Deputy Commissioner of Income-tax, Circle - 3, Pune V. M/s H.B. and Associates, Pune

ITA 1557/PUN/2017

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 9127 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-02-2020
• Assessment Year: 2012-2013
• Appeal Filed On: 20-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: IS DIRECTED AGAINS T PASSED
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE VIRTUAL COURT BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO.1557/PUN/2017 / ASSESSMENT YEAR : 2012-13 DY.CIT,CIRCLE-3, PUNE VS. M/S. H.B. AND ASSOCIATES, 1 PAYAL APARTMENTS, 1098/15, MODEL COLONY, PUNE 411 016 PAN : AAAFH7376N APPELLANT RESPONDENT / ORDER PER R.S.SYAL, VP : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A)-3, PUNE, DATED 25-01-2017 IN RELATION TO THE ASSESSMENT YEAR 2012-13. 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST THE DELETION O F ADDITION OF RS.2.25 CRORE MADE BY THE ASSESSING OFFICER (AO) U/S. 68 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER ALSO CALLED `TH E ACT). ASSESSEE BY SHRI C .V. DESHPANDE REVENUE BY SHRI S.P. WALIMBE DATE OF HEARING 04-08-2020 DATE OF PRONOUNCEMENT 04-08-2020 ITA NO.1557/PUN/2017 M/S. H.B. AND ASSOCIATES 2 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSE E IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF DEVELOPMENT OF IMMOVABLE PROPERTIES. A SUM OF RS.51.02 CRORE WAS SHO WN AS UNSECURED LOANS IN ITS BALANCE SHEET. THE AO REQUIRED THE ASSESSEE TO SUBMIT CONFIRMATION FROM THE CREDITORS. THE ASSESSEE SUB MITTED THE CONFIRMATIONS IN RESPECT OF ALL THE UNSECURED LOANS EXCEP T THE TWO PERSONS, NAMELY, SHRI AMITKUMAR KHEMCHANDBHAI PATEL RS.1.15 CRORE AND MRS. SONALBAHEN AMITKUMAR PATEL RS. 1.10 CRORE. THE ASSESSEE, BY SUBMITTING THEIR COMPLETE ADDRESSES, REQUESTED THE AO TO GET CONFIRMATIONS DIRECTLY FR OM THEM. THE AO ISSUED LETTERS TO BOTH THE PERSONS REQUIRING THEM TO SUBMIT WHETHER THEY HAD GIVEN ADVANCES TO THE ASSESSEE FIRM ALONG WITH OTHER NECESSARY DETAILS. BOTH THE PERSONS RESPONDED V IDE LETTER DATED 11-03-2015 STATING THAT THEY HAD NOT ADVANCED ANY LOAN TO THE ASSESSEE FIRM BUT HAVE, IN FACT, BOOKED FLAT NO.C2 A T FINAL PLOT NO.411, SL.NO.707-A, MUKUNDNAGAR, GULTEKDI, PUNE AND ALSO FURNISHED ACKNOWLEDGEMENT OF RECEIPT OF PAYMENT OF RS.1. 15 CRORE AND RS.1.10 CRORE RESPECTIVELY. ON BEING CALLED UPON TO E XPLAIN VARIATION IN THE SUBMISSION MADE BY THESE TWO PERSONS VIS--VIS THE ASSESSEE, IT WAS EXPLAINED THAT AS PER THE ORAL AGREEMENT W ITH THESE ITA NO.1557/PUN/2017 M/S. H.B. AND ASSOCIATES 3 TWO PERSONS, THE MONEY WAS TO BE KEPT AS DEPOSIT WITH THE A SSESSEE FOR A FEW MONTHS AND THEN THE SAME WAS TO BE TRANSFERRE D AS BOOKING ADVANCE TO M/S. H.B. K.J. & ADVANCE, A PARTN ERSHIP FIRM, IN WHICH ONE OF THE PARTNERS OF THE ASSESSEE FIRM WA S A PARTNER, THAT WAS TO CONSTRUCT THE CONCERNED FLAT. IT WAS IN PURSUANCE OF SUCH AN UNDERSTANDING THAT BOTH THE PERSON S ISSUED CHEQUES IN FAVOUR OF THE ASSESSEE. THE AO DID NOT ACCE PT THE STAND OF THE ASSESSEE AND MADE THE ADDITION OF RS.2.25 CRORE. THE LD. CIT(A) DELETED THE ADDITION, AGAINST WHICH THE REVENUE HAS C OME UP IN APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS THROUGH VIRTUAL COUR T AND GONE THROUGH THE RELEVANT MATERIAL ON RECORD. ADMI TTEDLY, THE AMOUNTS OF RS.1.15 CRORE AND RS.1.10 CRORE WERE RECE IVED BY THE ASSESSEE FROM SHRI AMITKUMAR KHEMCHANDBHAI PATEL AND MRS. SONALBAHEN AMITKUMAR PATEL RESPECTIVELY, WHICH WERE DEPOSITED IN THE ASSESSEES BANK ACCOUNT. A COPY OF THE ASSESSEE S BANK STATEMENT IS AVAILABLE AT PAGE 9 ONWARDS OF THE PAPER BOOK, WHICH PRIMARILY INDICATES THE RECEIPT OF MONEY FROM THESE PERSONS . THIS SHOWS THAT IT WAS THE ASSESSEE WHO RECEIVED THESE CHEQUES FROM SHRI AMITKUMAR KHEMCHANDBHAI PATEL AND MRS. SONALBAHEN ITA NO.1557/PUN/2017 M/S. H.B. AND ASSOCIATES 4 AMITKUMAR PATEL AND DEPOSITED THE SAME IN ITS BANK ACCOUNT. BECAUSE OF SOME ORAL UNDERSTANDING WITH THESE TWO PERSONS, THE AMOUNT WAS FIRST RECEIVED AS ADVANCE BY THE ASSESSEE FIRM WHICH WAS LATER ON TRANSFERRED TO M/S.H.B. K.J. & ADVANCE, A NOTHER PARTNERSHIP FIRM, IN WHICH ONE OF THE PARTNERS OF THE ASSE SSEE WAS ALSO A PARTNER. PAGES 7 & 8 OF THE PAPER BOOK ARE COP Y OF ACCOUNTS OF SHRI AMITKUMAR KHEMCHANDBHAI PATEL AND MRS. SONALBAHEN AMITKUMAR PATEL IN THE BOOKS OF THE ASSESSEE, IN WHICH THE AMOUNTS HAVE BEEN CREDITED WITH THE CORRESPONDING DEBIT TO THE BANK ACCOUNT. PAGE 6 IS AN EXTRACT FROM BOOKS OF ACCOU NT OF M/S.H.B. - K.J. & ADVANCE, WHICH SHOWS CREDIT IN THE NAME OF THESE PARTIES. WHEN WE FURTHER EXAMINE THE DATES OF RECEIP T BY THE ASSESSEE FIRM AND TRANSFER OF THE AMOUNT BY WAY OF ADJUS TMENT ENTRY TO H.B. - K.J. & ADVANCE ACCOUNT, IT BECOMES MAN IFESTLY EVIDENT THAT THE AMOUNTS RECEIVED BY THE ASSESSEE FIRM IN TH E LAST QUARTER OF THE YEAR ENDING 31-03-2012 WERE TRANSFERRED IN THE THIRD QUARTER TO H.B. - K.J. & ADVANCE OF THE NEXT YEAR. IN VIEW OF THE FACT THAT BOTH THE PERSONS DID ADMIT TO HAVE GIVEN THE AMOU NTS OF RS.2.25 CRORE THROUGH BANKING CHANNEL, WHICH WERE SUB SEQUENTLY ADJUSTED AGAINST THE BOOKING OF FLAT, THERE REMAINS NO DOUB T ABOUT ITA NO.1557/PUN/2017 M/S. H.B. AND ASSOCIATES 5 THE GENUINENESS OF THE TRANSACTIONS APPEARING IN THE BOOKS O F THE ASSESSEE. IT IS NOT A CASE THAT THE SAID AMOUNT OF RS.2.25 CRORE WAS FIRSTLY RECORDED BY M/S.H.B. - K.J. & ADVANCE IN ITS BOOK S OF ACCOUNT AND WAS SIMULTANEOUSLY REFLECTED BY THE ASSESSEE ALSO IN ITS BOOKS OF ACCOUNT. SINCE THE CHEQUES WERE ISSUED IN THE NAME OF THE ASSESSEE, THESE COULD HAVE ONLY BEEN DEPOSITED IN THE ASSESSEES BANK ACCOUNT, WHICH LED TO THE GENERATION OF CREDIT IN THE NAMES OF SHRI AMITKUMAR KHEMCHANDBHAI PATEL AND MRS. SONALBAHEN AMITKUMAR PATEL IN THE BOOKS OF THE ASSESSEE. WE , THEREFORE, AFFIRM THE ORDER OF LD. CIT(A) ON THIS SCORE. 5. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 04 TH AUGUST, 2020. SD/- SD/- (S.S. VISWANETHRA RAVI) (R.S.SY AL) JUDICIAL MEMBER VIC E PRESIDENT PUNE; DATED : 04 TH AUGUST, 2020 SATISH ITA NO.1557/PUN/2017 M/S. H.B. AND ASSOCIATES 6 / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT; 2. / THE RESPONDENT; 3. THE CIT-3, PUNE 4. 5. THE PR.CIT-2, PUNE , , / DR A, ITAT, PUNE 6. / GUARD FILE / BY ORDER, // TRUE COPY // SENIOR PRIVATE SECRETARY , / ITAT, PUNE DATE 1. DRAFT DICTATED ON 04-08-2020 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 04-08-2020 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. DATE OF UPLOADING ORDER SR.PS 8. FILE SENT TO THE BENCH CLERK SR.PS 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK 10. DATE ON WHICH FILE GOES TO THE A.R. 11. DATE OF DISPATCH OF ORDER. *