ITO, New Delhi V. M/s. Scorpio Biotechnology Pvt. Ltd., New Delhi

ITA 2091/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86885 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 7 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 03-03-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 11-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B R R KUMAR
• Keywords: Additional evidence; Onus to prove
• Section: 133(6); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH G GG G : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G.D. AGRAWAL BEFORE SHRI G.D. AGRAWAL BEFORE SHRI G.D. AGRAWAL BEFORE SHRI G.D. AGRAWAL, VICE , VICE , VICE , VICE PRESIDENT AND PRESIDENT AND PRESIDENT AND PRESIDENT AND SHRI SHRI SHRI SHRI GEORGE GEORGE K, JUDICIAL GEORGE GEORGE K, JUDICIAL GEORGE GEORGE K, JUDICIAL GEORGE GEORGE K, JUDICIAL MEMBER MEMBER MEMBER MEMBER ITA NO ITA NO ITA NO ITA NO. .. .2091/DEL/2013 2091/DEL/2013 2091/DEL/2013 2091/DEL/2013 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2006 2006 2006 2006- -- -07 0707 07 INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -7(4), 7(4), 7(4), 7(4), ROOM NO.305, C.R. BUILD ROOM NO.305, C.R. BUILD ROOM NO.305, C.R. BUILD ROOM NO.305, C.R. BUILDING, ING, ING, ING, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. VS. VS. VS. VS. M/S SCORPIO BIOTECHNOLOGY PVT.LTD., M/S SCORPIO BIOTECHNOLOGY PVT.LTD., M/S SCORPIO BIOTECHNOLOGY PVT.LTD., M/S SCORPIO BIOTECHNOLOGY PVT.LTD., A AA A- -- -86, PANDAV NAGAR, 86, PANDAV NAGAR, 86, PANDAV NAGAR, 86, PANDAV NAGAR, PATPARGANJ, PATPARGANJ, PATPARGANJ, PATPARGANJ, DELHI DELHI DELHI DELHI 110 092. 110 092. 110 092. 110 092. PAN : AAJCS5596H. PAN : AAJCS5596H. PAN : AAJCS5596H. PAN : AAJCS5596H. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI B.R.R. KUMAR, SR.DR. RESPONDENT BY : SHRI MANOJ KUMAR, CA. DATE OF HEARING : 03.03.2015 03.03.2015 03.03.2015 03.03.2015 DATE OF PRONOUNCEMENT : 04.03.2015 04.03.2015 04.03.2015 04.03.2015 ORDER ORDER ORDER ORDER PER GEORGE GEORGE K, JM PER GEORGE GEORGE K, JM PER GEORGE GEORGE K, JM PER GEORGE GEORGE K, JM : :: : THIS APPEAL AT THE INSTANCE OF THE REVENUE IS DIRE CTED AGAINST THE ORDER OF LEARNED CIT(A)-X, NEW DELHI DATED 25 TH FEBRUARY, 2013. THE RELEVANT ASSESSMENT YEAR IS 2006-07. 2. THE SOLITARY ISSUE THAT IS RAISED IS WHETHER THE CIT(A) IS JUSTIFIED IN DELETING THE ADDITION OF `1,33,50,000/- MADE BY THE ASSESSING OFFICER UNDER SECTION 68 OF THE INCOME-TAX ACT, 196 1, ON ACCOUNT OF UNEXPLAINED SHARE APPLICATION MONEY. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE AS FOL LOWS. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT UNDER SECTION 143( 3) OF THE ACT BY ORDER DATED 22 ND DECEMBER, 2008. IN THE SAID ASSESSMENT, ADDITION WAS MADE UNDER SECTION 68 OF THE ACT AMOUNTING TO ` 1,33,50,000/-. ITA-2091/DEL/2013 2 THE ASSESSING OFFICER WAS OF THE VIEW THAT ASSESSEE HAD FAILED TO DISCHARGE ITS ONUS TO PROVE THE GENUINENESS AND CRE DITWORTHINESS OF THE FOLLOWING PERSONS WHO HAD CLAIMED TO HAVE MADE INVESTMENT IN SHARE APPLICATION MONEY OF THE ASSESSEE COMPANY :- (I) MANISH GRANITE LTD. `25,00,000/- (II) MANISHA IMPEX LTD. `25,00,000/- (III) SHRI KRISHNA TRADING CO. `25,50,000/- (IV) M/S A.K. ENTERPRISE `41,00,000/- (V) KUMAWAT TRADING CO. `17,00,000/- ----------------- `1,33,50,000/- ----------------- 4. AGGRIEVED BY THE ASSESSMENT, ASSESSEE PREFERRED AN APPEAL TO THE CIT(A). THE CIT(A) ADMITTED THE ADDITIONAL EVI DENCE WITH REFERENCE TO THE INVESTMENT IN SHARES OF THE ASSESSEE COMPANY BY THE ABOVE MENTIONED FIVE ENTITIES. THE CIT(A) CALLED FOR THE REMAND REPORT FROM THE ASSESSING OFFICER AND THE REJOINDER ON THE SAME . AFTER EXAMINING THE ADDITIONAL EVIDENCE, THE REMAND REPORT AND THE REJOINDER, THE CIT(A) DELETED THE ADDITION MADE BY THE ASSESSING O FFICER UNDER SECTION 68 OF THE ACT. 5. THE REVENUE, BEING AGGRIEVED, IS IN APPEAL BEFOR E US. 6. LEARNED DR RELIED ON THE ORDER OF THE ASSESSING OFFICER. ON THE OTHER HAND, LEARNED AR REITERATED THE SUBMISSIONS M ADE BEFORE THE INCOME TAX AUTHORITIES AND RELIED ON THE FINDINGS/C ONCLUSIONS OF THE CIT(A). 7. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE CIT(A), AFTER EXAMINING THE REMAND REP ORT OF THE ITA-2091/DEL/2013 3 ASSESSING OFFICER, HAD DELETED THE ADDITION. THE R ELEVANT FINDING OF THE CIT(A) READS AS FOLLOWS :- (C) ON GOING THROUGH THE FACTS OF THE CASE IT IS OBSERVED THAT IN THIS CASE THE ASSESSING OFFICER HA D ALREADY ACCEPTED THE GENUINENESS OF THE SHARE APPLICATION MONEY IN THE CASE OF 8 OTHER PARTIES AN D IN THE CASE OF THESE 5 PARTIES THE ADDITIONS HAVE BEEN MADE DUE TO INADEQUATE DOCUMENTS HAVING BEEN SUBMITTED. THE A.R. STRONGLY ARGUED THAT THESE WER E TRANSACTIONS WITH ALL DOCUMENTS AVAILABLE AND ALL T HE PARTIES ARE WILLING TO CONFIRM THE TRANSACTION. SI NCE THE ASSESSING OFFICER HAS SATISFIED HIMSELF AFTER MAKIN G ENQUIRIES, THERE WAS NO CASE TO ARGUE THAT THESE AMOUNTS SHOULD BE ADDED U/S 68 OF THE I.T. ACT. (D) IN THE BACKGROUND OF THE REMAND REPORT SUBMITTE D BY THE ASSESSING OFFICER AFTER ISSUING NOTICES U/S 133(6) OF THE I.T. ACT TO ALL THE 5 PARTIES AND THE CONFIR MATIONS ALONGWITH THE DETAILS OF BANK ACCOUNTS, PAN, DETAIL S OF SHARE ALLOTMENTS ETC., IT APPEARS THAT THE ASSESSIN G OFFICER DOES NOT HAVE ANY GROUND TO NOW SUPPORT THI S ADDITION AS NONE OF THE DOCUMENTS PROVIDED BY THE PARTIES HAVE BEEN DISPUTED. (E) IN THIS REGARD IT IS IMPORTANT TO NOTE THAT THE A.O. HAS NOT MADE OUT ANY CASE OR ANYWHERE GIVEN A FINDI NG THAT THESE PARTIES FROM WHOM THE AMOUNTS HAD BEEN TAKEN WERE NOT GENUINE OR THAT THEY WERE ANYWHERE RELATED TO ANY GROUP OF ENTRY OPERATORS. MOREOVER, IT IS IMPORTANT TO NOTE THAT THE 5 PARTIES HAD ALSO MENTI ONED IN THEIR LETTERS BEFORE THE ASSESSING OFFICER THAT THEY WERE READY TO GIVE PERSONAL DEPOSITION AND CONFIRM THESE TRANSACTIONS. HOWEVER, THE ASSESSING OFFICER HAS NOT FOUND ANY REASON TO FURTHER INVESTIGATE OR DOUB T THESE DOCUMENTS FILED BY THE A.R. OF THE APPELLANT DURING THE REMAND PROCEEDINGS. (F) KEEPING IN VIEW THE VARIOUS JUDICIAL PRONOUNCEMENTS OF CIT V. LOVELY EXPORTS P.LTD. [200 8] 299 ITR 0268, CIT V. SHIPRA RETAILERS P.LTD. (SC) D T. 21- 01-2008, CIT V. DIVINE LEASING FINANCE LTD. [2008] 299 ITR 0268, CIT V. DWARIKADISH INVESTMENT P.LTD. (DEL)(2008) 167 TAXMAN 321 AND OTHERS, IT IS CLEAR THAT IN THIS CASE THE ASSESSING OFFICER HAS NOT ESTABLIS HED ITA-2091/DEL/2013 4 ANY FINDING TO SHOW THAT THIS SHARE APPLICATION MON EY WAS NOT GENUINE. DURING THE REMAND PROCEEDINGS, TH E ASSESSING OFFICER WAS PROVIDED THE VARIOUS SUPPORTI NG DOCUMENTS AND THE VARIOUS PARTIES HAVE ALSO CONFIRM ED THE TRANSACTION, WHICH HAS NOT BEEN DOUBTED BY THE ASSESSING OFFICER. ACCORDINGLY, THE ASSESSING OFFI CER HAS NOT MADE ANY CASE FOR UPHOLDING THIS ADDITION. 8. THE ASSESSING OFFICER IN THE REMAND REPORT HAS N OT DOUBTED THE INVESTMENT OF SHARE APPLICATION MONEY IN ASSESSEE C OMPANY BY THE ABOVE SAID FIVE ENTITIES. THE CIT(A), BASED ON THE REMAND REPORT, HAS DELETED THE ADDITION. THEREFORE, WE SEE NO REASON TO INTERFERE WITH THE ORDER OF LEARNED CIT(A) AND UPHOLD THE SAME AS CORR ECT AND IN ACCORDANCE WITH LAW. IT IS ORDERED ACCORDINGLY. 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 4 TH MARCH, 2015. SD/- SD/- ( (( (G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL) )) ) (GEORGE GEORGE K (GEORGE GEORGE K (GEORGE GEORGE K (GEORGE GEORGE K) )) ) VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER VK. COPY FORWARDED TO: - 1. APPELLANT : INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, WARD WARD WARD WARD- -- -7(4), ROOM NO.305, C.R. BUILD 7(4), ROOM NO.305, C.R. BUILD 7(4), ROOM NO.305, C.R. BUILD 7(4), ROOM NO.305, C.R. BUILDING, ING, ING, ING, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. 2. RESPONDENT : M/S SCORPIO BIOTECHNOLOGY PVT.LTD., M/S SCORPIO BIOTECHNOLOGY PVT.LTD., M/S SCORPIO BIOTECHNOLOGY PVT.LTD., M/S SCORPIO BIOTECHNOLOGY PVT.LTD., A AA A- -- -86, PANDAV NAGAR, PATPARGANJ, 86, PANDAV NAGAR, PATPARGANJ, 86, PANDAV NAGAR, PATPARGANJ, 86, PANDAV NAGAR, PATPARGANJ, DELHI DELHI DELHI DELHI 110 092. 110 092. 110 092. 110 092. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR