Rapid Diagnostic Pvt. Ltd., Delhi V. ITO, New Delhi

ITA 138/DEL/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6404 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 16-12-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 08-01-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: V R SONBHADRA
• Assessee Lawyers: SURESH KR GUPTA
• Keywords: Unexplained cash credit; Non compliance
• Section: 142(1); 68; 148

Judgement Text

1 ITA NO. 13 8/DEL/2013 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI N.K. SAINI, ACCOUNTANT ME MBER & SMT. BEENA PILLAI, JUDICIAL MEMBER I.T.A .NO.-138/DEL /2013 (ASSESSMENT YEAR-2004- 05) RAPID DIAGNOSTIC P. LTD., B-159, GUJRANWALA TOWN, DELHI. AAACR4366H VS ITO, WARD 15(2), NEW DELHI. APPELLANT BY SHRI SURESH KR. GUPTA, CA RESPONDENT BY SHRI V.R. SONBHADRA, SR. DR ORDER PER BEENA PILLAI, JUDICIAL MEMBER : THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A)S-XVIII, NEW DELHI VIDE HIS ORDER DATED 08.10.2012 FOR A.Y. 2004-05 ON THE FOLLOWING GROUND S: 1. THE LD. CIT(A) HAS ERRED BOTH IN LAW AND ON FACT S IN CONFIRMING THE ADDITION OF RS. 12,00,000/- BEING SH ARE APPLICATION MONEY ACCEPTED BY THE APPELLANT HAVING HELD THE SAME AS UNEXPLAINED CASH CREDIT IN TERMS OF PRO VISIONS OF SECTION 68 OF THE IT ACT NOTWITHSTANDING THE FAC T THAT ALL THE EVIDENCES IN SUPPORT OF IDENTITY OF THE APPLICA NT, HIS CREDIT WORTHINESS AND ALSO EVIDENCE TO ESTABLISH TH E DATE OF HEARING 16.12.2015 DATE OF PRONOUNCEMENT 19.02.2016 2 ITA NO. 13 8/DEL/2013 GENUINENESS OF THE TRANSACTION HAD BEEN SUBMITTED B EFORE THE AUTHORITIES BELOW. 2. LD. CIT(A) AND ASSESSING OFFICER HAS ERRED IN LAW AND ON FACTS IN TAKING ADVERSE VIEW AGAINST THE APPELLANT COMPANY OF THE NON COMPLIANCE OF THE SUMMONS ISSUED TO AND SERVED ON THE SHARE APPLICANTS AND ALSO IN PLAC ING BURDEN ON THE APPELLANT COMPANY TO PRODUCE SHARE APPLICANTS. 2. BRIEF FACTS OF THE CASE ARE THAT: DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE CO MPANY HAD FILED ITS RETURN OF INCOME ON 29/10/2004 DECLARING TOTAL INCOME OF RS. 18,55,521/-. NOTICE U/S 148 WAS ISSUED AFTER R ECORDING REASONS FOR REOPENING THE ASSESSMENT. THE ASSESSEE WAS ALSO PROVIDED WITH THE COPY OF THE REASONS RECORDED FOR REOPENING. NOTICES U/S 142(1) AND 143(2) OF THE ACT WERE ISSUE D AND SERVED UPON THE ASSESSEE. AS PER THE DETAILS FILED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE HAD RECEIV ED SHARE APPLICATION MONEY AMOUNTING TO RS. 12 LACS FROM THE FOLLOWING PARTIES: S.NO. NAME OF SHARE HOLDER AMOUNT 1. SUNITA GUPTA 2,00,000/- 2. PURNENDU KUMAR GUPTA 2,00,000/- 3. DEEP CHAND GUPTA 2,00,000/- 4. AMIT JAIN 2,00,000/- 5. MUKESH JAIN 2,00,000/- 6. VISHAL AGARWAL 2,00,000 /- 12,00,000 /- 3. THE ASSESSEE HAD FURNISHED CONFIRMATION AS WELL AS OTHER EVIDENCE IN SUPPORT OF ABOVE SHARE APPLICATION MONE Y. HOWEVER, THE ASSESSING OFFICER WAS OF THE OPINION THAT THE I NCOME/CAPITAL OF THE ABOVE PERSONS WAS NOT SUFFICIENT AND, THEREFORE , HE ARRIVED AT 3 ITA NO. 13 8/DEL/2013 THE CONCLUSION THAT THE ASSESSEE WAS UNABLE TO DISC HARGE THE ONUS OF PROVING THE CASH CREDIT IN HIS BOOKS. ON APPEAL , REJECTED THE ASSESSEES CONTENTION AND CONFIRMED THE ADDITION OF RS. 12,00,000/- MADE BY THE ASSESSING OFFICER. HENCE, THE ASSESSEE IS IN APPEAL BEFORE US. 4. ON APPEAL, THE LD. CIT(A) REJECTED THE ASSESSEE S CONTENTION AND CONFIRMED THE ADDITION OF RS. 12,00,000/- MADE BY THE ASSESSING OFFICER. HENCE, THE ASSESSEE IS IN APPEA L BEFORE US. 5. BEFORE US THE LD. AR SUBMITTED THAT THE IDENTICA L ISSUE WITH IDENTICAL PARTIES HAD AROSE IN THE YEAR 2003-04 AND THIS HONBLE TRIBUNAL HAD DELETED THE ADDITION IN RESPECT OF THE SHARE APPLICATION MONEY IN THE HANDS OF THE ASSESSEE IN I TA NO. 2848/D/2011 IN ACIT VS. M/S RAPID DIAGNOSTIC LTD. 6. WE HAVE PERUSED THE SAID ORDER OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR A.Y. 2003-04 AND HAVE FOUND THAT THE P ARTIES IN BOTH THE YEARS ARE SIMILAR EXCEPT FOR THE SHARE APPLICAT ION MONEY BEING DIFFERENT. 7. THIS TRIBUNAL HAS RECORDED ITS FINDINGS AT PARA 8 IN THE ORDER FOR AY 2003-04 WHICH IS REPRODUCED HEREIN BELOW: 8. HOWEVER, AFTER CONSIDERING THE ARGUMENTS OF B OTH THE SIDES AND THE FACTS OF THE CASE, WE ARE UNABLE TO AGREE WITH THE ASSESSING OFFICER, IT IS A SETTLED L AW THAT THE ONUS IS UPON THE ASSESSEE TO PROVE THE CRE DIT IN HIS BOOKS OF ACCOUNT. TO DISCHARGE SUCH ONUS, T HE ASSESSEE HAS TO ESTABLISH (I) THE IDENTITY OF TH E CREDITOR, (II) THE CREDITWORTHINESS OF THE CREDITOR AND (III) GENUINENESS OF THE TRANSACTION. ALL THE CREDITORS ARE ASSESSED TO INCOME TAX, THEIR PERMANENT ACCOUNT NUMBERS AS WELL AS THE COPY OF THE INCOME TAX RETUR NS 4 ITA NO. 13 8/DEL/2013 WERE FURNISHED BEFORE THE ASSESSING OFFICER. THEREFORE, THE IDENTITY OF THE SHARE APPLICANTS CAN NOT BE DOUBTED. ALL THE MONEY HAS COME BY CHEQUE, ALL THE SHARE APPLICANTS HAVE CONFIRMED THE SAME AND TH E AMOUNT IS DULY DEBITED IN THE SHARE APPLICANTS BAN K ACCOUNT. THEREFORE, THE GENUINENESS OF THE TRANSACTIONS ALSO CANNOT BE DOUBTED. THE ASSESSING OFFICER MAINLY DOUBTED THE CREDITWORTHINESS OF THE CREDITORS. HOWEVER, WE FIND THAT THE CAPITAL OF EA CH AND EVERY CREDITOR IS MUCH MORE THAN THE INVESTMENT MADE BY HIM IN THE SHARE CAPITAL. THE AMOUNT HAS DULY BEEN DISCLOSED IN THEIR BALANCE SHEET WHICH IS ALSO FURNISHED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER. IN VIEW OF THE TOTALITY OF THE ABOVE FACT S, WE ARE OF THE OPINION THAT THE ASSESSEE WAS ABLE TO DISCHARGE THE ONUS OF PROVING THE CREDIT IN THE FOR M OF SHARE APPLICATION MONEY OF ITS BOOKS OF ACCOUNT. W E, THEREFORE, DO NOT FIND ANY INFIRMITY IN THE ORDER O F THE LD. CIT(A). THE SAME IS SUSTAINED. 8. IN VIEW OF THE ABOVE DISCUSSION AND FINDINGS OF THE TRIBUNAL FOR A.Y. 2003-04, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEES APPEAL FOR THE PRESENT YEAR UNDER CONSIDERATION STA NDS SQUARELY COVERED BY THE ORDER OF THIS TRIBUNAL FOR AY 2003-0 4. THE GROUNDS RAISED BY THE ASSESSEE ARE, THEREFORE, ALLOWED. 9. IN THE RESULT, THE APPEAL STANDS ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 19.02. 2016 SD/- SD/- (N.K. SAINI) (BEENA PILLAI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 19/02/2016 *KAVITA, P.S. 5 ITA NO. 13 8/DEL/2013 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 6 ITA NO. 13 8/DEL/2013 DATE 1. DRAFT DICTATED ON 21.12.15 2. DRAFT PLACED BEFORE AUTHOR 28.12.15 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. 5. APPROVED DRAFT COMES TO THE SR.PS/PS 19.02.16 6. KEPT FOR PRONOUNCEMENT ON 19.02.16 7. FILE SENT TO THE BENCH CLERK 19.02.16 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.