Appeal details
Counselvise Citation
[2016] 131 COUNSELVISE.COM (IT) 1301 (ITAT-NAGPUR)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
2 year(s) 4 month(s) 29 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
25-11-2016
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
DB
Next Hearing Date
08-06-2016
Assessment Year
2004-2005
Appeal Filed On
26-06-2014
Judgement Text
1 ITA NO. 347/NAG/2014 & & ITA NO. 295/NAG/2014 IN THE INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI, JUDICIAL MEMBER.. I.T.A.NO.347/NAG/2014 ASSESSMENT YEAR : 2004 - 05. ASSTT. COMMISSIONER OF INCOME - TAX, GRACE INDUSTRIES LTD. CENTRAL CIR.2(3), VS. A - 23, TALADI GROUP CENTRE, ROOM NO 312, 3RD FLOOR, AAYAKAR CHANDRAPUR. BHAWAN, CIVIL LINES, NAGPUR. PAN AACCG2424R APPELLANT. RESPONDENT. I.T.A.NO.295/NAG/2014 ASSESSMENT YEAR : 2004 - 05. GRACE INDUSTRIES LTD. A SSTT. COMMR. OF INCOME - TAX, A - 23, TADALI GROUP CENTRE VS CENTRAL CIR.2(3), ROOM NO. 312 CHANDRAPUR. 3 RD FLOOR, AYAKAR BHAWAN, PAN AACCG2424R CIVIL LINES, NAGPUR. APPELLANT. RESPONDENT. DEPARTMENT BY : SHRI A.R. NINAWE. ASSESSEE BY : SHRI K.P. DEWANI. DATE OF HEARING : 24 - 11 - 2016 DATE OF PRONOUNCEMENT : 25 TH NOV.., 2016 O R D E R. PER RAM LAL NEGI THESE ARE THE CROSS APPEALS PREFERRED BY THE REVENUE AND THE ASSESSEE RESPECTIVELY AGAINST IMPU GNED ORDER DATED 28/3/2013 PASSED BY THE CIT(APPEALS) - III, NAGPUR WHEREBY THE LEARNED CIT(APPEALS) PARTLY ALLOWED 2 ITA NO. 347/NAG/2014 & & ITA NO. 295/NAG/2014 THE APPEAL FILED BY THE ASSESSEE AGAINST ASSESSMENT ORDER PASSED U/S 143(3) R.W.S. 153C OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2 . THE REVENUE HAS CHALLENGED THE IMPUGNED ORDER ON THE FOLLOWING EFFECTIVE GROUNDS : - 1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, WHETHER THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS 25 LAKHS, TOWARDS UNEXPLAINED SPHERE APPLICATION MONEY, BY HOLDING THAT THE ADDITION IS NOT BASED ON ANY SEIZED DOCUMENTS, WITHOUT APPRECIATING THE FACT THAT IS SEEN FROM THE SEIZED DOCUMENTS IN ANNEXURE A - 2, ITEM NO.1/PAGE 42 AND 45, THAT THE ASSESSEE COMPANY IS INVOLVED IN MONEY - LAUNDERING, AND THAT SUCH MONEY HAD BEEN RECEIVED BACK IN THE FORM OF SHARE CAPITAL/SHARE APPLICATION MONEY. 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, WHETHER THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS. 25 LAKHS TOWARDS UNEXPLAINED SHARE APPLICATION MONEY, BY HOLDING THAT THE SHARE CAPITAL/SHARE APPLICATION MONEY WAS ALSO RECEIVED FROM THE ENTITIES OF SHRI MUKESH GUPTA GROUP, WHOSE IDENTITIES WERE ESTABLISHED, THOUGH IS SEEN FROM THE SEIZED DOCUMENT ANNEXURE A - 2, ITEM 1/PAGE 49, SHRI MUKESH GUPTA AND HIS FAMILY MEMBERS AND GROUP CONCERNS HAVE RECEIVED HUGE AMOUNTS FROM VARIOUS PARTIES THROUGH CHEQUE LENA, NAGAD DENA WHICH IN TURN, HAD BEEN INVESTED IN THE ASSESSEE COMPANY AS SHARE CAPITAL/APPLICATION MONEY. 3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, WHETHER THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS. 25 LAKHS TOWARDS UNEXPLAINED SHARE APPLICATION MONEY, WITHOUT APPRECIATING THE FACT THAT THE AO HAD ELABORATELY DISCUSSED AND CLEARLY BROUGHT OUT THE NE XUS BETWEEN PAPER COMPANIES FLOATED BY SHRI D. P. SARDA AND AMOUNTS RECEIVED BY THE GUPTA GROUP, THROUGH MONEY - LAUNDERING WHICH HAD BEEN INVESTED IN THE ASSESSEE COMPANY IN THE FORM OF SHARE CAPITAL/SHARE APPLICATION MONEY. 4) ON THE FACTS AND IN THE CIRCUMS TANCES OF THE CASE AND IN LAW, WHETHER THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION TOWARDS UNEXPLAINED SHARE APPLICATION MONEY, EVEN THOUGH THE ASSESSEE FAILED TO ESTABLISH THE GENUINENESS OF THE TRANSACTIONS AND THE CREDIT - WORTHINESS OF THE INVESTO RS DURING THE ASSESSMENT PROCEEDINGS. 3 ITA NO. 347/NAG/2014 & & ITA NO. 295/NAG/2014 3. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE TAX EFFECT IN THIS CASE IS BELOW RS.10,00,000/ - AS THE AMOUNT OF ADDITION IN DISPUTE IS ONLY RS. 25,00,000/ - AND AS PER THE CBDT CIRCULAR NO. 21 OF 2015, DATED 10/12/2015, THE PRESE NT APPEAL IS NOT MAINTAINABLE. 4. THE LD. DR FAIRLY ADMITTED THAT THE TAX EFFECT IN DEPARTMENTS APPEAL IS BELOW RS.10 LAKHS, WE FIND THAT THE ISSUE RAISED IN APPEAL DOES NOT FALL UNDER ANY OF THE EXCEPTIONS SPECIFIED IN PARA 8 OF THE CIRCULAR. SINCE , IT HAS BEEN SPECIFICALLY CLARIFIED IN THE CIRCULAR AFORESAID THAT THE INSTRUCTION WILL APPLY RETROSPECTIVELY TO ALL THE PENDING APPEALS, THE PRESENT APPEAL FILED BY THE REVENUE IS NOT MAINTAINABLE. WE, THEREFORE, DISMISS THE SAME IN LIMINE . ITA NO 347 /NAG/2014. THE LD. COUNSEL FOR THE APPELLANT/ ASSESSEE SUBMITTED THAT SINCE THE ASSESSEE DOES NOT WANT TO PRESS THIS APPEAL HE WANTS TO WITHDRAW THE SAME. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS NO OBJECTION IN CASE WITHDRAWAL OF THE APPEAL I S ALLOWED. ACCORDINGLY, WE ALLOW THE REQUEST OF THE LD. COUNSEL AND DISMISS THE APPEAL AS WITHDRAWN. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE AS WELL AS THE ASSESSEE FOR THE AY 2004 - 05 ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 25 TH DAY OF NOV., 2016. SD/ - SD/ - ( SHAMIM YAHYA) (RAM LAL NEGI) ACOUNTANT MEMBER. JUDICIAL MEMBER. NAGPUR, DATED: 25 TH NOV. , 2016. 4 ITA NO. 347/NAG/2014 & & ITA NO. 295/NAG/2014 COPY FORWARDED TO : 1. APPELLANT. . 2. RESPONDENT. 3. C.I.T. - (CENTRAL) , NAGPUR. 4. CIT(APPEALS), - I II, NAGPUR. 5. D.R., ITAT, NAGPUR. 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR. WAKODE.
