M/s. Subhi International Pvt. Ltd, New Delhi V. ITO, New Delhi

ITA 3112/DEL/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53259 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 5 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Next Hearing Date: 07-12-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 06-07-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A K MONGA
• Assessee Lawyers: R SANTHAN AM
• Keywords: Unexplained cash credit; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G NEW DELHI) BEFORE SHRI RAJPAL YADAV AND SHRI A.N. PAHUJA ITA NO. 3112/DEL/2009 ASSESSMENT YEAR: 2005-06 M/S. SUBHI INTERNATIONAL PVT. LTD., VS. INCOME-TAX OFFICER, 108, 9/54, D.B. GUPTA ROAD, WARD 9(2), KAROL BAGH, NEW DELHI. NEW DELHI. (PAN: AACCS2799D) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI R. SANTHA NAM, ADV. RESPONDENT BY: SHRI AK MONGA, DR DATE OF HEARING : 07.12.2011 DATE OF PRONOUNCEMENT : .12.2011 ORDER PER RAJPAL YADAV: JUDICIAL MEMBER THE ASSESSEE IS IN APPEAL BEFORE US AGAINST THE OR DER OF LEARNED CIT(APPEALS) DATED 13.03.2009 PASSED FOR ASSESSMENT YEAR 2005-06. THE GROUNDS OF APPEALS TAKEN BY THE ASSESSEE ARE NOT IN CONSONANCE WITH RULE 8 OF THE ITAT'S RULES, THEY ARE DESCRIPTIVE AND ARGUM ENTATIVE IN NATURE. THE LEARNED COUNSEL FOR THE ASSESSEE AT THE TIME OF HEA RING POINTED OUT THAT ASSESSEE IS ONLY PRESSING ONE ISSUE WHICH RELATES T O CONFIRMATION OF AN ADDITION OF RS. 8 LACS ON ACCOUNT OF UNEXPLAINED CR EDIT AVAILABLE IN THE BOOKS OF THE ASSESSEE. HE DID NOT PRESS ANY OTHER ISSUE. 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS A PRIVATE LIMITED COMPANY. IT HAS FILED ITS RETURN OF INCOME ON 14.02 .2006 DECLARING A LOSS OF RS.15,220. THE CASE OF THE ASSESSEE WAS SELECTED FO R SCRUTINY ASSESSMENT AND A NOTICE UNDER SEC. 143(2) WAS ISSUED AND SERVED UP ON THE ASSESSEE. IN RESPONSE TO THE NOTICE, SHRI VIJAY KUMAR SANGHI, CA APPEARED BEFORE THE ASSESSING OFFICER FROM TIME TO TIME. ON SCRUTINY OF THE ACCOUNTS, IT REVEALED TO THE ASSESSING OFFICER THAT THE ASSESSEE HAS RECE IVED UNSECURED LOANS AMOUNTING TO RS.1,39,20,000. HE DIRECTED THE ASSESS EE TO FURNISH THE DETAILS EXHIBITING IDENTITY OF THE CREDITORS, THEIR CREDITW ORTHINESS AND GENUINENESS OF THE TRANSACTION. IT EMERGES OUT FROM THE RECORD THA T ASSESSEE WAS ABLE TO EXPLAIN THE CREDIT ENTRIES TO THE EXTENT OF RS.1,31 ,20,000. ACCORDING TO THE ASSESSING OFFICER, IT FAILED TO EXPLAIN THE CASH CR EDIT OF RS. 8 LACS APPEARING AGAINST THE NAME OF TWO CONCERNS, NAMELY, M/S. VED PRAKASH MEHTA AND A- ONE REALATORS AMOUNTING TO RS.1 LAC AND RS. 7 LACS RESPECTIVELY. HE MADE THE ADDITION OF THESE AMOUNTS. 3. DISSATISFIED WITH THE ACTION OF THE ASSESSING OF FICER, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LEARNED CIT(APPEALS ). IT POINTED OUT THAT DUE TO CERTAIN UNAVOIDABLE REASONS, CONFIRMATION FROM T HESE TWO CREDITORS COULD NOT BE FILED. IT WAS SUBMITTED THAT SHRI VED PRAKAS H MEHTA HAD LODGED AN 3 FIR AGAINST THE DIRECTOR AND OTHERS ON 30.1.2008 PR IOR TO THAT THE RELATIONSHIP WITH THE ASSESSEE WERE NOT CORDIAL, THEREFORE, CONF IRMATION ETC. COULD NOT BE OBTAINED. THE ASSESSEE FILED AN APPLICATION UNDER R ULE 46A BEFORE THE LEARNED FIRST APPELLATE AUTHORITY FOR PERMISSION TO ADDUCE ADDITIONAL EVIDENCE. IT POINTED OUT THAT SUBSEQUENTLY THE DISP UTE WAS SETTLED. A PETITION UNDER SECTION 482 OF CR.PC FOR QUASHING THE FIR WAS FILED BEFORE THE HON'BLE DELHI HIGH COURT AND IN VIEW OF THE COMPROM ISE BETWEEN THE PARTIES, THE FIR WAS QUASHED. THEREAFTER ASSESSEE W AS ABLE TO GET THE CONFIRMATION FROM THE CREDITORS. IT SOUGHT TO PLACE ON RECORD ALL THESE DOCUMENTS BY WAY OF ADDITIONAL EVIDENCE. LEARNED FI RST APPELLATE AUTHORITY REJECTED THE CONTENTION OF THE ASSESSEE AND CONFIRM ED THE ADDITION. 4. BEFORE US, LEARNED COUNSEL FOR THE ASSESSEE FILE D AN APPLICATION UNDER RULE 29 OF ITAT RULES, FOR PERMISSION TO ADDUCE ADD ITIONAL EVIDENCE. HE SUBMITTED THAT ON ACCOUNT OF UNAVOIDABLE CIRCUMSTAN CES THE DOCUMENTS IN THE SHAPE OF CONFIRMATION ETC. COULD NOT BE PRODUCE D BEFORE THE ASSESSING OFFICER. HE FURTHER SUBMITTED THAT THE LEARNED FIRS T APPELLATE AUTHORITY HAS NOT GIVEN ANY REASON FOR REJECTION OF ASSESSEES AP PLICATION UNDER RULE 46A OF THE ACT. HE PRAYED THAT THE ADDITIONAL EVIDENCE BE TAKEN ON RECORD AND THE ISSUE BE REMITTED TO THE FILE OF THE ASSESSING OFFI CER FOR READJUDICATION. ON 4 THE OTHER HAND, LEARNED DR RELIED UPON THE ORDER OF THE REVENUE AUTHORITIES BELOW. HE POINTED OUT THAT ASSESSEE SHOULD HAVE FIL ED ALL THESE EVIDENCES BEFORE THE ASSESSING OFFICER. THE FIR WAS LODGED IN JANUARY 2008 WHEREAS THE ASSESSMENT ORDER WAS PASSED ON 31.12.2007. 5. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AN D GONE THROUGH THE RECORD CAREFULLY. THE TOTAL UNSECURED LOANS TAKEN B Y THE ASSESSEE IN THIS YEAR ARE OF RS.1,39,20,000. THE ASSESSEE WAS ABLE TO PRO DUCE EVIDENCE TO THE SATISFACTION OF THE ASSESSING OFFICER TO THE EXTENT OF RS.1,31,20,000 OF UNSECURED LOAN RECEIVED BY IT. IT SUGGESTS THAT ASS ESSEE DID NOT TAKE THE PROCEEDINGS HIGHLY RATHER IT HAS MADE ALL ITS EFFOR TS FOR SUBMITTING THE RELEVANT EVIDENCE. THE EVIDENCE IN RESPECT OF TWO C REDITORS COULD NOT BE PRODUCED ON ACCOUNT OF STRAIN RELATIONSHIP. CONSIDE RING THE FIR, THE SETTLEMENT BETWEEN THE PARTIES AND THE ORDER OF THE HON'BLE HIGH COURT VIDE WHICH FIR WAS QUASHED, WE ARE OF THE VIEW THAT ENDS OF JUSTICE WOULD MEET IF WE SET ASIDE THIS ISSUE TO THE FILE OF THE ASSES SING OFFICER FOR READJUDICATION. LEARNED ASSESSING OFFICER SHALL DEC IDE THE ISSUE REGARDING AVAILABILITY OF UNEXPLAINED CASH CREDITS AMOUNTING TO RS.7 LACS AND RS. 1 LAC AGAINST THE NAME OF AONE REALATORS (P) LTD. AND MR. VED PRAKASH MEHTA. THE ASSESSEE WILL BE AT LIBERTY TO PRODUCE ANY EVID ENCE OR EXPLANATION IN 5 SUPPORT OF ITS EXPLANATION. ASSESSING OFFICER SHALL ADJUDICATE THE ISSUE AFTER PROVIDING DUE OPPORTUNITY OF HEARING. IT IS NEEDLES S TO SAY THAT THE OBSERVATIONS MADE BY US WILL NOT IMPAIR OR INJURE T HE CASE OF A.O. OR WOULD NOT CAUSE ANY PREJUDICE TO THE DEFENCE/EXPLANATION OF THE ASSESSEE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT. SD/- SD/- ( A.N. PAHUJA ) ( RA JPAL YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 07/12/2011 MOHAN LAL COPY FORWARDED TO: 1) APPELLANT 2) RESPONDENT 3) CIT 4) CIT(APPEALS) 5) DR:ITAT ASSISTANT REGISTRAR