M/s. Maneesha Finlease Ltd., New Delhi V. ITO, New Delhi

ITA 2824/DEL/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6527 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 06-03-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 17-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BEDOBINA CHAUDHARI
• Assessee Lawyers: RISHABH JAIN C S
• Keywords: Accommodation entries
• Section: 143(3); 147; 68; 148

Judgement Text

ITA NO. 2824 /DEL./201 6 ASSESSMENT Y EAR: 2007 - 08 PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH SM C NEW DELHI) BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMB E R ITA NO. 2 8 2 4 /DEL./201 6 ASSESSMENT YEAR: 200 7 - 0 8 MANEESHA FINLEASE LTD. (AMALGAMATED COMPANY OF ABHIVADAN MANAGEMENT AND CONSULTANCY PVT. LTD.) 153, VASANT ENCLAVE, NEW DELHI VS. IT O WARD - 1(2) NEW DELHI (APPLICANT) (RESPONDENT) (PAN: A AAPP0683N ) ASSESSEE BY: SH. RISHABH JAIN, C.S. REVENUE BY: MS. BEDOBINA CHAUDHARI, SR. DR DATE OF HEARING 06 / 0 3 /201 7 DATE OF PRONOUNCEMENT 0 7 / 0 3 /201 7 ORDER PER B.P. JAIN , ACCOUNTANT MEMBER : 1. THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF LD. CIT(A) - I , NEW DELHI VIDE ORDER DATED 5 . 4 .201 6 FOR THE A.Y. 200 7 - 0 8 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. THAT, THE NOTICE ISSUED UNDER SECTION 148 AND THE ASSESSMENT ORDER PASSED U/S 147 READ WITH SECTION 143(3) ARE ILLEGAL, BAD IN LAW AND WITHOUT JURISDICTION. 2. THAT THE CIT - (A) HAS, IN VI EW OF THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, GROSSLY ERRED IN PAGE 2 OF 5 LAW AND ON FACTS IN UPHOLDING THE VALIDITY OF THE ASSESSMENT ORDER ON THE NONEXISTENT ENTITY AND NOT FOLLOWING THE DECISIONS OF THE HON BLE JURISDICTIONAL HIGH COURT. 3. THAT THE CIT - (A) HAS ERRED IN LAW AND ON FACTS OF THE CASE WHILE UPHOLDING THE ADDITION OF RS 5.00,000/ - MADE BY THE AO U/S 68 OF THE INCOME TAX ACT, 1961 WITHOUT EXAMINATION OF THE DOCUMENT AVAILABLE ON RECORD. 4. THAT THE CIT - (A) HAS ERRED IN LAW AND ON FACTS OF THE CASE WHILE UPHOLDING THE ADDITION OF RS 1.250/ - MADE BY AO ON ACCOUNT OF COMMISSION EXPENSES ON ACCOMMODATION ENTRIES, WITHOUT BEING ANY DOCUMENT EVIDENCE ON RECORD TO PROVE THE ALLEGATION MADE BY THE AO. 5. THAT THE VARIOUS OBSERVATIONS MADE BY THE AO AND C1T(A) ARE ILLEGAL , BAD IN LAW AND CONTRARY TO THE FACTS ON RECORD. 6. THAT THE DETAILS FILED, EXPLANATIONS GIVEN AND THE EVIDENCE PLACED ON RECORD HAVE NOT BEEN PROPERLY CONSIDERED AND JUDICIALLY INTERPRETED. 7. THAT THE ADDITIONS UPHELD BY THE CIT - (A) WERE MADE ON SURMISES AND CONJECTURES AND ON GUESSWORK AND HAVE NO RELEVANCE TO THE FACTS AND THE LEGAL POSITION. 8. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER AND/OR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL AT OR BEFORE THE TIME OF HEARING. 2. THE BRIEF FACTS OF THE CASE AS POINTED OUT BY THE LD. COUNSEL OF THE ASSESSEE IS THAT THE ASSESSING OFFICER PASSED THE ASSESSMENT ORDER ON A COMPANY WHICH IS NOT IN EXISTENCE. IT WAS POINTED OUT AT PAGE 1 OF THE PAPER BOOK THE NOTICE U/S 14 8 WHERE IT IS CLEARLY MENTIONED AS UNDER: - M/S. ABHIVADAN MANAGEMENT AND CONSULTANCY PVT. LTD. HAS BEEN MERGED WITH M/S. MANEESHA FINLEASE LTD. COPY OF THE PAGE 3 OF 5 ORDER DATD 30.01.11 OF HON BLE DELHI HIGH COURT IS ENCLOSED HEREWITH FOR YOUR KIND REFERENCE. 3 . HE ALSO POINTED OUT THE ORDER OF THE HIGH COURT OF DELHI ABOUT THE MERGER OF ABHIVADAN MANAGEMENT AND CONSULTANTS PVT. LTD. AT PAGE 4 AND DISSOLUTION OF THE TRANSFER OR COMPANY WITHOUT BEING WINDING UP TRANSFER AT PAGE 20 OF THE PAPER BOOK IN THE ORDER OF THE HON BLE HIGH COURT OF DELHI. THE ORDER OF THE A.O. DATED 4.3.2015 AT REASONS RECORDED BY THE A.O. AVAILABLE AT PAPER BOOK 33 AND 34 DATED 24.3.2014. IT WAS ARGUED THAT ALL THE FACTS ARE AVAILABLE BEFORE THE A.O. AND THE LD. CIT (A) BUT EVE N THEN THE ORDER WAS PASSED ON THE NON EXISTENCE OF COMPANY. THE LD. COUNSEL RELIED UPON THE DECISION OF HON BLE DELHI HIGH COURT IN THE CASE OF CIT VS. MICRA INDIA LTD. DATED 22.1.2015 ON RECORD WHERE IT HAS BEEN HELD AS UNDER: - IN THE PRESENT CASE, NO DOUBT THERE WAS PARTICIPATION DURING THE COURSE OF ASSESSMENT; HOWEVER, THE AO, DESPITE BEING TOLD THAT THE ORIGINAL COMPANY WAS NO LONGER IN EXISTENCE, DID NOT TAKE REMEDIAL MEASURES AND DID NOT TRANSPOSE THE TRANSFEREE AS THE COMPANY WHICH HAD TO BE ASSE SSED. INSTEAD, HE RESORTED TO A PECULIAR PROCEDURE OF DESCRIBING THE ORIGINAL ASSESSEE AS THE PAGE 4 OF 5 ONE IN EXISTENCE; THE ORDER ALSO MENTIONED THE TRANSFEREE'S NAME BELOW THAT OF M/S MICRA INDIA PVT. LTD. NOW, THAT DID NOT LEAD TO THE ASSESSMENT BEING COMPLETED IN THE NAME OF THE TRANSFEREE COMPANY. ACCORDING TO THE AO, M/S MICRA INDIA PVT. LTD/WAS STILL IN EXISTENCE. CLEARLY, THIS WAS A CASE WHERE THE ASSESSMENT WAS CONTRARY TO LAW, AS HAVING BEING COMPLETED AGAINST A NON - EXISTENT COMPANY. THE ITAT S DECISION IS, IN THE CIRCUMSTANCES, JUSTIFIED AND WARRANTED. 4. I AGREE WITH THE ARGUMENTS MADE BY THE LD. COUNSEL FOR THE ASSESSEE AND F ACTS OF THE CASE BROUGHT BEFORE ME AND THE DECISION OF THE HON BLE HIGH COURT OF DELHI CITED HEREIN ABOVE, I AM OF THE VIEW THAT THE ASSESSMENT MADE IS ON THE NON EXISTENCE COMPANY IS BAD IN LAW AND IS DIRECTED TO BE QUASHED. 5 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. 6 . P RONOUNCED IN THE OPEN COURT ON 0 7 . 0 3 .201 7. S D / / - ( B.P. JAIN ) ACCOUNTANT MEMB E R DATED: 0 7 . 0 3 .2017 PAGE 5 OF 5 NARENDER COPY FORWARDED TO: 1) APPELLANT 2) RESPONDENT 3) CIT 4) CIT (APPEALS) 5) DR: ITAT ASSISTANT REGISTRAR DATE DRAFT DICTATED ON 06 .0 3 .2017 DRAFT PLACED BEFORE AUTHOR 7 .0 3 .2017 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. APPROVED DRAFT COMES TO THE SR.PS/PS 0 7 .3.2017 KEPT FOR PRONOUNCEMENT ON FILE SENT TO THE BENCH CLERK 0 7 .3.2017 DATE ON WHICH FILE GOES TO THE AR DATE ON WHICH FILE GOES TO THE HEAD CLERK. DATE OF DISPATCH OF ORDER.