ITAT order that upheld additional ‘unaccounted income’ as taxable for an individual who is alleged to have engaged in rigging of stocks, observing the tribunal has gone beyond its scope.The Income Tax Appellate Tribunal (Mumbai bench) had upheld the addition of ‘unaccounted income’ of Rs 90 crore in the hands of a defaulting taxpayer, Naresh Manakchand Jain, purported to have engaged in rigging of prices of select scrips and in money laundering by providing bogus entries like tax-exempt long-term capital gains to other parties. In addition, the ITAT had said that the names of 30,000-odd parties, who had benefited from these transactions, should be shared with regularity authorities.The orders were quashed on technical grounds, as the tax tribunal had passed them ex-parte (without giving a hearing opportunity to Jain). Further, the high court held that the powers of the ITAT are limited to passing an order which is confined to the issues placed before it, in appeal. The high court has directed the ITAT to hear the matter afresh.In this case, as reported by TOI in its edition dated September 9, the ITAT had referred to Jain as a kingpin and had gone beyond upholding the order of lower I-T authorities. It had directed Jain’s jurisdictional income-tax official to provide details of over 30,000 individuals and entities involved in the modus operandi to various regulatory authorities, such as jurisdictional I-T officials of these parties concerned, Sebi, stock exchanges, RBI, and the Registrar of Companies, for investigation and action. These details were to be provided within 90 days of the ITAT order.Subsequent to the ITAT’s order, the Bombay high court granted an interim stay. Now, in its final order, the high court stated: “These directions could not and in any case, should not have been passed because this was an appeal filed by the taxpayer and not an appeal that was filed by revenue authorities.”
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Bombay high court quashes ITAT order on technical grounds, as the tribunal had gone beyond its scope
The Bombay high court has overturned an order by the Income-tax Appellate Tribunal (ITAT) that upheld the addition of unaccounted income in the hands of Naresh Manakchand Jain. The court ruled that the ITAT’s order was passed without giving Jain an opportunity to be heard and that the ITAT’s powers are limited to the issues in appeal. The high court has directed the ITAT to hear the matter again without being influenced by its earlier order.
High court quashes ITAT order in money laundering case
The Bombay High Court has overturned an ITAT order that upheld additional ‘unaccounted income’ as taxable for an individual involved in stock rigging. The court held that the tribunal had exceeded its authority and had passed the orders without giving the individual a hearing opportunity. The high court has directed the ITAT to hear the case again. The ITAT had previously referred to the individual as a kingpin and had ordered the disclosure of details of over 30,000 individuals and entities involved in the scheme for investigation and action.
High court lets Manipur tribal bodies appeal Meitei ST tag order
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