DCIT, Cir.-1, Nashik V. M/s. Akshay Standard Insurence Services P. Ltd., Nashik

ITA 1038/PUN/2012

• Counselvise Citation: 103824514 RSA 2012
• Duration Of Justice: 1 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 12-11-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 23-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Assessee Lawyers: S N DOSHI
• Keywords: Unexplained cash credit
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES B, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.1038/PN/2012 (ASSESSMENT YEAR : 2008-09) DY. COMMISSIONER OF INCOME TAX, CIRCLE -1, NASHIK. . APPELLANT VS. M/S AKSHAY STANDARD INSURANCE SERVICES PVT. LTD., 3 TO 5, STADIUM COMPLEX, M. G. ROAD, NASHIK. PAN : AAFCA1136K . RESPONDENT DEPARTMENT BY : MR. S. P. WALIMBE ASSESSEE BY : MR. S. N. DOSHI DATE OF HEARING : 12-11-2013 DATE OF PRONOUNCEMENT : 21-11-2013 ORDER PER G. S. PANNU, AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST AN ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-I, NASHIK DATE D 03-04-2012 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 20-12-2010 PAS SED BY THE ASSESSING OFFICER, U/S 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2008-09. 2. IN THIS APPEAL, THE REVENUE HAS CHALLENGED THE A CTION OF THE CIT(A) IN DELETING THE ADDITION TO THE EXTENT OF RS.21 LACS W HICH WAS MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CREDITS BY INVOKING SECTION 68 OF THE ACT. 3. IN BRIEF, THE FACTS ARE THAT THE RESPONDENT-ASSE SSEE IS A COMPANY INCORPORATED UNDER THE PROVISIONS OF THE COMPANIES ACT, 1956 AND IS INTER-ALIA ENGAGED IN THE BUSINESS OF SUB-BROKER WORKING FOR K ANTILAL CHHAGANLAL ITA NO.1038/PN/2012 A.Y. 2008-09 SECURITIES PVT. LTD., MUMBAI. IN THE COURSE OF ASS ESSMENT PROCEEDINGS, ASSESSING OFFICER FOUND THAT THE ASSESSEE HAD RECEI VED LOANS FROM VARIOUS CONCERNS AMOUNTING TO RS.1,09,00,000/- AND AFTER CA RRYING OUT CERTAIN ENQUIRIES, THE SAME WAS ADDED AS AN UNEXPLAINED CRE DITS WITHIN THE MEANING OF SECTION 68 OF THE ACT. IN PROCEEDINGS BEFORE TH E CIT(A), ASSESSEE MADE DETAILED SUBMISSIONS AND A REMAND REPORT FROM THE A SSESSING OFFICER WAS ALSO CALLED FOR. ON THE BASIS OF ENQUIRIES CONDUCT ED BY THE ASSESSING OFFICER DURING THE REMAND PROCEEDINGS AND CONSIDERING THE C ONSEQUENT REMAND REPORT OF THE ASSESSING OFFICER, THE CIT(A) DELETED THE ENTIRE ADDITION OF RS.1,09,00,000/-. IN THE PRESENT APPEAL, THE REVEN UE HAS CHALLENGED THE ORDER OF THE CIT(A) ONLY WITH RESPECT TO THE DELETI ON OF UNEXPLAINED CASH CREDIT OF RS.21 LACS FROM THE FOLLOWING FOUR PARTIES : - (I) ASIT K. SETH RS. 3 LACS (II) MUKESH B JHAVERI RS. 10 LACS (III) NEMICHAND P PARIKH RS. 4 LACS (IV) MONA RAKESH SHAH RS. 4 LACS TOTAL RS. 21 LACS 4. AS PER THE REVENUE, THE MATERIAL AVAILABLE ON RE CORD AND ALSO THE ENQUIRIES CONDUCTED BY THE ASSESSING OFFICER DURING REMAND PROCEEDINGS SHOW THAT THE INGREDIENTS OF SECTION 68 OF THE ACT WITH RESPECT TO THE AFORESAID FOUR CASH CREDITORS WERE NOT ESTABLISHED AND THEREF ORE, THE CIT(A) WAS NOT JUSTIFIED IN DELETING THE SAME. 5. ON THE OTHER HAND, THE LEARNED COUNSEL APPEARING FOR THE RESPONDENT- ASSESSEE POINTED OUT WITH REFERENCE TO THE DISCUSSI ON MADE BY THE CIT(A) IN PARAS 7.2 TO 7.4 OF THE IMPUGNED ORDER THAT EVEN WI TH RESPECT TO THE FOUR CREDITORS IN QUESTION, THE MATERIAL ON RECORD AS WE LL AS THE RESULT OF ENQUIRIES PROVED THE IDENTITY, CREDITWORTHINESS OF THE CREDIT ORS AND ALSO THE GENUINENESS ITA NO.1038/PN/2012 A.Y. 2008-09 OF THE LOAN TRANSACTIONS. IT WAS, THEREFORE, CONTE NDED THAT THE ADDITION HAS BEEN RIGHTLY DELETED BY THE CIT(A). 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. AFTER PERUSING THE DETAILED DISCUSSION MADE BY THE CIT(A) WITH RESPECT TO EACH OF THE FOUR ABOVE CREDITORS, IT EMERGES THAT THE RESPECTIVE CREDITORS CONFIRMED THE ADVANCING OF LOANS TO THE ASSESSEE; THAT THE LOAN SO ADVANCED WA S ALSO SUPPORTED BY THE RESPECTIVE BANK STATEMENTS OF THE ABOVE FOUR CREDIT ORS; THAT EACH OF THE CREDITOR ALSO FURNISHED INCOME-TAX PARTICULARS, NAM ELY, PAN NOS.. THE CIT(A) HAS ALSO REFERRED THE BANK STATEMENT OF TWO OF THE CREDITORS TO OBSERVE THAT IT WAS NOT THE CASE WHERE ANY CASH WAS DEPOSITED IN TH E BANK ACCOUNT BEFORE ADVANCING OF MONEYS TO THE ASSESSEE. THE CIT(A) HAS ALSO NOTICED WITH RESPECT TO TWO CREDITORS THAT THE LOANS HAVE ALSO B EEN REPAID THROUGH THE BANK ACCOUNTS. THE CIT(A) HAS ALSO NOTICED THAT IN THE COURSE OF REMAND PROCEEDINGS BEFORE THE ASSESSING OFFICER EITHER THE CREDITORS OR THEIR REPRESENTATIVES APPEARED AND CONFIRMED THE LOAN TRA NSACTIONS. WITH REGARD TO THE CREDITWORTHINESS OF THE CREDITORS, THE CIT(A) H AS CATEGORICALLY AFFIRMED THAT THE CONFIRMATION LETTERS, BANK STATEMENTS, COMPUTAT ION OF INCOME WERE AVAILABLE, ETC. DEMONSTRATE THE CREDITWORTHINESS OF THE CREDITORS. MOREOVER, THE CIT(A) HAS ALSO OBSERVED THAT IN CASES WHERE AS SESSING OFFICER WAS DOUBTING THE CREDITWORTHINESS, THE ASSESSING OFFICE R DID NOT REQUIRE THE CREDITOR TO PROVE HIS SOURCE OF INCOME AT THE TIME OF ENQUIRIES. 7. AT THE TIME OF HEARING BEFORE US, NONE OF THE FA CTUAL ASPECTS APPRECIATED BY THE CIT(A) HAVE BEEN ASSAILED ON THE BASIS OF ANY COGENT MATERIAL OR EVIDENCE. THEREFORE, HAVING REGARD TO T HE MATERIAL ON RECORD BEFORE THE CIT(A), COPIES OF WHICH HAVE ALSO BEEN REFERRED TO IN THE PAPER BOOK FILED BY THE ASSESSEE BEFORE US, CLEARLY SHOW THAT SO FAR AS THE IMPUGNED CREDITORS ARE CONCERNED, THE IDENTITY AND CREDITWORTHINESS OF THE CREDITORS AND THE GENUINENESS OF THE TRANSACTIONS OF LOAN STAND ESTAB LISHED WITHIN THE MEANING ITA NO.1038/PN/2012 A.Y. 2008-09 OF SECTION 68 OF THE ACT. IN OUR VIEW, THE CIT(A) MADE NO MISTAKE IN DELETING THE IMPUGNED ADDITION, WHICH WE HEREBY AFFIRM IN TH E ABSENCE OF ANY CREDIBLE MATERIAL WITH THE REVENUE TO THE CONTRARY. 8. IN THE RESULT, THE ORDER OF THE CIT(A) IS HEREBY AFFIRMED AND THE APPEAL OF THE REVENUE IS DISMISSED. 9. RESULTANTLY, THE APPEAL OF THE REVENUE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST NOVEMBER, 2013. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 21 ST NOVEMBER, 2013 SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-I, NASHIK; 4) THE CIT-I, NASHIK; 5) THE DR, B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE