D.C.I.T.-4(1), Agra V. Sh. Dinesh Chand Agarwal, Agra

ITA 235/AGR/2010

• Counselvise Citation: 23520314 RSA 2010
• Duration Of Justice: 1 year(s) 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 09-08-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 08-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VISHAMBHAR DAYAL
• Assessee Lawyers: SHRI
• Keywords: Unexplained cash credit; Search and seizure; Accommodation entries

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI K.G. BANSAL, ACCOUNTANT MEMBER ITA NO. 235/AGRA/2010 ASSTT. YEAR : 2002-03 D.C.I.T. 4(1), VS. SHRI DINESH CHAND AGARWAL, AGRA. C/O M/S. SURESH CHAND DINESH CHAND, RAM NAGAR COLONY, AGRA. (PAN :AANPA 2739 F) C.O. NO.59/AGRA/2010 (IN ITA NO. 235/AGRA/2010) ASSTT. YEAR : 2002-03 SHRI DINESH CHAND AGARWAL, VS. D.C.I.T. 4(1), C/O M/S. SURESH CHAND DINESH CHAND, AGRA RAM NAGAR COLONY, AGRA (APPELLANT) (RESPONDENT) FOR REVENUE : SRI VISHAMBHAR DAYAL, JR. DR FOR ASSESSEE : SHRI PANKAJ GARGH, ADVOCATE ORDER PER BENCH: THE APPEAL BY THE REVENUE AND THE CROSS OBJECTION BY ASSESSEE ARISE OUT OF THE ORDER DATED 17.03.2010 OF THE LEARNED CIT(A)-II, AGRA. DU RING THE COURSE OF HEARING, THE LEARNED AR OF THE ASSESSEE MADE A STATEMENT THAT THE ASSESSEE DOES NOT WANT TO PRESS THE CROSS OBJECTION, OVER WHICH THE LEARNED DR HAS NO OBJECTION. THEREFO RE, THE CROSS OBJECTION FILED BY THE ASSESSEE IS DISMISSED AS NOT PRESSED. 2. ADVERTING TO THE APPEAL OF THE REVENUE, THE ONLY ISSUE INVOLVED THEREIN IS WITH RESPECT TO DELETION OF ADDITION OF RS.25,00,000/- ADDED BY THE ASSESSING OFFICER TO THE TOTAL INCOME OF THE 2 ASSESSEE U/S. 68 IN THE PROCEEDINGS INITIATED U/S. 147 OF THE ACT. THE PROCEEDINGS U/S. 147 OF THE ACT WERE INITIATED ON THE BASIS OF INFORMATION RECE IVED FROM THE ADDL. DIT (INV.), AGRA THAT THE ASSESSEE HAD TAKEN ACCOMMODATION ENTRY OF RS.25,00, 000/- FROM THE ASSOCIATES OF GANGA RAM GROUP OF CASES, WHEREIN SEARCH AND SEIZURE OPERATIO N WAS CONDUCTED BY THE DEPARTMENT ON 09.05.2002 AND IN THE SEARCH CASES, IT WAS CONCLUDE D THAT GANGA AM GROUP IS ENGAGED IN PROVIDING ACCOMMODATION ENTRIES BY CHEQUES IN LIEU OF CASH MADE AVAILABLE BY VARIOUS BENEFICIARIES AND FOR THAT THEY CHARGED COMMISSION OF 1% TO 2%. THE ASSESSING OFFICER HAS ALSO GIVEN INSTANCES OF ERSTWHILE PERSONS NAMELY SHRI RA JNEESH MALHOTRA, RACHIT MASLHOTRA, HAKIKAT RAI MALHOTRA, GREEN FIELD SERVICE STATION DURING TH E F.Y. 1996-97 AND 2001-02 WHO CONFESSED TO HAVE TOOK LOAN ENTRIES IN LIEU OF CASH PROVIDED BY GANGA RAM GROUP AND SURRENDERED THE LOAN AMOUNT AS THEIR UNDISCLOSED INCOME. THE ASSESSING O FFICER, HAVING FOUND THE ASSESSEE TO BE ONE OF SUCH BENEFICIARIES, MADE AN ADDITION OF RS.25,00 ,000/- AS UNEXPLAINED CASH CREDITS U/S. 68 OF THE I.T. ACT. 3. IN APPEAL BEFORE THE LEARNED CIT(A), THE ADDITIO N SO MADE BY AO WAS DELETED BY OBSERVING AS UNDER : IN THE PRESENT CASE ALSO THERE DO NOT APPEAR ANY C ASH DEPOSITS IN THE CONCERNED BANK ACCOUNTS OF THE LENDERS PRIOR TO THE ADVANCE OF THE LOANS TO THE APPELLANT. IT IS AN ADMITTED POSITION THAT THE DEPO SITORS ARE ASSESSED TO TAX AND HAVE CONFIRMED THE ADVANCE TO THE APPELLANT. MERE R EFERENCE TO THE SEARCH IN THE CASE OF M/S. GANGA RAM AGARWAL AND COMPANY AND OTHE R ENTITIES OF THE SAID GROUP AND THE FINDING GIVEN BY THE A.O. IN THOSE CA SES ARE OF NO HELP IN THE PRESENT CASE. IT HAS NOT BEEN SHOWN THAT THE DEPOSI TORS HAVE EVER ADMITTED THAT THEY WERE ENGAGED IN THE BUSINESS OF GIVING BOGUS E NTRIES OR THAT THEY HAD GIVEN BOGUS ENTRIES TO THE APPELLANT. THIS BEING THE CASE UNLESS IT IS PROVED BY THE A.O. WITH SOME CONCRETE EVIDENCE THAT THE APPELLANTS TR ANSACTIONS OF LOAN WITH THESE LENDERS OF THE GANGA RAM AGARWAL GROUP ARE GENUINE, THE IMPUGNED DEPOSITS CANNOT BE BROUGHT TO TAX UNDER SECTION 68 OF IT ACT , 1961. CONSIDERING THE FACTS 3 AND CIRCUMSTANCES OF THE CASE THE ADDITION OF RS.25 LACS MADE BY THE A.O. IS HEREBY DELETED. 4. THE LEARNED DR RELIED ON THE ORDER OF ASSESSING OFFICER WHEREAS THE LD. AR OF THE ASSESSEE PLACED RELIANCE ON THE DECISION OF LEANED CIT(A). 5. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTI ES AND HAVE GONE THROUGH THE MATERIAL AVAILABLE ON RECORD AND WE FIND NO INFIRMITY IN THE ORDER OF THE LEARNED CIT(A). IT IS WORTHWHILE TO POINT OUT THAT SIMILAR ISSUE IN THE IDENTICAL FA CTS AND CIRCUMSTANCES HAVE BEEN DECIDED BY AGRA BENCH OF TRIBUNAL IN PLENTY OF CASES IN FAVOUR OF T HE ASSESSEE. ONE OF SUCH DECISIONS IS IN THE CASE OF ITO VS. SMT. SUDESH JAIN DATED 29.03.2011 I N ITA NO. 426/AGRA/2009, WHEREIN ITAT, AGRA BENCH HAS HELD AS UNDER : 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE CO NSIDERED THE SAME INCLUDING THE ORDERS OF THE TAX AUTHORITIES BELOW A ND THE DECISIONS CITED AT BAR. WE FIND THAT THE ISSUE INVOLVED IN APPEAL OF THE RE VENUE IS SQUARELY COVERED BY THE DECISION OF ITAT AGRA DATED 06.02.2009 IN REVEN UES APPEALS IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2002-03 AND 2003-04 ( ITA NOS. 315 AND 335/AGRA/2006), WHEREIN THE SAME DEPOSITORS OF GANG A RAM GROUP ADVANCED LOAN TO THE ASSESSEE IN THE IDENTICAL FACTS AND CIR CUMSTANCES OF THE CASE AND THE ITAT AFTER CONSIDERING SIMILAR CONTENTIONS OF BOTH THE PARTIES HELD AS UNDER : WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE HAVE ALSO PERUSED THE ORDER OF TRIBUNAL RELIED UPON BY THE LD. COUNSE L FOR THE ASSESSEE. THE ADDITION HAS BEEN MADE BY THE ASSESSING OFFICER ON THE GROUND THAT (I) GANGA RAM GROUP IS INVOLVED IN GIVING BOGUS ACCOMMO DATION ENTRIES AND (II) THE SUMMONS ISSUED TO THE CREDITORS COULD NOT BE SERVED AND HENCE, THEIR IDENTIFY IS DOUBTFUL. THE LD. CIT (A) HAD DEL ETED THE ADDITION ON THE GROUND THAT THE INITIAL BURDEN CAST UPON THE ASSESS EE HAS BEEN DISCHARGED BY SUBMITTING THE CONFIRMATION LETTERS GIVING COMPL ETE ADDRESS AND PA NUMBER AS ALSO THE COPY OF BANK ACCOUNT. WE ARE IN AGREEMENT WITH THE FINDINGS OF LD. CIT (A). THERE ARE NO BASES TO ARRI VE AT THE FINDING THAT THE AMOUNTS ADVANCED BY THE CREDITORS ARE THE MONIES PR OVIDED BY THE ASSESSEE: TO AVAIL ACCOMMODATION ENTRIES. ON THE CO NTRARY, THE CONFIRMATION LETTER ADDRESSED AND P A NUMBER ETC. H AVE BEEN FILED. EXCEPT 4 SUSPICION, THERE IS NOTHING WITH THE ASSESSING OFFI CER TO DISBELIEVE THE LOAN TRANSACTION. IT IS ALSO ADMITTED FACT THAT THE FIND ING ARRIVED AT IN THE CASE OF GANGA RAM GROUP CASES WAS NEVER PUT TO THE ASSES SEE AND HENCE, DID NOT PARTAKE THE CHARACTER OF EVIDENCE. WE, THEREFOR E, HOLD THAT THE ASSESSEE, HAVING DISCHARGED THE BURDEN CAST UPON HI M AND THE SAME NOT HAVING BEEN PROVED UNTRUE BY THE ASSESSING OFFICER, THE GENUINENESS OF THE CASH CREDIT HAS BEEN ESTABLISHED AND HENCE, ADDITIO N WAS RIGHTLY DELETED BY THE LD. CIT (A). THE LD. CIT (A) WAS ALSO JUSTIF IED IN DELETING THE ADDITION BEING INTEREST PAYABLE ON SUCH CREDITS. RESPECTFULLY FOLLOWING THE DECISION OF CO-ORDINATE BENCH, THE APPEAL FILED BY THE REVENUE DESERVES TO BE DISMISSED. WE, THEREFORE, RESPECTFULLY FOLLOWING THE DECISION OF THIS BENCH, DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF LEARNED CIT(A). 6. IN RESULT, THE APPEAL OF THE REVENUE AND CROSS O BJECTION OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11.08.11. SD/- SD/- (K.G. BANSAL) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 11 TH AUGUST, 2011 *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A) BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. 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