ACIT CIR 19(3), MUMBAI V. BUNDA MANSURI, MUMBAI

ITA 5045/MUM/2008

• Counselvise Citation: [2010] 119 COUNSELVISE.COM (IT) 6335 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 15-11-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 08-08-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S RAWAL
• Assessee Lawyers: AJIT SHETTY
• Keywords: Gift; Accommodation entries

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'B' BENCH, MUMBAI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI VIJAY PAL RAO, JUDICIAL MEMBER ITA NO. 5045/MUM/2008 (ASSESSMENT YEAR: 2004-05) ACIT, CIRCLE 19(3) SHRI BUNDA MANSURI ROOM NO. 305, 3RD FLOOR NOVELTY FURNISHINGS, 249, N AVEL KUNJ PIRAMAL CHAMBERS, PAREL VS. LINKING ROAD, OFF NATIONAL COLLEGE MUMBAI 400012 BANDRA (W), MUMBAI 400050 PAN - AAKPM 5639 D APPELLANT RESPONDENT ITA NO. 5047/MUM/2008 (ASSESSMENT YEAR: 2004-05) ACIT, CIRCLE 19(3) SHRI BAFATI MANSURI ROOM NO. 305, 3RD FLOOR NOVELTY FURNISHINGS, 249, N AVEL KUNJ PIRAMAL CHAMBERS, PAREL VS. LINKING ROAD, OFF NATIONAL COLLEGE MUMBAI 400012 BANDRA (W), MUMBAI 400050 PAN - AAKPM 5642 G APPELLANT RESPONDENT ITA NO. 5048/MUM/2008 (ASSESSMENT YEAR: 2004-05) ACIT, CIRCLE 19(3) SHRI BABU MANSURI ROOM NO. 305, 3RD FLOOR NOVELTY FURNISHINGS, 249, N AVEL KUNJ PIRAMAL CHAMBERS, PAREL VS. LINKING ROAD, OFF NATIONAL COLLEGE MUMBAI 400012 BANDRA (W), MUMBAI 400050 PAN - AALPM 2993 H APPELLANT RESPONDENT APPELLANT BY: SHRI R.S. RAWAL RESPONDENT BY: SHRI AJIT SHETTY O R D E R PER J. SUDHAKAR REDDY, A.M. THESE THREE APPEALS WERE FILED BY THE REVENUE DIREC TED AGAINST SEPARATE ORDERS OF THE CIT(A) IN THE CASE OF THREE ASSESSEES . GROUNDS IN THESE APPEALS ARE IDENTICAL, WHICH ARE EXTRACTED FOR THE PURPOSE OF READY REFERENCE: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) XIX, MUMBAI ERRED IN HOLDING THAT THE LO NG TERM CAPITAL GAIN RECEIVED BY THE CASE ASSESSEE IN THE SCRIP SUR YADEEP SALT & ITA NOS. 5045,57 &58/MUM/2008 MANSURIS 2 CHEMICAL WAS A GENUINE TRANSACTION ESPECIALLY WHEN THE CIT(A) HAS NOT COUNTERED THE DEEP INVESTIGATION DONE BY HE A.O . 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION MADE BY A .O. ESPECIALLY WHEN SOME OF THE FACTUAL ASPECT HAS BEEN WRONGFULLY INTERPRETED BY CIT(A). 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT THE TRANSACTION WA S GENUINE WITHOUT APPRECIATING THE FACTS OF THE CASE UNDER CONSIDERAT ION. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN CONCLUDING THAT THE TRANSACTION OF SURYADEEP SALT IS GENUINE ONE WHEN THE RATIO OF THE CASE OF S OMNATH MANI (100 TTJ 917) CLEARLY SAYS IF FACTS AND CIRCUMSTANCES S O WARRANT THAT IT DOES NOT ACCORD WITH THE TEST OF HUMAN PROBABILITIE S, TRANSACTIONS HAVE BEEN HELD TO BE NON-GENUINE. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT THE ADDITION OF 15 % OF CAPITAL GAIN AS COMMISSION FOR ARRANGING THE GIFT IS UNWARRANTED IN THE SITUATION WHEN THERE IS A CONFESSIONAL STATEMENT OF MR. SHAH TO RECEIVE THE COMMISSION AND OPPORTUNITY TO CROSS EXAMINE HAS BEE N GIVEN TO ASSESSEE. 2. SHRI R.S. RAWAL, LEARNED D.R. AND SHRI AJIT SHETTY, LEARNED COUNSEL FOR THE ASSESSEE, SUBMITTED THAT SIMILAR ISSUE HAS COME UP BEFORE I BENCH OF THE TRIBUNAL IN THE CASE OF SHRI ISLAMUDDIN MANSURI IN ITA NO. 5050/MUM/ 2008 AND IN THE CASE OF SHRI IQBAL HUSSEIN MANSURI IN ITA NO. 5051/MUM/ 2008 AND THAT THE ISSUE IS FULLY COVERED BY THE DEC ISIONS OF THE TRIBUNAL CITED ABOVE. THE I BENCH OF THE TRIBUNAL IN ITS O RDER DATED 23 RD FEBRUARY 2010 AT PARA 23 & 24 HAD HELD AS FOLLOWS: - 23. AFTER GIVING OUR ANXIOUS CONSIDERATIONS TO TH E REASONS GIVEN BY THE LD CIT(A), WE CONCUR WITH HIS FINDING THAT THE TRANSACTIONS OF PURCHASE AND SALE OF THE SHARES OF M/S. SURYADEEP L TD. AS CLAIMED BY THE ASSESSEES CANNOT BE DOUBTED. ACCORDINGLY, GROUN D NOS. 1 TO 4 IN BOTH APPEALS ARE DISMISSED 24. NOW THE NEXT IS IN RESPECT OF DELETING THE ADD ITION TOWARDS ALLEGED PAYMENT OF 15% COMMISSION TO SHRI SHAH FOR ARRANGIN G ALLEGED ACCOMMODATION ENTRIES. THE A.O. ALSO MADE ADDITION AT ITA NO. 5050 27 & 5051/MUM/2008 15% OF CAPITAL GAIN DECLARED BY THE ASSESSES WHICH IS IN RESPECT OF COMMISSION PAID TO SHRI SHAH. WE H AVE ALREADY HELD THAT THERE IS NO CREDITWORTHINESS TO THE DEPOSITIONS MAD E BY SHRI SHAH AS HE KEPT CHANGING HIS STATEMENTS. MOREOVER, THERE IS AL SO CONTRADICTIONS ON THIS ISSUE AS AT ONE STAGE HE STATED THAT HE WAS PA ID 2 TO 3% COMMISSION AND IN SUBSEQUENT STATEMENTS HE STATED T HAT HE WAS PAID 15% COMMISSION?. OTHER THAN CONTRADICTORY STATEMENT S OF SHRI SHAH, ITA NOS. 5045,57 &58/MUM/2008 MANSURIS 3 NOTHING IS ON RECORD TO CORROBORATE THE STATEMENT O F SHRI SHAH. IT IS ALSO NOT THE CASE OF THE A.O. THAT SHRI SHAH HAS DECLARE D ANY COMMISSION AS STATED BY HIM. ONLY LAST PARA OF THE ASSESSMENT ORD ER DEALS WITH THIS ADDITION AND ON PERUSAL OF REASONS THIS ADDITION IS ONLY MADE ON THE BASIS OF CONTRADICTORY STATEMENTS OF SHRI SHAH AND NOTHING MORE. IN OUR OPINION LD. CIT(A) RIGHTLY DELETED THE ADDITION AND WE CONCUR WITH SAME. IN THE RESULT GROUND NO. 5 IS DISMISSED IN BOTH THE APPEALS. OTHER GROUNDS ARE GENERAL IN NATURE. 3. THIS DECISION WAS FOLLOWED BY A BENCH OF THE TRIB UNAL IN ITA NO. 5046/MUM/2008 & ITA 5052/MUM/2008 IN THE CASE OF AL TAF H. MANSURI AND ABDULLAH H. MANSURI BY ORDER DATED 16 TH APRIL 2010. FURTHER, A BENCH OF THE TRIBUNAL IN ITA NO. 4977/MUM/2008 UPHELD THE ORDER OF THE CIT(A) BY FOLLOWING THE ABOVE ORDER. SIMILAR DECISION WAS TAKEN BY F BENCH OF THE TRIBUNAL IN ITA NO. 5049/MUM/2008 ORDER DATED 23 RD JUNE 2010 IN THE CASE OF FAROOQ MANSURI NOVELTY FURNISHING. 4. AS THE AGREED DECISION BETWEEN THE PARTIES IS THAT THE ISSUES RAISED ARE IDENTICAL ON FACTS AS WELL AS LAW, WE, RESPECTF ULLY FOLLOWING THE COORDINATE BENCH DECISION, UPHOLD THE ORDER OF THE FIRST APPELLATE AUTHORITY AND DISMISS ALL THE APPEAL OF THE REVENUE. 5. IN THE RESULT, ALL THE APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH NOVEMBER 2010. SD/- SD/- (VIJAY PAL RAO) (J. SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 26 TH NOVEMBER 2010 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) XIX, MUMBAI 4. THE CIT XIX, MUMBAI CITY 5. THE DR, B BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.