Eight Imp Verdicts On Highly Controversial Issues Of Capital Gains, Search Assmnt, Penalty, Etc

ADIT vs. M/s I. M. Technologies (ITAT Delhi)

Transfer Pricing: Updated information not available at the time of the TP study but available at the stage of assessment has to be considered by AO
In the light of the facts on record, on a consideration of the same we are of the view that the reliance placed on the data available in the public domain at the time of the assessment proceedings which was not allowed by the AO and ultimately allowed at the Appellate stage cannot be faulted […]

ITO vs. Vandana Properties (ITAT Mumbai)

S. 133A: A statement given u/s 133A(iii) is not on oath and can be retracted. Even a statement on oath does not create any estoppel and can be retracted
On the issue whether the statement on oath u/s 133A is binding and cannot be retracted, we have to make a categorical observation, here that statement given u/s 133A is not on oath. Section 133A(iii) observes, “record a statement of any person which may be useful for, or relevant to, any proceeding under the Act”. […]

DCIT vs. Aakash Arogya Mindir P.Ltd (ITAT Delhi)

S. 153C: Whenever a document is found from a person who is being searched the normal presumption is that the said document belongs to that person. It is for the AO to rebut that presumption and come to a conclusion or "satisfaction" that the document in fact belongs to somebody else based on cogent material
On a plain reading of Section 153C, it is evident that the Assessing Officer of the searched person must be “satisfied” that inter alia any document seized or requisitioned “belongs to” a person other than the searched person. It is only then that the Assessing Officer of the search person can handover such document to […]

Bilag Industries Pvt. Ltd vs. CIT (Gujarat High Court)

S. 263: Failure to conduct inquiry & hear assessee before issue of notice renders proceedings invalid. Order of CIT(A) results in merger of AO's order and bars s. 263 revision
It is clear that the assessee and the revenue both had preferred the appeals raising all the grounds, over and above the ground of deduction under Section 80HHC and 80IA of the Act, the order of the AO stood merged into the order of the CIT(A). In other words, what was at large before the […]

Pepsi India Holdings Private Ltd vs. ACIT (Delhi High Court)

S. 153C cannot be invoked unless the AO is satisfied for cogent reasons that the seized documents do not belong to the searched person. Finding of photocopies with the searched person does not mean they "belong" to the person holding the originals. The distinction between "belongs to" and "relates to" or "refers to" must be borne in mind by the AO
(i) First of all, it is nobody’s case that the Jaipuria Group had disclaimed these documents as belonging to them. Unless and until it is established that the documents do not belong to the searched person, the provisions of Section 153C of the said Act do not get attracted because the very expression used in […]

ACIT vs. B. Rajamallu (ITAT Hyderabad)

S. 2(47)/ 53A: Mere handing over possession pursuant to development agreement does not result in transfer if developer has not taken steps for development of property
The AO has assessed capital gain in the assessment year for the reason that assessee as per the terms of the development agreement entered with the developer has handed over possession of the property. However, as can be seen from the order of learned CIT(A) as well as other facts and materials on record, there […]

Andhra Networks Limited vs. DCIT (ITAT Hyderabad)

For constituting a long-term capital asset, date of allotment of property and not date of registration to be considered. Benevolent approach should be adopted and not a hyper-technical or legalistic one
(i) All the aforesaid judgments relied on by the Revenue are cases arising prior to the amendment to Section 2(47) of the Act. The very same judgments show, in particular the judgment of the Full Bench of the Gujarat High Court, the reasons for amendment i.e., even in the absence of a registered deed of […]

Amrut Tubewell Company vs. ACIT (Gujarat High Court)

S. 271(1)(c) & 273(2)(a): Penalty cannot be mechanically levied. Cogent reasons have to be given

Sections 271(1)(c) and 273(2)(a) empower the AO to impose penalty on an assessee in a case, where, (1) there is concealment of income or (2) conscious attempt to provide the particulars of income which is untrue. Meaning thereby, the AO cannot impose penalty in case of an assessee mechanically, merely on the ground of addition […]