ACIT 18(1), MUMBAI V. GADIA EXPORTS, MUMBAI

ITA 2409/MUM/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5452 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 05-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect; Bogus loan
• Section: 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G , MUMBAI BEFORE SHRI C.N. PRASAD , HONBLE JUDICIAL MEMBER AND SHRI RAMIT KOCHAR , HONBLE ACCOUNTANT MEMBER ITA NO. 2409 /MUM/201 7 (A.Y: 20 08 - 09 ) ACIT 18(1) R.NO. 202 , 2ND FLOOR, EARNEST HOUSE, NARIMAN POINT, MUMBAI 400 021 V. M/S. GADIA EXPORTS JAI HIND ESTATE, BUILDING NO. 1, 2 ND FLOOR, BLOCK NO. 4, DR. ATMARAM MERCHANT ROAD, BHULESHWAR , MUMBAI 400 002 PAN NO: AABFG 7901 K (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI GAURAV KABRA DEPARTMENT B Y : SHRI T.A. KHAN DATE OF HEARING : 25.07.2018 DATE OF PRONOUNCEMENT : 25.07.2018 O R D E R PER C.N. PRASAD , JUDICIAL MEMBER THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - 29 , MUMBAI IN APPEAL NO. CIT(A) - 29/IT - 393/AC - 18(1)/15 - 16 DATED 09.01.2017 FOR THE ASSESSMENT YEAR 2008 - 09 . 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS IN ITS APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 30,00,000/ - MADE BY THE A.O. UNDER SECTION 68 OF THE ACT ON ACCOUNT OF UNSECURED LOAN FROM THE PERSON ENGAGED IN PROVIDING THE ACCOMMODATIO N ENTRY. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACTS IN IGNORING THE FACTS THAT A SEARCH ACTION UNDER SECTION 132 OF THE ACT WAS CONDUCTED IN THE CASE OF SHRI PRAVIN KUMAR JAIN AND VARIOUS COMPANIES OPERATE D BY HIM AND 2 ITA NO. 2409/MUM/2017 (A.Y:2008 - 09) M/S. GADIA EXPORTS HE WAS FOUND TO BE AN ENTRY OPERATOR WITHOUT ANY GENUINE BUSINESS ACTIVITY. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS ERRED IN LAW AS WELL AS ON FACTS IN IGNORING THE FACTS THAT ALL TRANSACTIONS ENTERED WITH SHR I PRAVIN KUMAR JAIN AND VARIOUS CONCERNS OPERATED AND CONTROLLED BY HIM WERE IN THE NATURE OF ACCOMMODATION ENTRY. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS. 2,52,493/ - MADE BY THE A.O. O N ACCOUNT OF INTEREST EXPENDITURE ON SUCH BOGUS LOAN FROM THE PERSON ENGAGED IN PROVIDING ACCOMMODATION ENTRY. 5. FOR THE ABOVE MENTIONED REASON AND ANY OTHER REASONS THAT MAY BE URGED AT THE TIME OF HEARING, IT IS REQUESTED THAT THE ORDER OF THE CIT(A) BE QUASHED AND THAT OF THE A.O. BE RESTORED. 6. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUNDS OR ADD A NEW GROUND, WHICH MAY BE NECESSARY. 3. AT THE TIME OF HEARING, AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT TAX EFFECT ON THE ISSUE IN THE PRESENT APPEAL IS BELOW 2 0 LAC S AND IN VIEW OF THE CBDT CIRCULAR N O . 3/2018 DATED 11/07 /201 8 IN F.NO.279/MISC.142/2007 - ITJ (PT) , THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE. A STATEMENT SHOWING CALCULATION OF TAX EFFECT IS ALSO FURNISHED ACCORDING TO WHICH THE TAX EFFECT COMES TO . 11,05,522 / - . 4. DEPARTMENTAL REPRESENTATIVE ALSO AGREED WITH THE ABOVE SUBMISSION OF THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE. THEREFORE, WE D I SMISS THE APPEAL OF THE REVENUE ON ACCOUNT OF LOW TAX EFFECT . 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE COURT AT THE CLOSE OF THE HEARING ON WEDNESDAY , THE 25 TH DAY OF JULY , 201 8 . SD/ - SD/ - ( RAMIT KOCHAR ) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI / DATED 25/07/2018 GIRIDHAR, SR.PS 3 ITA NO. 2409/MUM/2017 (A.Y:2008 - 09) M/S. GADIA EXPORTS COPY TO: 1. THE ASSESS E E. 2. THE REVENUE. 3. THE CIT 4. THE CIT(A) 5. THE D.R . 6. GUARD FILE. BY ORDER ASSISTANT REGISTRAR I.T.A.T., MUMBAI