M/s. Pert Consultants Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 2446/DEL/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 3021 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 18-05-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 27-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 147; 68; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E, NEW DELHI BEFORE SH. N. K. SAINI , ACCOUNTANT MEMBER AND SMT. BEENA A. PILLAI, JUDICIAL MEMBER ITA NO. 2446/DEL/2015 (ASSESSMENT YEAR: 2004-05) PERT CONSULTANTS PVT. LTD. A-12, LAJPAT NAGAR-II, NEW DELHI VS. IT O , WARD- 14(2), NEW DELHI PAN : AA A CP5416E (APPELLANT) (RESPONDENT) APPELLANT BY : MS.SUSHIL WADHWA, CA RESPONDENT BY : SH. RAJESH KUMAR, SR.DR DATE OF HEARING : 18.05.2017 DATE OF PRONOUNCEMENT : 22.05.2017 O R D E R PER BEENA A. PILLAI, J.M : 1. THE PRESENT APPEAL HAS BEEN FILED BY ASSESSEE AGAI NST ORDER DATED 18.02.2014 PASSED BY LD. CIT(A)-XVII, N EW DELHI FOR ASSESSMENT YEAR 2004-05 ON FOLLOWING GROUNDS OF APPEAL: 1. THAT HAVING REGARDS TO THE FACTS AND CIRCUMSTANCES OF THE CASE. LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD A.O IN CONSIDERING RS 5,00,515/-. CREDIT IN THE APPELLANT HOOKS AS SHARE APPLICATION MONCV AS 'UNEXPLAINED' AND ADDING THE SAME TO THE TAXABLE INCOME U/S. 68 OF THE INCOME TAX ACT ON ACCOUNT OF LACK OF EXPLANATION. 2. THAT HAVING REGARDS TO THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD. A.O. IN CONSIDERING RS 1,251/- 2 ITA NO. 2446/DEL/2015 (A.Y. 2004-05) (0.25% OF 5,00,515/- AS COMMISSION ON RECEIVING ALLEGED ACCOMMODATION ENTRY) AS 'UNEXPLAINED' AND ADDING THE SAME TO THE TAXABLE INCOME U/S 68 OF THE INCOME TAX ACT 3. THAT THE APPELLANT CRAVES THE LEAVE TO ADD- MODIFY, AMEND OR DELETE AM OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHOUT PREJUDICE TO EACH OTHER. 2. BRIEF FACTS OF THE CASE ARE AS UNDER: NOTICE UNDER 148 WAS ISSUED BY ASSESSING OFFICER ON 28.03.2011 TO ASSESSEE FOR THE YEAR UNDER CONSIDERA TION AT LAST ADDRESS KNOWN AS PER RECORDS. NOTICE WAS SENT BY SPEED POST AND WAS ALSO SERVED UPON THE ASSESSEE. BEFORE LD. AO THERE WAS NO COMPLIANCE OF NOTICE UNDER SECTION 148 BY ASSESSEE WITHIN PRESCRIBED TIME PERIOD. ACCORDINGLY LD. AO PASSED ORDER UNDER SECTION 144 READ WITH SECTION 14 7 BY MAKING ADDITION ON ACCOUNT OF COMMISSION EXPENDITUR E IN THE HANDS OF ASSESSEE. 3. AGGRIEVED BY ORDER OF LD. AO, ASSESSEE PREFERRED A PPEAL BEFORE LD. CIT(A). 4. LD. CIT(A) OBSERVED THAT ASSESSING OFFICER HAD OBT AINED INFORMATION FROM STATE BANK OF BIKANER & JAIPUR IN RESPECT OF M/S. S. J. CAPITAL LTD., FOR THE PERIOD 01.04.20 03 TO 30.03.2004. THE DETAILS FROM THE BANK REVEALED THAT ASSESSEE HAD RECEIVED RS. 5,00,515/- FROM M/S. S. J. CAPITAL , ON 14.07.2003. AS NO EXPLANATION ABOUT DEPOSITS INTO A CCOUNT OF ASSESSEE WAS RECEIVED BY ASSESSING OFFICER. HE, THE REFORE, TREATED SAID AMOUNT AS UNEXPLAINED UNDER SECTION 68 OF THE 3 ITA NO. 2446/DEL/2015 (A.Y. 2004-05) ACT. DURING APPELLATE PROCEEDINGS ASSESSEE SUBMITTE D THAT ASSESSEE HAD NOT RECEIVED THE SAID AMOUNT FROM M/S. S. J. CAPITAL BUT HAD RECEIVED RS. 5 LAKHS FROM M/S B.T. TECHNET LTD. IT WAS SUBMITTED THAT AMOUNT WAS PAID BY M/S. S. J CAPITAL AND ON BEHALF OF M/S B. T. TECHNET LTD. IN THE LIGHT OF ABOVE SUBMISSION LD. CIT(A) CALLED FOR A REPORT FRO M LD. AO AND OBSERVED AS UNDER: 4.6. THE REPORT RECEIVED FROM THE AO WAS SENT TO THE APPELLANT FOR GIVING A REPLY. THE APPELLANT DID NOT FURNISH A REPLY TO THE REMAND REPORT. THE APPELLANT GAVE NO FURTHER SUBMISSIONS. NO REASONS WERE GIVEN AS TO WHY M/S S. J. CAPITAL LTD., PAID MONEY TO THE APPELLANT ON BEHALF OF M/S B.T. TECHNET LTD. IN FAC T NO DETAILS HAVE BEEN GIVEN OF THE SHARE HOLDING OF M/S B. T. TECHNET LTD. NO CONFIRMATIONS COPIES OF BANK AMOUNT, SHARE ALLOTMENT DETAILS ETC WERE GIVEN . 4.7. THE FACT IS THAT THERE WAS A CREDIT IN THE ACC OUNT OF THE APPELLANT. THE AMOUNT WAS RECEIVED FROM M/S. S.J. CAPITAL SERVICES LTD. IT MAY HAVE BEEN ON BEHA LF OF SOME ONE ELSE. THE APPELLANT WAS REQUIRED TO EXPLAIN THE SOURCE OF DEPOSIT* NO EXPLANATION WAS GIVEN BY THE APPELLANT ABOUT THE NATURE AND SOURCE OF THE DEPOSIT. 4. LD. CIT(A) BY RELYING UPON VARIOUS JURISDICTIONAL HIGH COURT AND HONBLE SUPREME COURT DECISION, CONFIRMED ADDITION MADE BY LD. AO, AS CREDIT ENTRIES STOOD UN EXPLAINED BY ASSESSEE, THEREBY HOLDING THAT ASSESSEE HAD NOT DISCHARGED INITIAL ONUS, CAST UPON ASSESSEE BY SECTION 68 OF P ROVING IDENTITY, CREDITWORTHINESS AND MOST IMPORTANTLY GEN UINENESS OF TRANSACTION. 4 ITA NO. 2446/DEL/2015 (A.Y. 2004-05) 5. AGGRIEVED BY SAID ORDER OF LD. CIT(A) ASSESSEE IS IN APPEAL BEFORE US NOW. 6. LD. AR AND LD. SR. DR HAS AGREED FOR SETTING ASIDE THIS ISSUE TO FILE OF LD. AO FOR DE NOVO VERIFICATION. WE ARE ACCORDINGLY SETTING ASIDE THIS MATTER WITH DIRECTIO N TO LD. AO TO EXAMINE CREDIT ENTRY IN THE BANK ACCOUNT OF ASSE SSEE. LD. AO SHALL FIRST GRANT OPPORTUNITY TO ASSESSEE TO DIS CHARGE ITS INITIAL ONUS BY PROVING IDENTITY, CREDITWORTHINESS AND MOST IMPORTANTLY GENUINENESS OF TRANSACTION AS PER SECTI ON 68 OF THE ACT. AFTER DISCHARGE OF INITIAL ONUS BY ASSESSE E, LD. AO MAY CONDUCT ANY ENQUIRY THAT HE MAY DEEM FIT AND PR OPER TO INQUIRE ABOUT VERACITY OF EVIDENCES/INFORMATION SUB MITTED BY ASSESSEE IN RESPECT OF CREDIT ENTRY. LD. AO MAY TAK E ALL NECESSARY STEPS, IN ORDER TO IDENTIFY, EXAMINE CRED ITORS AND DECIDE ISSUE ON MERITS. NEEDLESS TO SAY THAT, ADEQU ATE OPPORTUNITY MAY BE GRANTED TO ASSESSEE TO SUPPORT I TS CASE. ACCORDINGLY, GROUND NO. 1 & 2 RAISED BY ASSESSEE ST ANDS ALLOWED FOR STATISTICAL PURPOSES. 7. GROUND NO. 3 IS GENERAL IN NATURE AND THEREFORE, D OES NOT REQUIRE ANY INTERFERENCE. IN THE RESULT APPEAL FILED BY THE ASSESSEE STANDS A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND MAY, 2017. SD/- SD/- (N. K. SAINI) (BEENA A. PILLAI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 22.05.2017 @M!T