Back
2016 Supreme(Guj) 1490
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
K.S. Jhaveri and G.R. Udhwani, JJ.
Commissioner of Income Tax - Appellants
Vs.
Lata Dipak Takwani - Respondent
Tax Appeal Nos. 551 to 554 of 2011, 2573 to 2574 of 2010 and 1937 of 2006
Decided On : 02-08-2016
For the Appellant :Pranav G. Desai, Advocate
For the Respondents:B.S. Soparkar, Advocate
The Tribunal's role as the fact-finding authority and its application of relevant legal principles in reaching the correct conclusion influenced the court's decision.
Headnote:
Income Tax - Search and Seizure - Section 132 of the Income Tax Act - 132 - 139 - 234 ITR 733 - 10% of the main addition sustained by CIT(A) - RS. 28,00,000/- in the case of Dipak Takwani and at Rs. 17,00,000/- in the case of Smt. Lata Takwani - No interference is required to be made
Fact of the Case:
The Department conducted a search under Section 132 of the Income Tax Act and made additions to the assessee's income. The appeals were heard together and the Tribunal partly allowed the appeal of the assessee, leading to the present group of appeals.
Finding of the Court:
The Tribunal, being the fact-finding authority, considered the issues raised and relevant legal principles, and reached the correct conclusion. The Tribunal restricted the overall total addition at RS. 28,00,000/- in the case of Dipak Takwani and at Rs. 17,00,000/- in the case of Smt. Lata Takwani on a lump sum basis, which work out to approximately 10% of the main addition sustained by CIT(A). The appeals preferred by the Department were dismissed, and the Tax Appeals preferred by the assessee were also dismissed.
Issues: The issues revolved around the additions made by the Department, the findings of the Tribunal, and the correctness of the AO's order.
Ratio Decidendi: The Tribunal's detailed reasoning and consideration of the relevant legal principles led to the conclusion that no interference was required, and the appeals were dismissed.
Final Decision: All the appeals preferred by the Department were dismissed, and the Tax Appeals preferred by the assessee were also dismissed.
K.S. Jhaveri, J.
1. When these group of matters were called out for hearing, learned Counsel Mr. Soparkar for the assessee prays for time. However, the said request was refused since the matter is of 2006 and sufficient time was granted. Furthermore, right from the beginning, the members of the Bar have been informed that no time will be granted in the old final hearing mattes, more particularly, matters prior to 2007 and accordingly this Court has proceeded with the hearing of the matters.
2. Since the appeals preferred by the Department as well as the assessee are arising out of the commons order passed by the tribunal, they are being heard and decided together by this common oral judgment.
3. The short facts of the case are that the Department had carried out the search under Section 132 of the Income Tax Act on 08/06/1999 at the common residence of both the assessee and at the business premises of Smt. Lata Takwani. That substantial material in hard and soft format (like several loose paper files, diaries and other records, the computer hard-disc and several floppy diskettes) were found and put under seizure. It is the case of the Department that during the course of original assessment proceedings, it was seen that the assessee was non-cooperative and avoiding service of various statutory notices and letters under one pretext or the other.
4. It is the case of the assessee that it was originally assessed in respect of the block period ending on 08/06/1999 whereby the total income at Rs. 25,89,63,460/- was determined and the additions were made. The appeal was preferred before the CIT(A) against the order of the AO and the additions which were made by the AO came to be confirmed by the CIT(A) vide order dated 03/09/2004.
4.1 Thereafter, the matter was carried before the Tribunal which had set aside the order of CIT(A) and restored the matter back to the file of AO by giving a specific direction to the revenue that the additions on account of cash credit are required to be restricted to the peak and the assessee is required to furnish the peak working and other relevant submission within a period of two months from the date of receipt of the order.
5. It is the case of the assessee that the assessee thereafter approached the AO. However, the AO finally passed an order assessing the income at Rs. 25,89,63,46/-. The said order was challenged before the CIT(A) which came to be partly allowed.
6. Against the said order of the CIT(A), the Department as well as the assessee have preferred an appeal before the Tribunal and the Tribunal by its common impugned order has dismissed the appeal of the department and partly allowed the appeal of the assessee, which gave rise to the present group of appeals.
7. Tax Appeal Nos. 551 to 552 of 2011 is preferred by the Department arising out of the order dated 23/09/2010 passed by the Tribunal in IT (SS) A. No. 40/RJT/2010 and IT (SS) A. No. 58/RJT/2010 respectively and came to be admitted on the following questions of law.
"Whether in the circumstances and facts of the case and in law, the Appellate Tribunal is right in deleting the total additions made by the Assessing Officer aggregating to Rs. 2,63,11,790/- on various counts viz, on account of unexplained investment in stock, unexplained investment in M/s. Raju Cotex and undisclosed income, and replacing it with an estimated addition of Rs. 17,00,000/- without any basis whatsoever?"
8. Tax Appeal Nos. 553 to 554 of 2011 is preferred by the Department arising out of the order dated 23/09/2010 passed by the Tribunal in IT (SS) A. No. 57/RJT/2010 and IT (SS) A. No. 39/RJT/2010 respectively and came to be admitted on the following questions of law.
"Whether in the circumstances and facts of the case and in law, the Appellate Tribunal is right in deleting the total additions made by the Assessing Officer aggregating to Rs. 2,63,11,790/- on various counts viz, on account of unexplained investment in stock, unexplained investment in M/s. Raju Cot
