Case Law Details
Shiv Shakti Enterprise Vs PCIT (ITAT Ahmedabad)
ITAT Ahmedabad held that provisions of Section 269ST of the Income Tax Act 1961 would apply to undisclosed income which was declared during the survey proceedings.
Facts- A survey action under Section 133A of the Act was carried out at the business premises of the assessee firm. During the course of survey, the assessee admitted an undisclosed income and working partner of the assessee firm.
While filing the return of income for A.Y. 2017- 18, the assessee firm had shown the above undisclosed income under the head “any other income” in the return of income filed by the assessee firm for the impugned assessment year. The assessment of the assessee was completed by the AO by making of a disallowance on account of disallowance out of claim of partner’s remuneration.
The Principal CIT initiated proceedings u/s. 263 of the Act on the ground that the AO computed the tax liability in respect of the aforesaid undisclosed income accepted / acknowledged by the assessee during the course of survey proceedings at normal rate of tax of 30% as against the higher rate as provided u/s. 115BBE of the Act of 60%. According to the Principal CIT(Appeals) the income should have been brought to tax under Section 69A r.w.s. 115 BBE of the Income Tax Act. Accordingly, the assessment order was held to be erroneous and prejudicial to the interests of the Revenue.
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