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DATE: May 20, 2016 (Date of pronouncement)
DATE: May 26, 2016 (Date of publication)
AY: 2007-08
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CITATION:
S. 147/ 148/ 153C: A case where the AO detects incriminating material in search has to be processed only u/s 153C and not u/s 147. A notice u/s 148 to assess such undisclosed income is void ab initio

Reassessment was initiated on the basis of incriminating material found in search of third party and the validity of the same was challenged by the assessee before the Learned CIT(Appeals) and the Learned CIT(Appeals) vitiated the proceedings. The same was questioned by the Revenue before the ITAT and the ITAT after discussing the cases of the parties and the relevant provisions in details has come to the conclusion that in the above situation, provisions of sec. 153C were applicable which excludes the application of sections 147 and 148 of the Act. The ITAT held the notice issued under sec. 148 and proceedings under sec. 147 as illegal and void ab initio. It was held that Assessing Officer having not followed procedure under sec. 153C, reassessment order was rightly quashed by the CIT(Appeals)

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DATE: March 30, 2016 (Date of pronouncement)
DATE: April 10, 2016 (Date of publication)
AY: 2007-08
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CITATION:
S. 68: Share application money received from an associate concern cannot be assessed as cash credits if assessee has discharged its initial onus to prove the identity, creditworthiness and genuineness of the transaction

CIT(A) dealt with issue all the objections raised by the AO and after considering the documents placed on record, recorded a categorical finding to the effect that amount payable and receivable by the assessee was squared off which was in accordance with the provisions of Companies Act. Further finding was recorded to the effect that these companies were assessed with I.T. Department for several years. The identity and genuineness of the transaction was duly accepted. The detailed finding recorded by CIT(A) are as per material on record

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DATE: February 19, 2016 (Date of pronouncement)
DATE: April 1, 2016 (Date of publication)
AY: 2009-10
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CITATION:
Whether subsequent decision of High Court reversing the view of the ITAT constitute mistake apparent from record

Non consideration of proposition of law laid down by the High Court is a mistake apparent from record

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DATE: February 24, 2016 (Date of pronouncement)
DATE: March 30, 2016 (Date of publication)
AY: 2009-10
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CITATION:
Section 68- Cash Credit

In this case, the assessee had given the names and addresses of the alleged creditors. It was in the knowledge of the Revenue that the said creditors were income-tax assessees. Their index numbers were in the file of the Revenue. The Revenue, apart from issuing notices under s. 131 at the instance of the assessee, did not pursue the matter further. The Revenue did not examine the source of income of the said alleged creditors to find out whether they were creditworthy or were such who could advance the alleged loans. There was no effort made to pursue the so-called alleged creditors. In those circumstances, the assessee could not do anything further

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DATE: February 19, 2016 (Date of pronouncement)
DATE: March 28, 2016 (Date of publication)
AY: 2004-05
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CITATION:
Reopening u/s 147 without application of mind is not valid

In this situation it was on the AO to peruse the relevant assessment record of AY 2005-06 which forming reason to believe and thus it is safely presumed that the AO initiated reassessment proceedings u/s 147 of the Act and issued notice u/s 148 of the Act without application of mind working in a mechanical manner and thus the same are not sustainable in the facts and on law. Respectfully following the dicta laid down by jurisdictional High Court in the case of CIT vs. G & G Pharma (Supra) we are inclined to hold that the AO issued notice u/s 148 of Act on the wrong and invalid assumption of Jurisdictional and all subsequent proceedings is pursuance thereto can’t be held as sustainable and valid hence, the same deserve to be quashed and we quash the same

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COURT:
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DATE: March 18, 2016 (Date of pronouncement)
DATE: March 28, 2016 (Date of publication)
AY: 2007-08 and 2006-07
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CITATION:
Deduction of section-10B, transferring pricing adjustment on account of ECB from parent company

Revenue has not disputed the submission made by the assessee before the CIT (A) that effective rate of interest paid by it in India was 6.62% on
loans. Interest paid by assessee on loans taken from AE abroad was 5%. This was below the rate of interest assessee was paying on loans taken
within India. When internal CUP with unrelated parties is available, in our opinion, it should be given precedence over external CUP Once such raw
gherkins are put into some process which increases its shelf life to six months or more, there indeed happen some irreversible change. Raw
gherkins are changed from its original state to a state where it remains good for human consumption even after six months. Thus the steps as
undertaken by the assessee which included fermentation and which extended the shelf life of raw gherkins, even if we construe as not ‘manufacture’, as commonly understood, it cannot be denied that it resulted in a product which cannot be equated with raw gherkins. The processes undertaken by the assessee had significant effect on the raw nature, converting it to a material capable of withstanding decay for a considerable period of time. In our opinion, in such a situation, it is difficult to say that what was packed by the assessee after the various process was very same as the raw gherkins which it got from its contract farmers

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