During Income tax proceedings, often statement of a person is used to catch hold of prospective tax evading assessees. But, it is trite that the statement of such a person cannot be allowed to be used against the assessee without even providing an opportunity of cross examining such person.
ITAT Amritsar held that the scrutiny of cases selected on the basis of information received through Annual Information Return (AIR) would be limited only to the aspects of information received through AIR.
Stand alone AIR Information is not sufficient to hold that cash deposits constitute income. Cash deposits in bank account may or may not be Income. Hence when the treatment of the amount as Income is itself doubt , it definitely can not constitute Income escaping assessment and, therefore, it shall be too far fetched to hold that AIR Information constitutes Reason to believe that Income has escaped assessment.
The law under section 51 and 56(2)(ix) provides for the taxability of forfeiture of advance money received in the hands of seller. Till AY 2014-15, the forfeited sum was deductible from the cost and even the excess of forfeited money over cost was capital receipt not taxable by virtue of Supreme Court Judgment in Travoncore Rubbers.
ITAT Amritsar held in the case of DCIT vs. All India Pingalwara Charitable Society that object of section 115BBC was to catch the unaccounted money which was brought in as Tax Free Income in the hands of the Charitable Trusts and this law was never meant for taxing the Petty Charities.
It remains undisputed that in the reasons recorded by the AO, there is no allegation, much less any specific one, regarding any alleged failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment.
What is apparent is not always real. To reach out to the real story, one has to undertake the scavenging exercise. This daunting task undertaken by ITAT Amritsar in a recent case pronounced on 05-02-2016 to resolve the mayhem when survey documents along with auditors qualifications had apparently almost maimed the assessee.
Recently, ITAT Amritsar in a decisions in case of Rohit Tandon ITA 345/2009 pronounced on 05-03-2015 had an occasion to deal with the issue of powers vested with ITAT regarding recall of its order, when it recalled its earlier order rendered against the assessee.
ITAT held in M/s F.C Sondhi & Co.(India) P Ltd Vs The DCIT that the premium paid on the keyman Insurance Policy would be allowed as a business expense because the same had been paid for the growth
ITAT Amritsar held In the case of M/s Aaren Exports vs. DCIT that a Keyman insurance policy is to enable business organizations to insure the life of a Keyman in order to protect the business against the financial loss which may occur in the likely eventuality of premature death.
