It is not in dispute that the aforesaid two amounts have been deposited by the two partners in their capital account. The partners are income tax payee. They have explained the source as having received gift from various persons, who have also filed their Income Tax Returns and have been assessed accordingly. Merely because, the donors are weavers and they own only one loom would not make any difference. They have filed their Income Tax Returns and have also filed the return under the Gift Tax Act. They have paid the gift tax also. Assessment under the Gift Tax Act has also been made, though the assessments made were summary in nature. In the case of Anil Rice Mills (supra), this Court has held that the assessee can not be asked to prove the source of source or the origin of origin.
The decision in J.K. Kashyap v. Asstt. CIT [2008] 302 ITR 255 is an authority for the proposition that even when an assessee becomes entitled to an undefined and undivided share in a property, through an agreement, which he later relinquishes, the gain has to be assessed as income from capital gain, and not as income from other sources.
In the absence of any material, and as the Court does not find any legal or valid ground to withhold sanction to the proposed Scheme, the same is hereby sanctioned. The prayers made in terms of Paragraph 22(a) of Company Petition No.142 of 2012 and in terms of Paragraph 15(a) of Company Petitions No.143 and 144 of 2012, are hereby granted.
A plain reading of the said provisions would reveal that what is required for the purpose of seeking approval thereunder is that the University or other educational institution should exist ‘solely for educational purposes and not for purposes of profit’. It is nowhere the case and/or finding of the learned CCIT that on account of the said defect in the admission procedure, the Trust ceased to exist solely for educational purposes and/or it existed for the purposes of profit.
We do not find any merit in such argument. The Commissioner of Income Tax (Appeals), Ludhiana, recorded a finding that the Assessing Officer has reported that the voluminous nature of entries cannot be verified. Once the Assessing Officer himself has failed to verify the entries, there is no reason to disallow the distribution expenses. It is a rule of thumb which was applied by the Commissioner of Income Tax (Appeals), Ludhiana to allow expenses to the tune of 40%, which has been found to be unjustified by the Tribunal.
The plea of learned counsel for the OL that as and when the monies become available for disbursement as a result of the proceedings under the RDDB Act they should be placed at the disposal of the OL is different from the law explained by the Supreme Court in Rajasthan State Financial Corporation (supra). What appears from a careful reading of paras 16, 17 and 18 of the said judgment is that the OL has certainly to be associated in all the proceedings of sale by public auction or otherwise of the properties of the company in liquidation and the orders of the DRT. As noted hereinbefore, the DRT has issued notices to the OL at every stage. The Court is now informed that since 2012, the OL has been participating in the proceedings before the DRT and now before the DRAT. Therefore, there may be no apprehension that the orders might be passed in the proceedings under the RDDB Act without the participation of the OL. It is for the OL to diligently pursue those proceedings hereinafter.
Both the CIT(A) as well as the ITAT have set aside the penalty imposed by the Assessing Officer under Section 271(1)(c) of the Income Tax Act, 1961 on the ground that the issue of deduction under Section 14A of the Act was a debatable issue.
We see no reason to take a different view from that adopted by the Bombay High Court. However, Mr Sabharwal, appearing on behalf of the revenue, raised a pointed question as to whether, in fact, the provision for payment of bonus in this case was actually an ascertained liability.
If the provisions of clause (d) of notification dated 23.5.1995 are perused, it can be seen that the income must not have been chargeable to tax on the basis of any order passed by the jurisdictional High Court and it should become taxable as a consequence of any retrospective amendment of law or on a decision of the Supreme Court. Insofar as the case in question is concerned, it can be seen that the petitioner was assessed with the status as a Firm and that subsequently, following the judgment of this Court in Narayanan & Co.’s case (supra), assessment was re-opened and the tax was re-assessed treating the petitioner as an Association Of Persons. Therefore, situation as contemplated in paragraph 2 clause (d) was not available to the petitioner to claim the benefit thereof.
In the absence of any material to show that said amount was sent by the assessee’s mother and brothers from Singapore, the claim of the assessee does not merit any consideration. Thus the amount of Rs. 78 lakhs treated as unexplained investment under section 69 and assessable as undisclosed income for the block period stands confirmed.
