The ITO 4(3), Indore V. M/s. Vinyaka Infraventure India Pvt. Ltd., Indore

ITA 378/IND/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 4695 (ITAT-INDORE)
• Duration Of Justice: 2 year(s) 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 18-07-2019
• Assessment Year: 2012-2013
• Appeal Filed On: 25-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Unexplained expenditure; Source of fund; Set aside
• Section: 69C; 143(3); 133A; 68; 69

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.378/IND/2018 ASSESSMENT YEAR: 2012-13 ITO 4(3) INDORE / VS. M/S VINYAKA INFRAVENTURE INDIA PVT. LTD, 203, ANMOL SAGAR DARSHAN,9/1, NEW PALASIA, INDORE (RE VENUE) ( RESPONDENT ) PAN: AADCV3600K REVENUE BY SHRI AMIT KUMAR SONI , SR. DR RESPONDENT BY NONE DATE OF HEARING: 18.07.2019 DATE OF PRONOUNCEMENT: 31.07.2019 / O R D E R PER MANISH BORAD, A.M: THE ABOVE CAPTIONED APPEAL FILED AT THE INSTANCE OF REVENUE PERTAINING TO A.Y. 2012-13 IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX(APPEALS)-II, INDORE, (IN SHORT CIT(A)), DATED 13.02.2017 WHICH IS ARISING OUT OF THE ORDER U/S 143(3) OF THE INCOME TAX ACT 1961(HEREINAFTER CALLED AS THE ACT ) FRAMED ON 27.03.2015 BY ITO-4(3), INDORE. VINAYAKAINFRAVENTURE INDIA PVT. LTD. ITANO.378/IND/2017 2 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APP EAL: WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, LD. CIT(A) HAS ERRED IN ALLOWING THE APPEAL O F THE ASSESSEE BY DELETING ALL THE ADDITIONS OF RS.77,12, 500/- WITHOUT APPRECIATING THE FINDING OF THE AO AS PER ASSESSMENT ORDER. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, LD. CIT(A) HAS ERRED IN NOT CONSIDERING THE ENQUIRIES DONE AND STATEMENT RECORDED BY THE DY. CI T (CENTRAL), INDORE AND INVESTIGATION DONE BY INVESTI GATION WING WHERE IN SO MANY DISCREPANCIES IN RESPECT OF ASSESSEE COMPANY WERE FOUND AS NOTED IN ASSESSMENT ORDER AND VARIOUS ADDITIONS WERE MADE BY THE AO ACCORDINGLY. 3.WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN DELETING OF RS.20,00, 000/- MADE BY THE AO U/S 68 OF THE IT ACT WHEREAS THE ASSESSEE COMPANY FAILED TO GIVE ANY SATISFACTORY RE PLY BEFORE THE AO NOR EXPLAINED WITH THE ENTRIES WITH B OOKS OF ACCOUNTS. 4(I) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN ALLOWING THE APPEAL O F THE ASSESSEE PERTAINING TO THE ADDITION OF RS.25,00,000 /- MADE BY THE AO U/S 68 OF THE IT ACT WHEREAS THE MONEY LENDER COMPANIES HAVING NO EXISTENCE PHYSICAL LY AND WERE FOUND TO BE PROVIDING ACCOMMODIATION ENTRY ONLY AS WELL THEIR IDENTITY AND CREDITWORTHINESS WA S NOT PROVED. (II) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN ALLOWING THE APPEAL O F THE ASSESSEE IN FULL WITHOUT REQUIRING REMAND REPORT FR OM THE CONCERNED AO IN PURSUANCE THE ADDITIONAL SUBMISSION/DOCUMENTS AS FURNISHED BY THEASSESSEE COMPANY WHICH IS AGAINST PRINCIPLES OF NATURAL JUST ICE AND RULE 46A OF IT RULES. 5(I) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.32,12,500/- MADE BY THE AO U/S 69 OF THE IT ACT VINAYAKAINFRAVENTURE INDIA PVT. LTD. ITANO.378/IND/2017 3 EVEN WHEN THE ASSESSEE COMPANY FAILED TO EXPLAIN T HE PROPER SOURCES OF THESE EXPENSES AND ULTIMATELY THE Y WERE PROVED TO HAVE MET IN CASH OUT OF UNDISCLOSED INCOME. (II) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LD. CIT(A) HAS ERRED IN ALLOWING THE APPEAL O F THE ASSESSEE IN FULL WITHOUT REQUIRING REMAND REPORT FR OM THE CONCERNED AO IN PURSUANCE THE ADDITIONAL SUBMISSION/DOCUMENTS AS FURNISHED BY THE ASSESSEE COMPANY WHICH IS AGAINST PRINCIPLES OF NATURAL JUST ICE AND RULE 46A OF IT RULES. 3. BRIEF FACTS AS CULLED OUT FROM THE RECORDS ARE T HAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGED IN REAL ESTATE DE VELOPERS BUSINESS. NIL INCOME WAS SHOWN IN THE E-RETURN FILE D ON 29.09.2012. CASE WAS SELECTED FOR SCRUTINY ASSESSME NT AS PER CASS, FOLLOWED BY SERVING OF NOTICES U/S 143(2)& 14 2(1) OF THE ACT. INFORMATION CALLED OUT FROM THE LEARNED ASSESSING O FFICER (IN SHORT LD. AO) WERE PARTLY FURNISHED AND AFTER CONSIDERING THE SAME LD. AO MADE AN ADDITION OF RS.45,00,000/- U/S 68 OF THE ACT FOR UNEXPLAINED CASH CREDIT AND ADDITION U/S 69 C OF TH E ACT AT RS.32,12,500/-. INCOME ASSESSED AT RS.77,12,500/-. 4. AGAINST THE ORDER OF LD. AO, ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) AND SUCCEEDED IN ALL THE GROUNDS. 5. NOW THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL . WHEN THE CASE WAS CALLED OUT NONE APPEARED AT THE ASSESSES BEHES T. SINCE VARIOUS OPPORTUNITIES WERE GIVEN TO THE ASSESSEE IN THE PAS T TO WHICH NO COMPLIANCE WAS MADE, IT WAS DECIDED TO ADJUDICATE T HE ISSUES WITH THE ASSISTANCE OF LD. DR AND AVAILABLE RECORDS. VINAYAKAINFRAVENTURE INDIA PVT. LTD. ITANO.378/IND/2017 4 7. LD. DR REFERRING TO THE GROUNDS MADE A COMMON SU BMISSION THAT THE ASSESSING OFFICER FAILED TO CONDUCT PROPER INQU IRY ABOUT THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE C ASH CREDITORS AS WELL AS THE ALLEGED UNEXPLAINED EXPENDITURE IN PURC HASE OF LAND.HE ALSO SUBMITTED THAT ALL THE ISSUES RAISED IN THIS A PPEAL MAY BE SET ASIDE TO THE FILE OF LD. CIT(A) FOR ADJUDICATION AF RESH AFTER CALLING FOR A REMAND REPORT FROM THE LD. AO TO BE PREPARED AFTE R CONDUCTING SUFFICIENT INQUIRY. 8. WE HAVE HEARD LD. DR AND PERUSED RECORDS PLACED BEFORE US. THROUGH THIS APPEAL, REVENUE HAS CHALLENGED THE FIN DING OF LD. CIT(A) DELETING THE ADDITIONS OF RS. 20,00,000/- AN D RS.25,00,000/- U/S 68 OF THE ACT AND DELETION OF ADDITION U/S 69C OF THE ACT AT RS.32,12,500/-. DURING THE COURSE OF HEARING LD. DR POINTED OUT WITH REGARD TO THE UNEXPLAINED CASH CREDIT U/S 68 O F THE ACT AT RS.25,00,000/- RECEIVED FROM FOUR PRIVATE LTD. CO. AT RS.4,00,000/-, RS.8,50,000/-, RS.5,00,000/- & RS.7,50,000/- RESPEC TIVELY. IT WAS SUBMITTED THAT ALL THE ALLEGED FOUR PVT. LTD. CO. A RE NOT HAVING REGULAR SOURCES OF INCOME FROM BUSINESS OPERATIONS AND THEY ARE MERELY ACCOMMODATION ENTRY PROVIDER. 9. AS REGARDS ADDITIONS FOR CASH CREDIT U/S 68 OF THE ACT AT RS.20,00,000/- THAT WE FIND THAT A SURVEY U/S 133A OF THE ACT WAS CONDUCTED IN THE CASE OF M/S SHAH BHARAT KUMAR LAXM ICHAND, INDORE. VARIOUS INCRIMINATING DOCUMENTS WERE FOUND WHICH VINAYAKAINFRAVENTURE INDIA PVT. LTD. ITANO.378/IND/2017 5 CONTAINED INFORMATION OF CERTAIN CASH TRANSACTIONS IN THE FORM OF AMOUNT ADVANCED TO THE ASSESSEE, LD. AO TREATED IT AS AN UNEXPLAINED CASH CREDIT RECEIVED FROM SHAH BHARAT K UMAR LAXMICHAND. HOWEVER, LD. AO DID NOT CONDUCT SUFFICI ENT INQUIRY BYWAY OF ISSUING SUMMONS TO THE ALLEGED CASH CREDIT ORS FOR THE LOAN OF RS.25,00,000/- AND CASH CREDIT FROM SHAH BHARAT KUMAR LAXMICHAND WILL AT RS.20,00,000/- BEFORE MAKING THE ADDITIONS LD. CIT(A) HAS ALSO NOT TAKEN NECESSARY STEPS TO SATISF Y ABOUT THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE C ASH CREDITORS AS WELL AS TRANSACTIONS. 10. AS REGARDS, THE ADDITION U/S 69C AT RS.32,12,50 0/- THE SAME WAS BASED ON THE OBSERVATION OF THE LD. AO ON THE B ASIS OF REGISTERED DEED OF THE AGRICULTURAL LAND SITUATED A T MANGALIA, SANWER INDORE, AS PER WHICH CHEQUE OF RS.26,00,000/ - HAS BEEN GIVEN BY ASSESSEE. HOWEVER NO DESCRIPTION OF CHEQUE SWAS MENTIONED NOR ANY SPECIFIC INFORMATION WAS PROVIDED BY THE ASSESSEE TO EXPLAIN THE INVESTMENT OF RS.32,12,500/ - (CHEQUE OF RS.26 LACS AND REGISTRATION EXPENSES OF RS.6,12,500 /-). 11. FROM PERUSAL OF THE FINDING OF THE LD. CIT(A) A S WELL AS IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND LOOKING TO THE LACK OF INQUIRY CONDUCTED BY THE LD. AO BEFORE MAKING THE A DDITIONS, WE ARE OF THE CONSIDERED VIEW THAT ALL THE ISSUES RAIS ED BY THE REVENUE NEEDS TO BE SET ASIDE TO THE FILE OF LD. CIT(A) FOR ADJUDICATION AFRESH. WE DIRECT THE LD. CIT(A) TO CALL A REMAND REPORT FR OM THE LD. AO, ON VINAYAKAINFRAVENTURE INDIA PVT. LTD. ITANO.378/IND/2017 6 ALL THE ISSUES RAISED IN THIS APPEAL WHICH SHOULD BE PREPARED AFTER ISSUING NECESSARY NOTICES/SUMMONS TO THE CONCERNED PARTIES AND AFTER COLLECTING THE INFORMATION AS PER THE PROVI SIONS OF LAW IN ORDER TO SUPPORT THE ADDITIONS MADE BY HIM. LD. DR RAISED NO OBJECTION IF ALL THE ISSUES ARE SET ASIDE TO THE FI LE OF LD. CIT(A). 12. WE, ACCORDINGLY AS PER THE TERMS INDICATED ABOV E SET ASIDE ALL THE GROUNDS RAISED IN THIS APPEAL TO THE FILE OF LD . CIT(A) FOR AFRESH ADJUDICATION. NEEDLESS TO MENTION THAT PROPER OPPOR TUNITY OF BEING HEAR SHOULD BE PROVIDED TO THE ASSESSEE. 13. IN THE RESULT, THE APPEAL OF THE REVENUE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 31 .07. 2019. SD/- (KUL BHARAT) SD/- (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER INDORE; DATED :31 /07/2019 CTX? P.S/. . . COPY TO: ASSESSEE/AO/PR. CIT/ CIT (A)/ITAT (DR)/GUAR D FILE. BY ORDER ASSISTANT REGISTRAR