ITO Wd 1[3] Pune, Pune V. M/s Jai Ganesh Construction Company, Nashik

ITA 696/PUN/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 76187 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 10 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-02-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 04-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L PATHADE

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI G.S. PANNU, ACCOUNTANT MEMBER ITA NO.696/PN/2012 (A.Y. 2007-08) ACIT, CIRCLE-1, NASHIK APPELLANT VS. M/S. JAI GANESH CONSTRUCTION COMPANY C/O SHRI SHUKLA SUHAS GOPAL, SIDDHIDATA BUNGALOW, SANJIVAN COLONY, NEAR BOYS TOWN, NASHIK PAN: AABFJ8929J RESPONDENT APPELLANT BY : SHRI P.L. P ATHADE RESPONDENT BY : SHRI KIS HORE PHADKE DATE OF HEARING: 26.02.2014 DATE OF ORDER : 27.02.2014 ORDER PER SHAILENDRA KUMAR YADAV, J.M: THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEAL)-II, [SHORT C IT(A)-II] NASHIK, DATED 16.01.2012 FOR A.Y. 2007-08 ON THE FO LLOWING GROUNDS. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE HONORABLE CIT(A)-II, NASIK ERRED IN DELETING THE AD DITION OF RS.4,50,000/- MADE ON ACCOUNT OF UNSECURED LOAN TAKEN FROM M. A. SHUKLA. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE HONORABLE CIT(A)-II, NASIK ERRED IN DELETING THE AD DITION OF RS.6,00,000/- MADE ON ACCOUNT OF ADVANCE RECEIVED F ROM SHRI. C.P. BADLANI. 2 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE HONORABLE CIT(A)-II, NASIK ERRED IN ADMITTING ADDIT IONAL EVIDENCE IN VIOLATION OF RULE 46A(3) OF THE INCOME- TAX RULE 1962. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE HONORABLE CIT(A)-II, NASIK IGNORED THE FACT THAT EV EN UPTO THE DATE OF DECIDING THE APPEAL ASSESSEE DID NOT KN OW THE WHEREABOUTS OF SHRI. C.P. BADLANI OR HIS RELATI VES, NOR ANY SHOP IS APPEARING IN THE BALANCE SHEET EARMARKE D FOR SALE TO SHRI. C.P. BADLANI , THEREBY, CONFIRMING TH E FACT THAT THE CASE IS CLEARLY COVERED BY THE PROVISIONS OF SE CTION 41(1)(A) OF THE INCOME-TAX ACT, 1961. 5. ON THE FACTS AND IN THE CIRCUMSTANCE OF THE CASE IT IS THEREFORE REQUESTED TO CANCEL THE ORDER OF THE HONO RABLE CIT(A)-II, NASIK AND RESTORE THE ORDER OF THE ASSES SING OFFICER. 6. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, MODIFY TH E GROUNDS OF APPEAL, IF CONSIDERED NECESSARY SUBSEQUE NTLY. 2. THE ASSESSEE JAI GANESH CONSTRUCTION COMPANY IS A PARTNERSHIP FIRM CONSISTING OF TWO PARTNERS WITH IT S REGISTERED OFFICE AT 232, MEGHDOOT SHOPPING CENTRE, OPP. C.B.S ., NASHIK. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF BUILDERS AND LAND DEVELOPERS. THE ASSESSEE FIRM HAD FILED RETURN OF INCOME FOR THE ASSESSMENT UNDER CONSIDERATION ON 24.03.2008 DECLAR ING TOTAL INCOME OF 5,10,050/-. THE ASSESSING OFFICER HAS PASSED THE ASSESSMENT ORDER U/S.143(3) OF I.T. ACT MAKING FOLL OWING ADDITIONS. (I) DISALLOWANCE ON ACCOUNT OF ADVANCE RECEIVED AGAINST LAND FROM G.C. BADLANI 6,00,000/- (II) DISALLOWANCE ON ACCOUNT OF LOAN FROM MRS. M.G. SHUKLA 4,50,000/- ---------------- TOTAL 10,50,000/- ========== 3 3. THE MATTER WAS CARRIED BEFORE THE FIRST APPELLAT E AUTHORITY, WHEREIN, VARIOUS CONTENTIONS HAVE BEEN RAISED ON BE HALF OF ASSESSEE AND HAVING CONSIDERED THE SAME, CIT(A) GRA NTED RELIEF TO THE ASSESSEE. AFTER GOING THROUGH THE RIVAL SUBMIS SIONS AND MATERIAL ON RECORD, WE FIND THAT THE ASSESSING OFFI CER HAS MADE THE ADDITION IN QUESTION AS THE ASSESSEE DID NOT FU RNISH ANY DETAILS DURING THE ASSESSMENT PROCEEDINGS. THE ASS ESSING OFFICER HAS MADE ADDITION OF 4,50,000/- ON ACCOUNT OF LOAN RECEIVED FROM LATE SMT. M.G.SHUKLA I.E. THE MOTHER SHRI S.G. SHUKLA. THE SAID ADVANCE WAS GIVEN BY LATE SMT. M.G.SHUKLA FROM HER BANK ACCOUNT WITH NASHIK DISTRICT INDUSTRIAL AND MERCANT ILE CO-OP. BANK LTD., NASHIK ON 11.11.2006. THE CONFIRMATION IN THIS REGARD WAS FILED ON BEHALF OF ASSESSEE. IN VIEW OF THE ABOVE, THE CIT(A) HAS RIGHTLY OBSERVED THAT THE ASSESSING OFFI CER WAS NOT JUSTIFIED IN TREATING THE SAID ADVANCE AS UNEXPLAIN ED CASH CREDIT IN THE HANDS OF THE ASSESSEE FIRM, ACCORDINGLY, THE SAME WAS RIGHTLY DIRECTED TO BE DELETED, WHICH NEEDS NO INTE RFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 4. THE ASSESSING OFFICER HAS MADE ANOTHER ADDITION OF 6,00,000/- ON ACCOUNT OF DISALLOWANCE OF ADVANCE RE CEIVED FROM SHRI C.P. BADLANI AGAINST THE SHOP. THE STAND OF TH E ASSESSEE HAS BEEN THAT THE ADVANCE WAS NOT RECEIVED IN THE ASSES SMENT YEAR UNDER APPEAL. THIS WAS AN OLD ADVANCE RECEIVED FRO M ONE SHRI C.P. BADLANI, G.P.A. HOLDER OF G.C. BADLANI AGAINST BOOKING OF A SHOP. IT WAS FURTHER SUBMITTED THAT THE SAID SHRI C . P. BADLANI, G.P.A. HOLDER HAS EXPIRED AND THEREFORE, THIS AMOUN T IS STILL SHOWN AS PAYABLE IN THE BALANCE SHEET. THE ASSESSE E HAS NOT BEEN ABLE TO TRACE THE FAMILY MEMBERS OF DECEASED S HRI BADLANI. THE ASSESSEE FIRM STATED THAT IT HAS NOT SOLD THE S HOP FOR WHICH THE ABOVE REFERRED ADVANCE WAS TAKEN. SINCE THE ASS ESSEE FIRM STILL OWNS UP THIS LIABILITY IN THE BALANCE SHEET A ND HAS NOT WRITTEN IT OFF LIABILITY OF 6,00,000/- SHOWN AS ADVANCE AGAINST 4 BOOKING OF SHOP DOES NOT CEASE TO EXIST. THIS IS N OT A CASE OF CESSATION OF LIABILITY. IN VIEW OF THE ABOVE, IT CO ULD NOT BE SAID TO AN INCOME OF THE ASSESSEE AND THEREFORE, ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING THE ADDITION OF 6,00,000/- AND IN THE HAND OF FIRM AND THE SAME WAS RIGHTLY DELETED BY CI T(A) BY REASONED FACTUAL FINDING. THIS REASONED FACTUAL FI NDING OF CIT(A) NEEDS NO INTERFERENCE FROM OUR SIDE. WE UPHOLD THE SAME. 5. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. PRONOUNCED IN THE OPEN COURT ON THIS THE DAY 27 TH OF FEBRUARY, 2014. SD/- SD/- (G.S. PANNU) (SHAILENDRA KUMAR YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 27 TH FEBRUARY, 2014 GCVSR COPY TO:- 1) DEPARTMENT 2) ASSESSEE 3) THE CIT(A)-II, NASHIK 4) THE CIT-II, NASHIK 5) THE DR, A BENCH, I.T.A.T., PUNE. 6) GUARD FILE BY ORDER //TRUE COPY// SENIOR PRIVATE SECRETARY, I.T.A.T., PUNE