ACIT, Circle - 34, Kolkata , Kolkata V. Shri Amarjit Banthia , Kolkata

ITA 1712/KOL/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 8103 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 13-08-2020
• Assessment Year: 2015-2016
• Appeal Filed On: 10-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3); 133(6); 201; 13

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH VIRTUAL C KOLKATA BEFORE SHRI J.SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI S.S.GODARA, JUDICIAL MEMBER ITA NO.1712/KOL/2018 ASSESSMENT YEAR: 2015-16 ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-34, AAYAKAR BHAWAN, P:OORVA, 7 TH FLOOR, 110, SHANTIPALLY, KOLKATA-700 001 / V/S . SHRI AMARJIT BANTHIA 23A, N.S. ROAD, 2 ND FLOOR, ROOM NO.-8, KOLKATA-700 001 [ PAN NO.ADKPB 5333 L ] /APPELLANT .. /RESPONDENT /BY APPELLANT SMT. RANU BISWAS, ADDL. CIT-DR /BY RESPONDENT SHRI S.M.SURANA, ADVOCATE /DATE OF HEARING 13-08-2020 /DATE OF PRONOUNCEMENT 19-08-2020 /O R D E R PER S.S.GODARA, JUDICIAL MEMBER:- THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2015-16 ARISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-10, KOLKATAS ORDER DATED 22.05.2018 PASSED IN CASE NO.889/CIT(A)-10/CIR 34/15-16/2017-18/KOL., INVOLVING PROCEEDINGS 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE(S) PERUSED. 2. THE REVENUES SOLE SUBSTANTIVE GRIEVANCE RAISED IN THE INSTANTS APPEAL SEEKS TO REVERSE CIT(A)S ACTION DELETING THE UNEXPLAINED CA SH CREDIT ADDITION OF 1,78,89,906/- MADE IN THE COURSE OF REGULAR ASSESSM ENT FRAMED ON 22.12.2017. ITA NO.1712/KOL/2018 ASSESSMENT YEAR 2015-16 AC T, CIR-34, KOL. VS. SH. AMARJIT BANTHIA PAGE 2 LEARNED DEPARTMENTAL REPRESENTATIVE INVITED OUR ATT ENTION TO ASSESSMENT FINDINGS HOLDING THE ASSESSEES SIX CREDITORS NAMELY M/S SWI TO FINANCE AND ESTATES PVT. LTD., M/S CASTLE COMMODITIES PVT. LTD., M/S MAHAVIR FINAN CE PVT LTD., M/S SHARP INVESTMENTS LTD, M/S RGF CAPITAL MARKETS LTD. AND M /S JAHANGIRABAD FINANCE CO PVT. LTD. AS MERE JAMA-KHARCHI PROVIDING ENTITIES ONLY. 3. WE SEE NO REASON TO EXPRESS OUR AGREEMENT WITH T HE REVENUES FOREGOING CONTENTION. THE FACT REMAINS THAT THE ASSESSEES FO RMER FIVE ENTITIES / NBFC FORMED THE SUBJECT-MATTER OF IDENTICAL ADDITION MADE IN RE SPECT TO THE PRECEDING ASSESSMENT YEAR 2014-15 AS WELL. THIS TRIBUNALS CO-ORDINATE B ENCHS DECISION IN ITA NO.780/KOL/2018 DECIDED ON 15.01.2020 HAS DELETED THE SAID IDENTIC AL ADDITION AS UNDER:- 3. HEARD RIVAL CONTENTIONS. THE SOLE GROUND RAISED BY THE AS UNDER :- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) ERRED DELETING THE DISALLOWANCE OF SUNDRY UNSECURED LOANS TO THE TUNE OF RS.3,59,01,331/- (INCLUDING INTEREST OF RS.8,01,331 / SINCE THE THREE GOLDEN RULES OF IDENTITY, CREDITWORTHINESS OF CREDI TORS AND GENUINENESS OF TRANSACTIONS HAVE ALL FAILED DURING THE ASSESSMENT STAGE. 4. WE FIND THAT THE LD. CIT(A) HAS AT PARA 10 TO 13 OF HIS ORDER, HELD AS FOLLOWS : 10 . I HAVE CAREFULLY GONE THROUGH THE LD. A.O.'S ORDE R AND SUBMISSION OF THE APPELLANT DURING THE COURSE OF ASSESSMENT PR OCEEDINGS AS WELL DURING APPELLATE PROCEEDINGS. IT IS SEEN THAT ALL T HE LENDERS ARE REGISTERED NBFC COMPANIES PERMITTED BY THE RESERVE LENDING AND INVESTMENT. ALL THESE COMPANIES HAVE BEEN REGULAR I N FILING THEIR RETURNS WITH INCOME TAX AS WELL AS ROC AUTHORITIES AND THE SAME HAVE BEEN ACCEPTED BY THEIR RESPECTIVE A.O. NOWHERE DID I FIN D ANY RE RETURNS HAVE BEEN REJECTED OR CHALLENGED BY THE DEPARTMENT. ALSO , I FIND THAT THE LD AO HAS NOT MADE ANY REFERENCE TO THE ASSESSING AUTH ORITIES OF THESE 5 COMPANIES FROM WHOM THE APPELLANT HAS TAKEN LOANS, AND ASCERTAINED THE STATUS FROM THOSE ASSESSING OFFICERS. IN THE FACTUA L MATRIX WHICH EMERGES, IT IS SEEN THAT THE ASSESSEE HAS DISCHARGE D ITS PRIMARY ONUS BY FILING THE DETAILS RELATING TO THE LOAN CREDITORS, AND THEREAFTER THE ONUS HAS SHIFTED TO THE LD. AO. IT IS ALSO SEEN THAT SOM E COMPANIES HAVE APPEARED BEFORE THE LD AO AND HAVE ADMITTED TO HAVI NG GIVEN THE LOANS. THE LD. AO HAS IGNORED THESE EVIDENCES WHICH FAVOUR THE APPELLANT. IN FACT IT IS OBSERVED THAT THE LD AO HAS RELIED UPON CERTA JIVENDRA MISHRA AND GOPAL MAITY BEFORE OFFICERS OF THE INVESTIGATIO N WING, AND HAS NOT ITA NO.1712/KOL/2018 ASSESSMENT YEAR 2015-16 AC T, CIR-34, KOL. VS. SH. AMARJIT BANTHIA PAGE 3 CONFRONTED THE ASSESSEE WITH SUCH ADVERSE MATERIAL, AND THIS ALONE RENDERS THE ORDER OF THE LD AO WEAK IN LAW. RELIANC E IS PLACED ON HON'BLE SUPREME COURT'S JUDGMENT IN THE CASE OF CIT VS. ORISSA CORPORATION (P) LTD. (1986) 159 ITR 78 (SC) FOR THE PROPOSITION THAT IF THE ISSUED SUMMONS U/S 133(6) IT IS HIS DUTY TO BRI NG THE PROCESS TO A LOGICAL CONCLUSION AND NON-RESPONSE BY SUCH ASSESSE E. THE JUDGMENT IS SQUARELY APPLICABLE TO THE CASE OF THE ASSESSEE. 11 . THE ADDITIONS IN CASES OF SWITO FINANCE AND ESTAT ES PVT LTD., CASTLE COMMODITIES PVT. LTD. AND MAHAVIR FINANCE PVT. LTD. HAS BEEN MADE RELYING THE STATEMENT OF THE PERSON MR. JIVENDRA MI SHRA WHO IS NEITHER THE DIRECTOR OR EMPLOYEE IN THE COMPANY. AS SUCH TH ERE IS NO EVIDENTIARY VALUE OF SUCH STATEMENT. IT IS ALSO SEEN THAT THE A PPELLANT ADDUCED AMPLE EVIDENCES IN SUPPORT OF THE IDENTITY AND TRANSACTIO NS AND NO DISCREPANCY WHATSOEVER HAS BEEN FOUND. BESIDES, IN CASES WHERE THE DIRECTORS OF THE LENDERS APPEARED HAVE ADMITTED TO HAVE GIVEN LOANS TO THE APPELLANT. THE NATURE OF RECEIPT IN EARLIER NUMBER OF STAFF IS IRR ELEVANT AS THE SAME IS THE INTERNAL MATTER OF THE LENDER COMPANY WITH WHICH AS SESSEE IS NOT CONCERNED. IN ANY CASE, THE APPELLANT HAS SATISFACT ORILY EXPLAINED THE SOURCE OF RECEIPTS. IT IS ALSO PERTINENT THAT THE A PPELLANT HAS FILED RETURNED INCOMES OF RS.45,21,990/- FOR THE AY 2013-14, RS.7 1,05,970/- FOR THIS SUBJECT A.Y 2014-15, RS.83,70,930/- FOR THE A.Y 201 5-16 AND RS.5,57,90,660/- FOR THE A.Y 2016-17. THESE DO NOT HAVE, IN MY CONSIDERED OPINION ANY DIRECT LINK WITH THE MATTERS AT HAND, BUT THEY DO SUGGEST THAT THE ASSESSEE IS A COMPLIANCE TAXPAYER IN A LARGER PICTURE. 12. UNDER THE FACTS AND CIRCUMSTANCES, I AM OF THE CO NSIDERED VIEW THAT THE ADDITION IS MERELY BASED ON SURMISES AND CONJEC TURES AND ON MATERIAL NOT RELEVANT FOR THE CASE OF THE APPELLANT-TAXPAYER . THEREFORE I FIND THAT THE ADDITIONS MADE BY THE LD AO ARE NOT SUSTAINABL E ON THE FACTS OF THE CASE, AND THE LAW APPLICABLE. THE SAME ARE THEREFOR E DELETED, AND THE GROUND ALLOWED IN FAVOUR OF THE ASSESSEE. 13. REGARDING DISALLOWANCE OF INTEREST ON LOAN, THE SA ME BEING CONSEQUENTIAL IN NATURE TO THE LOAN, ALSO REMAIN UN SUSTAINABLE, AND AS A COROLLARY ARE DELETED. AS A RESULT GROUNDS NO. 2-5 STAND ALLOWED . 5. THE CREDITS IN QUESTION ARE LOANS OBTAINED BY TH E ASSESSEE FROM NBFCS WHICH ARE REGISTERED WITH RESERVE BANK OF INDIA. ON A QUERY FROM THE BENCH, THE LD. COUNSEL FOR THE ASSESSEE, SUBMITTED THAT, T HE LOANS HAVE BEEN REPAID TO THESE NBFCS IN THE SUBSEQUENT YEARS. UNDER THESE CI RCUMSTANCES, WE FIND NO INFIRMITY IN THE OR INFIRMITY IN THE ORDER OF THE L D. CIT(A) AND UPHOLD THE SAME AND DISMISS THIS APPEAL OF THE REVENUE. ITA NO.1712/KOL/2018 ASSESSMENT YEAR 2015-16 AC T, CIR-34, KOL. VS. SH. AMARJIT BANTHIA PAGE 4 LEARNED DEPARTMENTAL REPRESENTATIVE IS FAIR ENOUGH IN NOT PIN-POINTING ANY DISTINCTION ON FACTS IN THE REVENUES SUBSTANTIVE GROUNDS RAISE D IN THE INSTANT APPEAL. 4. COMING TO THE SIXTH ENTITY M/S JAHANGIRABAD FINA NCE CO PVT. LTD., ITS EMERGES THAT THIS IS ALSO AN NBFC HAVING REGULAR LOAN TRANS ACTIONS WITH THE ASSESSEE IN LIEU OF CHARGING INTEREST. WE THUS ADOPT THE VERY FOREGOING REASONING MUTATIS MUTANDIS TO AFFIRM THE CIT(A)S ACTION IN CASE OF THIS LAST ENT ITY AS WELL. 5. THIS REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 19/08/2020 SD/- SD/- ( ') () ') (J.SUDHAKAR REDDY) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER *DKP-SR.PS * - 19/08/2020 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-ACIT, CIR-234, AYAKAR BHAWAN POORVA, 7 TH FLOOR, 110, SHANTIPALLY, K OLKATA-107 2. /RESPONDENT-SHRI AMARJIT BANTHIA, 23A, N.S.ROAD,2 ND FLOOR, ROOM NO.8 KOLKATA-001 3. - . / CONCERNED CIT 4. . - / CIT (A) 5. / ))- , - /DR, ITAT, KOLKATA 6. 3 / GUARD FILE. BY ORD ER/ , /TRUE COPY/ -,