AYAJ S. DHUMAL, MUMBAI V. ITO - 26(2)(4), MUMBAI

ITA 4519/MUM/2013

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9447 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-09-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 29-08-2017
• Assessment Year: 2006-2007
• Appeal Filed On: 05-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SAURABH DESH
• Section: 143(3)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE HONBLE S/SHRI JOGINDER SINGH (JM), AND RAJESH KUMAR, ( AM ) ./ I.T.A. NO . 4519 / MUM/20 1 3 ( / ASSESSMENT YEAR : 20 06 - 07 ) AJAY S DHUMAL, 229/230 ARUN CHAMBERS, 2 ND FLOOR, TARDEO, MUMBAI - 400034 / VS. INCOME TAX OFFICER - 2 6 (2 ) (4) , MUMBAI . ( / APPELLANT ) .. ( / RESPONDENT ) ./PAN NO. : AA CPD7035Q / APPELLANT BY: NONE / RESPONDENT BY SHRI SAURABH DESHPANDE / DATE OF HEARING : 2 9 .8. 201 7 / DATE OF PRONOUNCEMENT : 18. 9. 201 7 / O R D E R PER RAJESH KUMAR, ACCOUNTAN T MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE AND IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A) - 28 , MUMBAI D A T ED 1 3.03.2013 PERTAINING TO A.Y. 20 06 - 07 . 2. AT THE OUTSET, WE WOULD LIKE TO MENTION HERE THAT NEITHER THE ASSESSEE OR HIS AUTHORIZED REPRESENTATIVE APPEARED BEFORE THIS TRIBUNAL WHEN THE APPEAL WAS CALLED FOR HEARING NOR ANY APPLICATION SEEKING ADJOURNMENT OF THE HEARING WAS RECEIVED IN THE OFFICE OF THE TRIBUNAL DESPITE SERVICE OF NOTICE ITA NO . 4519 / M/1 3 2 THROUGH RPAD. THEREFORE, WE PROCEED TO DISPOSE OF THE APPEALS OF THE ASSESSEE EX - PARTE AFTER HEARING THE LD.DR. 3. ONLY ISSUE RAISED BY THE ASSESSEE IN THE VARIOUS GROUNDS OF APPEAL IS AGAINST THE CONFIRMATION OF ADDITION OF RS.16 LAKHS BY THE LD.CIT(A) AS MADE BY THE AO U/S 2(22)(E ) OF THE ACT. 4 . FACTS OF THE CASE ARE THAT AO, DURING THE COURSE OF ASSESSMENT PROCEEDINGS NOTICED THAT THE ASSESSEE IS A DIRECTOR OF M/S DARSHAN IMPEX PVT LTD AND HOLDING 50% OF THE VOTING POWER DURING THE YEAR. THE ASSESSEE WAS ALSO HOLDING 50 % VOTING POWER IN M/S K P POWER PVT LTD. THE AO NOTICED THAT THE ASSESSEE HAS TAKEN RS.16 LAKHS AS AN ADVANCE FROM M/S K P POWER PVT LTD DURING THE YEAR AND THE SAID COMPANY WAS NOT COMPANY IN WHICH PUBLIC WAS SUBSTANTIALLY INTERESTED AND THE RESERVE S AND SURPLUS FUND OF THE COMPANY W ERE OF RS.4,17,98,864/ - AND CAME TO THE CONCLUSION THAT THE PROVISIONS OF SECTION 2(22)(E) OF THE ACT WERE APPLICABLE. THE AO A FTER CONSIDER ING THE SUBMISSIONS OF THE ASSESSEE AND REJECTING THE SAME , ADDED THE AMOUNT OF RS.16 LAKHS TO THE IN COME OF THE ASSESSEE BY MAKING ASSESSMENT U/S 143(3) R.W.S.147 OF THE ACT VIDE ORDER DATED 21.12.2011. 5. IN THE APPELLATE PROCEEDINGS, THE FAA DISMISSED THE APPEAL OF THE ASSESSEE AFTER CONSIDERING T HE REPLY AND CONTENTIONS AS HAS BEEN INCORPORATED IN P ARA 4 OF THE APPELLATE ORDER BY OBSERVING AND HOLDING AS UNDER : ITA NO . 4519 / M/1 3 3 5. I HAVE CONSIDERED THE FACTS OF THE CASE. THERE IS NO DOUBT THAT AS PER RETURN OF INCOME FILED IN CASE OF M/S DARSHAN IMPEX PRIVATE LTD. FOR ASSESSMENT YEAR 2006 - 07, THE ASSESSEE IS HOLDIN G 50% SHARE IN THE EQUITY CAPITAL OF THE COMPANY. SIMILARLY, THE ASSESSEE IS HOLDING SHARES IN CASE OF M/S K.P. POWER PVT. LTD. THE ASSESSEE CLAIMED THAT THE FIGURE OF SHARE HOLDING IN THE RETURN WAS INCORRECT AND HE WAS HOLDING ONLY 9% OF THE SHARE CAPI TAL, HOWEVER, THE FACTS REMAINS THAT EVEN WITH THE ROC THE ASSESSEE DID 11 T DISCLOSED HIS SHARE HOLDING PATTERN ON 18.11.2011 AND ONLY ON THIS DATE THE ASSESSEE HAS FILED SOME KIND OF RETURN IT WAS ROE FROM ASSESSMENT YEAR 200~ - 04 ONWARDS. ACCORDINGLY, TH E ABOVE RETURNS FILED WITH THE ASSESSEE IS AN AFTERTHOUGHT AND PROBABLY DONE WITH THE VIEW TO ESCAPE PROVISIONS TO SECTION 2(22)(E) OF THE INCOME TAX ACT, AS ASSESSMENT PROCEEDINGS IN THIS EASE WAS ALREADY IN ADVANCE STAGE. THERE IS NO OTHER PROOF WITH THE ASSESSEE TO SHOW THAT HIS SHARE HOLDING WAS ONLY 9% DURING THE RELEVANT PERIOD AND NOT 50% AS. DISCLOSED BY HIM IN THE RETURN OF INCOME. THIS RETURN HAS BEEN SIGNED AND VERIFIED BY THE ASSESSEE AND THEREFORE, AUTHENTICITY OF THE SAME CAN NOT BE DOUBTED. THE ASSESSEE CAN NOT. CLAIM NOW, BY FILING A. BELATED RETURN BEFORE THE ROC THAT HIS SHARE HOLDING WAS ONLY 9%. ACCORDINGLY, I HOLD THAT BY TAKING A LOAN OF RS. 16,00,000/ - , THE ASSESSEE BEING MAJORITY SHAREHOLDER WAS CLEARLY IN DEFAULT OF THE PROVISIONS O F THE SECTION 2(22)(E). I ACCORDINGLY, CONFIRM THE ADDITION OF RS.16 LAKHS MADE BY THE AO IN THE HANDS OF THE ASSESSEE AND REJECT GROUNDS OF APPEAL OF THE ASSESSEE. 6 . WE HAVE HEARD THE LD.DR AND PERUSED THE MATERIAL PLACED ON RECORD. T HE FAA HAS RECORDED THE FINDINGS OF FACTS THAT ASSESSEE WAS HOLDING THE 50% SHARES AND THE SAID FACT WAS ALSO DISCLOSED BY IT IN THE RETURN OF INCOME BY THE ASSESSEE. THE CIT(A) ALSO RECORDED THE FINDING THAT THE ASSESSEE WAS NOT HAVING ANY PROOF OF OWNING 9% OF TH E SHAREHOLDINGS EXCEPT THE BELATED RETURNS OF ROC WHICH COULD NOT BE BELIEVED. THERE IS NOTHING BEFORE US TO CONTROVERT THE FINDINGS OF T HE LD. CIT(A) ON THIS ISSUE . W E ARE, THEREFORE, IN CLINED TO UPHOLD THE ORDER OF THE LD.CIT(A). ITA NO . 4519 / M/1 3 4 7 . RESULTANTLY , TH E APPEAL OF THE ASSESSEE STANDS DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 18 TH SEPT , 2017 . 18TH SEPT. 2017 SD SD (JOGINDER SINGH ) ( RAJESH KUMAR ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI : 18. 9. 2017 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. 6. , , / DR, ITAT, MUMBAI CONCERNED / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI