Case Number: ITA 1624/DEL/2019
Appellant: Ratna Talwar, Delhi
Respondent: ACIT, Central Circle-4, New Delhi
Assessment Year: 2012-13
Result: Final Tribunal Order
Case Filed On: 2019-02-27
Date of Order: 2021-01-19
Pronounced On: 2021-01-19
This case revolves around the appellant, Ratna Talwar from Delhi, and the respondent, ACIT, Central Circle-4, New Delhi, concerning the assessment year 2012-13. The proceedings and the final judgment were carried out by the Income Tax Appellate Tribunal, Delhi Benches “E”.
The case stems from a search and seizure operation conducted on December 29, 2015, involving key individuals linked to M/s. Jagatjit Industries Ltd. (JIL), including the Talwar and Duggal families. The primary issue identified was the significant transfer of funds through a series of bank accounts associated with the aforementioned individuals, which led to the investigation of unaccounted money generated through purportedly dubious financial activities.
The crux of the investigation highlighted the following:
The detailed investigation and proceedings focused on unraveling the complexities of financial transactions involving the Talwar and Duggal families. The statements provided by the individuals during the search and subsequent enquiries were scrutinized extensively to establish the flow and utilization of funds.
Both Shri Sanjay Duggal and Shri Rajnish Talwar, significant figures in the case, admitted to the utilization of M/s. Alfa India as a conduit for unaccounted funds. They disclosed that the amounts transferred into this dummy entity were subsequently distributed among various family members’ accounts and used for alleged pay-offs and sales promotions without any substantial documentation or verification.
The Assessing Officer (AO) found substantial discrepancies in the explanations provided by the involved parties. The AO noted:
Upon thorough examination of the facts, the Tribunal, comprising Shri Bhavnish Saini, Judicial Member, and Shri Prashant Maharishi, Accountant Member, delivered their judgment. The Tribunal noted that the approval under section 153D was granted in a mechanical manner without proper application of mind and due consideration of the material on record. This led to the conclusion that the assessments were framed in violation of the prescribed law and procedures.
The Tribunal emphasized the need for detailed scrutiny and independent verification by the approving authority before granting such approvals to ensure that the assessments are legally valid and substantiated by adequate evidence.
The case ITA 1624/DEL/2019 serves as a critical reference for the importance of rigorous and thorough investigation and approval processes in tax-related cases. It underscores the necessity for the assessing and approving authorities to meticulously examine and verify the material on record to uphold the integrity and legality of their assessments.
The Tribunal’s decision in favor of Ratna Talwar highlights the significance of due process and the protection of taxpayers’ rights against arbitrary and mechanical actions by the authorities.
Case ITA 1624/DEL/2019: Ratna Talwar vs. ACIT, Central Circle-4, New Delhi
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