ITO, New Delhi V. M/s Ekta Agro Industries Ltd., New Delhi

ITA 5497/DEL/2010

• Counselvise Citation: [2011] 135 COUNSELVISE.COM (IT) 0434 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 1998-1999
• Appeal Filed On: 06-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BANITA DEVI NAOREM
• Keywords: Bogus Share capital

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : B : NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO.5497/DEL/2010 ASSESSMENT YEAR : 1998-98 ITO, WARD 11 (1), ROOM NO.321, CR BUILDING, NEW DELHI. VS. EKTA AGRO INDUSTRIES LTD., 3/13-B, ASAF ALI ROAD, NEW DELHI. PAN : AAACE0383P (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : MS BANITA DEVI NAOREM, SR. DR ORDER PER I.P. BANSAL, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE. IT IS DIRECT ED AGAINST THE ORDER OF THE CIT (A) DATED 27 TH SEPTEMBER, 2010 FOR ASSESSMENT YEAR 1998-99. GROUNDS OF APPEAL READ AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE ORDER OF CIT (A) IS WRONG, PERVERSE, ILLEGAL & AGAINST THE PROVISIONS OF LAW WHICH IS LIABLE TO BE SET ASIDE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED IN DELETING PENALTY OF ` 5,25,000/- IMPOSED BY THE A.O. U/S 271(1)(C) OF THE I T ACT, 61. 3. THE APPELLANT CRAVES LEAVE TO ADD, TO ALTER, OR AMEND ANY GROUNDS OF THE APPEAL RAISED ABOVE AT THE TIME OF THE HEARING. ITA NO.5497/DEL/2010 2 2. THE PENALTY WAS LEVIED ON THE ASSESSEE ON ACCOUNT OF ADDITION MADE ON ACCOUNT OF UNEXPLAINED SHARE CAPITAL OF ` 15 LAC RECEIVED FROM THE FOLLOWING TWO PARTIES:- (A) HALLMARK HEALTH CARE LTD. - ` 10,00,000/- (B) FINORG CHEMICALS LTD. - ` 5,00,000/- 3. IT WAS NOTICED BY THE CIT (A) THAT ITAT DELHI BEN CH VIDE ITS ORDER DATED 24 TH JULY, 2009 IN M.A. NO.635/DEL/2008 HAS ALREADY DELE TED SUCH ADDITION AND SUCH FACT IS RECORDED BY THE LEARNED CIT (A) IN PARA 4 OF HIS ORDER. BASED ON THE SAID ORDER OF DELETION OF ADD ITION, LEARNED CIT (A) DELETED THE PENALTY AS THE ADDITION ITSELF HAS BEE N DELETED. 4. NOTICE OF HEARING WAS SENT TO THE ASSESSEE, HOWEVER, N ONE WAS PRESENT ON BEHALF OF THE ASSESSEE. AS THE CIT (A) HAS DEL ETED THE PENALTY ON THE GROUND THAT THE ADDITION ITSELF HAS BE EN DELETED BY THE TRIBUNAL, WE PROCEEDED TO DECIDE THE PRESENT APPEAL AFTER HEARING LEARNED DR. LD. DR RELIED UPON THE ORDER OF THE A SSESSING OFFICER. 5. AFTER CONSIDERING THE SUBMISSIONS OF LD. DR AND AFTER GOING THROUGH THE ORDER OF THE ASSESSING OFFICER AND THE CIT (A), WE ARE OF THE OPINION THAT LEARNED CIT (A) HAS RIGHTLY DELETED THE PENALTY AS THE ADDITION ITSELF HAS BEEN DELETED BY THE TRIBUNAL. IF THE ADDITION ITSELF IS NOT SUSTAINED, THEN, PENALTY CANNOT BE SUSTAINED ON THA T ADDITION. THEREFORE, THERE IS NO INFIRMITY IN THE ORDER OF THE CIT (A) VIDE WHICH THE IMPUGNED PENALTY HAS BEEN DELETED. WE DECLINE T O INTERFERE. 6. IN THE RESULT, THE APPEAL FILED BY THE DEPARTMENT IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 18.02.20 11. SD/- SD/- [SHAMIM YAHYA] [I.P. BANSAL] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED, 18.02.2011. ITA NO.5497/DEL/2010 3 DK COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES