ITO, New Delhi V. M/s Integer Leasing & Finance Co. Pvt. Ltd., Delhi

ITA 2575/DEL/2017

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9631 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 28-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Search and seizure
• Section: 153A; 153C; 68; 132

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI C BEN CH, NEW DELHI [THROUGH VIDEO CONFERENCE] BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI K.N. CHARY, JUDICIAL MEMBE R ITA NO. 2575/DEL/2017 [A.Y 2006-07] THE INCOME-TAX OFFICER VS. M/S INTEGER LEASING & F INANCE WARD -12(3) CO, PVT LTD, 2, PAL MOHAN NEW DELHI APARTMENT, CLUB ROAD, PUNJABI BAGH [W], NEW DELHI PAN: AAACI 0151 R [APPELLANT] [RESPONDENT] ASSESSEE BY : NONE REVENUE BY : MS. SUNITA SINGH, CI T-DR DATE OF HEARING : 27.07.2021 DATE OF PRONOUNCEMENT : 27.07.2021 ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE CIT(A) - 30, NEW DELHI DATED 18.01.2017 PERTAINING TO A.Y 2006-07 . 2 2. THE GRIEVANCES OF THE REVENUE READ AS UNDER: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT (A) HAS ERRED IN HOLDING THE ASSESSMENT MADE BY THE AO U/S 153C OF THE ACT AS VOID AB INITIO. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED IN HOLDING THAT THE ACTION U/S 153C OF TH E I.T.ACT, CAN BE TAKEN ONLY FOR A.Y. 2008-09 AND 2009-10 TO WHICH TH E SEIZED DOCUMENT WHICH IS A BALANCE SHEET FOUND AT THE PLAC E OF SEARCH. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) HAS ERRED BY NOT FOLLOWING THE PROVISIONS OF SECTIO N 153C WHICH REQUIRE THE AO TO TAKE ACTION U/S 153C IN THE MANNE R PROVIDED U/S 153A FOR MAKING ASSESSMENT FOR 6 YEARS PRIOR TO THE DATE OF SEARCH. THE ONLY CONDITION IS SEIZURE OF ANY DOCUME NT AND THE PERIOD TO WHICH IT RELATES, IS IMMATERIAL. 4. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIG HT TO AMEND, MODIFY, ADD OR FOREGO ANY GROUND(S) OF APPEAL AT AN Y TIME BEFORE OR DURING THE HEARING OF APPEAL. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE INSPITE OF NOTICE. WE DECIDED TO PROCEED EXPARTE. 3 4. THE LD. DR WAS HEARD AT LENGTH. CASE RECORDS CA REFULLY PERUSED. 5. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT A SEARCH AND SEIZURE OPERATION U/S 132 OF THE INCOME-TAX ACT, 1961 [HERE INAFTER REFERRED TO AS 'THE ACT'] WAS INITIATED BY THE INVESTIGATION WI NG ON 11.04.2011 IN THE CASE OF SHRI R.S. BANSAL. DOCUMENTS/BILLS BELO NGING TO THE ASSESSEE WERE FOUND AND SEIZED FROM THE OFFICE PREMISES OF S HRI R.S. BANSAL AND ACCORDINGLY, NOTICE U/S 153C R.W.S 153A OF THE ACT WAS ISSUED AND SERVED UPON THE ASSESSEE. 6. IN RESPONSE, THE ASSESSEE FILED RETURN OF INCOME DECLARING AN INCOME OF RS. 2,10,114/- 7. DURING SEARCH AT THE PREMISES OF SHRI R.S. BANSA L, BALANCE SHEET ETC OF THE APPELLANT WAS FOUND AND ON RECEIVING NO PLAUSIBLE REPLY, THE ASSESSING OFFICER MADE ADDITION OF RS. 18,99,739/- AS BOGUS EXPENSES. RS. 40 LAKHS WAS ADDED AS UNEXPLAINED CASH CREDIT U /S 68 OF THE ACT AND FURTHER ADDITION OF RS. 1,25,60,000/- WAS MADE ON ACCOUNT OF UNSECURED LOANS. 4 8. ASSESSMENT WAS ASSAILED BEFORE THE LD. CIT(A) AN D IT WAS STRONGLY CONTENDED THAT NO INCRIMINATING MATERIAL PERTAINING TO ASSESSMENT YEAR UNDER CONSIDERATION WAS FOUND FROM THE OFFICE PREMISES OF R.S. BANSAL GROUP. IT WAS POINTED OUT THAT THE ALLEGED BALANCE SHEET FOUND AND SEIZED FROM THE PREMISES OF R.S. BANSAL IS THE AUDITED BALANCE SHEET FINALIZED BY THE AUDITORS AND SIGNED BY THE D IRECTORS. THEREFORE, THE SAME CANNOT BE CONSIDERED AS INCRIMINATING MATE RIAL. 9. AFTER CONSIDERING THE FACTS AND SUBMISSIONS, THE LD. CIT(A) HELD AS UNDER: (III) IN THE APPELLATE PROCEEDINGS, THE APPELLA NT HAS SUBMITTED THAT THERE WAS NO -INCRIMINATING MATERIAL FOUND AND SEIZED DURING THE ACTION U/S 132 OF THE ACT, IN THE CASE OF SHRI R.S. BANSAL GROUP. IT IS A BALANCE SHEET BELONGING TO THE APPELLANT PR EPARED AS ON 31.3.2009 AND THEREFORE, SAME COVERS THE A.Y. 2009- 10 ONLY. IT IS FURTHER SUBMITTED BY THE AR THAT THIS BALANCE SHEET FOUND AND SEIZED FROM THE PREMISES OF SHRI R.S. BANSAL GROUP, IS THE AUDITED BALANCE SHEET FINALIZED BY THE AUDITOR AND SIGNED B Y THE DIRECTORS ALSO. THEREFORE, IT IS SUBMITTED BY THE AR THAT THE SAME CANNOT BE CONSIDERED AS INCRIMINATING DOCUMENTS. (IV) IN THE APPELLATE PROCEEDINGS, THE AR HAS ALSO SUBMITTED THAT THE ACTION U/S 153C OF THE ACT, IN THE CASE OF THE APPELLANT CANNOT 5 BE TAKEN IN THE A.YS., FOR WHICH NO DOCUMENT WAS FO UND AND SEIZED DURING THE ACTION U/S 132 OF THE ACT. ALTERNATIVELY , AR HAS FURTHER SUBMITTED THAT AT THE MOST, THE ALLEGED BALANCE SHE ET CAN BE CONSIDERED FOR THE A.Y. 2009-10 AND A.Y. 2008-09, B EING PREVIOUS YEAR INCLUDED IN THE BALANCE SHEET. FROM THE ABOVE, IT IS CLEAR THAT NO INCRIMINATING D OCUMENT WAS FOUND IN THE SEARCH AND SEIZURE ACTION PERTAINI NG TO A.Y. 2006- 07, A.Y. 2007-08, A.Y. 2010-11 AND A.Y. 2011-12, WH ICH RELATES TO THE APPELLANT. IN VIEW OF THE ABOVE, I AM OF THE CONSIDERED OPINIO N THAT THE ACTION OF THE A.O. U/S 153C OF THE ACT, IS NOT AS P ER PROVISION OF LAW AND THEREFORE, THE ACTION OF THE A.O. U/S 153C OF THE ACT, CANNOT BE APPROVED AND SAME IS HELD AS VOID AB INIT IO. ACCORDINGLY, GROUND NO. 1, IS HEREBY ALLOWED. 10. THE LD. DR COULD NOT POINT OUT ANY FACTUAL ERRO R IN THE AFOREMENTIONED FINDINGS OF THE LD. CIT(A). 6 11. ADMITTEDLY, THE BALANCE SHEET PERTAINED TO ASSE SSMENT YEAR 2009-10 AND THE SAME CANNOT BE TREATED AS INCRIMINA TING MATERIAL FOR ASSESSMENT YEAR 2006-07. WE, THEREFORE, DO NOT FIN D ANY ERROR OR INFIRMITY IN THE FINDINGS OF THE LD. CIT(A). 12. IN THE RESULT THE APPEAL OF THE REVENUE IN ITA NO. 2575/DEL/2017 IS DISMISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT IN THE PR ESENCE OF BOTH THE RIVAL REPRESENTATIVE ON 27.07.2021. SD/- SD/- [ K.N. CHARY ] [N.K. BILLAIYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 27 TH JULY, 2021 VL/ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI 7 DATE OF DICTATION ATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P S/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER