M/s. G.N.A. Transmission P.Ltd, Jalandhar V. The Income-tax Officer, Jalandhar

ITA 471/ASR/2013

• Counselvise Citation: 47120914 RSA 2013
• Duration Of Justice: 5 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 27-11-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 26-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: SSH PREM SINGH; GUNJEET S INGH ITP
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.471(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN :AAACG4933H M/S. G.N.A. TRANSMISSIONS (P) LTD. VS. INCOME TAX O FFICER, RAJINDER NAGAR, POLICE LINE ROAD, III(4), JALANAHD AR. (APPELLANT) (RESPONDENT) APPELLANT BY:S/SH.PREM SINGH, ADV. & GUNJEET SING H ITP RESPONDENT BY: SH. MAHAVIR SINGH, DR DATE OF HEARING: 27/11/2013 DATE OF PRONOUNCEMENT:29/11/2013 ORDER PER BENCH ; THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE CIT(A), JALANDHAR, DATED 15.04.2013 FOR THE ASSESSMENT YE AR 2007-08. 2. THE ASSESSEE DID NOT PRESS GROUNDS NO. 2 TO 10 A ND THE SAME ARE DISMISSED AS NOT PRESSED. 3. THE SOLITARY GROUND AGITATED BY THE ASSESSEE, R EADS AS UNDER: 1. THAT THE LD. CIT(A) HAS WRONGLY CONFIRMED DISA LLOWANCE OF INTEREST ON THE AMOUNT ADVANCED TO SH. SATISH KUM AR RS.50,000/- AND TO SH. SURJIT KUMAR RS.10,50,000/ - RESPECTIVELY. ITA NO.471(ASR)/2013 2 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAD ADVANCED FOLLOWING AMOUNTS TO TWO PERSONS AS UNDER: I) SH.SATISH KUMAR RS.50,000/- II) SH.SURJIT KUMAR RS.10.50 LACS THE ASSESSEE SUBMITTED THAT ADVANCES WERE MADE IN T HE YEAR 1999-2000 AND DUE TO CERTAIN UNFORESEEN CIRCUMSTANCES THE TRANSAC TIONS NEVER MATERIALIZED. THE AO FURTHER OBSERVED THAT THERE ARE UNSECURED LO ANS OUTSTANDING OF RS.43,96,973/- AND THE ASSESSEE HAS ALSO RAISED SEC URED LOANS FROM THE BANK AND THE ASSESSEE HAS DEBITED INTEREST PAID AMOUNTIN G TO RS.26,87,554/-. THE AO OBSERVED THAT THE SAID SUM OF UNSECURED AND SECU RED LOANS HAS BEEN UTILIZED TOWARDS SUCH ADVANCES AND IN THE ABSENCE O F ANY EXPLANATION FROM THE ASSESSEE, THE A.O. DISALLOWED PROPORTIONATE SUM AND ADDED THE SAME TO INCOME OF THE ASSESSEE. 5. THE ACTION OF THE A.O. WAS CONFIRMED BY THE LD. CIT(A). 6. THE LD. COUNSEL FOR THE ASSESSEE, MR. GUNJEET SI NGH, ITP APPEARING ALONGWITH SH. PREM SINGH, ADVOCATE ARGUED THAT THOU GH THERE IS NO BUSINESS RELATION OR CONNECTION WITH THE PERSONS TO WHOM ADV ANCES HAS BEEN MADE BY THE ASSESSEE COMPANY AND THEY ARE NOT IN ANY WAY RE LATED TO THE ASSESSEE COMPANY. THOUGH THE SAID AMOUNT WAS ADVANCED FOR PU RCHASING LAND BUT THE DEAL HAS NOT BEEN MATERIALIZED. HE ARGUED THAT THE ASSESSEE WAS HAVING SUFFICIENT INTEREST FREE FUNDS TO MAKE SUCH ADVANCE S IN THE YEAR IN WHICH ITA NO.471(ASR)/2013 3 SUCH ADVANCES WERE MADE AND NO ADDITION HAS BEEN M ADE IN THE PRECEDING YEARS I.E. 2005-06 & 2006-07 UNDER SECTION 143(3) O F THE ACT. THE LD. COUNSEL FOR THE ASSESSEE RELIED UPON THE DECISIONS OF THE HONBLE SUPREME COURT IN THE CASE OF S.A. BUILDERS LTD. VS. CIT (20 07) 288 ITR 1 AND IN THE CASE OF MUNJAL SALES CORPORATION VS. CIT (2008) 298 ITR 298 (SC). 7. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE O RDERS OF BOTH THE AUTHORITIES BELOW AND ARGUED THAT LD. COUNSEL FOR T HE ASSESSEE HAS NOT BROUGHT ON RECORD HOW THE SAID DECISIONS RELIED UPON ARE HA VING IDENTICAL FACTS OF THE PRESENT CASES AND THEREFORE, OUTRIGHTLY SUBMITTED T HAT THESE DECISIONS CANNOT BE APPLIED TO THE FACTS AND CIRCUMSTANCES OF THE PR ESENT CASE. 8. THE LD. COUNSEL FOR THE ASSESSEE HAS NOT BROUGHT ON RECORD, A COPY OF THE AGREEMENT OF THE ADVANCE GIVEN FOR THE LAND AS CLAIMED AND NOTHING FURTHER HAS BEEN BROUGHT ON RECORD WHETHER THE SAID ADVANCE HAS BEEN RECEIVED IN THE FOLLOWING YEARS OR EVEN TILL TODATE AND THEREFORE, SUCH A STORY MADE OUT, CANNOT BE RELIED UPON AND THEREFORE, LD. DR STRONGLY RELIED UPON THE FINDINGS OF THE AUTHORITIES BELOW AND PRAYED TO CONFIRM THE ORDER OF THE LD. CIT(A). 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. AT THE OUTSET, THE ARGUMENTS MADE BY THE LD. COUNSE L FOR THE ASSESSEE ARE TOTALLY IRRELEVANT FOR THE REASON THAT NO AGREEMENT WAS MADE THAT THE AMOUNT HAS BEEN ADVANCED FOR THE PURPOSE OF PURCHASE OF LA ND BEFORE ANY OF THE ITA NO.471(ASR)/2013 4 AUTHORITIES BELOW OR EVEN BEFORE US. NO CIRCUMSTANT IAL EVIDENCE HAS BEEN PLACED ON RECORD TO PROVE THAT IN FACT, THE ADVANCE S HAVE BEEN GIVEN FOR ANY BUSINESS PURPOSES, WHICH COULD BENEFIT THE ASSESSEE . SINCE THE PERSONS TO WHOM ADVANCES HAVE BEEN GIVEN ARE NOT AT ALL RELATE D. ALSO THERE IS NOTHING ON RECORD THAT ADVANCES HAVE BEEN GIVEN TO SISTER C ONCERN OR SUBSIDIARY COMPANY. NO DIRECT OR INDIRECT BENEFIT HAS ACCRUE D TO THE ASSESSEE, HAS BEEN ESTABLISHED. THE ARGUMENTS MADE BY THE LD. COUNSEL FOR THE ASSESSEE ARE TOTALLY WITHOUT ANY EVIDENCE, MATERIAL AND THEREFOR E, ARE NOT COVERED BY ANY OF THE DECISIONS RELIED UPON BY THE LD. COUNSEL FOR THE ASSESSEE. THE ARGUMENT BY THE LD. AR THAT NO SUCH DISALLOWANCE HA S BEEN MADE IN THE PAST CANNOT HELP THE ASSESSEE. IN THE FACTS AND CIRCUMST ANCES OF THE CASE, WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A). THUS, THE SOLITARY GROUND RAISED BY THE ASSESSEE IS DISMISSED. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IN ITA NO. 471(ASR)/2013 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29TH NOVEMBER., 2013. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 29TH NOVEMBER, 2013 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:M/S. G.N.A. TRANSMISSIONS (P) LTD. JA LANDHAR. 2. THE ITO, III(4), JALANDHAR. 3. THE CIT(A), JLR 4. THE CIT, JLR.5.THE SR DR, ITAT, AMRITSAR.