DCIT, New Delhi V. M/s Minda Industries Ltd., New Delhi

ITA 2477/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4003 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 09-05-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 25-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KISHORE B
• Keywords: Accommodation entries
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: E NEW DELHI BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA ACCOUNTANT MEMBER I.T.A NO. 2477/DEL/10 ASSTT. YEAR 2001-02 DY. COMMISSIONER OF INCOME TAX, CIRCLE 6 (1), NEW DELHI. VS. M/S. MINDA INDUSTRIES LTD. B-64/1, WAZIRPUR INDL. AREA, DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI KISHORE B, SR. DR. RESPONDENT BY: SHRI PRADEEP DINODIA, FCA ORDER PER RAJPAL YADAV, JM: REVENUE IS IN APPEAL BEFORE US AGAINST THE ORDER O F LD. CIT (A) DATED 18.3.2010 PASSED FOR ASSTT. YEAR 2001-02. T HE SOLITARY GRIEVANCE OF THE REVENUE IS THAT LD. CIT(A) HAS ERRED IN DELE ING THE ADDITION OF ` 15 LACS WHICH WAS ADDED BY THE AO U/S 68 OF THE INC OME TAX ACT. ITA NO. 2477/DEL/10 ASSTT. YEAR 2001-02 2 2. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE HA S FILED ITS RETURN OF INCOME ON 31 ST OCTOBER 2001 DECLARING AN INCOME OF ` 1,22,38,660/-. LD. AO HAS OBSERVED THAT HE HAS RECEIVED AN INFORMA TION FROM THE INVESTIGATION WING THAT ASSESSEE HAS TAKEN FOLLOW ING ACCOMMODATION ENTRIES ON VARIOUS DATES DURING THE PREVIOUS YEAR R ELEVANT TO ASSTT. YEAR 2001-02:- S.NO. NAME OF PERSON GIVING ENTRY AMOUNT DATE 1. M/S. IBEX INFOTECH PVT. LTD. 5,00,000/- 05.03.20 01 2. M/S. SHIMMER MARKETING PVT. LTD. 5,00,000/- 09- 03-2001 3. M/S. MAA SHAKUMBHARI STONE CRUSHERS PVT. LTD. 5,00,000/- 22-03-2001 3. THE AO HAS CALLED FOR THE FOLLOWING INFORMATION FROM THE ASSESSEE VIDE QUESTIONNAIRE DATED 24.6.2008:- PLEASE FILE THE INCOME TAX PARTICULARS VIZ. PA NO. WARD/CIRCLE, PRESENT ADDRESSES ALONGWITH CONFIRMATION FROM M/S. IBEX INF OTECH PVT. LTD., M/S. SHIMMER MARKETING PVT. LTD. AND M/S. MAA SHAKUMBHAR I STONE CRUSHERS PVT. LTD. THE PARTIES FROM WHOM YOU HAVE ALLEGEDLY TAKEN UNSECURED LOANS. PLEASE FURNISH THE DETAILS OF INTEREST PAID, MODE O F INTEREST PAID, DETAILS OF TDS DEDUCTED (WITH COPY OF TDS RETURNS) AND MODE AND DATE OF REPAYMENT . PLEASE PRODUCE THE INCOME TAX RETURNS ALONGWITH P & L ACCOUNT, BALANCE SHEET, TAX AUDIT REPORT ETC. OF THESE COMPA NIES FOR THE ASSTT. YEAR 2001-02. PLEASE PRODUCE THE COPY OF THE BANK ACCOUNT OF THES E COMPANIES FOR THE PERIOD FINANCIAL YEAR 2000-01. PLEASE GIVE THE MODE OF PAYMENT OF TAKEN BY YOU ALO NGWITH ANY AGREEMENT / DOCUMENT EXECUTED FOR THESE TRANSACTIONS. ITA NO. 2477/DEL/10 ASSTT. YEAR 2001-02 3 PLEASE PRODUCE YOUR BOOKS OF ACCOUNTS FOR THE A.Y. 2001-02 ALONGWITH SUPPORTING VOUCHERS. 4. IT EMERGES OUT THAT ASSESSEE HAS SUBMITTED ALL THE REQUISITE DETAILS AND LD. CIT(A) HAS REPRODUCED THOSE DETAIL S IN PARAGRAPH NO. 6 WHILE NOTING THE SUBMISSIONS OF THE ASSESSEE. THE D ETAILS SUBMITTED BY THE ASSESSEE IN RESPECT OF EACH CREDITOR READ AS U NDER :- IBEX INFO TECH PVT. LTD. I) BANK STATEMENT SHOWING PAYMENT TO MINDA INDUSTRI ES LTD. II) INCOME TAX RETURN FOR ASSESSMENT YEAR 2001-02 III) COPY OF LOAN ACCOUNT IN THE BOOKS OF MINDA IND USTRIES LTD. DULY CONFIRMED BY THE CREDITOR IV) NAME, ADDRESS AND PERMANENT ACCOUNT NUMBER V) DETAIL OF PAYMENT OF INTEREST/TDS/MODE AND DATE OF PAYMENT OF INTEREST VI) MODE AND DATE OF REPAYMENT OF LOAN VII) COPY OF BALANCE SHEET AND PROFIT & LOSS ACCOUN T FOR THE FINANCIAL YEAR 2000-2001 MAA SHAKUMBHARI STONE CRUSHERS PVT. LTD. I) BANK STATEMENT SHOWING PAYMENT TO MINDA INDUSTRI ES LTD. II) COPY OF LOAN ACCOUNT IN THE BOOKS OF MINDA INDU STRIES LTD. DULY CONFIRMED BY CREDITOR III) NAME, ADDRESS AND PERMANENT ACCOUNT NUMBER IV) DETAILS OF PAYMENT OF INTEREST/TDS/MODE AND DAT E OF PAYMENT OF INTEREST V) MODE AND DATE OF REPAYMENT OF LOAN VI) COPY OF BALANCE SHEET AND PROFIT & LOSS ACCOUNT FOR THE FINANCIAL YEAR 2000-2001 SHIMMER MARKETING PVT. LTD. I) INCOME TAX RETURN FOR ASSESSMENT YEAR 2001-02 II) COPY OF LOAN ACCOUNT IN THE BOOKS OF MINDA INDU STIRES LTD. DULY CONFIRMED BY CREDITORS III) NAME, ADDRESS AND PERMANENT ACCOUNT NUMBER IV) DETAIL OF PAYMENT OF INTEREST/TDS/MODE AND DATE OF PAYMENT OF INTEREST V) MODE AND DATE OF REPAYMENT OF LOAN VI) COPY OF BALANCE SHEET AND PROFIT & LOSS ACCOUNT FOR THE FINANCIAL YEAR 2000-2001 ITA NO. 2477/DEL/10 ASSTT. YEAR 2001-02 4 ON THE BASIS OF ABOVE DOCUMENTS FILED BEFORE THE AO , THE LD. COUNSEL FOR THE APPELLANT HAS AVERRED THAT I) ALL THE COMPANIES ARE REGISTERED WITH REGISTRAR OF COMPANIES II) ALL THE COMPANIES ARE ASSESSED TO INCOME TAX III) ALL THE LOANS HAVE BEEN RECEIVED/REPAID THROUG H BANKING CHANNEL IV) INTEREST HAS BEEN PAID ON THE ABOVE LOAN AND P AYMENT OF INTEREST HAS BEEN MADE AFTER DEDUCTION OF TAX AT SOURCE V) FULL DETAIL WITH REGARD TO REPAYMENT OF LOAN HAS BEEN PROVIDED VI) NET WORTH OF ALL THE COMPANIES AS AT 31.3.2001 IS AS UNDER: - IBEX INFO TECH PVT. LTD. 22.82 LAC -MAA SHAKUMBHARI STONE CRUSHERS PVT. LTD. 59 .40 LAC -SHIMMER MARKETING PVT. LTD. 20.40 L AC 5. THE AO HAD ISSUED SUMMONS U/S 131 TO THE PRINCIP AL OFFICERS M/S. SHIMMER MARKETING PVT. LTD AND M/S. MAA SHAKUMBARI STONE CRUSHERS PVT. LTD. M/S. IBEX INFOTECH PVT. LTD. ASKING THEM TO ATTEND THE OFFICE OF DCIT CIRCLE (1). BUT THEY DID NOT ATTEND. THEY SENT THEIR REPLY THROUGH POST AND CONFIRMED THE TRANSACTION. WITH REGARD TO OTHERS, SUMMONS WERE RECEIVED BACK WITH POSTAL REMARK LEFT OUT. T HE AO MADE THE ADDITION ON THE GROUND THAT CREDITORS FAILED TO APP EAR BEFORE HIM, THEREFORE, IT INDICATE THAT THERE ARE BOGUS ENTRIES . 6. LD. CIT(A) HAS DELETED THE ADDITION ON DETAILED ANALYSIS OF THE EVIDENCE SUBMITTED BY THE ASSESSEE. 7. BEFORE US LD. DR RELIED UPON THE ORDER OF AO AN D SUBMITTED THAT ASSESSEE DID NOT PROVIDE CORRECT ADDRESS OF TH E CREDITORS. ITA NO. 2477/DEL/10 ASSTT. YEAR 2001-02 5 THEREFORE, IT FAILED TO PROVE THE IDENTITY. WHEREAS LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT OUT OF THE THREE CREDITORS, ONE HAS CONFIRMED THE TRANSACTIONS TO THE AO IN RESPONSE TO THE SUMMO NS. THE ASSESSEE HAS PRODUCED BANK STATEMENT AND ALL OTHER DETAILS. IT HAS PRODUCED INCOME TAX RETURN OF SHIMMER MARKETING PVT LTD. AO HAS CALLED FOR 6 DETAILS AS MENTIONED IN THE QUESTIONNAIRE ISSUED ON 24 TH JUNE, 2008. ASSESSEE HAS COMPLIED WITH THIS QUESTIONNAIRE. THER EFORE, LD. CIT(A) HAS RIGHTLY DELETED THE ADDITION. IN SUPPORT OF ITS CONTENTION, HE RELIED UPON THE DECISION OF HONBLE DELHI HIGH COURT IN T HE CASE OF AGM PROTECTION DEVICE LTD. REPORTED IN 324 ITR 334. 8. WE HAVE DULY CONSIDERED THE RIVAL CONTENTION AND GONE THROUGH THE RECORD CAREFULLY. THE AMOUNTS HAVE BEEN TAKEN T HROUGH ACCOUNT PAYEE CHEQUE. ASSESSEE HAS SUBMITTED THE DETAILS OF NET WORTH OF THE CREDITORS WHICH PROVED THAT THE CREDITORS ARE CREDI TWORTHY. THE ASSESSEE HAS SUBMITTED COPY OF THE INCOME TAX RETURN IN RESP ECT OF TWO CREDITORS AND SUBMITTED PERMANENT ACCOUNT NUMBER IN RESPECT O F THE THIRD CREDITOR. THESE EVIDENCE FULFILL THE REQUIREMENT OF THREE INGREDIENTS CONTEMPLATED BY SECTION 68 OF THE INCOME TAX ACT. A PART FROM THESE THREE MAJOR DETAILS, ASSESSEE HAS FILED OTHER CORR OBORATIVE EVIDENCE I.E. BANK STATEMENT, DETAIL OF PAYMENT OF INTEREST MODE AND DATE OF ITA NO. 2477/DEL/10 ASSTT. YEAR 2001-02 6 REPAYMENT OF LOANS ETC. THE DETAILS SUBMITTED BY TH E ASSESSEE HAVE BEEN NOTICED BY US IN THE FOREGOING PARAGRAPHS. CON SIDERING ALL THESE DETAILS, WE DO NOT FIND ANY MERIT IN THIS APPEAL. I T IS DISMISSED. 9. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMI SSED. ORDER PRONOUNCED IN THE OPEN COURT ON 20.5.2011. SD/- SD/- [SHAMIM YAHYA] [RAJPAL YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 20.5.2011 VEENA COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT