Income Tax Officer, ward-2, Kishangarh V. Shri Pawan Kumar jain, Madanganj-Kishangarh

ITA 740/JPR/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6264 (ITAT-JAIPUR)
• Duration Of Justice: 1 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 29-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P P MEENA
• Keywords: Earning of tax free income; Wrong claim; Tax effect; Sham transactions
• Section: 69C; 68

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,O A JH HKKXPUN ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA- @ ITA NO. 740/JP/2018 FU/KZKJ.K O'K Z @ ASSESSMENT YEARS : 2014-15. THE INCOME TAX OFFICER, WARD-2, KISHANGARH. CUKE VS. SHRI PAWAN KUMAR JAIN, RAJ VILLA, OPP. RAVINDRA RANGMANCH, JAIN COLONY, MANDANGANJ-KISHANGARH. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. ADUPJ 0948 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI P.P. MEENA (JCIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : NONE LQUOKBZ DH RKJH[K@ DATE OF HEARING : 20.07.2018. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 24/07/2018. VKNS'K@ ORDER PER VIJAY PAL RAO, J.M. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 28 TH MARCH, 2018 OF LD. CIT (A) FOR THE ASSESSMENT YEAR 2014-15 . THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- ON FACT AND IN LAW, THE LD. CIT (A) AJMER ERRED IN :- 1. DELETING THE ADDITION OF RS. 36,23,863/- MADE U/S 6 8 OF THE I.T. ACT, 1961 ON ACCOUNT OF BOGUS CLAIM OF LTCG U/S 10( 38) AND ADDITION OF RS. 72,477/- MADE U/S 69C OF THE I.T. A CT FOR COMMISSION PAYMENT, WITHOUT APPRECIATING THE FACTS OF THE CASE AND MODUS OPERANDI OF THE SCHEME WHICH CLEARLY PROV E THAT ALL THE TRANSACTIONS WERE SHAM TRANSACTIONS AND USED AS A C OLORABLE DEVICE 2 ITA NO. 740/JP/2018 SHRI PAWAN KUMAR JAIN, KISHANGARH. TO CREATE DOCUMENTARY EVIDENCES FOR CONVERTING UNAC COUNTED MONEY INTO TAX EXEMPT INCOME ; 2. DELETING BOTH THE ADDITIONS WITHOUT APPRECIATING TH E FACT THAT THE ASSESSEE MADE BOGUS CLAIM OF LTCG BY AVAILING ACCOM MODATION ENTRIES IN LISTED COMPANIES CONTROLLED BY SHRI PRAV EEN KUMAR AGARWAL WHO ACCEPTED ON OATH THAT HE WAS INDULGED I N PROVIDING BOGUS LTCG/STCL ENTRIES AND THE DIRECTOR OF M/S. PS IT INFRASTRUCTURE &SERVICES LIMITED WAS ONE OF THE BEN EFICIARIES. THE DIRECTOR OF M/S. PS IT INFRASTRUCTURE & SERVICES LI MITED ALSO ADMITTED THAT THIS COMPANY IS A PAPER COMPANY; 3. THE APPELLANT CRAVES TO ADD, AMEND, ALTER, DELETE O R MODIFY THE ABOVE GROUND OF APPEAL BEFORE OR AT THE TIME OF HEA RING. THUS IT IS CLEAR FROM THE GROUNDS RAISED BY THE REV ENUE THAT THE REVENUE IS CHALLENGING THE RELIEF GRANTED BY THE LD. CIT (A) O F RS. 36,23,863/- ON ACCOUNT OF ADDITION MADE UNDER SECTION 68 AND FURTHER RS. 72,4 77/- ON ACCOUNT OF ADDITION MADE UNDER SECTION 69C. HENCE THE TOTAL ADDITION WH ICH WAS DELETED BY THE LD. CIT (A) WAS ABOUT RS. 37 LACS AND THEREFORE, THE TAX EF FECT IN THE APPEAL OF THE REVENUE IS NOT EXCEEDING RS. 20 LACS. 2. THE LD. D/R HAS FAIRLY SUBMITTED THAT THE TAX EF FECT INVOLVED IN THE REVENUES APPEAL IS LESS THAN 20 LACS WHICH IS PRESCRIBED THR ESHOLD LIMIT IN TERMS OF THE CBDT CIRCULAR NO. 3/2018 DATED 11 TH JULY, 2018 ISSUED IN SUPERSESSION OF ITS EARLIER C IRCULAR NO. 21 OF 2015 DATED 10.12.2015. 3. WE HAVE HEARD THE LD. D/R AND PERUSED THE MATERI ALS AVAILABLE ON RECORD. IT IS OBSERVED THAT THE DEMAND/ TAX EFFECT IN THE REVE NUES APPEAL IN QUESTION IS BELOW RS. 20.00 LACS . UNDER THE POWERS VESTED BY SECTION. 268A(1) OF THE I T ACT, CBDT HAS RECENTLY ISSUED CIRCULAR NO. 3/2018 DATED 11 TH JULY, 2018 (F NO. 279/MISC. 142/2007-ITJ(PT) INSTRUCTING THE AUTHORIT IES BELOW THAT 3 ITA NO. 740/JP/2018 SHRI PAWAN KUMAR JAIN, KISHANGARH. DEPARTMENTAL APPEAL SHOULD NOT BE FILED BEFORE ITAT WHERE THE DEMAND/TAX EFFECT DOES NOT EXCEED RS. 20 LACS. THE CIRCULAR IS SPECIFICALLY MENTIONED TO BE APPLICABLE FOR ALL PENDING APPEALS. 4. SUBJECT TO SOME EXCEPTIONS, IT IS FURTHER DIREC TED BY CBDT THAT ALL THE DEPARTMENTAL APPEALS PENDING BEFORE ITAT WHERE THE DEMAND/TAX EFFECT IS NOT EXCEEDING THAN 20 LACS SHOULD BE EITHER WITHDRAWN O R NOT PRESSED BY THE DEPARTMENTAL REPRESENTATIVES. 5. THE PRESENT APPEAL IS NOT COVERED BY ANY EXCEPT IONS MENTIONED IN THE SAID CBDT CIRCULAR. SINCE THE TAX DEMAND IN DISPUTE IN THIS DEPARTMENTAL APPEAL IS BELOW THE LIMIT SET OUT BY CBDT FOR THE APPEAL, THE APPEA L OF THE ASSESSEE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 3 OF 2018 DATED 11.07.2018. ACCORDINGLY THE APPEAL OF THE DEPARTMENT IS DISMISSED AS NOT PR ESSED/WITHDRAWN. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/07/ 2018. SD/- SD/- HKKXPUN FOT; IKY JKWO (BHAGCHAND) ( VIJAY PAL RAO ) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 24/07/2018. DAS/ 4 ITA NO. 740/JP/2018 SHRI PAWAN KUMAR JAIN, KISHANGARH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT-THE ITO WARD-2, KISHANGARH. 2. IZR;FKHZ@ THE RESPONDENT SHRI PAWAN KUMAR JAIN, KISHANGARH.- 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 740/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR