ITO 8(2)(4), MUMBAI V. POWER FUELS (I) INDIA P.LTD, MUMBAI

ITA 6135/MUM/2012

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0666 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 7 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 14-08-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 05-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PREMANAND J
• Assessee Lawyers: DR K SHIVRAM
• Section: 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI . . , . , BEFORE SHRI I.P. BANSAL, JM AND RAJENDRA, AM ./ I.T.A. NO.6135/MUM/2012 ( / ASSESSMENT YEAR : 2009-10 INCOME TAX OFFICER 8(2) - 4, ROOM NO.213/216A, 2 ND FLOOR, AAYKAR BHAVAN, MK ROAD, MUMBAI 400 020 / VS. M/S.POWER FUELS (I) INDIA P. LTD. B-184, RSG-2, SVP NAGAR, MHADA, ANDHERI (W), MUMBAI 400 053 ./ ./ PAN/GIR NO. : AADCP 2583R ( / APPELLANT ) .. ( / RESPONDENT ) A PPELLANT BY SHRI PREMANAND J RESPONDENT BY DR.K. SHIVRAM ' #$ / DATE OF HEARING : 06/05/2015 ' #$ / DATE OF PRONOUNCEMENT : 06/05/2015 / O R D E R PER I.P.BANSAL, J.M: THIS IS AN APPEAL FILED BY THE ASSESSEE AND IT IS DIRECTED AGAINST ORDER PASSED BY LD. CIT(A)-17, MUMBAI DATED 10/7/2012 FOR ASSESSMENT YEAR 2009-10. GROUNDS OF APPEAL READ AS UNDER: 1. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LEARNED CIT(A) ERRED IN DELETING THE ADDITION U/S 68 OF THE ACT OF RS. 33,50,000/- WITHOUT APPRECIATING THAT THE ASSESSEE HAD FAILED T O PROVE THE CREDITWORTHINESS OF THE LOAN CREDITOR AS REQUIRED U /S 68 OF THE ACT.' 1.1 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LEARNED CIT(A) ERRED IN DELETING THE ADDITION U/S 68 OF THE ACT OF RS. 33,50,000/- WITHOUT APPRECIATING THAT THE ASSESSEE HAD FAILED T O DISCHARGE ITS ONUS OF PROVING THE CREDITWORTHINESS OF THE LOAN CREDITOR I N TERMS OF SECTION 68 OF THE ACT WHICH IS EVIDENT FROM THE FACT THE LOAN CREDITO R'S ONLY SOURCE OF INCOME IS 'SALARY' AND RETURNED INCOME FOR AY 2008-09 AND 200 9-10 ARE ONLY RS. 2,74,760/- AND RS. 6,00,000/- RESPECTIVELY EVIDENCI NG THE LACK OF LOAN CREDITORS CAPACITY TO ADVANCE THE LOAN OF THE MAGNI TUDE OF RS. 33,50,000/-' 1.2 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LEARNED CIT(A) ERRED IN DELETING THE ADDITION U/S 68 OF THE ACT OF RS. 33,50,000/- ./ I.T.A. NO.6135/MUM/2012 ( / ASSESSMENT YEAR : 2009-10 2 WITHOUT APPRECIATING THAT THE ASSESSEE HAD FAILED T O DISCHARGE ITS ONUS OF PROVING THE CREDITWORTHINESS OF THE LOAN CREDITOR I N TERMS OF SECTION 68 OF THE ACT, IN VIEW OF THE FACT THAT THE CHEQUE OF RS. 18, 50,000/- ISSUED BY HER TO THE ASSESSEE COMPANY HAD BOUNCED EVIDENCING THE LACK OF CREDITWORTHINESS OF THE LOAN CREDITOR' 2. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUND BE SET ASIDE AND THAT OF THE AO BE RESTORED. 2. THERE WAS CREDIT OF RS.33,50,000/- IN THE ACCOUN T OF DIRECTOR OF THE ASSESSEE COMPANY NAMELY SMT. AMITA JAIN. THE DETAI LS OF CREDIT IS AS FOLLOWS: DATE AMOUNT 23/06/2008 RS.5,00,000 30/07/2008 RS.5,00,000 31/03/2009 RS.18,50,000/- 31/3/2009 RS.5,00,000/- 2.1 COPY OF THE LEDGER ACCOUNT IS FILED AT PAGE -8 OF THE PAPER BOOK. THE AO ADDED AFOREMENTIONED AMOUNT BEING UNEXPLAINED. DURING THE COURSE OF HEARING BEFORE LD. CIT(A) THE ASSESSEE SUBMITTED AS UNDER: THE LOANS WERE RECEIVED THROUGH PROPER BANKING CHA NNEL BY ACCOUNT PAYEE CHEQUE. THE CONFIRMATION LETTER, ALONG WITH BANK STATEMENT AND INCOME TAX RETURN OF SMT. AMITA JAIN WAS FILED BEFORE THE AO. HENCE, THE IDENTITY, GENUINENESS AND SOURCE OF THE LOAN HAVE BEEN ESTABLISHED. THAT CHEQUE OF RS 18,50,000/-, RECEIVED ON 31.3.200 9, BOUNCED ON 2.4.2009 . HENCE, THE ACTUAL ADDITION TO THE UNSECURED LOAN AC COUNT WAS ONLY RS. 15 LACS. SOURCE OF RS. 15 LACS IS DULY SUPPORTED BY BANK STA TEMENT AND COPY OF LEDGER ACCOUNT. DURING THE YEAR SMT. AMITA JAIN HAS NOT MADE ANY AD DITION IN HER ACCOUNT AND HAD ACTUALLY WITHDRAWN EXCESS AMOUNT OF RS. 6,5 0,000/-, BESIDES HER SALARY OF RS. 6,60.000/- HENCE. THE QUESTION OF ANY ADDITION U/S. 68 DOES NOT ARISE. RELIANCE WAS PLACED UPON A NUMBER OF DECISIONS, AS QUOTED IN THE WRITTEN SUBMISSIONS OF THE APPELLANT. 2.2 ON THE AFOREMENTIONED SUBMISSIONS MADE BY THE A SSESSEE, LD. CIT(A) OBSERVED THAT AS RS.18,50,000/- WAS THE SAME AMOUNT WHICH WAS RETURNED IN THE NEXT FINANCIAL YEAR, THEREFORE, THE SAID AMO UNT CANNOT BE CONSIDERED TO BE ADDITION TO THE ACCOUNT OF THE ASSESSEE AS TH AT WAS NOT CREDITED TO THE ./ I.T.A. NO.6135/MUM/2012 ( / ASSESSMENT YEAR : 2009-10 3 ACCOUNT OF THE ASSESSEE AND WAS A MERE CHEQUE ENTRY . THE ACTUAL CREDIT WAS ONLY A SUM OF RS.15,00,000/- WHICH WAS REQUIRED TO BE EXPLAINED. LD. CIT(A) HAS OBSERVED THAT THE CONFIRMATION FROM THE DIRECTOR WAS FILED ALONGWITH COPIES OF HER RETURN OF INCOME AND HER BA NK ACCOUNT WITH STANDARD CHARTERED BANK FROM WHERE THREE CHEQUES WE RE ISSUED AND THUS, LD.CIT(A) HAS ARRIVED AT A CONCLUSION THAT NO ADDIT ION WAS CALLED FOR. THE REVENUE IS AGGRIEVED, HENCE, HAS FILED AFOREMENTION ED GROUNDS. 3. DURING THE COURSE OF HEARING LD. DR FAIRLY SUBMI TTED THAT AS PER COPIES OF BANK ACCOUNT FILED BY THE ASSESSEE IN TH E PAPER BOOK ALL THE THREE ENTRIES OF RS.5.00 LACS ARE FOUND DEBITED. HOWEVE R, LD. DR RELIED UPON THE ORDER PASSED AO. 4. ON THE OTHER HAND, LD. AR SUBMITTED THAT ALL THE CREDITS IN THE ACCOUNTS OF THE DIRECTOR HAVE BEEN EXPLAINED AND, T HEREFORE, LD. CIT(A) HAS RIGHTLY DELETED THE ADDITION. WE HAVE HEARD BOTH THE PARTIES AND THEIR CONTENTION S HAVE CAREFULLY BEEN CONSIDERED. AFTER GOING THROUGH THE COPY OF BANK A CCOUNTS FILED BY THE ASSESSEE IN THE NAME OF AMITA JAIN, WE FIND THAT A LL THE THREE ENTRIES OF RS.5.00 LACS HAVE BEEN DEBITED IN THE BANK ACCOUNT OF THE CREDITOR. THE ENTRY OF RS.18,50,000/- RELATES TO CHEQUE RETURNED. IN THIS VIEW OF THE SITUATION, WE DO NO FIND ANY INFIRMITY IN THE RELIE F GRANTED BY LD. CIT(A) TO THE ASSESSEE, WE DECLINE TO INTERFERE. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS D ISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 06/05/2015 ' * +, 06/05/2015 ' SD/- SD/- (RAJENDRA) . . (I.P.BANSAL) /ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; + DATED 06/05/2015 ./ I.T.A. NO.6135/MUM/2012 ( / ASSESSMENT YEAR : 2009-10 4 !'# $#! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. /# ( ) / THE CIT(A)- 4. /# / CIT 5. 01 #23 , $ 23 , / DR, ITAT, MUMBAI 6. 4 / GUARD FILE. / BY ORDER, 0# # //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI . . .VM , SR. PS