S.147: Reassessment – No return was filed before issue of notice – Un explained deposit in the Bank – Specific information with the AO – Reassessment is held to be valid [ S.148 ]

S.147: Reassessment – Capital gains on sale of land – Sale executed and registered 12-1-2007 – Escapement of capital gains in AY. 2007 -08 -Reopening of assessment for the AY .2006 -07- No nexus between material and the formation of prima facie belief that income had escaped taxation for the AY. 2006 -07 – Reassessment is held to be bad in law [ S.148 ]

S.147: Reassessment-After the expiry of four years- Bogus purchases- No tangible material before the AO to come to the conclusion that income has escaped assessment – Reassessment was held to be not valid . Notice based on information from Sales Tax Department that assessee obtained accommodation entries-Recorded reasons have a live link with formation of belief – Failure to disclose primary facts – Reassessment was held to be valid – Matter was remanded to the AO to give fair opportunity of hearing and opportunity of cross examination [ S.148 ]

S.142(2A): Inquiry before assessment– Special audit– AO not giving any finding about nature and complexity of accounts, volume of accounts, multiplicity of transactions, specialised nature of business activity of assessee —Order being no speaking order for special audit was held to be not valid -Since the direction for special audit was without proper jurisdiction the time so taken could not be counted and the period did not get extended. Since the order was passed on July 28, 2010, it was time barred. Therefore the order passed by the Assessing Officer was therefore, bad in law. [ S.153C ]

S. 92C : Transfer pricing – Arm’s length price -Exclusion of comparable was held to be justified where ;difference between business model of earning Commission, only providing marketing support services to its head office ,company apart from corporate Advisory Practices also establishing two specialised divisions, Viz., Information Technology and Research activities which is not close to assessee in functionality Company dealing in research and survey Services And Products , Company, functionally different from assessee , no similarity between nature of services rendered by Company Vis-A-Vis Assessee ,diverse nature of services rendered by Company , difference business model of assessee . As regards working capital adjustment is concerned , in sufficient material is available for calculation of working capital adjustment in respect of comparable , AO was directed to compute working capital adjustment in terms of law .

S.68: Cash credit – Deposit of cash in bank- Advance received for sale of land which was deposited in bank and which was returned back due to cancellation of deal- Addition cannot be made as income from undisclosed sources .

S.68: Cash credit — Gift from relatives -Depositors mostly labourers – Failure to prove creditworthiness -Addition is held to be justified .

S. 54 : Capital gains – Profit on sale of property used for residence -Entire capital gains paid to developer of Flat — Assessee is entitled to exemption .[ S.45 ]

S. 50C : Capital gains – Full value of consideration – Stamp valuation – Assessee neither objected to value determined by Sub-Registrar nor requested the AO for referring to Valuation Officer – AO was justified in bringing to tax deemed sale consideration as per the Stamp duty authority instead of the actual sale consideration claimed by assessee- AO can not invoke provisions of S. 50C(2) suo motu.[ S.45 , 50C(2) ]

S.45: Capital gains- Capital asset- Report of Tehsildar about exact location of land – Certificate from Gram Panchayat could not take precedence over the report of the Tehsildar who was the appropriate land revenue authority to assessee the nature of and location of land -Tehsildar is a Govt official, assessee cannot complain that he was not given an opportunity of cross examination- Land is held to be assessable as capital asset [ S. 2(14) ]