PLB INFRASTRUCTURE PVT. LTD., NEW DELHI V. DCIT, CENTRAL CIRCLE- 25, NEW DELHI

ITA 6692/DEL/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 4102 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2012-2013
• Appeal Filed On: 06-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Opportunity of being heard
• Section: 133(6); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO.6692/DEL/2017 A.Y. : 2012-13 M/S PLB INFRASTRUCTURE PVT. LTD., 249-250, BANK STREET, KAROL BAGH, NEW DELHI 110 005 (PAN: AAECP8129L) VS. DCIT, CENTRAL CIRCLE-25, NEW DELHI (ASSESSEE) (RESPONDENT) ASSESSEE BY : SH. HIREN MEHTA, CA REVENUE BY : SH. ATIQ AHMAD, SR. DR ORDER PER H.S. SIDHU : JM THE ASSESSEE HAS FILED THIS APPEAL AGAINST THE IMPUG NED ORDER DATED 08.9.2017 OF THE LD. CIT(A)-29, NEW DELHI RELE VANT TO ASSESSMENT YEAR 2012-13. 2. THE GROUNDS RAISED IN THE APPEAL READ AS UNDER:- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE ORDER PASSED BY CIT (A)- 29, NEW DELHI (HEREINAFTER REFERRED TO AS CIT (A), IS BAD IN LAW. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT (A) WAS NOT JUSTIFIED IN UPHOLDING THE ACTION OF AO IN MAKING AN 2 ADDITION OF RS. 2,00,00,000/- BY TREATING THE SHARE APPLICATION MONEY RECEIVED DURING THE ASSESSMENT YEAR UNDER CONSIDERATION AS UNEXPLAINED CASH CREDIT U/S 68 OF THE INCOME TAX ACT. 3. THAT THE CIT (A) WAS NOT JUSTIFIED IN UPHOLDING THE ACTION OF AO IN MAKING IMPUGNED ADDITION AND ERRED IN NOT ADJUDICATING THE FOLLOWING SPECIFIC GROUNDS RAISED BY THE APPELLANT:- 3.1 PROPER AND REASONABLE OPPORTUNITY WAS NOT PROVIDED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 3.2 COPIES OF CONFIRMATION, ITR, BALANCE SHEET OF ALL THE COMPANIES WHO INVESTED IN SHARE CAPITAL IN THE ASSESSEE COMPANY WERE DULY FILED DURING THE ASSESSMENT PROCEEDINGS TO PROVE THE IDENTITY, GENUINITY AND CREDIT- WORTHINESS WHEREAS THE SAME HAVE BEEN OVERLOOKED BY AO. 3.3 AO LOST SIGHT OF THE FACT THAT THE SHARES ALLOTTED TO INVESTING COMPANIES WERE NOT BOUGHT BACK TILL DATE AND ARE STILL EXISTING IN THE NAME OF INVESTING COMPANIES. 3.4 AT THE FAG-END OF ASSESSMENT PROCEEDINGS I.E. ONLY ON 23.03.2015 THE ASSESSEE COMPANY WAS REQUIRED TO PRODUCE 3 DIRECTORS OF INVESTING COMPANIES AND AS SUCH PROPER AND REASONABLE OPPORTUNITY WAS NOT PROVIDED BY THE AO. 3.5 AS SUFFICIENT COMPLIANCE WAS MADE TO NOTICE ISSUED U/S 133(6) OF THE INVESTING COMPANIES ON 17.02.2015 ESTABLISHING THE FACT OF ALL THESE ENTITIES GENUINELY EXISTED, WHICH HAS BEEN OVERLOOKED BY THE A.O. 3.6 AO RELIED UPON THE STATEMENT OF THE PROMOTERS OF THE ASSESSEE COMPANY NAMELY SH. ASHOK GOEL & SH. PRAVEEN GUPTA WITHOUT PROVIDING A COPY OF THE SAID STATEMENT FOR REBUTTAL AND CROSS-EXAMINATION, WHICH IS AGAINST THE PROPOSITION OF LAW LAID DOWN BY THE DELHI HIGH COURT IN CIT VS. BEST INFRASTRUCTURE (INDIA) PVT. LTD. IN ITA NO. 12/2017 VIDE ORDER DATED 01.08.2017. 3.7 AO HAS RELIED UPON THE INQUIRIES CONDUCTED BY INVESTIGATION WING ON THE INVESTING COMPANIES WITHOUT PROVIDING ANY OPPORTUNITY TO THE ASSESSEE FOR A REBUTTAL DURING THE ENTIRE ASSESSMENT PROCEEDINGS IN SPITE OF ISSUING SPECIFIC QUESTIONNAIRES DATED 28.01.2014 AND 13.03.2015. 3.8 AO HAS RELIED UPON THE INQUIRIES CONDUCTED IN RESPECT OF INVESTING COMPANIES BASED OUT OF KOLKATA WITHOUT CONFRONTING WITH THE FINDINGS 4 OF THESE INQUIRIES TO THE ASSESSEE FOR A REBUTTAL AND CLARIFICATION. 3.9. AO HAS RELIED UPON THE STATEMENT OF SH. RAJESH KUMAR AGGARWAL RECORDED BY DDIT (INV), UNIT-IV(1), KOLKATA WITHOUT PROVIDING A COPY OF THE SAID STATEMENT FOR REBUTTAL AND CROSS-EXAMINATION OF SH. RAJESH KUMAR AGGARWAL WHICH IS AGAINST THE PROPOSITION OF LAW LAID DOWN BY THE DELHI HIGH COURT IN CIT VS. BEST INFRASTRUCTURE (INDIA) PVT. LTD. IN ITA NO. 12/2017 VIDE ORDER DATED 01.08.2017. 3.10 AO HAS RELIED UPON THE FINANCIAL PARAMETERS OF THE INVESTING COMPANIES ON THE BASIS OF FIELD INQUIRIES CONDUCTED BY INVESTIGATION WING, NEW DELHI WITHOUT CONFRONTING THE FINDINGS OF SUCH INQUIRY AND PROVIDING AN OPPORTUNITY FOR REBUTTAL TO THE ASSESSEE COMPANY DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 3.11 AO HAS RELIED UPON THE INQUIRIES CONDUCTED BY INVESTIGATION WING WITH THE BANK ACCOUNTS OF THE INVESTING COMPANIES BY CALLING FOR INFORMATION FROM RESPECTIVE BANKS WHILE THE SAME WAS NOT CONFRONTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR REBUTTAL NOR THE CONTENTS OF SUCH INQUIRIES WERE MADE AVAILABLE TO THE ASSESSEE FOR CLARIFICATION. 5 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE ACTION OF AO IN MAKING AN ADDITION OF RS. 2,00,000/- RECEIVED FROM M/S SURYA VINAYAK INDUSTRIES LTD. AS UNEXPLAINED CASH CREDITS WITHOUT ANY CORROBORATIVE MATERIAL FOUND DURING THE COURSE OF ENTIRE SEARCH PROCEEDINGS OR POST SEARCH INQUIRY. 4.1 THAT THE CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE ACTION OF AO AS THERE IS A COMPLETE LACK OF ANY MATERIAL TO SUGGEST RECEIPT OF ANY ACCOMMODATION ENTRY FROM M/S SURYA VINAYAK INDUSTRIES LTD. 4.2 THAT THE CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE ACTION OF AO AS STATEMENT FURNISHED BY SH. ASHOK GOEL ON 15.10.2013 AT THE TIME OF SEARCH WAS RETRACTED VIDE LETTER DATED 14.11.2013 AND ALSO THE STATEMENT OF SH. PRAVEEN GUPTA, PRADEEP GOEL AND ANIL GARG RECORDED AT THE TIME OF SEARCH CLEARLY DENIED HAVING RECEIVED ANY ACCOMMODATION ENTRY. 4.3 THAT THE CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THE ACTION OF AO SINCE STATEMENT OF SH. SANJEEV JAIN, CHAIRMAN OF M/S SURYA VINAYAK INDUSTRIES LTD. WAS RECORDED ON 25.11.2013 BY INVESTIGATION WING, NEW DELHI 6 DURING THE COURSE OF POST SEARCH PROCEEDINGS WHEREIN HE HAS COMPLETELY DENIED GIVING ANY ACCOMMODATION ENTRY AND CLARIFIED THAT THE AMOUNT WAS GIVEN ON ACCOUNT OF GENUINE BUSINESS TRANSACTION. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND, AND MODIFY ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING OR EARLIER. 3. THE FACTS NARRATED BY THE REVENUE AUTHORITIES ARE NOT DISPUTED BY BOTH THE PARTIES, HENCE, THE SAME ARE NOT REPEATED H ERE FOR THE SAKE OF BREVITY. 4. AT THE TIME OF HEARING, LD. COUNSEL FOR THE ASSESSEE HAS REITERATED THE CONTENTIONS RAISED IN THE GROUNDS OF AP PEAL AND STATED THAT NO PROPER AND REASONABLE OPPORTUNITY WAS PROVIDED DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND WITHO UT CONFRONTING THE MATERIAL COLLECTED BEHIND THE BACK OF TH E ASSESSEE. HENCE, IT WAS REQUESTED THAT ISSUES IN DISPUTE MAY BE SET ASIDE TO THE FILE OF THE AO FOR FRESH CONSIDERATION, AFTER GIV ING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 5. ON THE CONTRARY, LD. DR RELIED UPON THE ORDER OF THE AUTHORITIES BELOW. 7 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED RECORDS , ESPECIALLY THE IMPUGNED ORDER. WE FIND PROPER AND REASONABLE OPPORTUNITY WAS NOT PROVIDED DURING THE COURSE OF AS SESSMENT PROCEEDINGS BECAUSE COPIES OF CONFIRMATION, ITR, BAL ANCE SHEET OF ALL THE COMPANIES WHO INVESTED IN SHARE CAPITAL IN TH E ASSESSEE COMPANY WERE DULY FILED DURING THE ASSESSMENT PROCEE DINGS TO PROVE THE IDENTITY, GENUINENESS AND CREDIT-WORTHINES S WHEREAS THE SAME HAVE BEEN OVERLOOKED BY AO. ALSO AO LOST SIGHT O F THE FACT THAT THE SHARES ALLOTTED TO INVESTING COMPANIES WERE NOT BOUGHT BACK TILL DATE AND ARE STILL EXISTING IN THE NAME OF IN VESTING COMPANIES. AS PER RECORD IT REVEALS THAT SUFFICIENT COM PLIANCE WAS MADE TO NOTICE ISSUED U/S 133(6) OF THE I.T. ACT, 1961 OF THE INVESTING COMPANIES ON 17.02.2015 ESTABLISHING THE FAC T OF ALL THESE ENTITIES GENUINELY EXISTED, WHICH HAS BEEN OVERLOOKED BY THE A.O. HOWEVER, AO RELIED UPON THE STATEMENT OF THE PROMOTER S OF THE ASSESSEE COMPANY NAMELY SH. ASHOK GOEL & SH. PRAVEE N GUPTA WITHOUT PROVIDING A COPY OF THE SAID STATEMENT FOR REB UTTAL AND CROSS-EXAMINATION, WHICH IS NOT SUSTAINABLE IN THE EYE S OF LAW. WE FURTHER NOTE THAT AO HAS RELIED UPON THE INQUIRIES CON DUCTED BY INVESTIGATION WING ON THE INVESTING COMPANIES WITHOUT PROVIDING ANY OPPORTUNITY TO THE ASSESSEE FOR A REBUTTAL DURING TH E ENTIRE ASSESSMENT PROCEEDINGS IN SPITE OF ISSUING SPECIFIC Q UESTIONNAIRES 8 DATED 28.01.2014 AND 13.03.2015. AO HAS RELIED UPON THE INQUIRIES CONDUCTED IN RESPECT OF INVESTING COMPANIES BASED OU T OF KOLKATA WITHOUT CONFRONTING WITH THE FINDINGS OF THESE INQUIRIES TO THE ASSESSEE FOR A REBUTTAL AND CLARIFICATION. AO HAS FU RTHER RELIED UPON THE STATEMENT OF SH. RAJESH KUMAR AGGARWAL RECORDED BY DDIT (INV), UNIT-IV(1), KOLKATA WITHOUT PROVIDING A COPY OF THE SAID STATEMENT FOR REBUTTAL AND CROSS-EXAMINATION OF SH. RAJE SH KUMAR AGGARWAL WHICH IS NOT TENABLE. WE FURTHER NOTE THAT AO HAS RELIED UPON THE FINANCIAL PARAMETERS OF THE INVESTING COMPANIE S ON THE BASIS OF FIELD INQUIRIES CONDUCTED BY INVESTIGATION W ING, NEW DELHI WITHOUT CONFRONTING THE FINDINGS OF SUCH INQUIRY AND PROVIDING AN OPPORTUNITY FOR REBUTTAL TO THE ASSESSEE COMPANY DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS. AO HAS FURTHER RELIED UPO N THE INQUIRIES CONDUCTED BY INVESTIGATION WING WITH THE BANK ACCOUN TS OF THE INVESTING COMPANIES BY CALLING FOR INFORMATION FROM R ESPECTIVE BANKS WHILE THE SAME WAS NOT CONFRONTED DURING THE COUR SE OF ASSESSMENT PROCEEDINGS FOR REBUTTAL NOR THE CONTENTS OF SUCH INQUIRIES WERE MADE AVAILABLE TO THE ASSESSEE FOR CLA RIFICATION. FURTHER IT IS NOTED THAT SINCE STATEMENT OF SH. SANJEE V JAIN, CHAIRMAN OF M/S SURYA VINAYAK INDUSTRIES LTD. WAS RE CORDED ON 25.11.2013 BY INVESTIGATION WING, NEW DELHI DURING THE COURSE OF POST SEARCH PROCEEDINGS WHEREIN HE HAS COMPLETELY D ENIED GIVING 9 ANY ACCOMMODATION ENTRY AND CLARIFIED THAT THE AMOUNT WAS GIVEN ON ACCOUNT OF GENUINE BUSINESS TRANSACTION. KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE, THE ISSUES IN DISPUTE ARE REMITTED BACK TO THE FILE OF THE AO TO DECIDE THE ISSUES IN DISPUTE AFRESH, AFTER GIVING ADEQUATE OPP ORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRO NOUNCED ON 22/01/2018. SD/- SD/- [PRASHANT MAHARISHI] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 22/01/2018 COPY FORWARDED TO: - 1. ASSESSEE - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES