ITO, New Delhi V. M/s Thirani Industries Limited, New Delhi

ITA 2569/DEL/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 7337 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 18-08-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 01-06-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAMAL KAPOOR
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H : NEW DELHI BEFORE SHRI A.D.JAIN, JM AND SHRI R.C.SHARMA, AM ITA NO.2569/DEL/2009 ASSESSMENT YEAR : 2005-06 INCOME TAX OFFICER, WARD-16(2), NEW DELHI. VS. M/S THIRANI INDUSTRIES LIMITED, ALAKNANDA SHOP COMPLEX, E-2/203, BHARTI TRADER CENTRE, NEW DELHI 110 019. PAN NO.AAACT6029P. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI KAMAL KAPOOR, DR. RESPONDENT BY : SHRI AJAY WADHWA, CA. ORDER PER R.C.SHARMA, AM : THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) DATED 24.3.2009 FOR THE AY 2005-06, IN THE MATTER OF LEVY OF PENALTY U/S 271D OF THE IT ACT. 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PER USED. FACTS IN BRIEF ARE THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSES SEE WAS IN RECEIPT OF SHARE APPLICATION MONEY. SOME OF THE AMOUNT WAS RECEIVED IN CASH, THE AO CONSIDERED THE SAME AS LOAN TRANSACTION AND THEREBY APPLYING P ROVISIONS OF SECTION 269SS, LEVIED PENALTY U/S 271D. BY THE IMPUGNED ORDER, TH E CIT(A) DELETED THE PENALTY BY FOLLOWING THE ORDER OF THE HON'BLE MADRAS HIGH C OURT IN THE CASE OF RUGMINI RAM RAGAV SPINNERS (P) LTD. 304 ITR 417, WHEREIN HONBLE HIGH COURT HAS HELD THAT PROVISIONS OF SECTION 269SS AND 269T HAVE LIMITED APPLICATION IN RESPECT OF DEPOSITS OR LOANS, WHEN THE AMOUNT SO RECEIVED A S SHARE CAPITAL WAS NEITHER LOAN NOR DEPOSIT, THE PROVISIONS OF SECTION 269SS AND 26 9T ARE NOT APPLICABLE, THEREFORE NO PENALTY IS LEVIABLE U/S 271E/271D. TH E CIT(A) ALSO RECORDED A FINDING TO THE EFFECT THAT AMOUNT WAS RECEIVED BY T HE ASSESSEE COMPANY ON ACCOUNT ITA-2569/DEL/2009 2 OF SHARE APPLICATION WHICH IS EVIDENT FROM THE ASSE SSMENT ORDER FRAMED U/S 143(3) ON 28.11.2007 IN ASSESSEES OWN CASE AND THAT NOTHI NG WAS BROUGHT ON RECORD BY THE ADDITIONAL CIT TO PROVE THAT CASH RECEIPTS IN D ISPUTE WAS LOANS OR ADVANCES. IT WAS ALSO FOUND THAT ASSESSEE HAD NOT PAID ANY INTER EST ON THE AMOUNT SO RECEIVED, SINCE IT WAS IN THE NATURE OF SHARE APPLICATION MON EY. RESPECTFULLY FOLLOWING THE ORDER OF HON'BLE MADRAS HIGH COURT AS DISCUSSED HER EINABOVE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) FOR DELETING THE P ENALTY IMPOSED U/S 271D WITH RESPECT TO THE AMOUNT RECEIVED ON ACCOUNT OF SHARE CAPITAL. ITAT DELHI COORDINATE BENCH IN THE CASE OF NEW AGE GENERATORS PVT.LTD. ITA NO.1289/DEL/2010, VIDE ORDER DATED 30.7.2010 HAS AL SO HELD THAT NO PENALTY IS LEVIABLE U/S 271D WITH RESPECT TO THE SHARE APPLICA TION MONEY RECEIVED IN CASH. 3. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 18 TH AUGUST, 2010. SD/- SD/- (A.D.JAIN) (R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 18.08.2010. VK. COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT DEPUTY REGISTRAR ITA-2569/DEL/2009 3