M/s. Bansal Infracon Ltd., Bhavnagar V. The Jt.CIT, (OSD), Circle-I, Bhavnagar

ITA 1442/AHD/2014

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 2122 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 2 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 20-06-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 12-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: L P JAIN
• Keywords: Unexplained cash credit; Income from undisclosed sources; Principle of natural justice; Set aside
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH (BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER & SHRI WASEEM AHMED, ACCOUNTANT MEMBER) ITA. NO: 1442/AHD/2014 (ASSESSMENT YEARS: 2009-10) M/S. BANSAL INFRACON LTD., 2137, NR. GOLDEN ARC, ATABHAI CIRCLE, BHAVNAGAR-364001 V/S THE JCIT (OSD), CIRCLE-1, BHAVNAGAR (APPELLANT) (RESPONDENT) PAN: AAACB9000A APPELLANT BY : SHRI TUSHAR HEMANI, A.R. RESPONDENT BY : SHRI L. P. JAIN, SR. D.R. ( )/ ORDER DATE OF HEARING : 11-06-2019 DATE OF PRONOUNCEMENT : 25 -07-2019 PER MAHAVIR PRASAD, JUDICIAL MEMBER 1. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD. CIT(A)-XX, AHMEDABAD DATED 26.03.2014 PERTAINING TO A.Y. 2009-10 AND FOLLOWING GROUNDS HAVE BEEN TAKEN: ITA NO. 1442 /AHD/2014 . A.Y. 2009- 10 2 1. THE LEARNED CIT(A) HAS ERRED BOTH IN LAW AND ON THE FACTS OF THE CASE IN CONFIRMING THE ADDITION OF RS.1,00,00.000/- MADE U/ S 68 IN RESPECT OT UNSECURED LOAN RECEIVED BY THE APPELLANT. 2. THE LEARNED CIT(A) HAS OBSERVED AND NOTED THAT T HE WHOLE OF THE AMOUNT OF RS.1,00,00,000/- ADDED U/S 68 OF THE ACT HAS ALREAD Y BEEN OFFERED AS INCOME BY SHRI VIJAY BANSAL BEFORE THE SETTLEMENT COMMISSION ON PAGE 36 OF HIS IMPUGNED ORDER. HOWEVER, HE HAS ERRED IN NOT DELETING THE SA ID AMOUNT IN THE HANDS OF THE APPELLANT DESPITE GIVING SUCH CLEAR FINDING. HIS AC TION HAS RESULTED INTO DOUBLE TAXATION OF THE VERY SAME INCOME WHICH IS NOT PERMI SSIBLE UNDER THE ACT. 3. BOTH THE LOWER AUTHORITIES HAVE PASSED THE ORDE RS WITHOUT PROPERLY APPRECIATING THE FACT AND THAT THEY FURTHER ERRED I N GROSSLY IGNORING VARIOUS SUBMISSIONS, EXPLANATIONS AND INFORMATION SUBMITTED BY THE APPELLANT FROM TIME TO TIME WHICH OUGHT TO HAVE BEEN CONSIDERED BEFORE PASSING THE IMPUGNED ORDER. THIS ACTION OF THE LOWER AUTHORITIES IS IN CLEAR BR EACH OF LAW AND PRINCIPLES OF NATURAL JUSTICE AND THEREFORE DESERVES TO BE QUASHE D. 4. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN CONFIRMING ACTION OF THE ID. AO IN LEVYING INTEREST U/S 234A/B /C OF THE ACT. 5. THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS OF THE CASE IN CONFIRMING ACTION OF THE ID. AO IN INITIATING PENALTY U/S. 271 (1)(C) OF THE ACT. 2. FACTS OF THE CASE ARE THAT DURING THE ASSESSMENT PR OCEEDINGS IT IS OBSERVED THAT THE ASSESSEE COMPANY ACCEPTED UNSECURED LOANS FROM THE FOLIO-WING PARTIES: SR. NO NAME OF COMPANY UNSECURED LOAN (RS.) 1. SARAGASSA INVESTMENT & FINANCE LIMITED 30,00,000/- 2. SHREE DATTA INDUSTRIES LIMITED 40,00,000/- 3. GUJARAT CHEMI PLASTO LIMITED 30,00,000/- TOTAL... 1,00,00,000/- ITA NO. 1442 /AHD/2014 . A.Y. 2009- 10 3 NOTICES UNDER SECTION 133(6) OF THE INCOME TAX ACT, 1961 HAVE BEEN ISSUED TO THE ABOVE MENTIONED PARTIES FOR CRESS VERIFICATION OF THE DATA, HOWEVER, NO RESPONSE HAVE BEEN RECEIVED FROM THE SAID PARTIES H ENCE, SHOW CAUSE NOTICES DATED 03.11.2011 AND 02.12.2011 HAVE BEEN ISSUED TO THE ASSESSEE COMPANY. IN RESPONSE TO THE SAME THE ASSESSEE COMPANY HAS REPLI ED AS UNDER VIDE ITS LETTER DATED 03.12.2011. '2. AT THE OUTSET , SPECIFIC ATTENTION OF YOUR HONO R IS DRAWN TO THE FACT THAT EXCEPT FOR RECEIVING THE ABOVE MENTIONED UNSECURED LOANS THROUGH PROPER BANKING CHANNEL, FROM THE THREE PARTIES AS MENTIONE D IN THE NOTICE, WHICH HAVE BEEN REPAID IN FULL DURING THE COURSE OF THE FINANC IAL YEAR ITSELF AND THAT TOO, BY CROSSED ACCOUNT PAYEE BANK INSTRUMENTS, THE COMPANY HAS NOT CARRIED OUT ANY OTHER TRANSACTIONS WITH ANY OF THEM. IT MAY ALSO BE PLACED ON RECORD THAT ALL THESE THREE PARTIES ARE INDEPENDENT LEGAL ENTITIES, NOT ONLY INCORPORATED AS SUCH UNDER THE COMPANIES ACT, 1956 BUT ALSO HAVING VALID PAN SO AS TO BE ON THE RECORDS OF THE INCOME-TAX DEPARTMENTS AS WELL. FURT HER, THE ASSESSEE COMPANY OR ANY OF ITS DIRECTORS ARE NOT OTHERWISE ASSOCIATE D WITH THESE COMPANIES OR WITH ANY OF THEIR DIRECTORS OF SHAREHOLDERS, WHICH MAY PLEASE BE NOTED. 3. BUT LETTER ISSUED U/S. 133(6) OF THE INCOME TAX AC T FOR ENQUIRY FOR RETURNED UNSERVED IN ALL THE CASES. 4. SINCE ASSESSEE HAS FAILED TO ESTABLISH CREDITWORTHI NESS SOURCE AND GENUINENESS OF RS. 1 CRORE. THUS, ASSESSEE MADE AN ADDITION OF RS. 1 CRORE AS AN UNEXPLAINED CREDIT. 5. THEREAFTER, SHRI VIJAY KUMAR BANSAL MAIN PERSONS/DI RECTOR OF THE APPELLANT COMPANY HAS FILED THE COMPUTATION BEFORE THE HONBL E SETTLEMENT COMMISSION ITA NO. 1442 /AHD/2014 . A.Y. 2009- 10 4 DISCLOSURE HIS UNACCOUNTED INCOME TO THE TUNE OF RS . 26.15 CRORES WHICH INCLUDED HIS UNDISCLOSED INCOME ROUTED IN HIS GROUP . AS PER HIS COMPUTATION IN THE CASE OF APPELLANT COMPANY HIS UNDISCLOSED INCOM E TO THE TUNE OF RS. 6 CRORES HAVE BEEN INTRODUCED WHICH HAS BEEN INTIMATE D BY THE DCIT, CENTRAL CIRCLE-1(3), AHMEDABAD TO THE OFFICE OF LD. CIT(A). BUT DESPITE OF THAT FACT, LD. CIT(A) HAS CONFIRMED THE ACTION OF THE LD. A.O. 6. SINCE APPELLANT HAS ALREADY DECLARED RS. 6 CRORES B EFORE THE SETTLEMENT COMMISSION WHICH ALSO INCLUDE RS. 1 CRORE WHICH WAS ADDED AS UNEXPLAINED CREDIT. WHEN CONTENTION OF THE APPELLANT HAS BEEN ACCEPTED BY THE HONBLE SETTLEMENT COMMISSION AND THIS FACT WAS ALSO BROUGH T TO THE NOTICE OF THE LD. CIT(A) GIVING FULL DETAILS OF DISCLOSURE MADE UNDER VARIOUS HEAD. 7. IN VIEW OF THE ABOVE, WE SET ASIDE THE MATTER TO TH E FILE OF THE LD.A.O. TO GO THROUGH THE HONBLE SETTLEMENT COMMISSION ORDER AND TO SEE WHETHER AN AMOUNT OF RS. 1 CRORE WAS ACCEPTED AS UNSECURED LOA N FROM NAMELY: SR. NO. NAME OF COMPANY UNSECURED LOAN (RS.) 1 SARAGOSSA INVESTMENT & FINANCE LIMITED 30,00,000 /- 2 SHREE DATTA INDUSTRIES LTD. 40,00,000/- 3 GUJARAT CHEMI PLASTO LTD. 30,00,000/- TOTAL 1,00,00,000/- ITA NO. 1442 /AHD/2014 . A.Y. 2009- 10 5 8. IF IT IS FOUND THAT ABOVE SAID UNSECURED LOANS HAVE BEEN DECLARED AND APPELLANT HAS PAID TAX ON IT PURSUANT TO SETTLEMENT COMMISSIO N ORDER THEN ADDITION TO BE DELETED BY THE A.O AS PER PROVISION OF LAW. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 25- 07- 2019 SD/- SD/- (WASEEM AHMED) (MAHAVIR PRASAD) ACCOUNTANT MEMBER TRUE COPY JUDICIAL MEMBER AHMEDABAD: DATED 25/07/2019 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD