D.C.I.T CC - VII,kolkata, Kolkata V. M/s Bansidhar Vyapar Pvt Ltd, Kolkata

ITA 1193/KOL/2013

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4796 (ITAT-KOLKATA)
• Duration Of Justice: 6 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 10-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROBIN CHOUDHUR Y
• Keywords: Assessment record

Judgement Text

1 ITA NO. 1193/KOL/2013 M/S. BANSIDHAR VYAPAR PVT. LTD., AY 2008-09 , B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA ( ) . . , . ' # $% % , '( ) [BEFORE SHRI A. T. VARKEY, JM & DR. A. L. SAINI, A M] I.T.A. NO. 1193/KOL/2013 ASSESSMENT YEAR: 2008-09 DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-VII, KOLKATA VS. M/S. BANSIDHAR VYAPAR PVT. LTD. (PAN: AABCB4390G) APPELLANT RESPONDENT DATE OF HEARING 25.02.2019 DATE OF PRONOUNCEMENT 17.05.2019 FOR THE APPELLANT SHRI ROBIN CHOUDHURY, ADDL. CIT, SR. DR FOR THE RESPONDENT SHRI SUBASH AGARWAL, ADVOCATE ORDER PER SHRI A.T.VARKEY, JM THIS APPEAL PREFERRED BY THE REVENUE IS AGAINST THE ORDER OF THE LD. CIT(A), CENTRAL- 1, KOLKATA DATED 25.02.2013 FOR AY 2008-09. 2. AT THE OUTSET ITSELF, THE LD. DR BROUGHT TO OUR NOTICE THAT THERE IS A MISTAKE IN THE GROUNDS OF APPEAL WHEREIN IT HAS BEEN STATED THAT T HE ASSESSMENT HAS BEEN MADE ON A PROTECTIVE BASIS ON THE ASSESSEE, HOWEVER, THE AO H AS ACTUALLY MADE ASSESSMENT ON SUBSTANTIVE BASIS AGAINST THE ASSESSEE. WE NOTE TH AT THE APPEAL HAS BEEN FILED IN THE YEAR 2013 AND, THEREFORE, WE ARE INCLINED TO ADJUDICATE THE APPEAL. THE MAIN GRIEVANCE OF THE REVENUE IS AGAINST THE ACTION OF THE LD. CIT(A) IN DELETING THE ADDITION OF RS. 1 CR. 3. BRIEF FACTS OF THE CASE ARE THAT THE AO NOTED TH AT SHRI SURESH SETHI, THE DIRECTOR OF THE ASSESSEE COMPANY HAS GIVEN STATEMENT ON OATH BEFORE THE DDIT (INV.), KOLKATA ON 05.12.2006 THAT HE GOT CASH OF EQUIVALENT AMOUNT FR OM THE COMPANIES AND AGAINST THE SAME CHEQUE HAD BEEN ISSUED TO VARIOUS MUMBAI BASED COMP ANIES OF KETAN PAREKH GROUP. THEREAFTER, THE AO NOTES THAT AS PER THE STATEMENT OF SHRI SETHI RS. 50 LACS WERE INVESTED BY THE ASSESSEE COMPANY IN THE SHARE CAPITAL OF MUMBAI BASED COMPANY CONNECTED WITH KETAN 2 ITA NO. 1193/KOL/2013 M/S. BANSIDHAR VYAPAR PVT. LTD., AY 2008-09 PAREKH GROUP. EVEN THOUGH THE AO NOTED THAT SHRI S URESH SETHI HAD RETRACTED HIS STATEMENT, HOWEVER, THE AO TAKING INTO CONSIDERATI ON THE MODUS OPERANDI AS ADMITTED BY SHRI SURESH SETHI BEFORE THE DDIT (INV.), KOLKATA, THE AO ESTIMATED THE INCOME OF THE ASSESSEE AT RS. 1 CR. AGGRIEVED, THE ASSESSEE PREF ERRED AN APPEAL BEFORE THE LD. CIT(A), WHO WAS PLEASED TO DELETE THE SAME. AGGRIEVED THE REVENUE IS BEFORE US. 4. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE DIRECTOR OF THE ASSESSEE CO MPANY SHRI SURESH SETHI HAS MADE A STATEMENT ON OATH ON 05.12.2006 BEFORE DDIT (INV.), KOLKATA THAT IN LIEU OF CASH, CHEQUES WERE ISSUED TO COMPANIES OF KETAN PAREKH GROUP AND THE AO NOTED THAT SHRI SETHI HAS STATED THAT RS. 50 LACS WERE INVESTED BY THE ASSESS EE COMPANY IN THE SHARE CAPITAL OF MUMBAI BASED COMPANY OF KETAN PAREKH GROUP HAS MADE THE ESTIMATION OF THE INCOME OF THE ASSESSEE TO THE TUNE OF RS. 1 CR. WE NOTE THAT EVEN THOUGH THE AO ACKNOWLEDGES THAT SHRI SURESH SETHI BY A SWORN AFFIDAVIT BEFORE THE N OTARY PUBLIC HAS RETRACTED THE STATEMENT, HOWEVER, HE ESTIMATED THE INCOME OF ASSESSEE AT RS. 1 CR. ON APPEAL, IT WAS BROUGHT TO THE NOTICE OF LD. CIT(A) THAT NO CHEQUES WERE ISSUED BY THE ASSESSEE COMPANY IN THIS ASSESSMENT YEAR 2008-09 AND THEREFORE, THE AO HAS N OT VENTURED TO MAKE ANY ADDITIONS ON THIS COUNT. BEFORE US ALSO THE LD. DR COULD NOT C ONTROVERT THIS FACT. SO, WE NOTE THAT ESTIMATION OF INCOME WAS BASED ONLY ON THE PLEA THA T THERE WAS NON-COMPLIANCE ON THE PART OF THE ASSESSEE AT THE ASSESSMENT STAGE. HOWEVER, WE AGREE WITH THE LD. CIT(A) THAT THE AO HAS NOT SPELT OUT AS TO WHAT ALL DOCUMENTS THE A O DIRECTED THE ASSESSEE TO PRODUCE WHICH COULD HAVE THROWN LIGHT TO ESTIMATE THE INCOM E OF THE ASSESSEE. WE NOTE THAT ASSESSEE IS A PRIVATE LIMITED COMPANY INCORPORATED ON 26.03. 1993 AND IT FILES REGULARLY ITS RETURN OF INCOME AND THE SAME HAVE BEEN PROCESSED BY THE DEPA RTMENT EVERY YEAR. DURING THE INVESTIGATION OF SHRI KETAN PAREKHS GROUP ONLY THE DDIT (INV.), KOLKATA SUMMONED THE DIRECTORS OF THE ASSESSEE COMPANY. SO WHEN THE ASS ESSMENT UNDER SCRUTINY WAS CARRIED OUT, IF THE ASSESSEE FAILED TO PRODUCE SOME DOCUMENTS C ANNOT BE THE GROUND TO MAKE ARBITRARY AD- HOC ESTIMATION AS DONE BY THE AO IN THIS CASE. THE FINANCIALS OF THE ASSESSEE COMPANY ARE AVAILABLE IN THE ASSESSMENT RECORDS OF THE DEPA RTMENT AND, THEREFORE, ESTIMATION SHOULD BE REASONABLE AND OUGHT TO HAVE SOME LINK WITH THE ASSESSEES BUSINESS AND THERE SHOULD BE 3 ITA NO. 1193/KOL/2013 M/S. BANSIDHAR VYAPAR PVT. LTD., AY 2008-09 SOME BASIS TO ESTIMATE AT RS 1 CRORE. THEREFORE, T HE LD. CIT(A) TOOK THE VIEW THAT THE ACTION OF AO IS ARBITRARY AND ESTIMATION OF INCOME AT RS. 1 CR. CANNOT BE COUNTENANCED. THEREFORE, THE LD. CIT(A)S DECISION TO DELETE THE ADDITION CANNOT BE FAULTED WITH, SO, WE ARE INCLINED TO CONFIRM THE ORDER OF THE LD. CIT(A) AND DISMISS THE APPEAL OF THE REVENUE. 5. IN THE RESULT, APPEAL OF REVENUE IS DISMISSED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 17TH MAY, 2019. SD/- SD/- (DR. A. L. SAINI) (A. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 17TH MAY, 2019 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 APPELLANT DCIT, CENTRAL CIRCLE-VII, KOLKATA. 2 RESPONDENT M/S. BANSIDHAR VYAPAR PVT. LTD. 10A, H OSPITAL STREET, KOLKATA-700072 3 4 5 CIT (A), CENTRAL -1, KOLKATA (SENT THROUGH E-MAIL) CIT , KOLKATA. DR, KOLKATA BENCHES, KOLKATA (SENT THROUGH E-MAIL) / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR