The Supreme Court on Friday stayed a Delhi High Court order that set aside the penalty of R252 crore imposed by the income tax department on a Sahara firm for violation of tax laws.
A bench headed by justice Madan B Lokur, while issuing a notice to Sahara India Financial Corporation, also stayed the HC order that granted relief to the firm. Senior counsel Aman Sinha, appearing on behalf of the revenue authorities, argued that the HC ignored the CBDT circular of June 28, 1992 that said that the provisions with
regard to capping deposits/loans of and above R20,000 was introduced to counter attempts to circulate black money. The department stated that the assessee had not discharged the primary onus of establishing the identity and addresses of quite a number of depositors. “Furthermore, deposits figure in the books of accounts of the assessee on fictitious names and also in the names of persons who have denied having made the deposits,” it said.