The ITO, Ward-1(4), Surat V. M/s. Laser Synthetics Pvt. Ltd., Surat

ITA 2509/AHD/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6176 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-04-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 11-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SITA RAM MEENA
• Assessee Lawyers: RAMESH MAL
• Keywords: Bogus Share capital; Audit objection; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CAMP AT SURAT BEFORE SHRI RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH , ACCOUNTANT MEMBER ./ ITA NO. 2509 /AHD/201 4 / ASSTT. YEAR: 2010 - 11 INCOME - TAX OFFICER, WARD - 1(4), SURAT VS. M/S. LASER SYNTHETICS PVT LTD, SHOP NO.2034, JASH TEXTILE MARKET, RING ROAD, SURAT - 395002 PAN : AAACL 4097 R / (APPELLANT) / (RESPONDENT) REVENUE BY : MR. SITA RAM MEENA, SR DR ASSESSEE BY : MR. RAMESH MALPANI / DATE OF HEARING : 2 7 / 0 4 /201 7 / DATE OF PRONOUNCEMENT: 27 / 0 4 /201 7 / O R D E R PER RAJPAL YADAV , JUDICIAL MEMBER : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDE R OF THE COMMISSIONER OF INCOME - TAX (APPEALS) - I, SURAT DATED 19 .0 6 .2014 FOR A Y 2010 - 11 . 2. THE SOLITARY GROUND RAISED BY THE ASSESSEE READS AS UNDER: - ON THE FACTS AND CIRCUMSTANCES OF THE CASE, WHETHER THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE ADDIT ION MADE ON ACCOUNT OF BOGUS SHARE APPLICATION AND SHARE PREMIUM MONEY OF RS.25,00,000/ - , PARTICULARLY WHEN THE INVESTIGATION WING HAS ESTABLISHED THAT ALL THE PARTIES WHICH HAD APPLIED FOR SHARES IN THE ASSESSEE COMPANY WERE BOGUS AND ONLY ENTRY PROVIDERS . 3. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PRESENT APPEAL OF THE REVENUE NEEDS TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE CBDT CIRCULAR NO.21 OF 2015 DATED 10.12.2015. HE HAS ALSO ITA NO. 2509/AHD/ 2014 ITO VS. LASER SYNTHETICS PVT LTD AY : 2010 - 11 2 SUBMITTED THAT IN THE PRESENT CASE THE TAX EFFECT IS RS. 7, 72 , 500 / - WHICH IS BELOW THE PRESCRIBED LIMIT OF RS.10 LACS AND HE HAS PLACED ON RECORD THE WORKING FOR THE SAME. THE LD. DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT THE TAX EFFECT IS LESS THAN THE LIMIT PRESCRIBED BY THE A FORESAID CBDT CIRCULAR. 4 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT PRIMA - FACIE THIS APPEAL OF THE REVENUE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 21/2015 IN F.NO.279/MISC. 142/2007 - ITJ (PT) DATED 10TH DECEMBER 2015, VIDE WHICH IT HAS BEEN PROVIDED THAT IF THE TAX EFFECT BY VIRTUE OF THE COMMISSIONER OF INCOME - TAX (APPEALS)S ORDER IS BELOW RS. 10 LACS , THEN THAT ORDER WOULD NOT BE CHALLENGED BEFORE THE TRIBUNAL IN FURTHER APPEAL. THE BOARD H AS PROVIDED EXEMPTIONS AT CLAUSE (8) OF THE INSTRUCTIONS WHEREIN IT HAS BEEN PROVIDED THAT THESE INSTRUCTIONS WILL NOT BE APPLICABLE, IF VIRES OF ANY PROVISIONS HAS BEEN QUASHED BY IMPUGNED ORDER OR ADDITION WAS MADE ON SOME AUDIT OBJECTIONS OR THE ADDITIO N RELATES TO UNDISCLOSED FOREIGN ASSETS/BANK ACCOUNTS, ETC. WE FIND THAT THE PRESENT CASE DOES NOT FALL WITHIN THE EXEMPTION CLAUSE AND THE TAX IS LESS THAN RS. 10 LACS . THEREFORE, THE PRESENT APPEAL IS NOT MAINTAINABLE AND HENCE DISMISSED. 5 . IN THE R ESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 2 7 T H APRIL, 2017 AT CAMP SURAT . SD/ - SD/ - ( AMARJIT SINGH ) ACCOUNTANT MEMBER ( RAJPAL YADAV) JUDICIAL MEMBER SURAT ; DATED 2 7 / 0 4 /201 7 * BT ITA NO. 2509/AHD/ 2014 ITO VS. LASER SYNTHETICS PVT LTD AY : 2010 - 11 3 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) 5. , / DR, ITAT, 6. / GUARD FILE . / BY ORDER, T R U E C O P Y / (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD