M/s Oasis Distilleries Ltd., Indore V. DCIT, CC-II, Ludhiana

ITA 1349/CHANDI/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5025 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 11-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 153A; 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 1349/CHD/2017 ASSESSMENT YEAR : 2009-10 M/S OASIS DISTILLERIES LTD., VS. THE DCIT, CENTRAL CIRCLE-II, H.102, B-2, METRO TOWER, LUDHIANA VIJAY NAGAR, SCHEME NO. 54, INDORE, PAN NO. AAAC03509R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHOK GOYAL, CA RESPONDENT BY : SH. ASHISH KUMAR GUPTA, CIT DR DATE OF HEARING : 11.05.2018 DATE OF PRONOUNCEMENT: 11.05.2018 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER DATED 19/06/2017 OF THE COMMISSIO NER OF INCOME TAX (APPEALS)-5, LUDHIANA [HEREINAFTER REFE RRED TO AS CIT(A)]. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 10,00,000/- IN RESPECT OF SHARE CAPITAL U/S 68 AS PER PARA 4.2 OF THE ORDER. 2. THAT THE LD. CIT(A) HAS FAILED TO ADJUDICATE THE LEGAL GROUND OF APPEAL AS TAKEN BEFORE HIM DURING THE COURSE OF HEARING THAT SINCE NO INCRIMINATING ITA NO.1349/CHD/2017- M/S OASIS DISTILLERIES LTD., INDORE 2 MATERIAL HAD BEEN FOUND DURING THE COURSE OF SEARCH CONDUCTED ON 21/22 OCTOBER, 2010 AND, AS SUCH, THE ADDITION OF RS. 10 LACS AS CONFIRMED ON ACCOUNT OF UNSECURED LOAN IS NOT CALLED FOR. 3. THAT THE LD. CIT HAS FAILED TO APPRECIATE THE JUDGEMENT OF THE JURISDICTIONAL ITAT, CHANDIGARH BENCH AND OF THE VARIOUS HIGH COURTS INCLUDING THE CASE OF KABUL CHAWLA AND OTHERS AND IF NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH, THEN, THE ADDITION CANNOT BE MADE. \ 4. NOTWITHSTANDING THE ABOVE SAID GROUND OF APPEAL, THE LD CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 10 LACS AS PER PARA 4.2 OF THE ORDER. 5. THAT THE CONFIRMATION OF ADDITION AS MADE BY THE CIT(A) IS AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE FACTS AND ISSUE INVOLVED IN THIS APPEAL ARE RELATING TO THE ADDITIONS MADE WHICH WERE NOT BASED ON ANY INCRIMINATING MATERIAL FOUND DURING THE SEARCH ARE SQUARELY COVERED BY THE DECISION OF THE TRIBUNAL IN THE OWN CASE OF THE ASSESSEE RELATING TO ASSESSMENT YEAR 2007-08 IN ITA NO. 643/CHD/2015 & OTHERS. 4. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED T HAT THE ORIGINAL RETURN IN THIS CASE WAS PROCESSED U/S 143( 1) OF THE ACT. THEREAFTER, A SEARCH ACTION WAS CARRIED OUT AT THE PREMISES OF THE ASSESSEE U/S 132 OF THE INCOME-TAX ACT, 1961 (I N SHORT 'THE ACT') ON 21.10.2010 BUT NO INCRIMINATING MATERIAL W AS FOUND DURING THE SEARCH. THEREAFTER, THE ASSESSMENT PROCE EDINGS WERE ITA NO.1349/CHD/2017- M/S OASIS DISTILLERIES LTD., INDORE 3 CARRIED OUT U/S 153A OF THE ACT AND THE ASSESSING O FFICER HAS MADE THE IMPUGNED ADDITIONS BUT NOT BASED ON ANY IN CRIMINATING MATERIAL FOUND DURING THE SEARCH ACTION. THE LD. CO UNSEL, HAS SUBMITTED THAT SINCE THE ORIGINAL ASSESSMENT PROCEE DINGS ALREADY STOOD COMPLETED IN