ITO WD 11(1)(4), MUMBAI V. UZURI JEWELS P.LTD, MUMBAI

ITA 6203/MUM/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 6107 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 10-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARKAMAL SOHI SANDHU
• Keywords: Opportunity of cross examination; Third party statement; Tax effect
• Section: 133(6); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F , MUMBAI BEFORE SHRI C.N. PRASAD , HONBLE JUDICIAL MEMBER AND SHRI N.K. PRADHAN, HONBLE ACCOUNTANT MEMBER ITA NO . 6203 /MUM/201 7 ( A.Y: 2010 - 11) INCOME TAX OFFICER 11(1)(4) 2 ND FLOOR, R.NO. 202 AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400 020 V. M/S. UZURI JEWELS PVT. LTD 17 - 18, APOLLO INDUSTRIAL ESTATE OFF MAHAKALI CAVES ROAD MUMBAI 400 093 PAN NO: AABCU0883D (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI HARESH P. SHAH DEPARTMENT BY : SHRI HARKAMAL SOHI SANDHU DATE OF HEARING : 19.09.2019 DATE OF PRONOUNCEMENT : 19.09.2019 O R D E R PER C.N. PRASAD (JM) THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 18 , MUMBAI [HEREINAFTER IN SHORT LD.CIT(A)] IN APPEAL NO. CIT(A) - 18 / IT - 403/ITO - 11(1)(4)/15 - 16 DATED 28.06.2017 FOR THE ASSESSMENT YEAR 2010 - 11 . 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS IN ITS APPEAL : - 1. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) ERRED IN APPRECIATING THE FACT THAT THE A.O. HAS PASSED ORDER 2 ITA NO. 6203/MUM/2017 (A.Y: 2010 - 11) M/S. UZURI JEWELS PVT. LTD AFTER MAKING INDEPENDENT ENQUIRIES BY SENDING NOTICES U/S 136(6) TO THE BOGUS SHAREHOLDERS AT ADDRESSES GIVEN BY ASSESSEE, WHICH ARE SERVED BUT NO REPLY IS RECEIVED . NEITHER THESE PARTIES ATTENDED / REPLIED IN RESPONSE TO NOTICE U/S 133(6) NOR THE ASSESSEE HAS PRODUCED THESE PARTIES EVEN AFTER GIVEN MULTIPLE OPPORTUNITIES. THEREFORE, IT CANNOT BE SAID THAT THE AO HAS MERELY RELIED UPON THIRD PARTY STATEMENT.' 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED ON RELYING JUDICIAL DECISIONS WHICH HAS NOT ATTAINED FINALITY (M/S. RELIANCE CORPORATION) OR DECISIONS WHICH HAVE DIFFERENT FACTS FROM THE PRESENT CASE. 3. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN DELETING THE ADDITION OF RS.68,87,000/ - U/S.68 OF THE INCOME - TAX ACT, 1961. THE ORDER OF THE LD. CIT(A) IS PERVERSE AND DEPARTMENT IS RELYING ON THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF M/S. NOVA PROMOTERS & FINANCE (P) LTD. DATED 15.02.2012, IN WHICH THE HON'BLE DELHI HIGH COURT DISCUSSED THE CASE OF M/S. LOVELY EXPORTS AND AFTER DISCUSSION IT DID NOT ACCEPTED THE DECISION OF THE HON'BLE SUPREME COURT AFTER DIFFERENTIATING THE FACT OF THE CASE AND HELD THAT UNEXPLAINED SHARE APPLICATION MONEY RECEIVED CAN BE TAXED U/S 68 OF THE INCOME - TAX ACT, 1961.' 4 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN APPRECIATING THE FACT THAT IDENTITY O F THE SHAREHOLDERS CANNOT MERELY BE ESTABLISHED BY FURNISHING PAN, COPIES OF RETURN OF INCOME ALONGWITH ALL SCHEDULES, BANK STATEMENT, REQUEST LETTER FOR APPLICATION OF SHARES ETC. OR ASSESSMENT PARTICULARS DID NOT ESTABLISH THE IDENTITY OF THE PERSON, WHI CH ONLY SHOWS THAT THE COMPANY HAS AN IDENTITY AND THE FACT REMAINS THAT THESE WERE ONLY PAPER COMPANIES AND RELIANCE IS PLACED ON THE DECISION OF ITAT, INDORE IN THE CASE OF AGGARWAL TRANSPORT CORPORATION PVT. LTD. V/S. ADDL. CIT RANGE 5, INDORE IN ITA NO . 151/IND./2009 DATED 31.10.2011.' 5 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) ERRED IN APPRECIATING THE FACT THAT BY MERELY SUBMITTING THAT MONEY WAS RECEIVED THROUGH BANKING CHANNELS DID NOT REFLECT GENUINE BUSINES S ACTIVITY AND THE COMPANIES MERELY ROUTED MONEY WHICH WAS GIVEN BACK THROUGH BANK ACCOUNT. THE MOVEMENT OF THE MONEY THROUGH BANK ACCOUNT IS NOT SUFFICIENT TO ESTABLISH CREDITWORTHINESS OR EVEN GENUINENESS OF THE TRANSACTIONS.' 3. AT THE TIME OF HEARING, AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT TAX EFFECT ON THE ISSUE IN THE PRESENT APPEAL IS BELOW 5 0 LAC S AND IN VIEW OF THE CBDT CIRCULAR N O . 17/2019 DATED 08.08.2019 IN F.NO.279/MISC.142/2007 - ITJ (PT) , THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE. 3 ITA NO. 6203/MUM/2017 (A.Y: 2010 - 11) M/S. UZURI JEWELS PVT. LTD 4. DEPARTMENTAL REPRESENTATIVE ALSO AGREED WITH THE ABOVE SUBMISSION OF THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE . 5. WE HAVE HEARD THE SUBMISSIONS AND PERUSED THE GROUNDS OF APPEAL IN ALL THESE APPEALS. WE F IND THAT THE TAX EFFECT IN ALL THESE APPEAL S IS LESS THAN .5 0 LAKHS AND T HEREFORE THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE CBDT CIRCULAR NO. 17/2019 DATED 08.08.2019. HENCE TH IS APPEAL IS DISMISSED. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 19 TH SEPTEMBER, 2019 . S D/ - SD/ - ( N.K. PRADHAN) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI / DATED 19/09/2019 GIRIDHAR, SR.PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// BY ORDER, (ASSTT. REGISTRAR) ITAT, MUM