ITO, New Delhi V. M/s Ganpati Contractors Pvt. Ltd., New Delhi

ITA 4705/DEL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53006 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 14-10-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 28-10-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SALIL MISHRA
• Assessee Lawyers: MANOJ KUMAR CFA
• Keywords: Unexplained cash credit; Share purchase agreement
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH `C : NEW DELHI) BEFORE SHRI C.L.SETHI, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO.4705/DEL./2010 (ASSESSMENT YEAR : 2001-02) ITO, WARD 12(1), VS. M/S GANPATI CONTRACTORS PVT. LTD., NEW DELHI. A-3/24, MANAV APARTMENT, PASCHIM VIHAR, NEW DELHI. (PAN/GIR NO.AAACG4196J) AND C.O. NO.389/DEL./2010 ( IN ITA NO.4705/DEL./2010) (ASSESSMENT YEAR : 2001-02) M/S GANPATI CONTRACTORS (P) LTD., VS. ITO, WARD 12 (1), NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI MANOJ KUMAR, CFA REVENUE BY : SHRI SALIL MISHRA., SR.DR ORDER PER SHAMIM YAHYA: AM THE APPEAL BY THE REVENUE AND C.O. BY TH E ASSESSEE ARISE OUT OF THE ORDER OF CIT(A) DATED 2.8.2010 AND PERTAIN TO ASSESSMENT YEA R 2001-02. REVENUES APPEAL 2. IN THE REVENUES APPEAL, THE ISSUE RAISED IS THA T THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.800000/- U/S 68 OF THE I.T. ACT, 1961. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S RECEIVED RS.500000/- BY CHEQUE/DEMAND DRAFT DATED 08.09.2000 FROM M/S MKM F INSEC. PVT. LTD. AND RS.300000/- FROM GROWELL INVESTMENT BY CHEQUE ON 08 .09.2000 ON ACCOUNT OF SALE OF SHARES AS CLAIMED BY THE ASSESSEE. THE ASSESSING O FFICER TREATED THE ABOVE AMOUNT OF RS.800000/- AS UNEXPLAINED CASH CREDIT BY MAKING TH E FOLLOWING OBSERVATIONS: I.T.A. NO.4705/DEL./10 & C.O. NO.389/D/10 (ASSESSMENT YEAR. : 2001-02) 2 2 1) THE QUOTATION RATE ON NSE IS NOT TALLYING WITH T HE SALE PRICE SUBMITTED BY THE ASSESSEE. 2) THE PURCHASE DETAILS ARE NOT AVAILABLE. 3) NOWHERE IN THE BALANCE SHEET OF THE ASSESSEE, TH E STOCKS WHICH THE ASSESSEE HAS CLAIMED TO BE SOLD ARE MENTIONED. 4) THE SHARE OF PEARL POLY TRADED ON NSE AS PER DAT A OF BSE ARE 2100 WHILE, THE ASSESSEE CONTENTION IS THAT IT HAS DEALT IN 10000 S HARES ON THAT DAY. 5) THE APPELLANT ALSO FAILED IN PRODUCING THE AUTHO RIZED PERSON CONTROLLING M/S MKM FINSEC. PVT. AND GROWELL INVESTMENT. 4. IN VIEW OF THE ABOVE OBSERVATION, THE ASSESSING OFFICER HAS HELD THAT SINCE THE ASSESSEE FAILED TO PROVE THE GENUINENESS OF THE TRA NSACTIONS ENTERED INTO WITH THE ABOVE TWO PARTIES, THEREFORE, THE AMOUNT OF RS.800000/- R ECEIVED FROM THEM WAS THE UNDISCLOSED INCOME OF THE APPELLANT U/S 68 OF THE I .T. ACT, 1961. 5. UPON THE ASSESSEES APPEAL, THE CIT(A) HAS NOTED THAT THE ASSESSEE HAS FURNISHED VARIOUS DOCUMENTS IN SUPPORT OF CREDITS RECEIVED BY HIM BEFORE THE ASSESSING OFFICER AND ALSO DURING THE APPELLATE PROCEEDINGS BEFORE HIM. 6. THE CIT(A) FURTHER NOTED THAT IT CANNOT BE DISPU TED THAT THE INVESTMENT HAS BEEN MADE BY THE ASSESSEE IN THE EQUITY SHARES WHICH HAS BEEN SOLD, IN VIEW OF THE FACT THAT THE ASSESSEE HAS SUBMITTED COPY OF SHARE CERTIFICATES I N THE CASE OF M/S PANIANI OVERSEAS PVT. LTD. AND HAD ALSO SUBMITTED THE COPIES OF BILLS OF M/S GODREJ FINANCE SERVICES PVT. LTD. AND M/S SOLEMN FINANCE AND LEASING PVT. LTD. FROM W HOM THE SHARES OF PEARL POLY, JINDAL VIJAY & BAJAJ AUTO HAS BEEN PURCHASED. THE CIT(A) FURTHER OBSERVED THAT THE DISTINCTIVE NUMBERS OF SHARE CERTIFICATES AND ALSO RATE AT WHICH PURCHASES HAD BEEN MADE ARE CLEARLY SPECIFIED. THE CIT(A) FURTHER NOTED TH AT THE ASSESSEE HAS FILED CONFIRMATION REGARDING THE SALES MADE FROM THE BROKERS, COPY OF SHARE CERTIFICATES IN THE CASE OF M/S PUNIANI OVERSEAS PVT. LTD., WHEREIN THE ASSESSEE WA S ORIGINAL ALLOT TEE OF THE SHARES, COPY OF BILLS OF PURCHASE OF SHARES AND ALSO THE BILLS R EGARDING THE SALES OF SHARES. THE CIT(A) FURTHER NOTED THAT THE ASSESSEE HAS RECEIVED THE SA LE PROCEEDS THROUGH BANKING CHANNEL FOR WHICH COPIES OF BANK ACCOUNT HAVE ALSO BEEN SUBMITT ED. THE CIT(A) CONCLUDED THAT THE I.T.A. NO.4705/DEL./10 & C.O. NO.389/D/10 (ASSESSMENT YEAR. : 2001-02) 3 3 A.O. HAS NOT BROUGHT ABOUT ANY INFORMATION OR EVID ENCE ON RECORD TO DISPROVE THE CLAIM OF THE ASSESSEE SUBSTANTIATED BY IR-REBUTTAL EVIDEN CE BROUGHT ON RECORD BY THE ASSESSEE. 7. AGAINST THE ABOVE ORDER, THE REVENUE IS IN APPEA L BEFORE US. WE HAVE ALSO HEARD THE RIVAL SUBMISSION IN THE LIGHT OF THE MATERIAL B ROUGHT OUT BEFORE US AND THE PRECEDENTS RELIED UPON. WE FIND THAT THE ASSESSEE HAS SUBMITT ED BEFORE THE AUTHORITIES BELOW THE FOLLOWING IN SUPPORT OF THE TRANSACTIONS: 1. IN RESPECT OF TRANSACTION WITH M/S MKM FINSEC. P VT. LTD. (I) DATE OF SALE ALONG WITH THE PARTICULARS OF CHEQ UE (II) DISTINCTIVE NUMBER OF SHARE SOLD THROUGH MKM F INSEC. PVT. LTD. (III) COPY OF CREDIT NOTE/BILL OF MKM FINSEC. PVT. LTD. (IV) CONFIRMATION OF THE TRANSACTION FROM MKM FINSE C. PVT. LTD. (V) COPY OF SHARE CERTIFICATE OF PUNIANI OVERSEAS P VT. LTD. WHICH WERE SOLD. 2. IN RESPECT OF TRANSACTION WITH M/S GROWELL INVES TMENT PVT. LTD., THE ASSESSEE HAS SUBMITTED THE FOLLOWINGS: (I) DETAILS OF SHARES SOLD (II) DATE OF SALE ALONG WITH DETAILS OF CHEQUE THRO UGH WITH PAYMENT HAVE BEEN RECEIVED. (III) DETAILS OF THE PARTIES FROM WHOM THE SHARES W ERE PURCHASED. (IV) COPY OF PURCHASE BILL OF M/S GROWELL INVESTMEN T. (V) COPY OF BANK ACCOUNT IN WHICH THE MONEY WAS REC EIVED. (VI) DISTINCTIVE NUMBER OF THE SHARE SOLD. (VII) COPY OF CONFIRMATION FROM M/S GROWELL INVESTM ENT. 8. WE FURTHER FIND THAT THAT THE CIT(A) HAS GIVEN A FINDING THAT THE ASSESSEE HAS GIVEN COGENT EVIDENCE REGARDING INVESTMENTS MADE IN THE PURCHASE OF SHARES. HE HAS ALSO NOTED THAT THE ASSESSEE HAS SUBMITTED EVIDENCE REGA RDING THE SALES MADE BY FILING THE CONFIRMATION FROM THE BROKERS. MOREOVER, THE ASSES SEE HAS ALSO RECEIVED THE PAYMENT OF THE SALE PROCEEDS THROUGH BANKING CHANNEL. WE AGRE E WITH THE CIT(A) THAT THE ASSESSING OFFICER HAS NOT BROUGHT ABOUT ANY INFORMATION OR E VIDENCE TO DISPUTE THE SUBMISSIONS MADE BY THE ASSESSEE. IN OUR CONSIDERED OPINION, T HE CIT(A) HAS MADE REASONABLE ORDER WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART. ACCORDINGLY WE AFFIRM THE SAME. 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE S TANDS DISMISSED. I.T.A. NO.4705/DEL./10 & C.O. NO.389/D/10 (ASSESSMENT YEAR. : 2001-02) 4 4 C.O. BY THE ASSESSEE 10. IN THE C.O., THE ASSESSEE HAS CHALLENGED THE VA LIDITY OF THE RE-ASSESSMENT. BEFORE US, THE LD.COUNSEL OF THE ASSESSEE SUBMITTED THAT H E SHALL NOT BE PRESSING FOR THE C.O. ACCORDINGLY, THE C.O. IS DISMISSED AS NOT PRESSED. 10. IN THE RESULT, THE C.O. FILED BY THE ASSESSEE STANDS DISMISSED. 11. TO SUM UP, BOTH THE APPEALS ARE DISMISSED. 12. ORDER PRONOUNCED IN OPEN COURT ON 21.10.2010. SD/- SD/- (C.L.SETHI) ((SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED, OCT. 21, 2011. SKB COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-XV, NEW DELHI 5.CIT(ITAT), NEW DELHI. AR/ITAT