MADHU DADHA Vs. ASSISTANT COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) TAX Case Appeal against the order of the Income TAX Appellate Tribunal, Chennai 'B' Bench dated 25.04.2008 in ITA No.120/Mds/2007 for the Block Assessment year 1.4.1988 to 15.12.1988. The assessee has preferred the above appeal as against the order passed by the Income TAX Appellate Tribunal, Chennai 'B' Bench dated 25.04.2008 in ITA No.120/Mds/2007 for the Block Assessment year 1.4.1988 to 15.12.1988.

(2.) THE assessee is a partner in a firm and also a shareholder of M/s. Tamil Nadu Dadha Pharmaceuticals Limited. Pursuant to a search and seizure action conducted in the case of Sun Pharma Group of Industries at Mumbai and Baroda on 17.12.1988 consequential search was carried out in the business and residential premises of the Dadhas at Chennai as well as at Bangalore. Pursuant to the scheme of amalgamation approved by Gujarat and Madras High Court M/s Tamil Nadu Dadha Pharmaceuticals Limited was converted into M/s. Sun Pharma India Limited shares in the ratio of $:1 viz., for every 4 shares of M/s. Tamil Nadu Dhadha Pharmaceuticals Limited one share of M/s. Sun Pharma India Limited was allotted. THE Assessing Officer on the basis of certain loose sheets of paper found at the time of search and on the basis of suspicion came to a conclusion that the scheme of amalgamation was only on paper whereas in practice the shares were sold to M/s. Sun Pharma @ Rs.290 per share. THE Assessing Officer consequentially determined the shares held by the appellant as undisclosed income of the appellant. While doing so, the Assessing Officer clubbed the value of shares held by the minor sons in the hands of the appellant and determined the total undisclosed income of the appellant at Rs.3,91,93,881/- and determined the tax thereon at Rs.2,35,04,328/- and passed the order of assessment on 3.7.2008.

(3.) THE questions of law raised in the appeal are as follows:- (1) Whether the Income Tax Appellate Tribunal is right in law in not condoning the delay of the appellant in filing the appeal before the Tribunal by not appreciating the bonafide reason (death of the appellants authorised representative) of the appellant for not filing the appeal in time? (2) Whether the Income Tax Appellate Tribunal is right in law in disposing the appellant appeal on the grounds of limitation alone and not considering and adjudicating the various other grounds filed by the appellant before the Tribunal?