The DCIT, (OSD)-1, Circle-4, Ahmedabad V. M.H.Mills & Industries Ltd., Ahmedabad

ITA 2781/AHD/2013

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9163 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 14-02-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 28-11-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Unexplained investment
• Section: 43B; 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD . . , , BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI MAHAVIR PRASAD, JUDICIAL MEMBER ./ I.T.A. NO.2781/AHD/2013 ( / ASSESSMENT YEAR : 2008-09) THE DCIT, (OSD)-I, CIRCLE-4 AHMEDABAD. / VS. M.H. MILLS & INDUSTRIES LTD. SARASPUR ROAD, SARASPUR, AHMEDABAD. ./ ./ PAN/GIR NO. : AAACM 9900 G ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI JAMES KURIAN, SR. D.R. / RESPONDENT BY : SHRI SUNIL TALATI, A.R. / DATE OF HEARING 14/02/2017 / DATE OF PRONOUNCEMENT 16/02/2017 / O R D E R PER SHRI MAHAVIR PRASAD, JUDICIAL MEMBER : THIS APPEAL HAVE BEEN FILED BY THE DEPARTMENT IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-VIII, AHMEDABAD, DATED 14/08/2013 FOR THE ASSESSMENT YEAR (AY) 2008-09. DEPARTMENT HAVE BEEN TAKEN FOLLOWING GROUNDS OF APPEAL: I. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.5,14,00,000/- MADE U/S.68 OF THE IT ACT BEING UNEXPLAINED INVESTMENT IN SHARES AND SHARE APPLICATION MONEY RECEIVED BY FOUR PRIVATE LIMITED COMPANIES, WITHOUT PROPERLY APPRECIATING THE FACTS OF THE CASE AND THE MATERIAL BROUGHT ON RECORD. II. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER. ITA NO. 2781/AHD/2013 DCIT VS. M.H. MILLS & INDUSTRIES LTD. ASST.YEAR 2008-09 - 2 - 2. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS NOTICED THAT THE ASSESSEE HAS INCREASED ITS AUTHORIZED AND PAID UP SHARE CAPITAL. THE INCREASE IN AUTHORIZED SHARE CAPITAL IS RS.5,50,00,000/- AND PAID UP SHARE CAPITAL IS INCREASED BY RS.1,49,00,000/-. APART FROM THIS THE SHARE APPLICATION MONEY WAS INCREASED BY RS.3,62,00,000/- THE ASSESSEE WAS ASKED TO GIVE DETAILS OF THE INCREASE IN SHARE CAPITAL. THE ASSESSEE WAS ALSO ASKED VIDE ORDER SHEET ENTRIES AND SHOW CAUSE NOTICE TO PROVIDE THE DETAILS OF PERSONS TO WHOM THE SHARES HAVE BEEN ALLOTTED AND TO PROVE THE CREDITWORTHINESS, IDENTITY AND GENUINENESS OF THESE TRANSACTION. 3. ASSESSEE REPLIED THAT THESE PARTIES WITH CONFIRMATION LETTER TO PROVE THE IDENTITY, GENUINENESS AND CREDITWORTHINESS. THE FOLLOWING FACTS AROSE FOR CONSIDERATION:- NAME RETURNED INCOME AMOUNT UNDER CONSIDERATION PRABHUTI INVESTMENT PVT. LTD. 1308894/- RS. 84.50 LACS M/S. DHIREN INVESTMENT PVT. LTD. NIL RS. 67.50 LACS AABHAR HOLDINGS PVT. LTD. NIL RS. 140 LACS M/S. NAVDEEP INVESTMENT PVT. LTD. 9625130/- RS. 222 LACS 4. THE IDENTITY IS PROVED BY THE RETURN OF INCOME FILED BY THESE PARTIES. NOW THE ISSUE OF GENUINENESS AND CREDITWORTHINESS WAS REMAINED TO SATISFY. AFTER GOING THROUGH THE RETURN OF INCOME FILED BY THESE PARTIES IT WAS ALSO NOTICED THE CREDITWORTHINESS OF THESE PARTIES WERE SUBJECT TO QUESTION. THE ASSESSEE WAS FAILED TO PROVE THAT THE PARTIES HAVE ENOUGH ITA NO. 2781/AHD/2013 DCIT VS. M.H. MILLS & INDUSTRIES LTD. ASST.YEAR 2008-09 - 3 - FUNDS TO PROVIDE THESE FUNDS TO THE ASSESSEE. THE ASSESSEE WAS ASKED TO PROVIDE THE COPY OF BALANCE SHEET OF THESE COMPANIES BUT HE FAILED TO PROVIDE ANY FURTHER DETAIL. 5. THEREAFTER, ADDITION U/S. 68 OF THE ACT WAS MADE IN THE TOTAL INCOME OF COMPUTATION OF THE ASSESSEE. TOTAL INCOME AS PER COMPUTATIONS OF TOTAL INCOME (-) RS. 54103353/- ADD: UNEXPLAINED CASH CREDIT RS.5,14,00,000/- EXCESS EXPENSES DISALLOWED RS. 5,63,818/- EXPENSES U/S. 43B RS. 74,44,337/- RS.59408155/- RS.53,04,802/- LESS: SET OFF OF BUSINESS LOSS RS.53,04,802/- TOTAL ASSESSED INCOME RS. NIL . 6. AGAINST THE SAID ORDER ASSESSEE PREFERRED FIRST STATUTORY APPEAL BEFORE THE LD. CIT(A) WHO PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. NOW ADDITION OF RS. 5,14,00,000/- IS BEFORE US . 7. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMPUGNED ORDER AND PAPER BOOK FILED BY THE LD. A.R., SAME HAS BEEN DISCUSSED UNDER RULE 18(VI) OF THE ITAT RULES. BEFORE THE LD.CIT(A). ASSESSEE FILED CONFIRMATION LETTER WITH PAN NO., COPY OF RETURN OF INCOME OF DEPOSITOR, AND COPY OF BANK ACCOUNT FROM WHICH CHEQUE ISSUED BY THE APPELLANT. BUT LD. CIT(A) DID NOT COVER ANY REMAND REPORT FOR THE ASSESSING OFFICER. IN OUR CONSIDERED OPINION WHEN ASSESSEE FILED ADDITIONAL DOCUMENTS, LD. CIT(A) OUGHT TO HAVE CALLED FOR REMAND REPORT FROM THE A.O. WHICH HE HAS BEEN FAILED TO DO SO AND SAME IS AMOUNT TO MISCARRIAGE OF JUSTICE. THEREFORE WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND WE REMAND THIS MATTER BACK TO THE FILE OF THE AO; WHO WILL EXAMINE ITA NO. 2781/AHD/2013 DCIT VS. M.H. MILLS & INDUSTRIES LTD. ASST.YEAR 2008-09 - 4 - THE DOCUMENTS WHICH WERE FILED BEFORE THE LD.CIT(A) AND DECIDE THE MATTER AFRESH. 8. IN THE RESULT APPEAL FILED BY THE DEPARTMENT IS ALLOWED FOR THE STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 16/02/2017 SD/- SD/- . . ( ) ( ) ( N.K. BILLAIYA ) ( MAHAVIR PRASAD ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 16/02 /2017 PRITI YADAV, SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A)-VIII, AHMEDABAD. 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE. / BY ORDER, //TRUE COPY// / (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD \ 1. TRUE COPY DATE OF DICTATION 15/02/2017 (DICTATION-PAD 3 PAGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 15/02/2017 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P.S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P.S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CL