOCH
• Keywords: Assessment proceedings; Assessment Year 2008-09; Income Tax; Revisional Authority; Undisclosed investment
• Section: 147; 148; 263; 69

Judgement Text

"IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Sr. No.102-2 ITA No.186 of 2016 (O&M) Date of decision: 10.05.2018 The Pr. Commissioner of Income Tax-3, Ludhiana ....Appellant versus Harinder ....Respondent CORAM: HON'BLE MR. JUSTICE RAJESH BINDAL HON'BLE MR. JUSTICE DEEPAK SIBAL * * * Present: Mr. Rajesh Katoch, Advocate for the appellant. * * * RAJESH BINDAL, J. Revenue is in appeal against the order dated 18.12.2015 passed by the Income Tax Appellate Tribunal, Division Bench, Chandigarh (for short – 'the Tribunal') passed in ITA No.506/CHD/2014. The appeal pertains to the assessment year 2008-09 and seeks to raise the following substantial questions of law:- i) Whether on the facts and in circumstances of the case and in law, the Hon'ble ITAT was right in deleting addition of Rs.1,28,36,000/- made by the Assessing Officer u/s 69 of the Income Tax Act and in deleting the addition of Rs.2,98,39,000/- on account of profit on sale of plots. ii) Whether on the facts and in the circumstances of the case and in law, the Hon'ble ITAT has erred in granting relief to the assessee holding that same addition has been made in the case of M/s Basera Realtors Pvt. Ltd. without appreciating that the Assessing Officer has formed opinion based on Jyoti Sharma 2018.05.24 11:18 I attest to the accuracy and integrity of this document ITA No.186 of 2016 (O&M) -2- evidences gathered during assessment proceedings in the form of statement of sellers and submission of the directors of M/s Basera Realtors Pvt. Ltd. before the DCIT, Central Circle and without appreciating that the assessment in the case of M/s Basera Realtors Pvt. Ltd. has not attained finality.” Learned counsel for the revenue submitted that search was conducted on the premises of Basera Realtors Pvt. Ltd. During the course of assessment proceedings, Managing Director of Basera Realtors Pvt. Ltd. made a statement that 50% of unexplained investment belong to the respondent-assessee. The information was passed on to the Assessing Officer. Assessment proceedings under Sections 147/148 of the Income Tax Act, 1961, (for short – 'the Act') were completed. The present proceedings arise out of those assessment orders. Order passed by the Assessing Officer was revised by the Commissioner of Income Tax (Central), Ludhiana, in exercise of powers under Section 263 of the Act. It was opined that the entire undisclosed investment is to be assessed at the hands of Basera Realtors Pvt. Ltd. In the appeal filed by Basera Realtors Pvt. Ltd., the Tribunal upheld the order passed by the revisional authority. As per the information available with the Department, Basera Realtors Pvt. Ltd. has not challenged the order passed by the Tribunal upholding the order passed by the Commissioner of Income Tax (Central), Ludhiana, under Section 263 of the Act. In view of the aforesaid factual matrix, once the entire undisclosed investment has been assessed in the hands of Basera Realtors Pvt. Ltd., the assessment of the same amount in the hands of the assessee Jyoti Sharma 2018.05.24 11:18 I attest to the accuracy and integrity of this document ITA No.186 of 2016 (O&M) -3- will not be justified. Keeping in view of the aforesaid facts, no substantial questions of law arise in the present appeal and the same is, accordingly, dismissed. (Rajesh Bindal) Judge May 10, 2018 (Deepak Sibal) Jyoti 1 Judge Whether speaking/reasoned Yes Whether reportable Yes/No Jyoti Sharma 2018.05.24 11:18 I attest to the accuracy and integrity of this document "