Tirumala Securities (P) Ltd., Kolkata V. ITO, Ward - 1(3), Kolkata, Kolkata

ITA 1144/KOL/2007

• Counselvise Citation: 114423514 RSA 2007
• Duration Of Justice: 4 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2011
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2002-2003
• Appeal Filed On: 08-05-2007
• Court: TRIBUNAL
• Department Lawyers: H N SINGH
• Assessee Lawyers: SUBHASH AGARWAL
• Keywords: Set aside
• Section: 12; 10; 11; 115JB; 10B

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH A, KOLKATA () BEFORE , , , , , SHRI MAHAVIR SINGH, JUDICIAL MEMBER. /AND . .. . ! ! ! !. .. . , '# SHRI C.D.RAO, ACCOUNTANT MEMBER $ $ $ $ / ITA NO S. 1144 & 1145 /KOL/2007 %& '(/ ASSESSMENT YEARS : 2002-03 & 2004-05 (*+ / APPELLANT ) TIRUMALA SECURITIES (P) LTD., KOLKATA (PAN: AABCT 0676 K) - % - - VERSUS - . (-.*+/ RESPONDENT ) I.T.O., WARD-1(3), KOLKATA *+ / 0 '/ FOR THE APPELLANT: SHRI SUBHASH AGARWAL -.*+ / 0 '/ FOR THE RESPONDENT: SHRI H.N.SINGH '1 / ORDER ( (( ( . .. . ! ! ! !. .. . ) )) ), , , , '# PER SHRI C.D.RAO, AM THE ABOVE TWO APPEALS ARE FILED BY THE ASSESSEE AG AINST SEPARATE ORDERS DATED 01.03.2007 AND 31.03.2007 RESPECTIVELY OF THE CIT(A )-CENTRAL-II, KOLKATA PERTAINING TO A.YRS. 2002-03 AND 2004-05. 2. THE ASSESSEE HAS RAISED THE FOLLOWING REV ISED GROUND FOR A.YR. 2002-03 1. FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, THE LD. CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS.45,0 00/- ON ACCOUNT OF SHARE APPLICATION MONEY RECEIVED IN CASH OUT OF THE TOTAL ADDITION OF RS.90,000/- MADE BY THE A.O. 3. THE BRIEF FACTS OF THE ISSUE ARE THAT THE A O WHILE DOING THE SCRUTINY ASSESSMENT ADDED AN AMOUNT OF RS.90,000/- ON ACCOUNT OF SHARE APPLICATION MONEY RECEIVED BY 2 THE ASSESSEE BY OBSERVING THAT THE ASSESSEE COMPANY FAILED TO PRODUCE THE IDENTITY OF THE SHARE APPLICANTS AS REQUIRED. 3.1. ON APPEAL THE LD. CIT(A) HAS RESTRICTED TH E DISALLOWANCE TO RS.45,000/- IN RESPECT OF THREE SHARE APPLICANTS NAMELY (I) SHRI S IKHAR CHAND LUNIA; (II) SMT. LAXMI LUNIA; AND (III) M/S. LUNIA COMMONTRADE (P) LTD. 3.2. AGGRIEVED BY THIS GHE ASSESSEE IS IN AP PEAL BEFORE US. 4. AT THE TIME OF HEARING, THE LD. COUNSEL APPEARING ON BEHALF OF THE ASSESSEE HAS REITERATED THE SUBMISSIONS MADE BEFORE THE REVENUE AUTHORITIES AND FURTHER CONTENDED THAT THE ASSESSEE HAS DISCHARGED THE INITIAL ONUS B Y FOLLOWING THE LETTER ISSUED BY THE SHARE APPLICANTS STATING THAT THEY HAVE APPLIED FOR THE SHARES OF THE ASSESSEE COMPANY. THEREFORE, HE REQUESTED TO DELETE THE ADDITION SUST AINED BY THE LD. CIT(A). 5. ON THE OTHER HAND, THE LD. DR APPEARING ON BEHALF OF THE REVENUE RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. 6. AFTER HEARING THE RIVAL SUBMISSIONS AND ON P ERUSAL OF MATERIALS AVAILABLE ON RECORD, WE FIND NO INFIRMITY IN THE ORDERS OF THE L D. CIT(A) WHO HAS SUSTAINED THE ADDITION OF RS.45,000/- BY OBSERVING THAT THE AFORE SAID THREE PERSONS WHOSE IDENTITY COULD NOT BE PROVED. THEREFORE WE DISMISS THE APPEA L OF THE ASSESSEE. 7. THE REVISED GROUND TAKEN BY THE ASSESSEE I N RESPECT OF A.YR. 2004-05 IS AS UNDER :- 1. FOR THAT THE LD. CIT(A) ERRED IN CONFIRMING THE ACTION OF THE AO IN NOT ALLOWING REDUCTION OF DIVIDEND INCOME OF RS.1,50,12 8/- FOR THE PURPOSE OF COMPUTATION OF BOOK PROFIT IN TERMS OF SECTION 115J B. 8. THE BRIEF FACTS OF THIS ISSUE ARE THAT THE AO WHILE DOING THE SCRUTINY ASSESSMENT HAS DISALLOWED AN AMOUNT OF RS.1,50,128/- WHILE COM PUTING THE BOOK PROFIT U/S 115JB OF THE IT ACT ON ACCOUNT OF DIVIDEND INCOME. 3 8.1. ON APPEAL ALSO THE LD. CIT(A) HAS CONFIRM ED THE SAME. 8.2. AGGRIEVED BY THIS THE ASSESSEE IS IN APPE AL BEFORE US. 9. THE LD. COUNSEL APPEARING ON BEHALF OF THE ASSESSEE HAS FILED THE EXTRACT OF SECTION 115JB OF ACT WHICH WAS PLACED AT PAPER BOOK PAGES 1 TO 4 AND CONTENDED THAT AS PER THE EXPLANATION ATTACHED TO CLAUSE (II) OF T HE EXPLANATION OF SUB-SECTION 2 OF SECTION 115JB OF THE ACT, THE ASSESSEE IS ENTITLED TO REDUCTION OF PROFIT BY WHICH THE AMOUNT OF INCOME TO WHICH ANY OF THE PROVISIONS OF SECTION 10 [(OTHER THAN THE PROVISIONS CONTAINED IN CLAUSE (23G) THEREOF] OR SE CTION 10A OR SECTION 10B OR SECTION 11 OR SECTION 12 APPLY; IF ANY SUCH AMOUNT IS CREDI TED TO THE PROFIT AND LOSS ACCOUNT. THEREFORE HE CONTENDED THAT THE REVENUE IS NOT JUST IFIED IN DISALLOWING THE SAME U/S 115JB WHICH IS STATUTORILY ALLOWABLE. THEREFORE HE REQUESTED TO SET ASIDE THE ORDERS OF THE LD. CIT(A) WHO CONFIRMED THE ACTION OF THE AO A ND DIRECT THE REVENUE AUTHORITIES TO ALLOW THE CLAIM OF THE ASSESSEE. 10. ON THE OTHER HAND, THE LD. DR APPEARING O N BEHALF OF THE REVENUE RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. 11. AFTER HEARING THE RIVAL SUBMISSIONS AND ON C AREFUL PERUSAL OF PROVISIONS OF SECTION 115JB OF THE ACT RELIED UPON BY THE LD. COU NSEL WE ARE OF THE VIEW THAT THE ASSESSEE IS ENTITLED FOR ADJUSTMENT OF THE BOOK PRO FIT U/S 115JB OF THE ACT FOR THE IMPUGNED ASSESSMENT YEAR. KEEPING IN VIEW OF THE FA CT THAT THE ASSESSEE HAS CREDITED IN THE P&L ACCOUNT THE DIVIDEND INCOME OF RS.1,50,1 28/-. WE FIND NO JUSTIFICATION ON THE PART OF THE REVENUE TO ADD THE SAME IGNORING TH E PROVISION OF SECTION 115JB OF THE ACT. THEREFORE WE SET ASIDE THE ORDERS OF THE REVEN UE AUTHORITIES AND ALLOW THE APPEAL OF THE ASSESSEE. 4 12. IN THE RESULT THE APPEAL OF THE ASSESSE E IS ALLOWED IN PART. ORDER PRONOUNCED IN THE OPEN COURT ON 31.05.2011. SD/- SD/- MAHAVIR SINGH, JUDICIAL MEMBER . .. . ! ! ! !. .. . , ,, , '# '# '# '# , C.D.RAO, ACCOUNTANT MEMBER ( (( (!# !# !# !#) )) ) DATE: 31.05.2011 '1 / -2 3'2'4- COPY OF THE ORDER FORWARDED TO: 1. TIRUMALA SECURITIES (P) LTD., 12, KHETRA DAS LANE, 2 ND FLOOR, KOLKATA- 700012. 2 THE I.T.O., WARD-1(3), KOLKATA 3. THE CIT, 4. THE CIT(A)-CENTRAL-II, KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA .2 -/ TRUE COPY, '1%9/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES R.G.(.P.S.)