Tax evasion by way of Colourable Devices and Sham Transaction to defraud Department: ITAT dismisses assessee appeal [Read Order]
![Tax evasion by way of Colourable Devices and Sham Transaction to defraud Department: ITAT dismisses assessee appeal [Read Order]](https://www.taxscan.in/wp-content/uploads/2023/10/Tax-evasion-Colourable-Devices-Sham-Transaction-defraud-Department-ITAT-dismisses-assessee-appeal-taxscan.jpg "Tax evasion by way of Colourable Devices and Sham Transaction to defraud Department: ITAT dismisses assessee appeal [Read Order]")
The Income Tax Appellate Tribunal (ITAT) Panaji bench dismissed the appeal filed by the assessee and observed that the assessee has evaded tax by way of colourable devices and sham transactions to defraud the income tax department. When a search and seizure action is carried out in the case of assessee, Manoj Anand assesee filed his return of income declaring income of Rs. 7,50,670/....
The Income Tax Appellate Tribunal (ITAT) Panaji bench dismissed the appeal filed by the assessee and observed that the assessee has evaded tax by way of colourable devices and sham transactions to defraud the income tax department.
When a search and seizure action is carried out in the case of assessee, Manoj Anand assesee filed his return of income declaring income of Rs. 7,50,670/. The Assessing Officer (AO) completed the assessment under Section 143(3) along with Section 147 of Income Tax Act, 1961 determining the total income at Rs. 3,20,00,670/-.
Aggrieved by the order assesee filed appeal before CIT(A), who dismissed the appeal. Against the order assessee filed appeal before the tribunal.
During the proceedings no one appeared for the assessee. Therefore the bench considers the materials/documents on record to conclude the proceedings.
Prabhakar Anand, Counsel for Revenue submitted that assessee had designed a structure of tax evasion by employing paper companies which were listed on the recognized stock exchanges and the subsidiary paper companies of such listed companies.
Thus assessee converted unaccounted money by way of shell companies and putting them a shape of legitimate color of converting such unaccounted cash available with the individuals.
During the proceedings the tribunal observed that assessee had resorted to colourable devices and sham transaction in order to defraud the Department by camouflaging its unaccounted income,So it amount to tax evasion.
After considering the facts submitted and circumstances, the two member bench of Dr. B.R.R. Kumar(Accountant Member) and Chandra Mohan Garg (Judicial Member) held that assessee has evaded tax by way of colourable devices and sham transactions to defraud the income tax department.
To Read the full text of the Order CLICK HERE
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
