Jennyfar Lalzarliani Hrahsel Vs Union of India (Gauhati High Court)
Gauhati High Court on a humane approach and powers of the Commissioner under Section 264.
The Hon’ble Gauhati High Court, Aizawl Bench has set aside the revisional order dated 30.12.2024 passed under Section 264 of the Income Tax Act, 1961 and remanded the matter back to the revisional authority.
The principal controversy before the Court was whether the petitioner, a Mizo tribal woman engaged in retail and wholesale distribution of FMCG products in Mizoram, is entitled to the exemption under Section 10(26) of the Income Tax Act, which is available to members of Scheduled Tribes in respect of income that accrues or arises within the State of Mizoram.
A demand of Rs. 28 crore was raised, primarily on account of large cash deposits of Rs. 29 crore in her bank account and a significant variance between her Income Tax Return and her GSTR-9C filing.
The Hon’ble Court observed that Section 69A can be invoked only upon satisfaction of certain cumulative conditions, namely: (a) the assessee is found to be the owner of money, bullion, jewellery or other valuable articles; (b) such assets are not recorded in the books of account, if any, maintained by the assessee; and (c) the assessee either fails to offer any explanation regarding the nature and source of such assets, or the explanation furnished is not, in the opinion of the Assessing Officer, satisfactory.
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