Dy.Commissioner of Income Tax, Lucknow V. Sigma Trade Wings, Lucknow

ITA 701/LKW/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9125 (ITAT-LUCKNOW)
• Duration Of Justice: 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 03-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJIV BANSAL
• Section: 68

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.701/LKW/2014 ASSESSMENT YEAR:2010 - 2011 M/S SIGMA TRADE WINGS, D - 165, INDIRA NAGAR, LUCKNOW. PAN:AAOFS9857R VS DY.C.I.T., RANGE - 1, LUCKNOW. (RESPONDENT) (APPELLANT) SHRI C. P. SINGH, D. R. APPELLANT BY SHRI RAJIV BANSAL, C.A. RESPONDENT BY 16/12/2014 DATE OF HEARING 23 /01/2015 DATE OF PRONOUNCEMENT O R D E R PER A. K. GARODIA, A.M. THIS IS REVENUES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) - I, LUCKNOW DATED 22/06/2014 FOR THE ASSESSMENT YEAR 2010 - 2011. 2. IN THIS APPEAL, THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 1. UNDER THE FACTS AND THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETING THE ADDITION OF RS.20,00,000/ - U/S 68 OF THE ACT WITHOUT APPRECIATING THAT SUCH TRANSACTION WAS IN GENUINE IN AS MUCH AS ON THE DATE OF CREDIT OF AMO UNTS IN THE ASSESSEE'S FIRM I.E. 30 - 03 - 2010, THE PARTNERS HAD NOT ENOUGH MONEY IN THEIR BANK ACCOUNTS TO ADVANCE SUCH CAPITAL TO THE ASSESSEE FIRM. 2 3. LEARNED D. R. OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WHEREAS LEARNED A. R. OF THE ASSESSEE SUPPO RTED THE ORDER OF LEARNED CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THIS ISSUE WAS DECIDED BY LEARNED CIT(A) AS PER PARA 5.2 OF HIS ORDER, WHICH IS REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: - 5.2 I HAVE CONSIDERED THE M ATTER. I FIND THAT THE ADDITION OF RS.20 LAC MADE BY THE ASSESSING OFFICER IS NOT IN PROPER PERSPECTIVE. IT IS SEEN THAT THE CHEQUES OF CAPITAL CONTRIBUTIONS OF RS.15 LAC AND RS.5 LAC WERE ISSUED BY THE PARTNERS ON 31/03/2010 AND THE SAME WERE ENCASHED O N 29.09.2010. IN THE BOOKS OF ACCOUNT THESE ENTRIES WERE DEBITED IN THE BANK OF BARODA OD ACCOUNT. THESE CHEQUES WERE SUBSEQUENTLY ENCASHED ON 29.09.2010 IN THE NEXT FINANCIAL YEAR. BOTH THE PARTNERS, SHRI MAHENDRA DEV DIXIT AND SHRI NARENDRA DEV DIXIT ARE DULY ASSESSED TO TAX. THE APPELLANT FILED COPIES OF THEIR INCOME TAX RETURNS FOR AY 2010 - 11 DECLARING TOTAL INCOME OF RS.15,25,790/ - AND RS.10,05,240/ - ON WHICH THEY HAVE PAID TAXES OF RS.4,06,400/ - AND RS.2,46,410/ - RESPECTIVELY. THE CHEQUES FOR CAPITAL CONTRIBUTIONS WERE ISSUED BY THE PARTNERS FROM THEIR REGULAR BANK ACCOUNTS IN BANK OF BARODA AND DEPOSIT/CREDIT ENTRIES IN THESE BANK ACCOUNTS BEFORE THE CHEUQES WERE ENCASHED ON 29.09.2010 WERE FOUND TO BE DULY EXPLAINED. I ALSO FIND THAT THE OBJECTION OF THE AO THAT THE PARTNERS DID NOT HAVE SUFFICIENT BALANCE AS ON 31.3.2010 TO MAKE CAPITAL CONTRIBUTION IS MISPLACED. ON 29.09.2010 WHEN CHEQUES WERE ENCASHED, MAHENDRA DEV DIXIT HAD SUFFICIENT BALANCE IN HIS BANK ACCOUNT AND AS REGARDS SHRI NARENDRA DEV DI XIT THE PAYMENT HAS BEEN CLEARED FROM HIS OVERDRAFT ACCOUNT. IN VIEW OF THE ABOVE IT IS HELD THAT CAPACITY OF THE PARTNERS TO INTRODUCE CAPITAL AND GENUINENESS OF THE TRANSACTIONS WERE DULY PROVED BY THE APPELLANT AND HENCE THE AO WAS NOT JUSTIFIED IN MAK ING ADDITION OF RS. 20 LACS UNDER SECTION 68 OF THE ACT. ADDITION OF RS. 20 LAC MADE THE AO IS, THEREFORE, DELETED. 4.1 FROM THE ABOVE P ARA FROM THE ORDER OF CIT(A), WE FIND THAT IT IS NOTED BY HIM THAT CHEQUE S OF CAPITAL CONTRIBUTIONS OF RS.15 LAC AND RS.5 LAC 3 WERE ISSUED BY THE PARTNERS ON 31/03/2010 AND THE SAME WERE ENCASHED ON 29.09.2010. IT IS ALSO NOTED BY CIT(A) THAT THE CHEQUE OF CONTRIBUTION WERE ISSUED FROM REGULAR BANK ACCOUNTS. HE HAS NOTED THAT ON 29 / 09 / 2010 WHEN CHEQUES WERE ENCASHED, MAHENDRA DEV DIXIT HAD SUFFICIENT BALANCE IN HIS BANK ACCOUNT AND REGARDING SHRI NARENDRA DEV DIXIT , THE PAYMENT HA VE BEEN CLEARED FROM HIS OVERDRAFT BANK ACCOUNT. CONSIDERING THESE FACTS, WE ARE OF THE CONSIDERED OPIN ION THAT THE CIT(A) HAS EXAMINED THE ISSUE IN ALL RESPECT AND HIS ORDER DOES NOT SUFFER FROM ANY INFIRMITY. WE, THEREFORE, DECLINE TO INTERFERE IN THE ORDER OF CIT(A). 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. (ORDER WAS PRONOUNCED I N THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 23 /01/2015 *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1.THE APPELLANT 2.THE RESPONDENT. 3.CONCERNED CIT 4.THE CIT(A) 5.D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR