MCM Oil Mills (P) Ltd., Delhi V. ITO, New Delhi

ITA 4250/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5037 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 1 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2001-2002
• Appeal Filed On: 01-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRAVAN GOTRU
• Assessee Lawyers: V K TULSIYAN
• Section: 68; 2

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D : NEW DELHI BEFORE SHRI H.S.SIDHU , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 4250/DEL/2015 (ASSESSMENT YEAR: 2001 - 02 ) MCM OIL MILLS (P) LTD, 349, NAYA BANS, DELHI PAN:AADCM0875H VS. ITO, WARD - 6(1), NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VK TULSIYAN, CA REVENUE BY: SHRI SHRAVAN GOTRU, SR. DR DATE OF HEARING 22/08 / 2017 DATE OF PRONOUNCEMENT 25 / 08 / 2017 O R D E R PER PRASHANT MAHARISHI , A. M. 1. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD CIT(A) - 6, DELHI DATED 31.03.2015 FOR THE ASSESSMENT YEAR 20001 - 02. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. WHETHER THE LD CIT(A) WAS JUSTIFIED BY UPHOLDING THE ADDITI ON U/S 68 ON ACCOUNT OF UNSECURED LOANS OF RS. 1.50 LACS FROM LATE SH. PC HOTA, WHICH IS NOT A FRESH LOAN BUT ON ACCOUNT OF CONVERSION OF CREDITOR INTO LENDER ACCOUNT, TREATED AS UNEXPLAINED MERELY DUE TO INCORRECT PAN ALTHOUGH PAN PROVIDED BY THE FIRM WAS DIFFERENT AS NOTED BY THE LD CIT(A) FROM CONFIRMATION. 3. BRIEF FACTS OF THE CASES THAT ASSESSEE IS A PRIVATE LIMITED COMPANY WHO FILED ITS RETURN OF INCOME DECLARING LOSS OF RS. 5 07371/ - ON 31/10/2001. THE ASSESSMENT U/S 143 (3) READ WITH SECTION 254 OF T HE INCOME TAX ACT , 1961, WAS PASSED ON 30/11/2011 IN TERMS OF THE ORDER OF THE COORDINATE BENCH WHO REMANDED THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO REFRAME THE ASSESSMENT ORDER. THE ONLY ISSUE IN DISPUTE BEFORE US IS THAT LD. ASSESSING OFFICER HAS MADE AN ADDITION UNDER SECTION 68 OF THE INCOME TAX ACT ON ACCOUNT OF LOAN FROM SH. P.C. HOTA. THE ASSESSEE AGITATED THE ABOVE ADDITION BEFORE THE LD. CIT (A) , WHO CONFIRMED THE ABOVE ADDITION. THEREFORE, ASSESSEE IS IN APPEAL BEFO RE US. 4. THE LD. AUTHORIZED REPRESENTATIVE HAS PLACED BEFORE US. THE DETAILED WRITTEN SUBMISSION AS WELL AS STATED THAT ADDITION HAS ONLY BEEN MADE U/S 68 OF THE ACT, AS CPC BOTH ARE HAS PASSED AWAY AND THE ORIGINALLY THE AMOUNT WAS GIVEN FOR SUPPLY OF EDIBLE OILS AND NOT LOAN. IT WAS FURTHER SUBMITTED THAT DUE TO THIS, ALONG CLASSIFICATION THESE LIABILITIES WERE SHOWN UNDER THE HEAD UNSECURED LOAN. HE PAGE 2 OF 3 SU BMITTED THAT THE LOWER AUTHORITIES FAILED TO APPRECIATE THE ABOVE SUBMISSION OF THE ASSESSEE AND THEREFORE REQUESTED THAT THE ABOVE ADDITION MAYBE DELETED. 5. THE LD. DEPARTMENTAL REPRESENTATIVE RELIED UPON THE ORDERS OF THE LOWER AUTHORITIES. 6. WE HAVE CAREFUL LY CONSIDERED THE RIVAL CONTENTIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES. IT WAS THE CLAIM OF THE ASSESSEE THAT CPC BOTH ARE WAS RAJASTHAN - BASED BUYER OF THE VEGETABLE OIL PRODUCED BY THE COMPANY AND USED TO PURCHASE THE GOODS AND THEREBY MAKING PAYMENT IS AN ADVANCE AGAINST THE SUPPLY OF OIL OR AT SOME LATER DATE AFTER THE GOODS HAS BEEN SUPPLIED. FOR THE CURRENT TRANSACTION THE COMPANY HAS RECEIVED THE ABOUT SUM AS ADVANCE AGAINST SUPPLY OF EDIBLE OIL, BUT ULTIMATELY, THE DELIVERY COULD NOT BE GIVEN AND THEREFORE THE ABOVE SUM IS IN THE NATURE OF ADVANCE RECEIVED AGAINST THE SALE OF GOODS BUT BY ERROR IT WAS SHOWN AS UNSECURED LOAN. THE ASSESSEE IS FILED THE CONFIRMATION OF THE CREDITOR WHO HAS CATEGORICALLY STATED HIS PERMANENT ACCOUNT NUMBER A ND ADDRESS. MERELY BECAUSE OF THE REASON THAT ASSESSING OFFICER HAS ISSUED NOTICE U/S 133 (6) WHICH WAS NOT REPLIED BY THE CREDITOR THE ADDITION CANNOT BE MADE U/S 68 OF THE ACT I N THE PRESENT FACTS AND CIRCUMSTANCES OF THE CASE WHERE MONEY WAS RECEIVED AS ADVANCE IN EARLIER YEAR AND AMOUNT IS ERRONEOUSLY SHOWN AS UNSECURED LOAN IN CURRENT YEAR . IT IS ALSO SUBMITTED THAT THE PROPRIETOR OF PC HOTA & CO HAS PASSED AWAY LONG BACK. IT WAS ALSO NOT DENIED BY THE REVENUE THAT THE ABOVE SUM WAS RECEIVED BY THE AS SESSEE TOWARDS ADVANCE AGAINST SALE OF GOODS, WHICH WERE LATER ON SHOWN AS UNSECURED LOAN AND ERRONEOUSLY. IT WAS ALSO STATED BEFORE US THAT THIS AMOUNT WAS NOT RECEIVED DURING THE YEAR, BUT IN THE EARLIER YEAR. IN VIEW OF THIS, WE REVERSE THE FINDING OF T HE LOWER AUTHORITIES AND DIRECT THE LD. ASSESSING OFFICER TO DELETE THE ADDITION OF RS. 1.50 LAKHS IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF LOAN OF MR P C HOTA. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED WITH RESPECT TO GROUND NO. 1. 7. IN THE RESULT APPEAL FILED BY THE ASSESSEE IS ALLOWED ORDER PRONOUNCED IN THE OPEN COURT ON 2 5 / 08 / 2017 . - S D / - - S D / - ( H.S.SIDHU ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT M EMBER DATED: 2 5 / 08 / 2017 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT PAGE 3 OF 3 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI