RUBICON PHARMACEUTICALS P.LTD, NAVI MUMBAI V. DCIT CEN CIR 45, MUMBAI

ITA 1480/MUM/2011

• Counselvise Citation: 148019914 RSA 2011
• Duration Of Justice: 3 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 21-04-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 18-02-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: J K GARG
• Keywords: Unexplained cash credit; Corroborative evidences; Retraction
• Section: 68

Judgement Text

, INCOME TAX APPELLATE TRIBUNALMUMBAI BENCHE S I MUMBAI , . .. . ' ' ' ' . .. .# # # # . .. . ' ' ' ' . .. .$ $ $ $ , BEFORE S/SH. RAJENDRA,ACCOUNTANT MEMBER & DR. S.T.M. PAVALAN,JUDICIAL MEMBER ./ ITA.S/1474&1480/MUM/2011 $ $ $ $ % % % % / AY.S. 2004-05&2006-07 ( &' / APPELLANT) ( ()&' / RESPONDENT) $*+ $*+ $*+ $*+ , , , , / ASSESSEE BY : NONE - , / REVENUE BY : SHRI J.K.GARG $ $ $ $ - -- - + + + + / DATE OF HEARING : 04/08/2014 ./% - + / DATE OF PRONOUNCEMENT : 04/08/2014 $ $ $ $ , 1961 - -- - 254(1) +1+ +1+ +1+ +1+ 2 2 2 2 ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA,AM $ $ $ $ : CHALLENGING THE ORDERS OF THE CIT(A)-36,MUMBAI,ASSE SSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: ITA/1474/MUM/2011-AY.2004-05: 1)ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, AND IN LAW, THE LEARNED CIT (A) ERRED IN CONFIRMING THE ADDITIONS OF RS.1,25,00,000/- RECEIV ED BY THE APPELLANT TOWARDS UNSECURED LOANS AS UNEXPLAINED CASH CREDITS U/S 68 OF THE INCOME TA X ACT, 1961. 2)ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , AND IN LAW, THE LEARNED CIT (A) HAVE NOT APPRECIATED THE FACTS THAT ALL THE UNSECURED LOAN R ECEIPTS ARE SUPPORTED BY CONFIRMATION OF PARTIES AND ALSO THEIR RETURN ACKNOWLEDGEMENT WITH BALANCE SHEET. ALL THE SUPPORTING EVIDENCES HAS BEEN SUBMITTED TO THE LEARNED CIT (A). 3)ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LEARNED CIT (A) ERRED IN CONFIRMING INTEREST CHARGED. 4)ALL THE ABOVE GROUNDS OF APPEAL ARE MUTUALLY EXCL USIVE AND WITHOUT PREJUDICE TO EACH OTHER. 5)THE ASSESSEE PRAYS FOR LEAVE TO ADD, ALTER OR AME ND ANY OR ALL OF THE ABOVE GROUNDS OF APPEAL AT OR BEFORE THE DATE OF HEARING. ITA/1480/MUM/2011-AY.2006-07: 1)ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , AND IN LAW, THE LEARNED CIT (A) ERRED IN CONFIRMING THE ADDITIONS OF RS.19,70,000/- RECEIVED BY THE APPELLANT TOWARDS UNSECURED LOANS AS UNEXPLAINED CASH CREDITS U/S 68 OF THE INCOME TAX A CT, 1961. 2)ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , AND IN LAW, THE LEARNED CIT (A) HAVE NOT APPRECIATED THE FACTS THAT ALL THE UNSECURED LOAN R ECEIPTS ARE SUPPORTED BY CONFIRMATION OF PARTIES AND ALSO THEIR RETURN ACKNOWLEDGEMENT WITH BALANCE SHEET. ALL THE SUPPORTING EVIDENCES HAS BEEN SUBMITTED TO THE LEARNED CIT (A). 3)ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE , THE LEARNED CIT (A) ERRED IN CONFIRMING INTEREST CHARGED. 4)ALL THE ABOVE GROUNDS OF APPEAL ARE MUTUALLY EXCL USIVE AND WITHOUT PREJUDICE TO EACH OTHER. 5)THE ASSESSEE PRAYS FOR LEAVE TO ADD, ALTER OR AME ND ANY OR ALL OF THE ABOVE GROUNDS OF APPEAL AT RUBICON PHARMACEUTICALS PVT.LTD. S.S.4,GROUND FLOOR,XEROX LANE, SHOP NO.285,SECTOR 2,VASHI , NEW MUMBAI-400703 PAN:AAACR4629R VS $ DCIT CENTRAL CIRCLE-45 MUMBAI- 2 ITA NO. 1474 & 1480/MUM/2011 RUBICON PHARMACEUTICAL S PVT.LTD. OR BEFORE THE DATE OF HEARING. AS THE ISSUE INVOLVED IN BOTH THE APPEALS ARE IDENT ICAL,SO,WE ARE DECIDING APPEALS BY A SINGLE COMMON ORDER FOR SAKE OF CONVENIENCE. 2. ASSESSEE-COMPANY IS ENGAGED IN THE BUSINESS OF PHA RMACEUTICALS. DETAILS OF DATES OF FILING OF RETURNS,INCOMES RETURNED,DATES OF ASSESSMENT,ASSESS ED INCOMES, DATES OF ORDERS OF THE CIT(A)CAN BE SUMMARISED AS UNDER : AY. DT. OF FILING OF RETURN RETURNED INCOME (RS.) DATE OF ASSESSMENT ASSESSED INCOME DT. OF ORDER OF CIT(A) 2004 - 05 31.03.2005 ( - ) 18,249/ - 24.12.2009 1,24,81,750/ - 31.12.2010 2006 - 07 30.11.2006 ( - ) 16,66,433/ - 24.12.2009 3,03,570/ - 31.12.2010 IN THESE CASES NOTICES OF HEARING WERE ISSUE BY RPA D AT THE POSTAL ADDRESS GIVEN BY THE ASSESSEE IN ITS FORM NO.36.BUT,THE POSTAL AUTHORITIES HAVE R ETURNED BACK THE NOTICES WITH AN OBSERVATION THAT IT HAD LEFT PREMISES.AS THE ASSESSEE HAS NOT FURNIS HED THE NEW ADDRESS AND NOBODY HAD APPEARED BEFORE US, SO,WE ARE DECIDING THE APPEALS ON THE BA SIS OF AVAILABLE MATERIALS. ITA/1474/MUM/2011-AY.2004-05: 2. DURING THE ASSESSMENT PROCEEDINGS THE AO DIRECTED T HE ASSESSEE TO PRODUCE THE GENUINENESS OF SHARE APPLICATION MONEY AND UNSECURED LOANS,APPEARI NG IN THE BALANCE SHEET,RECEIVED DURING THE YEAR UNDER APPEAL.THE AO FOUND THAT IT HAD RECEIVED UNSECURED LOAN OF RS.1.25 CRORES FROM CHEVRON METAL PRODUCT PRIVATE LIMITED(CMPPL).AS THE ASSESSEE COULD NOT FILE SUPPORTING EVIDENCES IN ITS FAVOUR,SO,HE MADE AN ADDITION AMOU NTING TO RS.1.25 CRORES TO THE INCOME OF THE ASSESSEE. 2.1. AGGRIEVED BY THE ORDER OF THE AO,THE AO FILED AN AP PEAL BEFORE THE FIRST APPELLATE AUTHORITY (FAA).BEFORE HIM IT WAS ARGUED THAT SECTION 68 COUL D NOT BE INVOKED,THAT IN THE PRESENT CASE ASSESSMENT WAS BASED ON THE STATEMENT OF WITNESSES WHICH HAD BEEN RETRACTED BY THEM AT THE EARLIEST OPPORTUNITY,THAT THEIR ACCOUNTS AND ITS BA LANCE SHEETS WERE ON RECORD AND COULD EASILY BE CROSS VERIFIED,THAT THAT THE CONCERNED LOAN CREDITO R WAS ASSESSED TO TAX IN THE SAME CHARGE.IT ALSO FILED THE CONFIRMATION, PAN AND OTHER RELEVANT DETA ILS.AS THE ASSESSEE HAD FILED A PAPER BOOK CONTAINING THE DOCUMENTS OF THE LOAN CREDITOR BEFOR E THE FAA,SO,THE IT WAS FORWARDED TO AO FOR HIS REMAND REPORT.IN HIS REMAND REPORT,THE AO STATE D THAT THE ASSESSEE HAD FAILED TO PRODUCE SUCH LOAN CREDITOR,THAT THAT IN ABSENCE OF EXAMINATION O F SUCH LOAN CREDITOR THE ADDITION WAS JUSTIFIED. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE A ND THE REMAND REPORT,HE HELD THAT THE EVEN IN THE REMAND REPORT PROCEEDINGS THE ASSESSEE DID NOT PRODUCE THE DIRECTOR BEFORE THE ASSESSING OFFICER.HE CONFIRMED THE ADDITION MADE BY THE AO. 2.2. AS STATED EARLIER YEAR,NOBODY APPEARED BEFORE US.IN THE MATTER BEFORE US,IT IS FOUND THAT THE AO HAD DIRECTED THE ASSESSEE TO PROVE THE GENUINENE SS OF THE TRANSACTION.BUT,THE ASSESSEE DID NOT PRODUCE THE DIRECTOR OF THE COMPANY WHO HAD ADVANCE D LOAN TO IT.IT WAS NECESSARY IN LIGHT OF THE RETRACTION OF THE STATEMENTS BY THE WITNESS WHO HAD FIRST DENIED THE EXISTENCE OF THE TRANSACTION.IN THESE CIRCUMSTANCES, WE ARE OF THE OPINION THAT THE ORDER OF THE FAA DOES NOT SUFFER FROM ANY LEGAL INFIRMITY.THEREFORE,CONFIRMING HIS ORDER WE D ECIDE THE EFFECTIVE GROUND OF APPEAL AGAINST THE ASSESSEE. AS A RESULT APPEAL FILED BY THE ASSESSEE STANDS DISMISSED. ITA/1480/MUM/2011-AY.2006-07: 3. FACTS FOR THE YEAR UNDER CONSIDERATION ARE IDENTICA L TO THE FACTS OF THE EARLIER YEAR-THE ONLY DIFFERENCE IS ABOUT THE AMOUNT INVOLVED.IN THIS YEA R ,THE AMOUNT OF UNSECURED LOAN WAS OF RS.19. 3 ITA NO. 1474 & 1480/MUM/2011 RUBICON PHARMACEUTICAL S PVT.LTD. 70 LAKHS.FOLLOWING OUR ORDER FOR THE YEAR 2004-05 W E DECIDE THE GROUND AGAINST THE ASSESSEE. AS A RESULT,APPEALS FILED BY THE ASSESSEE FOR BOTH THE YEARS STAND DISMISSED. * +3$*+ 4 5 - 1 /$/ %6 - 7 $+ - + 89. ORDER PRONOUNCED IN T HE OPEN COURT ON 4 TH ,AUGUST,2014 . 2 - ./% 7 :$ 4 1+ , 201 4 / - 1 < SD/- SD/- ( . .. . ' ' ' ' . .. .# # # # . .. . ' ' ' ' . .. .$ $ $ $ / DR.S.T.M. PAVALAN ) ( / RAJENDRA ) /JUDICIAL MEMBER /ACCOUNTANT MEMBER / MUMBAI, :$ / DATE:04.08.2014 SHASHI SHEKHAR KUMAR 2 2 2 2 - -- - (+= (+= (+= (+= >=%+ >=%+ >=%+ >=%+ / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / &' 2. RESPONDENT / ()&' 3. THE CONCERNED CIT(A)/ ? @ , 4. THE CONCERNED CIT / ? @ 5. DR D BENCH, ITAT, MUMBAI / =A1 (+$ , . . . 6. GUARD FILE/ 1 B )=+ )=+ )=+ )=+ (+ (+(+ (+ //TRUE COPY// 2$ / BY ORDER, C / 8 DY./ASST. REGISTRAR , /ITAT, MUMBAI