ITO, New Delhi V. Smt. Anu Advani, New Delhi

ITA 527/DEL/2009

• Counselvise Citation: [2010] 119 COUNSELVISE.COM (IT) 5515 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 16-03-2010
• Assessment Year: 2000-2001
• Appeal Filed On: 12-02-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: FARHAT DURESHI
• Assessee Lawyers: B L GUPTA ITP
• Keywords: Unexplained investment; Income from undisclosed sources; Assessment record
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH A DELHI ] BEFORE SHRI R. P. TOLANI, JM AND SHRI K. D . RANJAN, AM I. T. APPEAL NO. 527 (DEL) OF 2009. ASSESSMENT YEAR : 2000-01. THE INCOME-TAX OFFICER, SMT. ANU ADVANI, S 39, 1 ST FLOOR, C I R C L E : 36 (4), VS. SUNDER BLOCK, S H A K A R P U R, N E W D E L H I. D E L H I. PAN/GIR NO. ADIPA3767B ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY : SHRI B. L. GUPTA, I. T. P.; DEPARTMENT BY : SHRI FARHAT DURESHI, SR. D.R. ; O R D E R. PER K. D. RANJAN, AM : THIS APPEAL BY THE REVENUE FOR ASSESSMENT YEAR 2000 -01 ARISES OUT OF THE ORDER OF THE LD. CIT (APPEALS)-XXVII, NEW DELHI. 2. THE GROUNDS OF APPEAL, RAISED BY THE REVENUE, AR E REPRODUCED AS UNDER :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT (APPEALS) HAS ERRED IN DELETING THE ADDITION OF RS.20,00,000/ - MADE ON ACCOUNT OF UNEXPLAINED INVESTMENTS TOWARDS LOAN AND SHARES UND ER SECTION 69 OF THE I. T. ACT, 1961, WHICH WERE PLEDGED TO RAISE LOAN; 2 I. T. APPEAL NO. 527 (DEL) OF 2009. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT (APPEALS) HAS ERRED IN HOLDING THAT THE ASSESSEE HAS NOT MADE ANY INVESTMENT IN SHARES AND NEITHER IS SHE THE BENEFICIARY OF THE AMOUNT OF LOA N. ' 3. THE ONLY ISSUE FOR CONSIDERATION RELATES TO DELE TING THE ADDITION OF RS.20 LAKHS ON ACCOUNT OF UNEXPLAINED INVESTMENTS IN SHARES UNDER SECTION 69 OF THE ACT. THE FACTS OF THE CASE STATED IN BRIEF ARE THAT THE SURVEY UNDER SECTION 133-A OF TH E ACT WAS CONDUCTED ON 24/01/2006 ON THE BUSINESS PREMISES OF SHRI GIAN GUPTA GROUP OF CASES . ON SCRUTINY OF PAPERS IMPOUNDED DURING THE COURSE OF SURVEY IT WAS NOTICED THAT SHRI GIAN GUPTA AND HIS FAMILY MEMBERS AS ALSO THEIR BUSINESS CONCERNS RECEIVED HUGE CREDITS IN THEIR BA NK ACCOUNT FROM SMT. ANU ADVANI. ENQUIRIES WERE CONDUCTED FROM THE ASSESSEE AND SHRI GIAN GUPT A. IT WAS FOUND THAT SHRI GIAN GUPTA RECEIVED LOAN OF RS.20 LAKHS FROM THE ASSESSEE DURI NG THE FINANCIAL YEAR 1999-2000 RELEVANT TO ASSESSMENT YEAR 2000-01. SHRI SURESH ADVANI, THE H USBAND OF THE ASSESSEE STATED THAT THE SAID LOAN AMOUNT WAS GIVEN FROM LOAN PROCEEDS OBTAINED F ROM STANDARD CHARTERED BANK AGAINST THE PLEDGE OF SHARES BELONGING TO SHRI GAIN GUPTA AND H IS FAMILY MEMBERS, BUT NO DETAILS OF SHARES PLEDGED WITH THE BANK AGAINST WHICH THE LOAN WAS RA ISED WERE FILED. SHRI GIAN GUPTA WAS ASKED TO GIVE THE DETAILS OF SALE AND PURCHASE OF THE SHA RES SO PLEDGED. HE WAS ASKED TO EXPLAIN THE SOURCE OF INVESTMENT IN THE SHARES, BUT HE DID NOT FILE THE DETAILS OF SHARES PLEDGED AND THE SOURCE OF INVESTMENT THEREIN. HIS ASSESSMENT RECORD FOR A SSESSMENT YEAR 2000-01 WAS ALSO PERUSED, BUT NO DETAILS WERE AVAILABLE. ON THE BASIS OF THESE F ACTS THE ASSESSING OFFICER CAME TO THE CONCLUSION THAT SOURCES OF LOAN AND SHARES AMOUNTING TO RS.20 LAKHS MADE BY THE ASSESSEE COULD NOT BE PROVED. HE ACCORDINGLY ADDED THE AMOUNT OF RS.20 L AKHS AS UNACCOUNTED INCOME. 4. ON APPEAL IT WAS SUBMITTED THAT THE ASSESSMENT W AS COMPLETED ON A TOTAL INCOME OF RS.20 LAKHS. SMT. ANU ADVANI IS RELATED TO SHRI GIAN GUP TA AND SHRI GIAN GUPTA ALONG WITH HIS WIFE AND SON WERE CARRYING ON VARIOUS BUSINESSES INCLUDI NG PURCHASE AND SALE OF SHARES ON LARGE SCALE ON LARGE SCALE. IT WAS SUBMITTED THAT THE FAMILY O F SHRI GIAN GUPTA NEEDED SOME FUNDS, BUT THE BANKS WERE NOT PREPARED TO GIVE ALL THE FUNDS IN ON E NAME. THEREFORE, THE BANK ADVISED THAT IT COULD GIVE LOAN OF RS.20 LAKHS TO EACH INDIVIDUAL. IT WAS, HOWEVER, OPEN THAT THE SHARES OF 3 I. T. APPEAL NO. 527 (DEL) OF 2009. ANYBODY COULD BE PLEDGED, BUT THE ACCOUNT OF LOAN W ILL BE DEBITED IN THE NAME OF SUCH INDIVIDUAL PERSON. ACCORDINGLY, SHRI GIAN GUPTA PLEDGED HIS S HARES AND OBTAINED A LOAN OF RS.20 LAKHS IN THE NAME OF SMT. ANU ADVANI FROM STANDARD CHARTERED BANK. THE BANK ADVANCED THE LOAN AGAINST SECURITY OF SHARES, NAMELY, 7,940 SHARES OF ACC; 360 SHARES OF CIPLA; 1,500 SHARES OF RANBAXY AND 4,300 SHARES OF TISCO. IT WAS FURTHER SUBMITTED THAT THESE SHARES WERE PART OF DEMAT ACCOUNT OF SHRI GAIN GUPTA FOR WHICH NECESSAR Y EVIDENCE WAS FILED BEFORE THE LD. CIT (APPEALS). DEMAT ACCOUNT OF SHRI GIAN GUPTA WAS HA NDLED BY M/S. ALANKRIT ASSIGNMENT. ON 25 TH FEBRUARY AND 20 TH MARCH, 2000 SHARES WERE PLEDGED TO THE DEMAT ACCOU NT OF STANDARD CHARTERED BANK. ACCORDINGLY, M/S. ALANKRIT DID SHO W AND ON THE BASIS OF THE SAME THE BANK GRANTED LOAN OF RS.20 LAKHS ON 26/02/2000. IT WAS ALSO SUBMITTED THAT THIS AMOUNT HAD BEEN DECLARED ALSO BY SHRI ASHISH GUPTA SON OF SHRI GIAN GUPTA IN HIS BALANCE SHEET. THE ASSESSEE FILED BALANCE SHEET OF SHRI GIAN GUPTA, WHO HAD DEC LARED SMT. ANU ADVANI AS HIS CREDITOR EXACTLY OF THE SAME AMOUNT AS APPEARING IN THE BANK ACCOUNT OF SMT. ANU ADVANI I.E. RS.20,36,844/-. ACCORDINGLY, IT WAS PLEADED THAT S MT. ANU ADVANI HAD NOT MADE ANY INVESTMENT IN THE SHARES. THE LD. CIT (APPEALS) ON THE BASIS OF THE ABOVE OBSERVED THAT SMT. ANU ADVANI WAS NOT THE OWNER OF SHARES. THE SHARES BELONGED T O SHRI GIAN GUPTA. HE HAD RAISED THE LOAN IN QUESTION BY PLEDGING HIS SHARES AND HE AND HIS FAMI LY MEMBERS ARE THE REAL BENEFICIARIES OF THE LOAN AMOUNT. SHRI GIAN GUPTA AND HIS SON SHRI ASHI SH GUPTA HAD DULY DECLARED THE INVESTMENT IN SUCH SHARES AND LIABILITY OF SUCH LOAN RESPECTIV ELY IN THEIR BALANCE SHEET FILED WITH THE RETURN OF INCOME. THE LD. CIT (A) ACCORDINGLY DELETED THE AD DITION. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. FROM THE ORDER OF THE LD. CIT (APPEALS) IT APPEARS THAT SHRI GIAN GUPTA IS THE REAL OWNER OF THE SHARES PLEDGED BY SMT. ANU ADVANI. THE LD. CIT (A) HAS RE CORDED A SPECIFIC FINDING THAT THE REAL BENEFICIARY OF THE LOAN IS SHRI GIAN GUPTA AND HIS FAMILY MEMBERS. THE REVENUE HAS NOT BROUGHT ON RECORD ANY MATERIAL TO CONTROVERT THE FI NDINGS OF THE LD. CIT (A) THAT THE SHARES PLEDGED FOR OBTAINING THE LOAN FROM STANDARD CHARTE RED BANK DID NOT BELONG TO SHRI GIAN GUPTA AND HIS FAMILY MEMBERS. IN THE ABSENCE OF ANY MATE RIAL TO PROVE THAT THE ASSESSEE HAD INVESTED MONEYS IN SHARES, WHICH WERE PLEDGED WITH THE STAND ARD CHARTERED BANK FOR THE PURPOSE OF 4 I. T. APPEAL NO. 527 (DEL) OF 2009. OBTAINING OF LOAN OF RS.20 LAKHS, IN OUR CONSIDERED OPINION, THE LD. CIT (A) WAS JUSTIFIED IN DELETING THE ADDITION. HENCE, NO INTERFERENCE IS C ALLED FOR. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON : 16 TH MARCH, 2010. SD/- SD/- [ R. P. TOLANI ] [ K. D. RANJAN ] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 16 TH MARCH, 2010. *MEHTA * COPY OF THE ORDER FORWARDED TO : - 1. APPELLANT. 2. RESPONDENT. 3. CIT, 4. CIT (APPEALS), 5. DR, ITAT, NEW DELHI. TRUE COPY. BY ORDER. ASSISTANT REGISTRAR, ITAT. 5 I. T. APPEAL NO. 527 (DEL) OF 2009. 6 I. T. APPEAL NO. 527 (DEL) OF 2009.