A.C.I.T., CIRCLE-3, Srinagar V. M/s. Shaw & Brothers, SRINAGAR

ITA 389/ASR/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5754 (ITAT-AMRITSAR)
• Duration Of Justice: 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 19-02-2018
• Assessment Year: 2011-2012
• Appeal Filed On: 14-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S NEGI
• Assessee Lawyers: MALIK MANZOOR AHMAD
• Keywords: Unexplained investment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE SHRI R.S. SYAL, VICE PRESIDENT AND SHRI N.K. CHOUDHRY, JUDICIAL MEMBER ITA NO.389/ASR/2017 ASSESSMENT YEAR : 2011-12 THE ACIT, CIRCLE-3, SRINAGAR. VS. M/S SHAW & BROTHERS, THE BUND SRINAGAR PAN: AAOFS8284N (APPELLANTS) (RESPONDENTS) ASSESSEE BY : SHRI MALIK MANZOOR AHMAD, ADVOCATE DEPARTMENT BY : SHRI S.S. NEGI DATE OF HEARING : 19.02.2018 DATE OF PRONOUNCEMENT : 20.02.2018 ORDER PER R.S. SYAL, VP: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER PASSED BY THE CIT(A) ON 31.03.2017 IN RELATION TO T HE ASSESSMENT YEAR 2011-12. ITA NO.389/ASR/2017 2 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST THE DELETION OF ADDITION IN RESPECT OF UNEXPLAINED INVESTMENT IN MU TUAL FUNDS AND SHARES. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER RECEIVED AIR INFORMATION INDICATING THAT TH E ASSESSEE MADE INVESTMENTS IN MUTUAL FUNDS AND SHARES AMOUNTING TO RS.529,03,977/-. ON BEING CALLED UPON TO EXPLAIN TH E SOURCE OF THE INVESTMENTS, THE ASSESSEE SUBMITTED THAT SUCH INVES TMENTS WERE MADE FROM THE REGULAR BOOKS OF ACCOUNT. CONSIDERIN G THE FACT THAT THE BALANCE OF INVESTMENTS IN MUTUAL FUNDS AND SHAR ES, ETC., AT THE END OF THE YEAR STOOD AT RS.3,48,33,926/-, THE ASSE SSING OFFICER MADE AN ADDITION FOR THE DIFFERENTIAL AMOUNT OF RS. 180,70,051/- (RS.5.29 CRORE MINUS RS.3.48 CRORE). THE LD. CIT(A ) DELETED THE ADDITION, AGAINST WHICH THE REVENUE HAS COME UP IN APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE RELEV ANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE ASSESSING OFFICER GOT AIR INFORMATION ITA NO.389/ASR/2017 3 ABOUT THE ASSESSEE HAVING MADE INVESTMENT IN MUTUAL FUNDS AND SHARES DURING THE YEAR AMOUNTING TO RS.5.29 CRORE. AS AGAI NST SUCH INVESTMENTS, HE CONSIDERED ONLY THE CLOSING BALANCE IN THE ASSESSEES BALANCE SHEET FOR MAKING AN ADDITION OF RS.1.80 CRO RE. IT CAN BE SEEN FROM THE AMEXCO IBC INVESTMENT ACCOUNT IN THE ASSES SEES BOOKS OF ACCOUNT THAT AS AGAINST THE OPENING BALANCE OF RS.1 .93 CRORE, THE ASSESSEE MADE FRESH INVESTMENTS TO THE TUNE OF RS.5 .06 CRORE IN, BRINGING THE BALANCE UP TO RS.6.99 CRORE. A COPY OF SUCH ACC OUNT HAS BEEN PLACED AT PAGES 17 TO 20 OF THE PAPER BOOK. APART FROM TH IS, THE ASSESSEE ALSO MADE FRESH INVESTMENTS AMOUNTING TO RS.10 LAC IN IN DIA REIB FUND SCHEME IB AMOUNTING TO RS.10 LAC AND RS.40 LAC IN F ORTIS FIXED TERM FUND SERIES 18B D, WHOSE COPIES HAVE BEEN PLACED AT PAGES 36 AND 39 OF THE PAPER BOOK. THUS, IT IS MANIFEST THAT THE A SSESSEE MADE TOTAL INVESTMENTS OF RS.5.56 CRORE [RS.5.06 CRORE PLUS RS .10 LAC PLUS RS. 40 LAC] DURING THE YEAR. AFTER CERTAIN REDEMPTIONS AN D MATURITIES, THE CLOSING BALANCE OF INVESTMENTS STOOD AT RS.3.48 CRO RE. SINCE THE INFORMATION WITH THE ASSESSING OFFICER WAS ABOUT TH E ASSESSEE HAVING MADE INVESTMENTS TO THE TUNE OF RS.5.29 CRORE WHICH IS, IN FACT, LOWER ITA NO.389/ASR/2017 4 THAN THE ACTUAL INVESTMENT MADE BY THE ASSESSEE AT RS.5.56 CRORE, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSING OFFICE R WAS NOT JUSTIFIED IN CONSIDERING ONLY THE CLOSING BALANCE OF INVESTMENTS OVERLOOKING THE REDEMPTIONS AND MATURITIES MADE DURING THE YEAR. W E, THEREFORE, UPHOLD THE IMPUGNED ORDER DELETING THE ADDITION. 5. IN THE RESULT, THE APPEAL IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 20.02.201 8. SD/- SD/- [N.K. CHOUDHRY] [R.S. SYAL] JUDICIAL MEMBER VICE PRESIDENT DATED, 20 TH FEBRUARY, 2018. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, AMRITSAR.