Malik Enterprises Pvt. Ltd., Delhi V. ITO, New Delhi

ITA 2553/DEL/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4061 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 28-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T VASANTHAN
• Section: 133(6); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC : NEW DELHI BEFORE SHRI R.S. SYAL, VICE PRESIDENT ITA NO.2553/DEL/2017 ASSESSMENT YEAR : 2008-09 MALIK ENTERPRISES PVT. LTD., 2144, TURKMAN GATE, DELHI. PAN: AAACM1403C VS. ITO, WARD-16(2), NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI PIYUSH KAUSHIK, ADVOCATE DEPARTMENT BY : SHRI T. VASANTHAN, SR. DR DATE OF HEARING : 16.10.2017 DATE OF PRONOUNCEMENT : 17.10.2017 ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST OR DER PASSED BY THE CIT(A) ON 18.01.2017 IN RELATION TO THE ASSESSMENT YEAR 2008-09. ITA NO.2553/DEL/2017 2 2. ONLY GROUND NO.2, AGAINST THE SUSTENANCE OF ADDI TION AMOUNTING TO RS.27,50,000/- MADE U/S 68 OF THE INCOME-TAX ACT, W AS PRESSED. OTHER GROUNDS, THEREFORE, STAND DISMISSED AS NOT PRESSED. 3. BRIEFLY STATED, THE FACTS OF THE SURVIVING GROU ND ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTICED TH AT THE ASSESSEE HAD CERTAIN BUSINESS TRANSACTIONS WITH M/S M.Y. PAPER P RODUCTS PVT. LTD. AND M/S SAKET PAPER PRODUCTS PVT. LTD. IN ORDER TO PROVE THE GENUINENESS OF THESE TRANSACTIONS, THE ASSESSEE FUR NISHED COPY OF LEDGER ACCOUNT OF THESE TWO PARTIES TO WHOM TRANSACTIONS I N THE NATURE OF SALES WERE MADE. THE ASSESSING OFFICER OBSERVED THAT THE RE WAS A CLOSING CREDIT BALANCE OF RS.5.03 LAC IN THE ACCOUNT OF M/S M.Y. PAPER PRODUCTS PVT. LTD. AND THERE WAS A DEBIT BALANCE IN THE SUBS EQUENT YEARS. IN ORDER TO VERIFY THE GENUINENESS OF THE TRANSACTIONS, THE ASSESSING OFFICER ISSUED NOTICES U/S 133(6) TO BOTH THE PARTIES. M/S SAKET PAPER PRODUCTS PVT. LTD. SENT ITS REPLY, WITH WHICH THE ASSESSING OFFICER GOT CONVINCED. SINCE NO COMPLIANCE WAS MADE BY M/S M.Y. PAPER PROD UCTS PVT. LTD., THE ASSESSING OFFICER ADDED A SUM OF RS.27,50,000/- U/S 68 OF THE ACT, ITA NO.2553/DEL/2017 3 BEING, THE AMOUNT RECEIVED FROM THIS PARTY DURING T HE YEAR THROUGH VARIOUS CHEQUES. THE LD. CIT(A) CONFIRMED THE ADDI TION. THE ASSESSEE IS AGGRIEVED AGAINST THE SUSTENANCE OF SUCH ADDITION. 4. I HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE RELEVANT MATERIAL ON RECORD. A COPY OF THE ACCOUNT OF M/S M. Y. PAPER PRODUCTS PVT. LTD. IN THE BOOKS OF THE ASSESSEE, IS AVAILABL E IN THE PAPER BOOK. IT CAN BE SEEN THAT THERE IS OPENING DEBIT BALANCE OF RS.6,270/-. THERE ARE VARIOUS CREDIT ENTRIES REPRESENTING THE AMOUNTS REC EIVED BY THE ASSESSEE THROUGH CHEQUES FROM THIS PARTY AGGREGATING TO RS.2 7,50,000/-. DURING THE YEAR, THE ASSESSEE MADE SEVERAL SALE TRANSACTIO NS TO THIS PARTY WHICH ARE MORE THAN RS.22.40 LAC, THEREBY GIVING NET CLOS ING BALANCE OF RS.5,02,925/-. THE ASSESSING OFFICER MADE THE ADDI TION BY SUMMING UP ALL THE RECEIPTS FROM THIS CUSTOMER AND IGNORING TH AT THE ASSESSEE HAD ALSO EFFECTED SALES TO IT THROUGH VARIOUS TRANSACT IONS. GENUINENESS OF SUCH SALES TRANSACTIONS HAS NOT BEEN DOUBTED BY THE AO. I FAIL TO COMPREHEND AS TO HOW AN ADDITION U/S 68 OF THE ACT CAN BE MADE FOR THE AMOUNTS RECEIVED FROM A CUSTOMER TO WHOM REGULAR SA LES HAVE BEEN ITA NO.2553/DEL/2017 4 MADE DURING THE YEAR. IT IS, ERGO, HELD THAT THE A DDITION WAS WRONGLY MADE AND SUSTAINED. UNDER THESE CIRCUMSTANCES, THE ADDITION IS DELETED AND THE IMPUGNED ORDER IS SET ASIDE TO THIS EXTENT. 5. IN THE RESULT, THE APPEAL IS ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 17.10.201 7. SD/- [R.S. SYAL] VICE PRESIDENT DATED, 17 TH OCTOBER, 2017. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.