Sec.132 and Chapter 14 B of Income Tax Act - Basing on the receipts one is payment of Rs. 10 lakhs and another is refund of Rs.10 lakhs resulted in failure of a deal - can not be added as unexplained income with out recovering any cash ready in hand -2015 A.P.(2014)MSLLAWREPORTS


The premises of the appellant was searched on 19.01.2001 
by the officials of the Income Tax Department in exercise of power
under Section 132 of the Act.  A receipt evidencing payment of a
sum of Rs.10,00,000/- to one Mr. Prabhakar Reddy is said to have
been discovered.  Another receipt evidencing repayment of that
very amount was also discovered.  A statement under sub-Section 
(4) of Section 132 of the Act is also recorded on the day of search.
When a question was put to the appellant as to whether he has
made any payment to one Mr.Prabhu, he gave answer in a  
negative.
        Thereafter, a further statement was recorded on 27.03.2001.
A question was put to the appellant as to whether he paid a sum of
Rs.10,00,000/- to Mr. Prabhakar Reddy.  The appellant accepted
that he paid that amount to Mr.Prabhakar Reddy on 25.11.2000 
for purchasing of a plot. He further explained that the deal did not
fructify, and as such, the amount of Rs.10,00,000/- was returned
to him on 30.11.2000.  The case of the appellant was that the
amount is from the funds of M/s.Sapta Sikhara Housing Private
Limited (for short the company) in which he himself and his
family members have substantial stake.=
The Assessing Officer passed an order of Block Assessment  
on 31.01.2003 adding a sum of Rs.10,00,000/- to his income and
levying tax as provided for under Chapter 14B of the Act. -
 In the instant case, the plea of the appellant was that the
amount was held by the company and that it was paid to the
owner of the land.  The transaction did not fructify and it was paid
back to the company.  Neither the person, who is said to have
received the amount nor any other individual, were examined to
prove that the payment was by; or, for and on behalf of the
appellant herein.       The plea of the appellant was that the
department did not cross-verify the matter from any authorized
representative of the company.  Therefore, whether one goes by the
factum of the Department itself treating the only documents,
namely, receipts as not true; or their failure to record the
statements of any individual including the authorized
representative of the company, the very basis for the proceedings
ceases to exist.
        The Assessing Officer as well as the Tribunal proceeded on
the assumption that the appellant was under obligation to explain
the factum of payment.  When the amount was not recovered nor 
was said to be in the control and custody of the appellant, there
was no basis for initiating that proceedings.
      We, therefore, allow the appeal and set aside the order of
Block Assessment insofar as it has added a sum of Rs.10,00,000/- 
to the income of the appellant.  There shall be no order as to costs. -2015 A.P.(2014)MSLLAWREPORTS

Popular posts from this blog

APEX COURT DIGEST - Jan.2017 [6]

Delhi Rent control Act sec.14 - Rent Control Case - Eviction Petition - The landlord sought the eviction of the tenant  on  the  ground  that  the tenant had sub-let the premises to his son-in-law  in  contravention  of Section 14 of the Delhi Rent Control Act, 1958 (hereinafter referred  to  as ‘the Act’).  -  whether  he  was doing business along with his father-in-law or independent of him,  i.e. whether  he  was  doing  business  exclusively  behind  the  façade   of   a  partnership or as a genuine partner.  It is an  uncontroverted  fact  before  us that the landlord’s permission in writing was  not  obtained  before  the  tenant had allowed the alleged sub-tenant to occupy the shop -  the Rent Controller clearly found that the son-in-law had been put  in  possession of the shop in pursua...
Read more

Writ - praying to declare that explanation to Section 6 of the amendment Act of 39 of 2005, Explanation: for the purpose of this Section partition means any partition made by execution of a deed of partition duly registered under the Registration Act, 1908 (16 of 1908) or partition effected by a decree of a court as unconstitutional and the same is liable to be struck down and etc; -2015 KAR(2015) msklawreports

"(i) Whether  Section 6  of the Hindu Succession Act, 1956, as amended by the Amendment Act , 2005 is prospective or retrospective in operation? (ii) Whether  Section 6  of the Hindu Succession Act, 1956 as amended by the Amendment Act , 2005 applies to daughters born prior to 17.6.1956? (iii) Whether  Section 6  of the Hindu Succession Act, 1956 as amended by the Amendment Act , 2005 applies to daughters born after 17.6.1956 and prior to 9.9.2005? (iv) Whether  Section 6  of the Hindu Succession Act, 1956 as amended by the Amendment Act , 2005 applies only to daughters born after 9.9.2005? (v) Whether the decision of the Division Bench in the case of Vaishali Ganorkar is per in curium of Gandori Koteshwaramma and others?"   In addressing an argument that the Explanation to  Section 6  clearly provides that partition means any partition made by execution of a deed duly registered under the  Registration Act , 1908...
Read more

Or.39, Rule 1 & 2 and Sec. 151 and sec.94 of C.P.C - Police aid when to be granted - hear both parties when resisted - to avoid dispossession of actual possessor with the help of police aid - identify the property before issuing of police aid with the help of advocate commissioner if necessary - since the defendant pleaded that before the filing of suit and after filing of the suit ,he never trespassed into the suit schedule property nor violated interim injunction order - even though no evidence of violation of injunction not filed , the lower court feels that no prejudice would be caused to the respondent when police aid is granted -2013 A.P. msklawreports

filed the I.A.No.175 of 2010 for granting police aid on the ground that the order of ad-interim injunction could not be implemented as the petitioners involved in violating it. In particular the petitioner has not filed any document to show that the injunction granted by this Court is being violated or the respondents damaged his quarry It is the case of the respondents that they did not trespass into suit schedule property before or after the injunction is granted.  What that is the case of the respondents, this Court feels that no prejudice would be caused to the respondents if the police aid is granted to implement the order of this Court. "  the Court below granted the police aid aggrieved by which the present C.R.P. has been filed However, whereas great caution is to be taken for granting ex parte ad-interim injunction equal measures are to be taken while granting police aid to enforce that order.   Under the guise of an order of ad-interim i...
Read more