Zeus Impex Pvt. Ltd., Delhi V. ACIT, Central Circle 26, Delhi

CO 65/DEL/2023

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 7259 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 12-05-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 30-04-2024
• Assessment Year: 2012-2013
• Appeal Filed On: 21-06-2023
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P.N. BARNWAL
• Section: 144; 15; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “F” DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER AND SHRI SUDHIR KUMAR, JUDICIAL MEMBER ITAs No.375, 376, 377, 378 & 379/Del/2022 Assessment Years 2012-13, 2013-14, 2014-15, 2015-16 & 2016-17 ACIT Central Circle-26 New Delhi Vs. M/s. Zeus Impex Pvt. Ltd. Property No.194, Shop No.2 Pocket-26, Sector-24, Rohini Delhi-110085 TAN/PAN: AAACZ3569Q (Appellant) (Respondent) CO No.65, 66, 67, 68 & 69/Del/2023 (Arising out of ITAs No.375, 376, 377, 378 & 379/Del/2022) Assessment Years 2012-13, 2013-14, 2014-15, 2015-16 & 2016-17 M/s. Zeus Impex Pvt. Ltd. Property No.194, Shop No.2 Pocket-26, Sector-24, Rohini Delhi-110085 Vs. ACIT Central Circle-26 New Delhi TAN/PAN: AAACZ3569Q (Appellant) (Respondent) Applicant by: Ms. Shilpi Jain, Chartered Accountant Respondent by: Shri P.N. Barnwal, CIT-DR Date of hearing: 01 05 2024 Date of pronouncement: 13 05 2024 O R D E R PER PRADIP KUMAR KEDIA - A.M.: T he c a p t io n e d A p p e a l s h a ve b e e n p r e f e rr e d b y th e Re ve n ue a nd t he A s s e s s e e h a s a l s o f il e d C ro s s O b j e c t i o ns i n t he R e ve n u e A p pe a l a ga i n s t t h e re s p e c t i ve o r d e r s p a s s e d b y t he C I T (A ) f o r c a p ti o n e d a s s e s s m e nt ye a rs a s t a b u l a t e d b e l o w : ITAs No.1136 to 1142/Del/2023 2 Sr. No. ITA/CO Nos. Appeal /Cross Objection by A.Y. Pr.CIT Order dated Assessment Order dated Remarks 1. ITA No.375/Del/2022 Revenue 2012-13 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144 of the Income Tax Act, 1961. 2 ITA No.376/Del/2022 Revenue 2013-14 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 3. ITA No.377/Del/2022 Revenue 2014-15 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 4. ITA No.378/Del/2022 Revenue 2015-16 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 5. ITA No.379/Del/2022 Revenue 2016-17 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 6. CO No.65/Del/2023 Assessee 2012-13 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 7. CO No.66/Del/2023 Assessee 2013-14 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 8. CO No.67/Del/2023 Assessee 2013-14 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 9. CO No.68/Del/2023 Assessee 2013-14 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. 10. CO No.69/Del/2023 Assessee 2013-14 CIT(A)-29, New Delhi order dated 09.12.2021 Assessment order dated 26.12.2018 Assessment Order under section 153C/144of the Income Tax Act, 1961. ITAs No.1136 to 1142/Del/2023 3 2. W h e n t h e m a t t e r w a s c a l l e d f o r h e a ri n g, t h e l d . c ou n s e l f or t he a s s e s s e e i n s u p p o rt o f C r os s O b j e c t i o n f i l e d b y t h e a s s e s s e e s ub m i t t e d t ha t t h e n a m e of t he c o m pa n y go t s t r uc k of f f r om t he R e gis t e r o f M e m b e rs m a i n t a i ne d b y t h e M i n i s t r y o f C o rp or a t e A f fa i r s , G o ve rn m e nt of I nd i a ( M C A ) w . e . f . 19 . 0 1 . 2 01 7 . T he c o m pa n y m a s t er d a t a a nd c om p a n y i nf o r m a t i o n s ho w i n g ‘ s t ri k e o f f ’ a ga i n s t t he c om p a n y s t a t u s o n t he r e c o r d of M C A w a s pl a c e d on re c o rd . 2. 1 W i t h r e f e r e n c e t o s u c h d o c um e n t , t h e l d . c ou ns el s u b m i tt e d t h a t in pu r s ua n c e of Se c t i o n 5 60 (5 ) o f th e C om p a ni e s A c t, 19 56 , t he n a m e of t he a s s e s s e e , Ze u s I m pe x P v t . Lt d . , h a s be e n s t r uc k of f f ro m t h e R e gi s te r a nd c on s e q ue n t l y t h e s a i d c om p a n y i s d i s s o l ve d w . e . f . 19 . 0 1 . 2 0 1 7. T h e l d . c ou n s e l p oi n t e d o ut t ha t t hi s f a c t w a s a l s o m a d e a va i l a bl e be f o re t he C I T ( A ) a s re c o rd e d i n pa r a gr a p h 1 1 a t p a ge 3 7 o f t he f i r s t a p p e l l a t e or d e r pa s s e d u n d e r Se c t i o n 2 50 o f t h e A c t . T h e ld . c ou n s el t h u s s ub m i t t e d t ha t no a d ve r s e a c t i on c ou l d be t a k e n b y t h e A O a ga i n s t a no n -e x i s t e nt c om p a n y b y i s s u i n g n o ti c e s t o s uc h n o n - e xi s t e n t c o mpa n y. T h e ld . c ou n s e l a l s o po i nt e d ou t t h a t th e a s s e s s m e nt o r de r ha s be e n p a s s e d e x - pa r t e u n d e r Se c t i on 1 5 3C r . w . Se c t i o n 1 44 o f t h e A c t o w in g t o n o n - e xi s t e n c e of t h e c o m p a n y. 2. 2 O n m e r i t s , t h e l d . c o un s e l s ub m i t t e d th a t t h e as s e s s e e -c o m pa n y i s on l y a c o n d u i t c o m pa n y f o r t he p ur po s e of p ro vi d i n g a c c o m m o da t i o n e nt r i e s b y J a in B r ot h e rs t o va r i o u s be n e f i c i a ri e s in l i e u o f c a s h a f te r c ha r gi n g c o m m i s s i o n a s r e c o r de d i n p a r a g ra p h 6 o f th e a s s e s s m e n t o r d e r . T he l d . c o u ns e l re l i e d up o n c e r t a i n de c i s i o ns o f t he C o- o r d i na t e B e nc h , vi z . , A C I T v s . M /s . H o l e on T r ad e r s P v t. Lt d . i n I TA N o . 4 95 8 t o 49 6 2/ D e l / 2 01 9 o r d e r da t e d 2 1 . 07 . 20 2 3 ; A C I T v s . M / s . Ze d E n t e r p r i s e s (P ) Lt d . i n I T A N o . 20 8 t o 2 1 2 / D e l / 20 2 2 o r d e r d at e d 09 . 0 1 . 2 02 4 ; D C I T v s . M / s . Sh i v j i G a r m e n t s P v t . L t d. in I TA N o . 96 3 9 to 9 6 42 / D e l / 20 1 9 or de r d at e d 0 6. 0 2. 2 0 24 ; S h r i A n a nd K u m a r J a i n v s . AC I T i n I T A N o . 1 3 1 8 / D e l/ 2 0 19 o r d e r d at e d 2 8. 0 4. 2 0 23 t o s u bm i t t h a t i n s u c h or de r s pa s s e d, t h e I T A T h a s t a ke n a vi e w t h a t c o m pa n y b e i ng a c on d ui t ITAs No.1136 to 1142/Del/2023 4 c om p a n y, t h e a d d i ti o n s m a de o n p r ot e c t i ve b a s i s o r o t h e r w i s e o f w ho l e o f t he c r e d i t i s no t j u s t i f ie d . T h e i n c om e i n t h e ha n ds o f t h e a s s e s s e e c a n a t be s t b e c h a r ge d o n c e rt a i n s m a l l pe r c e nt a g e i n t h e r e gi o n o f 0. 2 5% t ow a r d s c o m m i s s i o n . T h e l d . c o u ns e l t hu s s u bm i t t e d t h a t n o i nt e r f e r e nc e w i t h th e o rd e r o f t h e C IT ( A ) on m e ri t s is c a l l e d f or . 3. T h e ld . C I T - D R f o r t he R e ve n ue , o n t h e o t h e r ha nd , s ub m i t te d t ha t t he A O w a s n e ve r i nf or m e d a t a ny s t a ge t ow a r d s t he f a c t of w i n d i n g up / s t r i ke o f f . T he a s s e s s e e - c om p a n y i n i t i a te d vo lu nt a r y w i n di n g u p pr o c e s s a n d o bt a i n e d vol u nt a r y s t r ik e of f f r o m t h e m a s t e r d a t a t o e s c a pe t he c l u t c h e s o f r e ve n u e a nd f o r th c o m i n g i nc o m e t a x p ro c e e di n gs ow i n g t o s e a rc h c a rr i e d o u t u nd e r S e c t i o n 1 3 2 o f t h e A c t i n t he c a s e o f A n a n d K u m a r J a i n a n d N a r e s h K um a r J a i n ( J a i n B ro t he r s ) w he r e t h e l a r ge s c a l e bu s i n e s s o f pr o vi d i n g a c c om m o da t i o n e n t r i e s t o va r iou s b e ne f i c i a r i e s t hr o u gh va r i o u s du m m y / p a pe r c o m pa n i e s / f i r m s i n cl u d i n g a s s e s s e e c om p a n y c on t ro l l e d a nd m a n a ge d b y J a in B r ot h e rs t o p r o v i de a c c om m o da t i o n e n t r i e s , w e r e f ou n d. T h e a s s e s s e e -c o mp a n y h e r e i n w a s on e o f t h e a c c om m o d a ti o n e nt r y p r o vi de r s a t b e he s t of t h e J a i n G ro u p. T he l d. C I T - D R a l s o s u b m it t e d t h a t t h e a s s e s s e e a l so n e e ds t o p oi n t o u t t he f a c t s a b ou t ul t i m a t e a s s e s s m e n t of l a r ge s c a l e a c c om m o da t i o n e n t r i e s un e a rt h e d i n t h e c ou r s e of s e a r c h of J a i n B r o t h e rs , a f e w o f w hi c h a re a l le ge d l y r o u t e d t h ro u gh th e a s s e s s e e -c o m pa n y. T h e a s s e s s e e , a c o r po ra t e e nt i t y, c a n no t e s c a p e t h e t a x l i a b i l i t y a t tr i b u t a b le t o s u c h e n t r ie s o n t he gr o un d s o f a c on d u i t c o m pa n y, un l e s s t he r e ve n u e h as c o ll e c t e d t he t a x t he r e on f ro m s o c a l l e d be n e f i c i a r y c o m pa n i e s . 4. W e h a ve c o ns id e re d t he r i va l a r g u m e nt s a n d t h e fa c t s p l a c e d on re c o rd . T he a s s e s s m e n t o r de r h a s b e e n s t a t e dl y pa s se d on a no n -e x i s t e nt c om p a n y. N o i nt i m a t i on a pp e a r s to ha ve be e n gi ve n to t he A O o f t h e f a c t of t he ‘ s t r ik e o f f ’ . T h e a dd i t i o n s m a de h a ve b e e n su b s t a nt i a l l y d e l e te d b y t he C I T ( A ) b a s e d o n a pp e a l m e m o s i gn e d b y t h e ‘ f o rme r ’ d i r e c t o r of t he e rs tw hi l e c om p a n y w h o i s n o t s h ow n t o b e c o m p e t e n t t o ve r i f y s u c h a pp e a l i n t e r m s o f Se c t i o n 14 0 o f t h e A c t . T h e C r o ss O b j e c t i o n f i l e d ITAs No.1136 to 1142/Del/2023 5 be f or e t h e T ri b u na l b y t he f o r m e r di r e c t or h a vi n g no l oc u s i s a l s o t hu s w i t h o u t a n y c om p e t e nc e ve s t e d t o t he s ig n a to r y o f th e C r o s s o bj e c t i on m e m o. F ro m t h e r e c o rd , i t a pp e a r s t ha t t h e a s s e s s e e- c om p a n y h a s b e e n us e d a s a c on d ui t t o pr o vi d e l a r ge s c a l e a c c om m o d a ti o n e nt r i e s a nd a va i l e d th e v ol u nt a r y s t r i ke o f f f ro m t h e r e c or d o f t h e M a s te r D a t a o f M C A a n d h a s t h us c e a s e d t o e xi s t. T he pr o c e e d i n g s ca n be in i t i a t e d a ga i n s t t he a s s e s s e e - c o m p a n y o n l y w he n re c o ur s e t o t he r e vi v a l of t he c om p a n y i s t a ke n b y t h e R e ve n ue in a c c o rd a nc e w i t h l a w , s u bs t a n t i a l l y a f f e c t e d by s uc h a c t i o n o f t he a s s e s s e e . Pa r a d o x i c al l y , t h e a p p e a l b e f o re t he T r i bu na l a r i s e s f ro m t he f i rs t a p p e l l a t e o rd e r p a s s e d un d e r Se c t i o n 25 0 o f t h e A c t w hi c h , i n t u r n , i s b a s e d up o n i n c om pe t e nt a p p e a l m e m o s i gne d b y a ‘ f o r m e r ’ D i re c t o r. I t i s no t s h o w n a s to h ow s uc h f o r m e r di r e c t o r h a s de r i ve d a u t ho r i t y i n l a w t o pu r s ue a ppe a l b e f o re C I T ( A ) o n be h a l f o f a ‘ s t r uc k o f f ’ c o m pa n y. T h e e nt i r e f i r s t a pp e l l a t e p r oc e e d in gs i s t hu s vi t i a t e d a nd r e n d e re d no n -e s t . T h e c a pt i o ne d app e a l s be f o re T r ib u na l a ri s i n g f r om t h e f i r s t a pp e l l a t e or de r p a s s e d t h us a p p e a r t o be w i th o ut s a n c t i t y of l a w a n d o u ts i de t h e re a l m o f a d j ud i c a tio n . 5. I n vi e w of s u c h gl a r i n g d e f i c i e nc i e s , no u s e f u l p ur po s e w o u l d be s e r ve d b y c o n t i n ui n g w i t h t h e pr e s e n t p r oc e e d i n g s in t he p r e s e nt f or m . N o us e f u l p u r p os e w i ll b e s e r ve d i n ke e p i n g t he c a pti o n e d a p pe a l s pe n d in g e i t h e r . T he r e f o r e , t he r i gh t c o u r s e , t o ou r m in d , w i l l b e to c on s i gn t h e p r e s e nt a pp e a l s a nd t he C ro s s o b j e c t i o ns t o t he r e c o r ds . B o t h t he s i d e s s h a l l be a t l i b e r t y t o r e vi ve t he a p pe a l s a t o pp o r t u ne t i m e a s a nd w h e n t h e c i rc u m s t a n c e s m a y w a r ra n t . 6. I n v i e w o f t h e a f o r e s a i d d e l i n e a t i on s , w e d i s m i ss t h e c a p t i o n e d a pp e a l s of t he R e ve n ue a r i s i n g f r o m d e f e c t i ve a n d in c o m p e t e nt a p pe a l pl a c e d be f or e t he C IT ( A ) i n l i m i ne. T h e C r os s o b j e c t io n s f i l e d b y t he ‘f o rm e r ’ d i re c t or o f a s s e s s e e , un a u t h o r i z e d t o ve r if y s uc h m e m o, a r e a l s o di s m is s e d i n l i m i ne . H o w e ve r , l i b e rt y i s gr a n t e d t o t h e R e ve n ue a s w e l l a s t o t he a s s e s s e e t o s e e k t he re vi va l of t he i r r e sp e c t i ve a p pe a l s a n d C r o s s O b j e c t i o ns i n c a s e i t d e s i re d t o p u rs u e t h e gr i e va n c e r a i s e d i n t he ITAs No.1136 to 1142/Del/2023 6 a pp e a l m e m o a s a n d w h e n s o a d vi s e d . 7. I n t he re s u l t , a l l t h e c a pt i o ne d a p pe a l s o f t he R e ve nu e a s w e l l a s C r o s s o bj e c t i on s o f t h e a s s e s s e e a re d i s m i s s e d i n li m in e. Order pronounced in the open Court on 13 th May, 2024. Sd/- Sd/- [SUDHIR KUMAR] [PRADIP KUMAR KEDIA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: May, 2024 Prabhat