ASST CIT 15(1), MUMBAI V. GIRISH L. SHAH, MUMBAI

ITA 3456/MUM/2013

• Counselvise Citation: 345619914 RSA 2013
• Duration Of Justice: 1 year(s) 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 12-02-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 03-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S C TIWARI; PRIYANKA MANE
• Assessee Lawyers: PAVAN KUMAR BEER LA
• Keywords: Gift; Accommodation entries

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND VIVEK VARMA (J M) . . , , ./I.T.A. NO.3141/MUM/2013 ( / ASSESSMENT YEAR : 2005-06) MR.GIRISH SHAH, 59, KIKA STREET, GULALWADI, MUMBAI-400004 / VS. THE JT. COMMISSIONER OF INCOME TAX (OSD), CIRCLE-15(1), MUMBAI ( / APPELLANT) .. ( / RESPONDENT) ./I.T.A. NO.3456/MUM/2013 ( / ASSESSMENT YEAR : 2005-06) THE ASTT. COMMISSIONER OF INCOME TAX-15(1), ROOM NO.104, MATRU MANDIR, 1 ST FLOOR, TARDEO RD., MUMBAI-400007 / VS. MR.GIRISH L.SHAH, 59, KIKA STREET, GULALWADI, MUMBAI-400004 ( / APPELLANT) .. ( / RESPONDENT) ./ ! ./PAN/GIR NO. :AACPS7752D ' / APPELLANT BY SHRI S C TIWARI AND MS.PRIYANKA MANE # ' / RESPONDENT BY SHRI PAVAN KUMAR BEERLA $ % # &' / DATE OF HEARING :12.2.2015 () # &' /DATE OF PRONOUNCEMENT : 20.2.2015 ITA. NO3141/MUM/2013 AND ITA 3456/MUM/2013 2 / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THESE CROSS APPEALS ARE DIRECTED AGAINST THE ORDER DATED 04-02- 2013 PASSED BY LD CIT(A)-26, MUMBAI AND THEY RELATE TO THE ASSESSMENT YEAR 2005-06. THE ASSESSEE IS AGGRIEVED BY THE DEC ISION OF LD CIT(A) IN CONFIRMING THE ADDITION OF RS.20.00 LAKHS RELATING TO THE GIFT RECEIPTS AND THE REVENUE IS AGGRIEVED BY THE DECISION OF LD CIT( A) IN DELETING ASSESSMENT OF GROSS RECEIPTS REALIZED ON SALE OF SH ARES AS CASH CREDITS. 2. THE LD A.R SUBMITTED THAT THE ASSESSEE HAD DECL ARED LONG TERM CAPITAL GAIN ON SALE OF SHARES AND HAD ALSO DISCLOS ED THE RECEIPT OF GIFTS FROM CLOSE FRIEND. HOWEVER, THE AO TOOK THE VIEW T HAT THE ASSESSEE HAD TAKEN ONLY ACCOMMODATION ENTRIES WITH REGARD TO LON G TERM CAPITAL GAINS. ACCORDINGLY HE REJECTED THE CLAIM OF LONG TERM CAPI TAL GAINS AND ASSESSED THE GROSS SALE RECEIPTS AS INCOME OF THE ASSESSEE U NDER THE HEAD INCOME FROM OTHER SOURCES. SIMILARLY HE ASSESSED THE GIFT RECEIPTS ALSO AS INCOME OF THE ASSESSEE TREATING THE SAME AS UNEXPLAINED, E VEN THOUGH THE ASSESSEE HAD DISCHARGED THE BURDEN IN THAT REGARD. 3. THE LD A.R SUBMITTED THAT THE AO HAD MADE IDENT ICAL ADDITIONS IN THE CASE OF ASSESSEES MOTHER NAMED SMT. MANJULABEN L SHAH. THE MATTERS REACHED THE ITAT AND THE TRIBUNAL, VIDE ITS ORDER DATED 31.10.2014 PASSED IN ITA NO.3112/MUM/2014 RELATING TO THE ASSESSMENT YEAR 2005-06, HAS DELETED BOTH THE ADDITIONS. HE F URTHER SUBMITTED THAT THE AO HAD ALSO MADE IDENTICAL ADDITIONS IN THE CAS E OF ANOTHER FAMILY MEMBER NAMED SHRI PINAKIN L SHAH AND THE TRIBUNAL D ELETED BOTH THE ADDITIONS. HE SUBMITTED THAT THE ORDER OF THE TRIB UNAL, HAS SINCE BEEN CONFIRMED BY THE HONBLE BOMBAY HIGH COURT ALSO. A CCORDINGLY HE SUBMITTED THAT BOTH THE ADDITIONS ARE COVERED BY TH E DECISION OF THE TRIBUNAL, REFERRED ABOVE, AND ACCORDINGLY PRAYED FO R DELETION OF THE SAME ITA. NO3141/MUM/2013 AND ITA 3456/MUM/2013 3 BY FOLLOWING THE DECISION OF THE TRIBUNAL PASSED IN THE CASE OF SMT. MANJULABEN L SHAH. 4. ON THE CONTRARY, THE LD D.R PLACED RELIANCE ON THE WRITTEN SUBMISSIONS FILED BEFORE THE BENCH. A PERUSAL OF T HE SAME WOULD SHOW THAT THE REVENUE IS STRONGLY SUPPORTING THE ORDER O F THE ASSESSING OFFICER. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE RECORD. WE NOTICE THAT THE ASSESSMENTS IN THE HANDS OF THE ASS ESSEE AS WELL IN THE HANDS OF HIS MOTHER NAMED SMT. MANJULABEN L SHAH WE RE COMPLETED ON THE BASIS OF INFORMATION OBTAINED BY THE DEPARTMENT DURING THE COURSE OF SEARCH CONDUCTED ON MR. MUKESH CHOKSI. DURING THE COURSE OF SEARCH, IT WAS NOTICED THAT SHRI MUKESH CHOKSHI HAD PROVIDED A CCOMMODATION ENTRIES FOR BOGUS SHARE TRANSACTIONS, INTER ALIA, I N RESPECT OF SHARES OF M/S TALEN INFOWAY LTD. THESE ASSESSEE HEREIN HAD ALSO PURCHASED AND SOLD THE SHARES OF THE ABOVE SAID COMPANY. HENCE, THE A O DISBELIEVED THE CLAIM OF LONG TERM CAPITAL GAIN AND ASSESSED THE GR OSS SALE PROCEEDS AS INCOME OF THE ASSESSEE UNDER THE HEAD INCOME FROM O THER SOURCES. THE ASSESSEE HAD ALSO RECEIVED GIFTS FROM SHRI MUKESH C HOKSI AND SHRI MANEKLAL CHOKSI. THE AO ALSO DISBELIEVED THE CLAIM OF RECEIPT OF GIFT AND ACCORDINGLY ASSESSED THE GIFT AMOUNTS ALSO AS INCOM E OF THE ASSESSEE UNDER THE HEAD INCOME FROM OTHER SOURCES. THE LD CIT(A) ACCEPTED THE GENUINENESS OF LONG TERM CAPITAL GAIN DECLARED BY T HE ASSESSEE AND ACCORDINGLY DELETED THE ASSESSMENT OF GROSS SALE RE CEIPTS AS INCOME OF THE ASSESSEE. HOWEVER, HE CONFIRMED THE REJECTION OF C LAIM OF GIFT RECEIPTS AND CONSEQUENT ASSESSMENT OF THE SAME AS INCOME OF THE ASSESSEE. 6. A PERUSAL OF THE ORDER PASSED BY THE TRIBUNAL I N THE CASE OF SMT. MANULABEN L SHAH WOULD SHOW THAT THE TRIBUNAL HAS R ECORDED A FINDING THAT SHRI MUKESH CHOKSI HAS NOT IMPLICATED THE ASSE SSEE THEREIN OR HER ITA. NO3141/MUM/2013 AND ITA 3456/MUM/2013 4 FAMILY. FOLLOWING OBSERVATIONS MADE BY THE TRIBUNA L AT PAGE 17 OF ITS ORDER ARE RELEVANT HERE:- . THE LD CIT(A) MERELY RELIED UPON THE STATEMENT OF SHRI MUKESH CHOKSI, GIVEN EARLIER. EVEN IF WE RELY ON S UCH A STATEMENT, WHICH HAS BEEN REPRODUCED BY THE LEARNED CIT(A) FRO M PAGES 7 TO 9 OF THE APPELLATE ORDER, THEN IT CAN BE SEEN THAT, N OWHERE THE NAME OF THE ASSESSEE HAS SURFACED NOR ANY REFERENCE IS M ADE TO ASSESSEE OR HER FAMILY, HENCE SUCH A STATEMENT THAT HE WAS E NGAGED IN PROVIDING ACCOMMODATION ENTRIES TO ALL, CANNOT BE T AKEN AT FACE VALUE, UNLESS THE SAME IS CORROBORATED BY A COGENT MATERIAL QUA THE ASSESSEE. THE ASSESSEE HEREIN IS A FAMILY MEMBER OF SMT. MANJ ULABEN L SHAH AND WE HAVE NOTICED THAT THE CO-ORDINATE BENCH HAS ALRE ADY GIVEN A FINDING THAT THE NAME OF SMT. MANJULABEN L SHAH OR HER FAMI LY WAS NOT IMPLICATED BY SHRI MUKESH CHOKSI. THE TRIBUNAL HAS FURTHER NO TICED THAT SHRI MUKESH CHOKSI HAS ALSO GIVEN A LETTER TO THE AO TO THE EFF ECT THAT THE TRANSACTIONS WITH THE FAMILY OF SHRI PINAKIN L SHAH (ANOTHER FAM ILY MEMBER OF SMT. MANJULABEN L SHAH) ARE GENUINE. WE FURTHER NOTICE THAT THE CO-ORDINATE BENCH OF TRIBUNAL HAD ALSO GIVEN RELIEF FROM IDENTI CAL ADDITIONS (BOTH CAPITAL GAINS AND GIFT RECEIPTS) MADE IN THE HANDS OF SHRI PINAKIN L SHAH (ITA NO.3030/MUM/2008 AND ITA NO.3453/MUM/2008, VID E ORDER DATED 14-07-2009). THE SAID ORDER OF THE TRIBUNAL HAS SI NCE BEEN UPHELD BY THE HONBLE BOMBAY HIGH COURT, VIDE ITS ORDER DATED 18- 01-2012 PASSED IN ITA NO.3380 OF 2010. THE ASSESSEE HAS PLACED COPIES OF THE ORDERS PASSED BY THE TRIBUNAL AS WELL AS THE HIGH COURT IN THE PAPER BOOK. 7. IN THE CASE OF SMT. MANULABEN L SHAH, THE CO-O RDINATE BENCH ALSO TAKEN NOTE OF THE DECISION RENDERED BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF SHRI PINAKIN L SHAH AND HAS HELD THAT T HERE CANNOT BE A DIFFERENT FINDING IN THE CASE OF THE ASSESSEE TO TH AT HAS BEEN GIVEN IN PINAKIN L SHAH, WHICH HAS SINCE BEEN CONFIRMED BY H ONBLE HIGH COURT. ITA. NO3141/MUM/2013 AND ITA 3456/MUM/2013 5 8. IN THE INSTANT CASE ALSO, THE FACTS AND CIRCUMS TANCES RELATING TO THE LONG TERM CAPITAL GAIN AND GIFT RECEIPTS ARE IDENTI CAL TO THAT OF SHRI MANJULABEN L SHAH AND SHRI PINAKIN L SHAH. HENCE, FOLLOWING THE DECISIONS RENDERED IN THE ABOVE SAID TWO CASES, WE UPHOLD THE ORDER OF LD CIT(A) IN RESPECT OF THE LONG TERM CAPITAL GAIN DEC LARED BY THE ASSESSEE. WE NOTICE THAT THE ASSESSEE HAS FURNISHED ALL THE D ETAILS RELATING TO THE GIFT RECEIPTS BEFORE THE LD CIT(A). HENCE, FOLLOWING TH E DECISIONS RENDERED IN THE ABOVE SAID TWO CASES, WE SET ASIDE THE ORDER OF LD CIT(A) IN RESPECT OF GIFT RECEIPTS AND DIRECT THE AO TO DELETE THE ADDIT ION RELATING TO THE SAME. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED AND THE APPEAL OF THE REVENUE IS DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OP EN COURT ON 20TH FEB, 2015 . () $ * +, 20TH FEB, 2015 ) # 1% 2 SD SD ( / VIVEK VARMA ) ( . . / B.R. BASKARAN) / JUDICIAL MEMBER / ACCOUNTANT MEMBER $ % MUMBAI: 20TH FEB ,2015. . . ./ SRL , SR. PS !'#$ %$&' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. $ 3& ( ) / THE CIT(A)- CONCERNED 4. $ 3& / CIT CONCERNED 5. 41 &5 , ' 5 , $ % / DR, ITAT, MUMBAI CONCERNED 6. 16 7% / GUARD FILE. 8 $ / BY ORDER, TRUE COPY 9 (ASSTT. REGISTRAR) ' 5 , $ % /ITAT, MUMBAI