The ITO, Ward-5(3), Surat V. M/s. Patel Motor Garage, Surat

ITA 2547/AHD/2008

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50976 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 30-11-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 09-07-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VINOD TANWANI
• Assessee Lawyers: UMAIDSINGH BHATI
• Keywords: Unexplained cash credit; Gift
• Section: 68

Judgement Text

, , , , , IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, C BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ # ## #. .. .% $% % $% % $% % $%, , , , &' ( &' ( &' ( &' ( & ' & ' & ' & ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER) ITA NO.2547/AHD/2008 [ASSTT.YEAR : 2005-2006] ITO, WARD-5(3) SURAT. /VS. M/S.PATEL MOTOR GARAGE JYOTI PARK SOCIETY KAMREJ CHAR RASTA SURAT. ( (( (*+ *+ *+ *+ / APPELLANT) ( (( (,-*+ ,-*+ ,-*+ ,-*+ / RESPONDENT) ( . / &/ REVENUE BY : SHRI VINOD TANWANI 12 . / &/ ASSESSEE BY : SHRI UMAID SINGH BHATI 3 . 24'/ DATE OF HEARING : 30 TH NOVEMBER, 2011 5%6 . 24'/ DATE OF PRONOUNCEMENT : 2 ND DECEMBER, 2011 &7 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS APPEAL FOR A.Y.2005- 2006 IS DIRECTED AGAINST THE ORDER OF THE COMMISSIO NER OF INCOME-TAX (APPEALS)-III, SURAT. 2. THE ONLY GROUND RAISED IN THIS APPEAL OF THE REV ENUE READS AS UNDER: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 11 LACS MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S.68. 3. THE LEARNED DR SUBMITTED THAT THE CREDITORS COUL D NOT PRODUCE THE PARTICULARS OF SALE BILLS OF AGRICULTURE PRODUCE IN SUPPORT OF THEIR CLAIM OF HAVING AGRICULTURAL INCOME AND THAT THEIR CREDIT WO RTHINESS COULD NOT BE PROVED BEFORE THE AO. HE SUBMITTED THAT THERE WAS NO EVIDENCE TO PROVE THAT THE BROKERS HAVE COME TO THE VILLAGE FOR PURCH ASE OF CROPS AND THE ITA NO.2547/AHD/2008 -2- PAYMENT WAS MADE IN CASH AND THEREFORE THERE WERE N O SALE BILLS AVAILABLE WITH THESE PERSONS. HE SUBMITTED THAT THE CRUX OF THE MATTER IS THAT THE SOME PAPERS ON WHICH EVIDENCE OF GIFT WAS EVIDENCED WERE PRODUCED AFTER ONE-AND-HALF YEARS FROM THE DATE OF GIFT TO T HE ASSESSEE. HE RELIED ON THE ORDER OF THE AO. 4. THE LEARNED COUNSEL FOR THE ASSESSEE HAS OPPOSED THE SUBMISSIONS OF THE LEARNED DR AND HE SUBMITTED THAT OUT OF THE TOTAL AMOUNT OF RS.11 LAKHS ADDED UNDER SECTION 68 IN THE CASE OF THE ASS ESSEE, THE SUM OF RS.5 LAKHS IS CREDITED IN THE ACCOUNT OF THE PARTNERS OF THE ASSESSEE-FIRM AND THEREFORE NO ADVERSE ACTION COULD BE TAKEN IN THE C ASE OF THE ASSESSEE. HE SUBMITTED THAT THE ISSUE OF PURCHASE OF STAMP PAPER AFTER A GAP OF ONE- AND-HALF YEAR YEARS WAS NOT RELEVANT SINCE THE SUM RELATES TO THE CREDIT ENTRIES IN THE ACCOUNT OF THE PARTNERS ONLY. HE RE LIED ON THE DECISION OF THE ITAT, AHMEDABAD BENCH DECISION IN THE CASE OF I TO VS. JAY VARUDI CONSTRUCTION, IN ITA NO.3123 & 3123/AHD/2008 DATED 18-11-2001 AND ALSO OF HONBLE JURISDICTIONAL HIGH COURT IN THE CA SE OF CIT VS. PANKAJ DYESTUFF INDUSTRIES, INCOME TAX REFERENCE NO.241 OF 1993 DATED 6-7- 2005. HE SUBMITTED THAT THE ISSUE IS COVERED IN FA VOUR OF THE ASSESSEE WITH THESE JUDGMENTS. REGARDING THE BALANCE AMOUN T OF CREDITS, HE SUBMITTED THAT THE ASSESSEE HAS FILED CONFIRMATION LETTERS FROM THE CREDITORS WITH THEIR PAN AND THE CREDIT ENTRIES WER E THROUGH CHEQUES. HE SUBMITTED THAT IDENTITY OF THE CREDITORS, THEIR CRE DIT WORTHINESS AND GENUINENESS OF THE TRANSACTION WAS PROVED BEYOND DO UBT BY THE ASSESSEE AND THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE WITH THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN CASE OF DCIT V S. ROHINI BUILDERS, 256 ITR 360 AND COMMISSIONER OF INCOME-TAX VS AMBUJ A GINNING, PRESSING AND OIL CO. P. LTD., 332 ITR 434 (GUJ). ITA NO.2547/AHD/2008 -3- 5. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE AO AND THE CIT(A). WE FIND THAT THE ISSUE OF CREDIT OF RS.5 LAKHS IN THE ACCOUNT OF THE ASSESSEE IS COVERED IN FAVOUR OF THE ASSESSEE WITH THE DECISION OF THE HONBLE HIGH COURT RELIED UPON BY T HE LEARNED COUNSEL FOR THE ASSESSEE. THE ITO WAS ENTITLED TO PROCEED AGAI NST THE PARTNERS IN CASE THEIR EXPLANATION WAS NOT FOUND TO BE SATISFACTORY. REGARDING THE BALANCE AMOUNT OF CREDIT ENTRIES, THE CREDITORS HAVE FILED THEIR CONFIRMATIONS ALONG WITH THEIR PAN AND CREDIT ENTRIES WERE THROUGH BANK ING CHANNEL. THE IDENTITY OF THE CREDITORS, THEIR CREDIT-WORTHINESS AND THE GENUINENESS OF THE TRANSACTION ARE PROVED BEYOND DOUBT BY THE ASSE SSEE. THE DECISIONS OF THE HONBLE JURISDICTIONAL HIGH COURT RELIED UPO N BY THE LEARNED COUNSEL ARE IN FAVOUR OF THE ASSESSEE. IN THESE CI RCUMSTANCES, WE HOLD THAT THERE IS NO MISTAKE IN THE ORDER OF THE CIT(A) HOLDING THAT THE IDENTITY OF THE CREDITORS, THEIR CREDIT-WORTHINESS AND GENUINENESS OF THE TRANSACTION WAS PROVED BY THE ASSESSEE IN THIS CASE AND IN DELETING THE ADDITION MADE UNDER SECTION 68 OF THE ACT. ACCORDI NGLY, THE ORDER OF THE CIT(A) IS CONFIRMED AND THE GROUND OF THE REVENUES APPEAL IS DISMISSED. 6. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( #.% $% /A.MOHAN ALANKAMONY) &' ( /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT.