D.C.I.T Cir - VI, Kolkata, Kolkata V. M/s Maithan Alloys Ltd., Kolkata

ITA 1872/KOL/2012

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7870 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 11 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2014
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 19-12-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

I.T.A. N O . 1872 /KOL./201 2 ASSESSMENT YEAR: 200 9 - 20 10 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA C BENCH, KOLKATA BEFORE SHRI SHAMIM YAHYA (ACCOUNTANT MEMBER) , AND SHRI GEORGE MATHAN (JUDICIAL MEMBER) I.T.A. NO. 1872 /KOL . / 20 1 2 ASSESSMENT YEAR : 200 9 - 20 10 DEPUTY COMMISSIONER OF INCOME TAX, ...... ...... .. .APP ELL ANT CENTRAL CIRCLE - VI, KOLKATA, AAYAKAR BHAWAN POORVA, E.M. BYE PASS, 110, SHANTI PALLY, KOLKATA - 700 107 - VS. - M/S. MAITHAN ALLOYS LIMITED, ......... ................ . RESPONDENT 9, A.J.C. BOSE ROAD, ID E AL PLAZA, KOLKATA - 700 020 [ PAN : AA BCM 7758 B ] APPEARANCES BY: SHRI UDAY KUMAR SARDAR , JOINT CIT, SR. D.R., FOR THE DEPARTMENT SHRI SANJAY KUMAR KEJRIWAL, F.C.A , FOR THE ASSESSEE DATE OF CONCLUDING THE HEARING : DEC EM BER 1 5 , 2 01 4 DATE OF PRONOUNCING THE ORDER : DEC EM BER 18 , 201 4 O R D E R PER GEORGE MATHAN : THIS IS AN APPEAL FILED BY THE REVENU E AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS) , CENTRAL - I , KOLKATA IN APPEAL NO. 155 / CIT( A ) - C - I/CC - VI/KOL/11 - 12 DATED 03 . 1 0 .201 2 FOR TH E ASSESSMENT YEAR 200 9 - 10 . I.T.A. N O . 1872 /KOL./201 2 ASSESSMENT YEAR: 200 9 - 20 10 PAGE 2 OF 4 2 . SHRI UDAY KUMAR SARDAR , JOINT CIT, SR. D.R., REPRESENTED ON BEHALF OF THE REVENUE AND SHRI SANJAY KUMAR KEJRIWAL, F.C.A. , REPRESENTED ON BEHALF OF THE ASSESSEE . 3. AT THE TIME OF HEARING, IT WAS SUBMITTED BY THE LD. SR. D.R. THAT THE ONLY ISSUE IN THE REVENUE S APPEAL WAS AGAINST THE ACTION OF THE LD. CIT(APPEALS) IN DELETING THE ADDITION OF RS.45,00,000/ - MADE BY THE ASSESSING OFFICER IN RESPECT OF THE SUNDRY CREDITORS. IT WAS THE SUBMISSION THAT IN THE COURSE OF ASSESSMENT, IT WAS NOTICED THAT THE ASSESSEE HAD TAKEN LOAN OF RS.1,98,00,000/ - FROM M/S. GRADE MERCHANDISE (PVT.) LIMITED. ON BEING QUESTIONED IT WAS INFORMED THAT THE AMOUNT REPRESENTED TWO CHEQUES OF RS.25,00,000/ - EACH FROM THE BANK ACCOUNT OF M/S. IMTIHAN DISTRIBUTORS (PVT.) LTD. I T WAS THE SUBMISSION THAT THE LOAN CONFIRMATION WAS ISSUED FROM M/S. GRADE MERCHANDISE (PVT.) LTD, BUT NO EVIDENCE REGARDING THE IDENTITY AND CREDITWORTHINESS OF THE LOAN CREDITORS WERE FURNISHED AND NEITHER WAS ANY DOCUMENT FURNISHED REGARDING THE SOURCE OF THE LOAN GIVEN BY M/S. IMTIHAN DISTRIBUTORS (PVT.) LTD. THROUGH M/S. GRADE MERCHANDISE (PVT.) LTD. CONSEQUENTLY THE ASSESSING OFFICER HAD ADDED THE AMOUNT OF RS.45,00,000/ - CLAIMED TO HAVE BEEN RECEIVED FROM M/S. GRA DE MERCHANDISE ( PVT. ) LTD., AS UNEXPL AINED CASH CREDIT IN THE HANDS OF THE ASSESSEE. IT WAS THE SUBMISSION THAT THE AMOUNT OF RS.45,00,000/ - WAS LIABLE TO BE READ AS RS.50,00,000/ - . IT WAS THE SUBMISSION TH A T THE LD. CIT(APPEALS) HAD WITHOUT EXAMINE THE SOURCE OF EITHER M/S. GR ADE MERCHANDISE ( PVT. ) LTD. OR M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. DELETED THE ADDITION. IT WAS THE SUBMISSION THAT THE ORDER OF THE LD. CIT(APPEALS) WAS LIABLE TO BE REVERSED. IT WAS THE ALTERNATE SUBMISSION THAT THE ISSUE WAS LIABLE TO BE RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR DE NOVO EXAMINATION. 4 . IN REPLY, IT WAS SUBMITTED BY THE LD. A.R. THAT THE ASSESSEE HAD TAKEN RS.1.98 CRORES AS LOAN AND ON BEHALF OF M/S. GRA DE MERCHANDISE ( PVT. ) LTD. RS.50 LAKHS HAD BEEN GIVEN BY M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. IT WAS I.T.A. N O . 1872 /KOL./201 2 ASSESSMENT YEAR: 200 9 - 20 10 PAGE 3 OF 4 THE SUBMISSION THAT THE BANK STATEMENTS OF M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. WERE ALSO PRODUCED BEFORE THE LD. CIT(APPEALS) AND THE ASSESSING OFFICER. T HE LD. A.R. DREW OUR ATTENTION TO PAGES 39 & 40 OF THE PAPER BOOK, WHICH WAS THE COPY OF THE CONFIRMATION OF THE LOAN GIVEN TO THE ASSESSEE BY M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. IT WAS THE SUBMISSION THAT THE ORDER OF THE LD. CIT(APPEALS) WAS LIABLE TO BE CONFIRMED. 5 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AT THE OUTSET, A PERUSAL OF THE CONFIRMATION AT PAGE 39 SHOWS THAT M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. HAVE CONFIRMED TO HAVE GIVEN RS.1,15,00,000/ - TO THE ASSESSEE. HOWEVER, BEFORE THE ASSESSING OFFICER, THE STATEMENT SEEM S TO BE THAT THE ASSESSEE HAS RECEIVED ONLY RS.50,00,000/ - FROM M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. A PERUSAL OF THE ANNUAL REPORT S OF BOTH M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. AND M/S. GRA DE MERCHANDISE ( PVT. ) LTD. SHOWS THAT THE AUDITORS ARE THE SAME FOR BOTH THE COMPANIES. THE DIRECTORS ARE THE SAME AND EVEN THE ADDRESS IS SAME. BOTH M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. AND M/S. GRA DE MERCHANDISE ( PVT. ) LTD. SURPRISINGLY ARE THE COMPANIES , WHICH HAVE NO FIXED ASSETS. THE BANK STATEMENT S OF M/S. GRA DE MERCHANDISE ( PVT. ) LTD. AND M/S. IMTIHAN DISTRIBUTORS ( PVT . ) LTD. SHOW THAT ONLY THE TRANSACTIONS FOR PART OF THE MONTH OF OCTOBER AND PART OF THE MONTH OF NOVEMBER HAD BEEN GIVEN. INTERESTINGLY THE ACCOUNT NUMBERS OF M/S. IMTIHAN DISTRIBUTORS ( PVT. ) LTD. AND M/S. GRA DE MERCHANDISE ( PVT. ) LTD. IN STATE BANK OF HY DERABAD, IS ALSO SEQUENTIAL. ADMITTEDLY THE CREDITWORTHINESS OF THE TWO C OMPANIES HAS BEEN CORRECTLY QUESTIONED BY THE ASSESSING OFFICER. HOWEVER, THE INVESTIGATION DONE BY THE ASSESSING OFFICER IS SUBSTANTIALLY L ACKING . FURTHER A PERUSAL OF THE ORDER OF T HE LD. CIT(APPEALS) SHOWS THAT THE LD. CIT(APPEALS) HAS BLINDLY ACCEPTED THE CREDITWORTHINESS JUST BECAUSE THERE IS A COPY OF THE LOAN CONFIRMATION, INCOME TAX RETURN ACKNOWLEDGMENT AND PAN CARD WAS PRODUCED IN THE COURSE OF ASSESSMENT. PRODUCTION OF THE I TR OR THE PAN OR THE LOAN CONFIRMATION DOES NOT PROVE THE GENUINENESS OF THE I.T.A. N O . 1872 /KOL./201 2 ASSESSMENT YEAR: 200 9 - 20 10 PAGE 4 OF 4 TRANSACTIONS. THE SOURCE MUST BE EXPLAINED. IN THESE CIRCUMSTANCES, THE ISSUE OF THE LOAN TRANSACTION OF RS.1,98,00,000/ - IS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR RE - A DJUDICATION DE NOVO AFTER GRANTING THE ASSESSEE ADEQUATE OPPORTUNITY TO SUBSTANTIATE ITS CASE. 6 . IN THE RESULT, THE APPEAL OF THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH DEC EM BER, 2014. SD/ - SD/ - SHAM IM YAHYA GEORGE MATHAN ( ACCOUNTANT MEMBER) ( JUDICIAL MEMBER) KOLKATA, THE 18 TH D AY OF DEC EM B ER , 201 4 COPIES TO : (1) DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - VI, KOLKATA, AAYAKAR BHAWAN POORVA, E.M. BYE PASS, 110, SHANTI PALLY, KOLKATA - 700 107 (2) M/S. MAITHAN ALLOYS LIMITED, 9, A.J.C. BOSE ROAD, IDEAL PLAZA, KOLKATA - 700 020 (3) COMMISSIONER OF INCOME TAX (APPEALS) ( 4 ) COMMISSIONER OF INCOME TAX ( 5 ) THE DEPARTMENTAL REPRESENTATIVE ( 6 ) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.