Joint Commissioner of Income Tax (OSD)-2 (1), Indore V. M/s Gyansheela Developers Limited, Indore

ITA 430/Ind/2018

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 9297 (ITAT-INDORE)
• Duration Of Justice: 3 year(s) 8 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 07-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 68; 64

Judgement Text

आयकर अपीलȣय अͬधकरण, इंदौर Ûयायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER VIRTUAL HEARING ITA No.430/Ind/2018 Assessment Year:2011-12 JCIT (OSD)-2(1), Indore बनाम/ Vs. M/s Gyansheela Developers Ltd., Indore (Appellant) (Respondent ) P.A. No.AACCK5282B Revenue by Shri P.K. Mitra, CIT-DR Assessee by Shri Kunal Agrawal, CA Date of Hearing: 21.12.2021 Date of Pronouncement: 07.02.2022 आदेश / O R D E R M/s.Gyansheela Developers Ltd., Indore 2 PER MANISH BORAD, A.M: The above captioned appeal filed at the instance of the Revenue for Assessment Year 2011-12 is directed against the order of Ld. Commissioner of Income Tax(Appeals) (in short ‘Ld.CIT]-1, Indore dated 15.02.2018 which is arising out of the order u/s 143(3)/147 of the Income Tax Act 1961(In short the ‘Act’) dated 29.12.2016 framed by DCIT-2 (1), Indore. The revenue has raised following grounds of appeal : 1. The order of the learned CIT(A) is bad and erroneous in law as well as on facts. 2. The learned CIT(A) erred in deleting the addition of Rs.7,50,00,000/- made by the Assessing Officer u/s 68 of the I.T. Act without appreciating the fact that inspite of proper opportunity provided by the Assessing Officer during the assessment, the assessee failed to explain source of deposits in its bank account. 3. The learned CIT(A) erred in deletion only for the reason that the transaction was through banking channel and ignoring all other ingredients requiring for justifying source of credit entry in one’s books of accounts as discussed by the Assessing Officer in assessment order. M/s.Gyansheela Developers Ltd., Indore 3 2. The only issue involved in the present appeal relates to deletion of addition of Rs.7,50,00,000/- made by the Assessing Officer u/s 68 of the I.T. Act. Facts as culled out from the record of the Revenue Authorities are that the assessee is a public company engaged in the business of construction and real estate development, having registered office situated at 6, Gyanspark Colony, Telephone Nagar, Indore. The income of the assessee was assessed u /s 147/143(3) vide order dated 29.12.2016 as under: - The Assessing Officer made the addition of Rs.7,50,00,000/- on account of credit entries on the ground that 12 credit entries amounting to Rs.62,50,000/- each, totaling to Rs.7,50,00,000/- were found unexplained. Particulars Amount ( Rs.) Returned Income 94,98,320/- Addition on account of – Unexplained credits 7,50,00,000/- Assessed Income u/s 147 of the Income Tax Act,1961 8,44,98,320/- M/s.Gyansheela Developers Ltd., Indore 4 Being aggrieved, the assessee approached learned CIT(A) and learned CIT(A) considering the facts, the submissions and material deleted the addition on the ground that the assessee proved all the three limbs as required u/s 68 of the I.T. Act. Being aggrieved, the Revenue is in appeal before this Tribunal. 3. Before us, ld. CIT-DR relied upon the order of the Assessing Officer and submitted that since 12 credit entries amounting to Rs.62,50,000/- each were found unexplained, the Assessing Officer was justified in making the addition of Rs.7.50 crores. 4. Per contra, learned Counsel for the assessee relied upon the order of the learned CIT(A) and submitted that the assessee had through documentary evidences explained the said 12 credit entries, therefore, the addition made by the Assessing Officer was wrong and the order of the learned CIT(A) deserves to be upheld. M/s.Gyansheela Developers Ltd., Indore 5 5. We have considered rival contentions and gone through the material available on record. We find that the assessee co. purchased a land nearby Mhow for a sum of Rs. 9,05,85,000/- from 64 farmers through their 06 power of attorney holders and one of them was Mr. Mansingh Yadav s/o Jeevanlal as is evident from the copy of registered Power of Attorney (PB 56-79) and registered Sale deed filed at page nos. 80 to 94 of the paper book. Out of Sale consideration of Rs. 9,05,85,000/-, a sum of Rs. 1,55,85,000/- was paid in earlier years and balance amount of Rs. 7,50,00,000/- was paid through 12 cheques of Rs.62,50,000/- each at the time of registry for the year under consideration as is evident from the page nos. 83 & 84 of the paper book. The payment of Rs. 7,50,00,000/- was made to Mr. Mansingh Yadav (Power of attorney holder ) on the basis of the terms of registered power of attorney with mutual consent of all the sellers as is evident from the page no.59 of the paper book and Mr. Mansingh Yadav later on gave this amount of Rs. M/s.Gyansheela Developers Ltd., Indore 6 7,50,00,000/- in 12 trenches to Mr. Kulbhushan Mittal (Director of assessee company) through account payee cheques as is evident from the page nos.104 to 116 of the paper book. Mr. Kulbhushan Mittal (Director of assessee company) gave this amount of Rs. 7,50,00,000/- in 12 trenches to assessee through account payee cheques as is evident from perusal of Bank statements of Mr. Kulbhushan Mittal (page nos.104-109 of the paper book) and assessee (page nos. 117-124 of the paper book). 6. On perusal of these documents and material available on record, we find that the amount of Rs.7.50 crore received by Mr. Mansingh Yadav was given to Mr. Kulbhushan Mittal, Director of assessee co. through account payee cheques as is evident from the perusal of bank statement of Mr. Mansingh Yadav and Mr. Kulbhushan Mittal. The same is also evident from the perusal of para 3.5 of the assessment order which reads as under: “3.5 In the state ment while reply to question no.5, Shri Man Singh Yad av has stated that he sold a land situated M/s.Gyansheela Developers Ltd., Indore 7 at village Mhow admeasuring 20 Hectare to M/s. Gyansheela Developers Pvt. Ltd. at sale consideration of Rs.9.06 crore. The above land belongs to 64 diffeent f armers and Shri Man Singh has taken Po wer of Attorney from them. Shri Man S ingh Yadav received Rs.7.50 crore and remaining balance Rs.1.56 crore was directly paid to some f armers by M/s. Gyansheela Developers Pvt. Ltd., Indore.” Thus, there is no dispute regarding the land transactions as the ld. the Assessing Officer did not doubt the same which proves the genuineness of the transactions. Further, we find from the ledger account of Kulbhushan Mittal, Director of assessee co. that for getting substantial interest, he was regularly giving funds to the assessee co. through banking channels during the normal course as per business needs from time to time in preceding years as well as in the year under consideration and the amount of Rs.7.50 crore (62.50 lacs x 12) was not only trench of transactions but one of the transactions among many other transactions which was given to the assessee co. as is evident from the perusal of ledger account of Mr. Kulbhushan Mittal filed at page nos.102 & 103 of the paper book. Further, as per audited balance-sheet-Schedule-3, M/s.Gyansheela Developers Ltd., Indore 8 unsecured loan as on 31.3.2010 was Rs.32,58,190/- and Rs.8,54,51,244/- as on 31.3.2011 as is verified from the ledger account of Mr. Kulbhushan Mittal(Director of assessee co.), audited balance-sheet and audit report filed in the paper book. Thus, it is clear that the assessee co. received the said amount of Rs.7.50 crore from its Director Mr. Kulbhushan Mittal only and not from Mr. Man Singh Yadav and the amount of Rs.7.50 crore (62.50 lacs x 12) was not only trench of transactions but one of the transactions among many other transactions which was given to the assessee co. by Mr. Kulbhushan Mittal, Director of the assessee co. The learned CIT(A) examined all these documentary evidences and noted that all the above cheques were received from banking channel as verified from bank accounts and in the balance-sheet of the assessee, the loan in the name of Shri Kulbhushan Mittal is reflected. As per audited balance-sheet Schedule-3, unsecured loan as on 31.3.2010 was at Rs.32,58,190 and as on 31.3.2011 at Rs.8,54,51,244/-. Thus, learned CIT(A) held that the assessee has proved all the three limbs as M/s.Gyansheela Developers Ltd., Indore 9 required u/s 68 of the I.T. Act. On consideration of these facts, as regard amount received from Mr. Kulbhushan Mittal, we hold that the assessee co. had proved Identity, creditworthiness and genuineness of the transactions with the help of documentary evidences as it is clear that the assessee company received the said amount of Rs. 7.50 crore from its director namely, Mr. Kulbhushan Mittal only and not from Mr. Mansingh Yadav. Hence, the finding of the Ld. Assessing Officer that 12 entries in trenches of Rs. 62,50,000/- totaling to Rs. 7,50,00,000/- and each one from one Mr. Mansingh Yadav was wrong on facts, therefore, the addition, so made, was rightly deleted by the learned CIT(A) as the assessee co. did not receive any amount from Mr. Mansingh Yadav and 64 farmers. Further, before us, learned CIT(A) could not controvert the factual aspects with documentary evidences as discussed above and findings of the learned CIT(A) by bringing any contrary material on record. Thus, we do not find any infirmity in the order of the learned CIT(A). We confirm the same. M/s.Gyansheela Developers Ltd., Indore 10 Accordingly, grounds raised in the departmental appeal stand dismissed. 7. In result, the departmental appeal i.e. ITA No.430/Ind/2018 is dismissed. The order pronounced as per Rule 34 of ITAT Rules, 1963 on 07.02.2022. Sd/- Sd/- (MAHAVIR PRASAD) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER Ǒदनांक /Dated : 07.02.2022 !vyas! Copy to: The Appellant/Respondent/CIT concerned/CIT(A) concerned/ DR, ITAT, Indore/Guard file. By Order, Asstt.Registrar, I.T.A.T., Indore