DCIT, CIRCLE- 7(1), NEW DELHI V. DELCO INFRASTRUCTURE PROJECTS LTD., NEW DELHI

ITA 4159/DEL/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 5723 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 22-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: JAGDISH SINGH
• Keywords: Assessment record
• Section: 143(3); 133(6); 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH B: NEW DELHI BEFORE SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER AND SHRI K.NARASIMHA CHARY, JUDICIAL MEMBER I.T.A. NO. 4159/DEL/2017 ASSESSMENT YEAR: 2011-12 DCIT, CIRCLE 7(1), VS. DELCO INFRASTRUCTURE PROJEC TS LTD., NEW DELHI. 158, SECTOR-9, POCKET-I, DWARKA, NEW DELHI. PAN: AABCV2032P (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI JAGDISH SINGH, SR. DR DEPARTMENT BY: NONE DATE OF HEARING: 16/01/2020 DATE OF PRONOUNCEMENT: 14/02/2020 ORDER PER K. NARASIMHA CHARY, JM CHALLENGING THE ORDER DATED 03/03/2017 IN APPEAL NO . 81/14-15 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS)-3 DELHI (THE LD. CIT(A)), FOR THE ASSESSMENT YEAR 2011-12 , IN THE CASE OF M/S. DELCO INFRASTRUCTURE PROJECTS LTD. (THE ASSESSEE) , REVENUE PREFERRED THIS APPEAL. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A COMPANY, ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION. FOR THE ASSE SSMENT YEAR 2011-12, IT HAD FILED ITS RETURN OF INCOME ON 30/09/2011 DECLAR ING AN INCOME OF RS.1,95,46,030/-. LEARNED ASSESSING OFFICER, HOWEVE R, COMPLETED 2 ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX A CT, 1961 (FOR SHORT THE ACT) AT RS.9,31,71,400/-BY MAKING CERTAIN ADD ITIONS WHICH INCLUDES THE ADDITION OF RS.2,47,50,000/-UNDER SECTION 68 OF THE ACT ON ACCOUNT OF THE SHARE APPLICATION MONEY RECEIVED BY THE ASSESSE E AND RS.4,80,60,180/-BY DISALLOWING THE TRADE CREDITORS. 3. AGGRIEVED BY SUCH ADDITIONS, ASSESSEE PREFERRED APPEAL. LD. CIT(A) FOUND THAT THE SHARE CAPITAL TO THE TUNE OF RS.2,01,50,000/-WAS RECEIVED BY THE ASSESSEE IN THE PRECEDING YEARS AND THERE WAS NO CREDIT IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE DURING THE PREVIOUS YEAR IN RESPECT OF SUCH AMOUNT AND THEREFORE, DELETED THE S AME. IN RESPECT OF THE SHARE CAPITAL AMOUNT RECEIVED DURING THE YEAR T O THE TUNE OF RS.46 LACS, RECEIVED FROM ONE ACCUREX INFOTECH PRIV ATE LIMITED, LD. CIT(A), ON VERIFICATION OF THE ASSESSMENT RECORD, F OUND THAT NO NOTICE UNDER SECTION 133(6) OF THE ACT OR SUMMONS UNDER SE CTION 131 OF THE ACT WERE ISSUED TO M/S ACCUREX INFOTECH PRIVATE LIMITED NOR ANY EVIDENCE WAS BROUGHT ON RECORD BY THE LEARNED ASSESSING OFFI CER BY CONDUCTING THE INVESTIGATION TO INDICATE THAT THE TRANSACTION WAS IN THE NATURE OF ACCOMMODATION ENTRY, AND, THEREFORE, WHILE FOLLOWIN G THE DECISIONS OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE O F CIT VS. FAIR FINVEST LTD IN ITA NO. 232/2012 ORDER DATED 22/11/2012, CIT VS. GANGESHWARI METAL PRIVATE LIMITED IN ITA 597/2012 DATED 21.01.2013, C IT VS. VRINDAVAN FARMS (P) LTD., ITA 71/2015 DATED 12/08/2015 AND CI T VS. RAKAM MONEY MATTERS (P) LTD ITA NO. 778/2015 DATED 13/10/2015 R ETURNED A FINDING THAT THE ASSESSING OFFICER FAILED TO MAKE ANY EFFOR T TO MAKE PROPER ENQUIRY SO AS TO ASCERTAIN THE GENUINENESS OF THE E NTITY AND SATISFY 3 HIMSELF OF ITS CREDITWORTHINESS, AND TO TAKE THE MA TTER TO THE LOGICAL END. HE THEREFORE DELETED THE ADDITION OF 46 LACS ALSO. 4. CIT(A) FURTHER FOUND THAT OUT OF THE DISALLOWED TRADE CREDITORS TO THE TUNE OF RS.4,80,60,180/-,A SUM OF RS.3,14,10,05 1/- AND RS.42,47,439/- SHOULD ALSO BE DELETED BECAUSE OF THE EXPLANATION O FFERED BY THE ASSESSEE THAT THE TRADE CREDITORS HAVE THE RUNNING ACCOUNT AND THE TRANSACTIONS WERE ACCEPTED BY THE LEARNED ASSESSING OFFICER IN THE SUBSEQUENT YEARS. CHALLENGING SUCH DELETIONS, REVEN UE PREFERRED THIS APPEAL. 5. WHEN THE MATTER IS CALLED, NEITHER THE ASSESSEE NOR ANY AUTHORISED REPRESENTATIVE ENTERED APPEARANCE. IT CO ULD BE SEEN FROM THE RECORD THAT THE NOTICE SENT TO THE ADDRESS GIVEN IN FORM NO. 36 IS RETURNED UNSERVED. IF THE ASSESSEE IS AVAILABLE IN SUCH ADDRESS, SUCH NOTICE SHOULD HAVE BEEN SERVED ON THE ASSESSEE. IF FOR ANY REASON, THE ASSESSEE IS NOT AVAILABLE THERE, IT IS FOR THE ASSE SSEE TO MAKE ARRANGEMENTS FOR SERVICE OF SUCH NOTICE BY FURNISHI NG THE ADDRESS WHERE THE ASSESSEE WOULD BE AVAILABLE, OR TO DELIVER IT T O SOME AUTHORISED PERSON, OR BY MAKING REQUEST TO THE POSTAL DEPARTME NT TO DETAIN THE MAIL TILL THE ASSESSEE CLAIMS THE SAME. SINCE THE ASSESS EE DOES NOT SEEM TO HAVE ADOPTED ANY OF THESE METHODS, WE ARE THE CONSI DERED OPINION THAT NO TIME COULD BE GRANTED. BASING ON THE RECORD WE P ROCEED TO HEAR THE COUNSEL FOR REVENUE AND DECIDE THE MATTER ON MERITS . 6. INSOFAR AS THE FIRST GROUND IS CONCERNED, OUT OF THE TOTAL DELETION OF RS.2,47,50,000/-UNDER SECTION 68 OF THE ACT, THE FINDING OF THE LD. CIT(A) THAT ADDITION OF RS.2,01,50,000/- IS UNSUSTA INABLE BECAUSE SUCH AMOUNT WAS RECEIVED BY THE ASSESSEE IN THE PRECEDIN G YEARS AND THERE 4 WAS NO CREDIT IN THE BOOKS OF ACCOUNTS OF THE ASSES SEE IN RESPECT OF SUCH AMOUNT DURING THE PREVIOUS YEAR, GOES UNCHALLENGED AND THE REVENUE CONFINES THE CHALLENGE ONLY TO THE EXTENT OF RS. 46 LACS DELETED BY THE LD. CIT(A) IN RESPECT OF M/S ACCUREX INFOTECH PRIVATE L IMITED. 7. LD. DR, HOWEVER, COULD NOT CONTROVERT THE FACTUA L FINDING OF THE LD. CIT(A) THAT ON VERIFICATION OF THE ASSESSMENT R ECORDS, IT WAS FOUND THAT NO NOTICE UNDER SECTION 133(6) OF THE ACT OR S UMMONS UNDER SECTION 131 OF THE ACT WERE ISSUED IN THE CASE OF M/S ACCUR EX INFOTECH PRIVATE LIMITED AND THE ASSESSING OFFICER FAILED TO MAKE AN Y EFFORT IN THAT DIRECTION TO SECURE THE PRESENCE OF THE DIRECTORS A ND TO TAKE THE MATTER TO ITS LOGICAL END, AND ALSO THAT THE ASSESSING OFF ICER FAILED TO SEEK THE ASSISTANCE OF THE ASSESSING OFFICERS OF THE CONCERN ED COMPANY WHOSE ITR AND PAN CARD DETAILS WERE FURNISHED. CIT (A) THEREF ORE, IN THE LIGHT OF THE DECISIONS CITED BEFORE HIM INCLUDING THE ONE IN THE CASE OF RAKAM MONEY MATTERS (P) LTD (SUPRA), DID NOT FIND ANY OPTION BU T TO DELETE THE ADDITION OF RS. 46 LACS. 8. IN THIS FACTUAL SITUATION, WE FIND THAT THERE IS A LAPSE ON THE PART OF THE LEARNED ASSESSING OFFICER TO PURSUE THE COUR SE OPEN TO HIM UNDER LAW AND IN THE CIRCUMSTANCES IN THE LIGHT OF THE DE CISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF RAKAM MONE Y MATTERS (P) LTD (SUPRA) AND OTHER CASES WE FIND THAT THE VIEW TAKEN BY THE LD. CIT(A) THAT THE ASSESSING OFFICER FAILED TO COME UP WITH THE MA TERIAL TO DISPROVE WHAT HAD BEEN PRODUCED BY THE ASSESSEE IS CERTAINLY A PLAUSIBLE VIEW AND THE FINDINGS OF THE LD. CIT(A) CANNOT BE SAID TO BE PERVERSE. ON THIS PREMISE, WE DISMISS GROUND NO. 1. 5 9. NOW COMING TO THE SUNDRY CREDITORS TO THE TUNE O F RS.42,47,439/-AND RS.3,14,10,048/-, ON VERIFICATION OF THE DETAILS, LD. CIT(A) FOUND THAT THE CLOSING BALANCE OF RS.3,04,21 ,207/- AS ON 31/3/2011 WAS REDUCED TO RS.52,86,110/- AS ON 31/3/2012 AND T HE ASSESSMENTS FOR THE ASSESSMENT YEARS 2012-13 AND 2014-15 WERE COMPL ETED BY THE ASSESSING OFFICER UNDER SECTION 143(3) OF THE ACT A ND THE TRANSACTIONS WERE ACCEPTED. FURTHER LD. CIT(A) FOUND THAT THE VE RIFICATION OF THE ASSESSMENT RECORD REVEALED THAT THE DETAILS OF THE CREDITORS OF RS.9,92,16,749/-WERE FILED DURING THE ASSESSMENT PR OCEEDINGS, BUT THE LEARNED ASSESSING OFFICER MADE THE SELECTIVE VERIFI CATION OF THE CREDITORS AND OBSERVED THAT THE DETAILS OF ONLY CREDITORS WOR TH RS. 9,49,69,310/- WERE FILED AND THEREBY THE DISALLOWANCE OF THE REMA INING AMOUNT OF RS.42,47,439/-WAS MADE. ON A PERUSAL OF THE DETAILS OF THE TOTAL CREDITORS OF RS.9,92,16,749/- IT WAS FOUND THAT THE POSITION OF BALANCES AS APPEARING ON 31/3/2011 WAS ACCEPTED BY THE ASSESSIN G OFFICER IN THE SUBSEQUENT YEARS. 10. THERE IS NO DENIAL OF THE FACT THAT THE CREDITO RS WHO HAVE SUPPLIED THE GOODS ON DAY-TO-DAY BASIS TO THE ASSES SEE HAVE RUNNING ACCOUNT AND THE DETAILS OF THE BALANCES AS ON 31/3/ 2010, 31/3/2011 AND 31/3/2012 ARE INCORPORATED IN THE IMPUGNED ORDER. F URTHER THERE IS NO DENIAL OF THE FACT THAT THE CLOSING BALANCES AS ON 31/3/2011 WAS REDUCED TO RS.52,86,110/- AS ON 31/3/2012 AND WHILE COMPUTI NG THE ASSESSMENT FOR THE ASSESSMENT YEARS 2012-13 AND 2014-15, THE L EARNED ASSESSING OFFICER ACCEPTED THE TRANSACTIONS. IN THESE CIRCUMS TANCES WE DO NOT FIND ANY ILLEGALITY OR IRREGULARITY IN THE FINDINGS OF T HE LD. CIT(A). WE ACCORDINGLY CONFIRM THE SAME AND DISMISS GROUND NOS . 2 AND 3. 6 11. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH FEBRUARY, 2020. SD/- SD/- (PRASHANT MAHARISHI) (K.NARASIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 14/02/2020 . *AKS/-