THIS CASE ON THE DATE OF SEARCH AND THAT SINCE NO INCRIMINATING MATERIAL WAS FOUND DURING THE SEAR CH ACTION, THE ASSESSING OFFICER WAS PRECLUDED FROM MAKING ANY ADDITION OR OPENING UP AN ISSUE, IN RELATION TO ALREADY CONC LUDED ASSESSMENT PROCEEDINGS AND, HENCE, NO ADDITIONS WER E WARRANTED IN THE YEAR UNDER CONSIDERATION IN THE ASSESSMENT P ROCEEDINGS CARRIED OUT U/S 153A OF THE ACT. HE IN THIS RESPEC T HAS RELIED UPON VARIOUS JUDICIAL DECISIONS INCLUDING THE DECIS ION OF THE IN THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT V S. MURLI AGRO PRODUCTS PVT LTD, (2014) 49 TAXMAN.COM 172 (B OM.), ITA NO.36 OF 2009 AND IN THE CASE OF CIT VS. CONTINENT AL WAREHOUSING CORPORATION ITA NO. 523 OF 2013 REPORT ED IN (2015) 279 CTR 0389 (BOMBAY) AND OF THE HON'BLE DEL HI HIGH COURT IN THE CASE OF CIT VS. KABUL CHAWLA 234 TAX MAN 300 (DELHI) AND SUBSEQUENT DECISION OF THE DELHI HIGH C OURT IN THE CASE OF PRINCIPAL CIT VS. MEETA GUTGUTIA PROP M/S FERNS N PETALS, ITA 306/2017 AND OTHERS DECIDED VIDE ORDER DATED 25.5.2017. 5. THE LD. DR HAS ALSO BEEN FAIR ENOUGH TO ADMIT TH AT NO INCRIMINATING MATERIAL WAS FOUND IN THE CASE DURING THE SEARCH ITA NO.1349/CHD/2017- M/S OASIS DISTILLERIES LTD., INDORE 4 ACTION AND THAT THE FACTS AND ISSUE INVOLVED ARE SQ UARELY COVERED BY THE AFORESAID DECISIONS. 6. WE FIND FORCE IN THE CONTENTION OF THE LD. AR. ADMITTEDLY, THE ASSESSMENT FOR THE YEAR UNDER CONSI DERATION STOOD COMPLETED ON THE DATE OF SEARCH. NO INCRIMIN ATING MATERIAL WHATSOEVER IN RELATION TO THE SHARE APPLIC ATION MONEY WAS FOUND. IT HAS BEEN TIME AND AGAIN HELD BY THE VARIOUS HIGH COURTS THAT IF NO INCRIMINATING MATERIAL IS FO UND DURING THE SEARCH ACTION, THE ADDITION IN THE CASE OF ALRE ADY CONCLUDED ASSESSMENT CANNOT BE MADE WHILE FRAMING ASSESSMENT U/S 153A OF THE ACT. RELIANCE IN THIS RESPECT CAN BE PLACED IN THE CASE OF CIT VS. CONTINENTAL WAREHOUSING CORPORATION ITA N O. 523 OF 2013 REPORTED IN (2015) 279 CTR 0389 (BOMBAY) AND O F THE HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. KA BUL CHAWLA 234 TAXMAN 300 (DELHI). 7. WE FIND THAT THE CASE OF THE ASSESSEE IS SQUARE LY COVERED BY THE AFORESAID DECISIONS. THE AFORESAID DECISIONS HAVE BEEN FURTHER AFFIRMED BY THE DECISION OF THE DELHI HIGH COURT IN THE CASE OF PRINCIPAL CIT VS. MEETA GUTGUTIA PROP M/S FERNS N PETALS, ITA 306/2017 AND OTHERS DECIDED VIDE ORDER DATED 25.5.2017. THE AFORESAID CASE LAWS CAN BE WELL APPL IED TO THE FACTS AND CIRCUMSTANCES OF THE CASE IN HAND. IN VIE W OF THIS, WE DO NOT FIND ANY JUSTIFICATION ON THE PART OF THE LO WER AUTHORITIES FOR MAKING ADDITION ON ACCOUNT OF SHARE APPLICATION MONEY FOR THE YEAR UNDER CONSIDERATION. ITA NO.1349/CHD/2017- M/S OASIS DISTILLERIES LTD., INDORE 5 IN VIEW OF THIS, THE APPEAL OF THE ASSESSEE IS HERE BY ALLOWED ORDER PRONOUNCED IN THE OPEN COURT SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 11.05.2018 RKK COPY TO: THE APPELLANT THE RESPONDENT THE CIT THE CIT(A) THE DR