sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
News Headlines »
 Here are other documents you need to file online ITR Got your Form-16 for FY18?
 10 must have documents to file your tax return
 Know all about how to file ITR FY 2017-18
 Government extends sale of pre-GST goods with stickers of revised price till July 31
 All 7 ITR forms for assessment year 2018-19 activated for e-filing: Income Tax Department
 Check if new salary structure is income tax efficient
 GST refund drive extended till June 16
 5 income tax returns filing mistakes you must avoid
 Your complete guide to file income tax return
 Input Tax Credit refund drive till June 14
 File Your Income Tax Return for FY 2017-18 Immediately, Know Why

SC rules on IT act seizures
March, 03rd 2007

The state of Rajasthan formulated two schemes that allowed for exemption of payment from sales tax. The two schemes are the 'Sales Tax Incentive Scheme, 1987' and 'Sales Tax New Incentive Scheme for Industries, 1989'. In terms of 1987 Scheme, exemption from payment of sales tax of 100% was provided. The 1989 Scheme which was notified in the Official Gazette on or about 06.07.1989 was given retrospective operation with effect from 05.03.1987. It was to remain in force upto 31.03.1998.

The Appellant in this case was eligible to obtain the benefits of the said Industrial Policy both under 1987 and 1989 Schemes. It, however, opted for 1989 Scheme, for which an application for grant of sanction of eligibility certificate was filed before the Manager, District Industries Centre, Rajsamand on 01.04.1995. Indisputably, the eligibility certificate was to be granted by the Industries Department of the State. The said certificate was granted on 07.12.1996, under which exemption from tax liability was limited to 75%.

Contending that it had altered its position on a representation made by the state that the 1987 Scheme would be applicable in its case, the appellant alleged that it had not realized sales-tax from its customers. In support of the said contention, it relied upon an order of sanction of eligibility for grant of exemption issued by the Member Secretary of the Department to the Commercial Taxes Officer, Rajsamand. Reliance has also been placed on the order of assessment passed by the Assessing Authority of the Commercial Taxes Department, in which exemption had been stated to have been granted in terms of 1987 Scheme.

The mistake of the Assessing Authority, however, having been discovered, the appellant was issued with a notice to show cause as to why it should not pay the balance sales-tax on 25% of its turnover. A writ petition filed there against the appellant has been dismissed by the impugned judgment. And the party is in the Supreme Court.

The Supreme Court contended that although 1989 Scheme was framed during pendency of 1987 Scheme the same was given a retrospective operation and the entrepreneurs were given a choice to opt either for 1987 Scheme or 1989 Scheme. The Appellant was aware about this and opted for 1989 Scheme. It was so explicitly stated in the eligibility certificate also. The Apex Court said that it may be true that the Assessing Authority committed a mistake in referring to the 1987 Scheme in its order of assessment, but thereby the appellant cannot be permitted to derive any benefit to which it was not entitled under the law. Appellant having opted for grant exemption under 1989 Scheme, the respondent was bound to accept the same and, thus, it had not committed any illegality in doing so. So the appeal was dismissed with costs.

Search and seizure under Income Tax Act

The question before the Apex Court is related to the interpretation of provision of Sec 158BC of the Income Tax Act. The assessee is an incorporated Construction Company. A search was conducted u/s 132, in the premises of the company, its Director and his wife. Several incriminating documents were seized. A proceeding was initiated u/s 158BC of the Act.

The Tribunal in an appeal preferred by the assessee opined that the Assessing Officer had no jurisdiction to proceed against the assessee for making the block assessments in terms of Chapter XIV-B of the Act, as no search was conducted in terms of Section 132 of the Act.

The tribunal noted that instead of determining the undisclosed income on the basis of the materials seized from the residence of the Co's Director, the AO embarked upon a roving enquiry by referring three apartments to the Valuation Cell 'to ascertain the correct investment made by the assessee'. Moreover, on receipt of the reports of the Valuation Cell the AO proceeded to compute the income u/s 69 as unexplained investment, adding thereto further undisclosed profit earned on sale of flats.

Having heard the arguments the Apex Court observed that section 158BD provides for taking recourse to a block assessment in terms of Section 158BC in respect of any other person, the conditions precedents are : (i) Satisfaction must be recorded by the Assessing Officer that any undisclosed income belongs to any person, other than the person with respect to whom search was made under Section 132 of the Act; (ii) The books of account or other documents seized had been handed over to the Assessing Officer having jurisdiction and (iii) The Assessing Officer has proceeded under Section 158BC . But the SC found that the notice issued to the assessee did not record any satisfaction and the seized documents werent handed over.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Bath SEO Company Birmingham SEO Company Bradford SEO Company Brighton and Hove SEO Company Bristol SEO Company Cambridge SEO Company Canterbury SEO Company Carlisle SEO Company Chester SEO Company Chichester SEO Company Coventry SEO Compan

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions