One of the contention of the ld. Departmental Representative that Section 12AA(3) has been amended w.e.f. 01.06.2010 wherein power has been given to cancel registration under section 12A(1) of the Act. In that case the CIT cancelled registration under section 12A of the Act after 01.06.2010, therefore, the fact is different than case under consideration. This contention of the ld. Departmental Representative is not acceptable in the light of above discussions that the CIT cancelled registration under section 12A w.e.f. 2009-10 which is the period prior to 01.06.2010. The C.B.D.T. has also clarified that the amendment in section 12AA(3) is applicable from A.Y. 2011-12.
The ld. CIT(A) considered the issue in detail in the light of exceptions provided under Rule 6DD in order to grant relief to the assessee for violation of section 40A(3) of the IT Act. The finding of fact recorded by the ld. CIT(A) to the effect that the assessee was a Pakka Arahtia and made purchases from Kachcha Arahtias have not been disputed by the ld. DR during the course of arguments. It is also not in dispute that the assessee acted as per Krishi Utpadan Mandi Samiti Rules.
On perusal of the A.O.’s order and material on record, we find that the CIT invoked section 263 of the Act because the CIT did not feel satisfy with the conclusion made by the A.O not on account of that the order of the A.O. was erroneous. The CIT invoked section 263 of the Act simply on account that the A.O. did not carry out the investigation of the case on the line of investigation as CIT wants.
If we consider the facts of the case as stated above that neither the Revenue authorities nor the assessee has brought on record any material or evidence in support of the determination of annual value of properties, however, the assessee has furnished evidence in respect of annual value determined by municipal/local authority, Agra Nagar Nigam in support of annual value of concerned properties.
Whether this agreed addition is to be added while calculating book profit under section 115JB of the Act. Section 115JB provides that where in the case of an assessee being a Company, the income tax payable on total income as computed under this Act is less than 10% (applicable in the impugned Assessment Year) of its book profit, such book profit shall be deemed to be the total income of the assessee.
Since grant of registration is a condition precedent for grant of exemption under section 11 and in this case, there is no registration granted under section 12AA in favour of the assessee, no relief or exemption can be granted to the assessee under section 11.
According to section 271A, if the assessee fails to keep and maintain any such books of account and other documents as required by section 44AA and the Rules in any previous year, penalty is leviable. Section 44AA(2)(i) and (ii) provides that every person carrying on business shall keep and maintain such books of account and other documents as may enable the AO to compute his total income in accordance with the provisions of this Act.
In the light of above discussion, we find that the assessee has failed to establish that the substantial part of business of the company is money lending and the loans and advances received to the assessee is the in the ordinary course of money lending business.
It is not in dispute that on the date of maturity, i.e., 22.11.2006, the certificates of gold were redeemed, therefore, 22.11.2006 should be considered as the date of acquisition of the gold for the purpose of computation of capital gains. The authorities below were, therefore, not justified in rejecting the claim of assessee for short term capital gains on redemption of bonds.
No material is produced before us to prove that the AO in the case of person searched was satisfied that any money, bullion, jewellery or other valuable articles or things or books accounts or documents seized or requisitioned belongs to or belong to a person other than the person referred to in sec. 153A. No material is produced before us to show if any satisfaction was recorded by the AO in that case that the seized material belongs to any person other than the person with respect to whom search was made u/s 132 of the Act.
